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Criminal Appeal No. 141 of 1967.
Appeal from the judgment and order dated July 21, 1967 of the Kerala High Court in Criminal Appeal No. 109 of 1966.
865 A.S.R. Chari, A. section Nambiar and K.R. Nambiar, for the appellant.
V.K. Krishna Menon and ' M.R.K. Pillar, for the respondent.
The Judgment of the Court was delivered by Sikri, J.
In this appeal by certificate the only point that arises is whether the cash memo, exhibit D1, issued by the seller to the appellant contains a warranty within r. 12A of the rules framed under the (Act 37 of 1954), hereinafter referred to as the Act.
The Magistrate, who tried the complaint, held that exhibit D1 was a proper warranty and it fell within the proviso to r. 12A.
The High Court on appeal held to the contrary.
The relevant facts are these.
The appellant is a Rice & General Merchant and holds a wholesaler 's licence.
It was alleged in the complaint that the appellant had stored and exposed for sale and sold compounded asafoetida which was found ' to have been adulterated by wheat starch and tapioca starch and that non permitted orange coaltar dye was present.
The report of the Public Analyst to Government, Trivandrum, was relied on.
in this connection.
The appellant appeared as a witness and he stated that he purchased asafoetida from L.T. Alakesan and Brothers, received it in enclosed packets in bags and sold it in bags.
He received invoice which reads as follows: "Lt. T. Alhakesan & Brothers, Asafoetida Merchants, Veliamadom Sri K. Ranganatha Reddier, Kottarakara Rate: 6.00 Particulars: C.S.T. Rs. 2.
One case of Asafoetida Misky bag 30 Rs. 180/ The quality is up to the mark.
C.S.T. Rs. 3.60 Rs. 183.60 Rupees one hundred and eighty three and N.P. sixty only.
One case (1d) (Id) 1/4/64 (Sd.) 147542 18/5/64" He further stated that "it is written on the packet as "Extra Superior" in English and as "Compounded misky full of quality and flavour" in Tamil." The relevant statutory provisions are: 866 The "section 14.
Manufacturers, distributors and dealers to give warranty.
No manufacturer, distributor or dealer of any article food shall sell such article to any vendor unless he also gives a warranty in writing in the prescribed form about the nature and quality of such article to the vendor." "section 19(2).
A vendor shah not be deemed to have committed an offence pertaining to the sale of any adulterated or misbranded article of food if he proved (a) that he purchased the article of food (i) in a case where a license is prescribed for the sale thereof, from a duly licensed manufacturer, distributor or dealer, (ii) in any other case, from any manufacturer, distributor or dealer, with a written warranty in the prescribed form; and (b) that the article of food while in his possession was properly stored and that he sold it in the same state as he purchased it.
" The Prevention of Food Adulteration Rules, 1955 "Rule 12 A. Warranty Every trader selling an article of food to a vendor shall, if the vendor so requires, deliver to the vendor a warranty in Form VI A: Provided that no warranty in such form shall be necessary if the label on the article of food or the cash memo delivered by the trader to the vendor in respect of that article contains a warranty certifying that the food contained in the package or container or mentioned in the cash memo is the same in nature, substance and quality as demanded by the vendor.
Explanation.
The term "trader ' shall mean an importer, manufacturer, wholesale dealer or an authorised agent of such importer, manufacturer or wholesale dealer.
" We are not concerned with the question whether rule 12A is contrary to the provisions of the Act.
We take it that it is valid and if the appellant 's case falls within the proviso he is entitled 'to acquittal.
867 It was contended before us on behalf of the respondent that the warranty must state expressly that the food mentioned in the cash memo was the same in nature, substance and quality as demanded by the vendor, and if these words did not exist in the cash memo, the proviso would not apply.
We are unable to accede to this contention.
It may be that if the warranty is not contained in a label or cash memo the warranty must be in Form VI A, which uses these words: "We hereby certify that the food/foods mentioned in this invoice is/are warranted to be the same in nature, substance and quality as that demanded by the vendor.
" But we do not decide this as it is not necessary to do so.
In our view when the proviso expressly says that no warranty in such form shall be necessary in certain eventualities it would be rewriting the rule to hold that nevertheless the same things must exist in the label or the cash memo.
It seems to us that if the words in the warranty can reasonably be interpreted to have the s_nine effect as certifying "the nature, substance and quality" of an article of food, the warranty will fall within the proviso.
The Act is of wide application and millions of small traders have to comply with the provisions of the Act and the Rules.
The learned counsel for the State says that if they are not able to comply with the provisions they should stop carrying on their trade.
But if the object underlying the Act can be achieved, without disorganising the trade, by giving a reasonable interpretation to Rule 12A, it is our duty to do so.
A number of English cases were referred to us, but we do not find it necessary to refer to them as they interpret the Sale of Food & Drugs Act, 1875, and the later Food & Drugs Act, 1955.
The language of the relevant sections dealing with defences is different and warranties employing different words have been interpreted.
But they do at least show this that trade can be carried on and the object of the Act is not defeated even if traders use ordinary language of the trade or popular language in warranties.
Coming now to the language used in the cash memo it seems to us that the words "quality is up to the mark" mean that the quality of the article is up to the standard required by the Act and the vendee.
Quality in this context would include nature and substance because the name of the article is given in the cash memo.
It must be remembered that it is not a document drafted by a solicitor; it is a document using the language of a tradesman.
Any tradesman, when he is assured that the quality of the article is up to the mark will readily conclude that he is being assured 868 that the article is not adulterated.
The offence, if any, has been committed by the seller and not the appellant.
There was some argument before as to the difference in the meaning of the words "nature, substance and quality".
It was pointed out that section 14 only uses two words "nature and quality" and not substance.
But it is not necessary to express our views on this point.
Reference was made to the case of Baburally vs Corporation of Calcutta(1).
This Court held that the words on the label and the so called cash memo in that case did not contain the requisite warranty.
But we are unable to see how that case assists either the appellant or the State.
In the result the appeal is allowed, judgment of the High Court set aside and that of the Magistrate restored.
The appellant 's bail bond shall be treated as cancelled.
R.K.P.S. Appeal allowed.
| It was alleged in a complaint against the appellant, who held a wholesaler 's license, that he had stored and sold compounded asafoetida which was found to have been adulterated.
It was the appellant 's case that he had purchased the asafoetida from a distributor in enclosed packets and that the cash memo furnished to him by the distributor stated inter alia that "quality is upto the mark".
It was therefore contended on his behalf that the case fell within the proviso to Rule 12 A of the Prevention of Food Adulteration Rules, 1955, framed under Act 37 of 1954 in that no warranty in a prescribed form was necessary as the cash memo contained a warranty that the food contained in the package was the same in nature, substance and quality as demanded by the appellant.
Although the Trial Court upheld the appellant 's contention, the High Court on appeal held to the contrary.
In the appeal to this Court it was respondent 's contention that the warranty must state expressly that the food mentioned in the cash memo was the same in nature, substance and quality as demanded by the vendor and if these words did not exist in the cash memo, the proviso would not apply.
HELD: Allowing the appeal: The words "quality is upto the mark" in the cash memo meant that the quality of the article was upto the standard required by the Act and the vendee.
Quality in this context would include nature and substance because the name of the article was given in the cash memo.
The cash memo was the document using the language of a tradesman.
Any tradesman who was assured that the quality of the article was upto the mark would 'readily conclude that he was being assured the article was not adulterated.
[867 H] When the proviso to Rule 12 A expressly says that no warranty in the prescribed form shall be necessary in certain eventualities, it would be rewriting the rule to hold that nevertheless the same things must exist in the label or the cash memo.
If the words used in the warranty can reasonably be interpreted to have the same effect as certifying "the nature, substance and quality" of an article of food, the warranty wilt fail within the proviso.
[867 D]
|
ivil Appeal No. 322 of 1973.
From the Judgment and Order dated 4.12.1970 of the Madhya Pradesh High Court in First Appeal No. 90 of 1962.
Awadh Bihan Rohtagis Vivek Gambhir and S.K. Gambhir for the Appellants.
U.R. Lalit and G.B. Sathe for the Respondents.
The Judgment of the Court was delivered by 762 K. RAMASWAMY, J.
1.
This appeal by special leave by the legal representatives of the plaintiff, Bhikubai, arises from decision in First Appeal No. 90/62 of the High Court of Madhya Pradesh, Indore Bench, dated July 18, 1982 reversing the decree of the trial court in O.S. No. 29/51 filed for possession and mesne profits of two houses, Nos. 88 of 89 situated at Nandlalpura, Indore City, mentioned in the plaint 'schedule.
In this appeal, we are only concerned with House No. 88 as the parties have settled their dispute regarding to the other house.
The admitted facts are that one Hariba Bhagwat of Mouza Pisore village had a son by name Appaji and a daughter Bajabai.
Appaji in turn had a son by name Rakhmaji and a daughter Bhikubai (the plaintiff).
Bajabai was married to Ganpatrao Page of Madhavagoan vil lage.
As they were issueless they adopted Rakhmaji.
Both the villages are situated in Ahmednagar District of Bombay Province.
They are Dhangars (Shepard) by caste.
All of them migrated to Indore.
Rakhmaji died in 1918 and Sonubai his childless widow succeeded to the two houses and other properties as limited owner.
She gifted House No. 88 to Shankar Lanke, a brahmin, first defendant by a registered gift deed dated October 31, 1944 under Ex DI 5.
Shankar Lanke in turn hypothecated House No. 88 to Hiralal, fifth defendant/first respondent on September 21, 1948 under Ex 5 D3.
Sonubai died on March 11, 1949.
Rakhmaji was the natural brother of Bhikubai, but by operation of law namely adoption, he became her father 's sister 's son, i.e. a band hu.
The case of the plaintiff was that the family is gov erned by the Bombay School of Hindu Law wherein female bandhu is an heir and thereby she was entitled to succeed to the estate of Rakhmaji.
Sonubai, as limited owner, had no power to dispose of the properties by way of gift and so the gift deed and the mortgage are void and do not bind her.
The respondents are in unlawful possession as trespassers.
The suit was resisted by the first defendant, the donee, on diverse grounds.
The material defence relevant for the disposal of this appeal is that the persons concerned are governed by the Banaras School of Hindu Law under which a female bandhu is not an heir, Hiralal 's case was that the mortgage was for consideration and that he had no objection to hand over the possession of the property provided the consideration of Rs. 12,000 borrowed by Shankar Lanke was paid to him.
The trial court framed as many as 14 issues with sub issues on each count.
It found on issue No. 6a, which is material for the purpose of this case, that the parties are governed by the Bombay School, and not the Banaras School, of Hindu Law; the plaintiff is the heir of Rakhmaji as his mother 's brother 's daughter, and though the consi 763 deration was paid under the mortgage obtained by Hiralal, it was not taken after due inquiry about existence of legal necessity and in good faith.
The gift deed was declared void and does not bind the plaintiff.
The plaintiff was held entitled to possession and mesne profits.
The claim for refund of the mortgaged money was rejected.
Accordingly, the suit was decreed.
Hiralal and another filed the appeal.
Shankar Lanke did not file any appeal.
It was contended before the High Court that the plaintiff 's family belonging to Dhangar caste were migrants from U.P. (Mathura) to Auran gabad from where they had further migrated to Central Prov ince (now Madhya Pradesh).
They are governed by the Banaras School of Hindu Law.
There is no proof that they abandoned the personal law, namely, Banaras School of Hindu Law, and adopted Bombay School of Hindu Law.
This contention found favour with the Hindu Court, which relief upon the statement made in Indore State Gazette of 193 1 at page 20, wherein it was claimed to have been recorded that Holkars belonged to Dhangar caste and it would appear that they were originally residents of the country side around Mathura and they mi grated to Aurangabad District and thereafter Phaltan Parga na.
At page 90, it was mentioned about Dhangars in general and that in Indore Shepard caste was the ruling family.
Many of the Dhangars were Shivail 's trusted Maoles used for Gureilla warfare.
In domestic life as also in language, dress and food they closely resemble the Marathas, though in the caste scale their position is lower.
Their deity is Khandoba.
The High Court also found that the parties, name ly, Rakhmaji 's father and Ganpatrao Page were residents of Ahmednagar District.
Their family God is Malhar Jijori, which is situated in the District of Poona.
They migrated from Maharashtra to Indore.
This finding is based on the evidence of, not only the plaintiff (PW 4), but also the admission made by the defendant No. 1 and his witness, D.W. No. 8 Placing reliance solely on the recital in the Indore State Gazette, it was concluded that the parties had migrat ed from Mathura and thereby they are governed by the Banaras School of Hindu Law, under which the female Bandhu is not an heir to succeed to the estate of the last male holder.
Alternatively, it also found that even applying the Bombay School of Hindu Law (Mitakshara), the plaintiff had not established that she was an heir to Rakhmaji.
Accordingly, the appeal was allowed.
At the outset, it is made clear that neither Hiralal, nor Shankar Lanke pleaded that the plaintiff or her ances tors had migrated from Mathura and settled down in Ahmedna gar District.
The specific plea of the plaintiff in para graph 5 of the plaint that they were original residents of Ahmednagar District was not disputed.
Hiralal 764 did not also plead that the Banaras School of Hindu Law would apply to the plaintiff 's family.
Shankar Lanke vaguely pleaded this but adduced no evidence in proof thereof.
Both the Courts have concurrently found that the plaintiff, Rakhmaji, and Ganpatrao Page are Dhangars by caste; their family God is Khandoba of Jijori; their manners and customs were also of Maharashtrian, vide D.W. 8 Khsumrao; and the High Court also further found that, "Undoubtedly true that the customs, manners, marriages and the way they worship the God are all the same as that of Maharashtrians or of the Marathas.
" But the customs, dress, language and manners may not by themselves show that person migrating from Mathura has given up the law of origin, though they are relevant facts.
It must also be proved that in a particular case that they have given up their law of origin, i.e. the Banaras School of Hindu Law, and adopted the law of domicile, i.e. the Bombay School of Hindu Law.
Accordingly, it was held that the parties are governed by the Banaras School of Hindu Law.
Migration is changing one 's abode, quitting one 's place of abode and settling permanently at another place.
The burden of proving migration lies on the person setting up the plea of migration.
As seen the respondents neither pleaded nor proved that the plaintiff 's family migrated from Mathura to Ahmednagar in Bombay Presidency.
When the plain tiff was examined as a witness no attempt Was made to elicit from her that they or their ancestors were migrants from Mathura and settled down in Ahmednagar.
On the other hand the specific plea of the plaintiff in her plaint that they were the original residents of Ahmednagar District remained undisputed.
In Hindu Law by Raghavachariar, 8th Edition, 1987 edited by Prof. section Venkataraman who was himself an authority on Hindu Law, in paragraph 32 stated that a fami ly 's original place of abode can be inferred from the Chief characteristics of the family.
In Keshao Rao Bapurao & Anr.
vs Sadasheorao Dajiba, AIR 1938 Nagpur 163.
Vivian Bose, J., as he then was, held that wherever a family is found cling ing to its individuality and retaining its identity as Maharashtrian, it must be presumed until the contrary is shown that it hailed from the race of group of people known as Maharashtrians and carried the law of Maharashtra with them.
Thus, it is clear that migration cannot be presumed but it must be established by abduction of evidence.
The question then arises is whether the recital in Indore State Gazette relied on, at the appellate stage, can form the sole base to establish that the plaintiff 's family were the migrants from Mathura in U.P. Section 37 of the Evidence Act, 1872 postulates that any statement made in a Government Gazette of a public nature is a relevant fact.
Section 57(13) declares 765 that on all matters of public history, the Court may resort for its aid to appropriate books or documents of reference, and Section 81 draws a presumption as to genuineness of Gazettes coming from proper custody.
Phipson on Evidence, The Common Law Library (Thirteenth Edition) at page 510 paragraph 25.07 stated that the Government Gazettes . , . . are admissible (and sometimes conclusive) evidence of the public, but not of the private matters contained therein.
In Rajah Muttu Ramalinga Setupati vs Perianayagum Pillai, [1873 74] L.R. 1 IA 209 at p. 238 the Judicial Committee, while considering the reliability of a report sent by the District Collector to the Commissioner about the management of a temple, held that when the reports express opinions on the private rights of parties, such opinions are not to be regarded as having judicial authority or force.
But being the reports of public officers made in the course of duty, and under statutory authority, they are entitled to great consideration so far as they supply infor mation of official proceedings and historical facts, and also in so far as they are relevant to explain the conduct and acts of the parties in relation to them, and the pro ceedings of the Government rounded upon them.
Same view was reiterated in Martand Rao vs Malhar Rao, [1927 28] L.R. 55 IA 45 at 48 on the question of reliability of official reports relating to succession to a Zamindari, and held that "their Lordships consider it necessary at the outset to point out that, though such official reports are valuable and in many cases the best evidence of facts stated therein, opinions therein expressed should not be treated as conclu sive in respect of matters requiring judicial determination, however, eminent the authors of such reports may be.
In Arunachellam Chetty vs Venkatachellapathi Guru Swamigal, [1919] L.R. 46 IA 204 it was held that while their Lordships do not doubt that such a report (Inam register) would not displace actual and authentic evidence in individual cases; yet the Board, when such is not available, cannot fail to attach the utmost importance, as part of the history of the property, to the information set forth in the Inam register.
This view was followed by this Court in Narayan Bhagwantrao Gosavi Balajiwale vs Gopal Vinayak Gosavi & Ors., ; at p. 788.
Same is the view expressed in The Poohari Fakir Sadavarthy of Bomdilipuram vs The Commissioner, Hindu Religious & Charitable Endowments, [1962] Suppl.
2 SCR 276 and held that Inam register is of great evidentiary value but the entries cannot be accepted on the face value without giving due consideration to other evidence on record.
In Mahant Shri Srinivasa Ramanuj Das vs Surajnarayan Dass & Anr., [1966] Supp.
SCR 436 at p. 447 relied on by Shri Lalit, learned senior counsel for the respondents, it was held that the statements in the Gazetteer can be consulted on matters of public history.
This is also 766 the case relating to entries in Inam Register.
Inam Fair Registers are maintained while exercising the statutory power and the entries were made in the relevant columns during the course of discharging official duties and so they are entitled to weight and great consideration, while as sessing the evidence.
Therefore, this Court did not lay any rule contrary to what has been laid by the Judicial Commit tee or by this Court in the decisions referred to hereinbe fore.
The Statement of fact contained in the official Gazette made in the course of the discharge of the official duties on private affairs or on historical facts in some cases is best evidence of facts stated therein and is enti tled to due consideration but should not be treated as conclusive in respect of matters requiting judicial adjudi cation.
In an appropriate case where there is some evidence on record to prove the fact in issue but it is not suffi cient to record a finding thereon, the statement of facts concerning management private temples or historical facts of status of private persons etc.
found in the Official Gazette may be relied upon without further proof thereof as corrobo rative evidence.
Therefore, though the statement of facts contained in Indore State Gazette regarding historical facts of Dhangars ' social status and habitation of them may be relevant fact and in an appropriate case the Court may presume to be genuine without any further proof of its contents but it is not conclusive.
Where there is absolutely no evidence on record in proof of the migration of the family of the plaintiff or their ancestors from Mathura area, the historical factum of some Dhangars having migrated from U.P. and settled down in Aurangabad District or in the Central Province by itself cannot be accepted as sufficient evidence to prove migration of the plaintiff family.
Further no evidence was placed on record connecting Holkars of Indore with Dhangars of Bombay Province.
Shri Lalit, learned counsel, admits that the statement of facts of Dhangars contained in Indore State Gazette is not conclusive evidence but he says that it may be taken into account as evidence connecting the family of the plaintiff.
In the absence of any evidence proving migration of the family of the plain tiff or their ancestors from Mathura to Ahmednagar, the historical factum of the migration of Dhangars from U.P. State mentioned in Indore State Gazette is of little assist ance to the respondents so as to hold that they carried with them to Indore the Banaras School of Hindu Law prevailing in Uttar Pradesh.
Even as regards the Dhangars as migrants, Thurston on Caste and Tribes of Southern India in Vol.
III p. 167 stated that the statement of the census Report of 190 1 establishes that Marathi Caste of Shepard are Dhangars and their home speech is Marathi and they are the residents 767 Of Bombay Presidency.
It would, thus, show that even in 1901, Dhangars were held to be original Marathis of Bombay Presidency.
We, therefore, hold that the case before us that Bhikubai, the plaintiff, and her family had migrated from Mathura to Ahmednagar District in Bombay Presidency has not been proved and admittedly, they migrated from Ahmednagar to Indore.
In India a Hindu is governed by his personal branch of law which he carries with him wherever he goes.
But the law of the province wherein he resides prima facie governs him and in this sense and to this extent only the law of domicile is of relevance or importance.
But if it is shown that a person came from another Province, the presumption will be that he is governed by the law or the special custom by which he would have been governed in his earlier home at the time of migration.
An inference of migration can well be made from the known facts of the chief characteristics of the family, the language, observance of customs and rites though they are not sufficient to prove that they are gov erned by a particular school of law.
The presumption can be displaced by showing that the immigrant had renounced the law of the place of his origin and adopted the law of the place to which he had migrated.
The onus lies on the person alleging that the family had renounced the law of its origin and adopted that prevailing in the place to which he had migrated vide Hindu Law by Raghavachariar, Eighth Edition, para 32 at pages 30 & 31.
The same view was expressed in Mulla 's Hindu Law, edited by Justice S.T. Desai, 15th Edn., in para 13A and 14.
In Hindu Law By S.V. Gupta (Vol. 1, Third Edition p. 50) article 10 it is stated that in case of migration of a Hindu from one part of India to another, it is presumed that he and his descendants continue to be governed by the law of the school to which he belonged before migration.
Such presumptions are rebuttable.
In Balwant Rao & Ors.
vs Baji Rao & Ors., AIR 1921 PC 59.
Lord Dunedin speaking for the Board held that it is absolutely settled that the law of succession in any given case is to be determined according to the personal law of the individu al whose succession is in question.
In that case it was found that Bapuji 's ancestors at one time lived in Bombay Province and his migration at the place of death was ob scured.
Therefore, it was held that the original law that prevailed in Bombay Province at the time of migration gov erns the succession to a Maharashtra Brahmin and Bombay School of Mitakshara Law would apply and the daughter would take her father 's property as an absolute owner and her hefts alone would be entitled to succeed to her estate.
This was reiterated by Bose, J. in Keshav Rao 's case in consider ing the question of migration by a Maharashtra Brahmin residing in Central 768 Provinces and was held to be governed by the Bombay School of Mitakshara Hindu Law when migration is not proved in the sense that the exact origin of the family cannot be traced.
Same view was followed in Udebhan Rajaram vs Vikram Ganu, Accordingly, we hold that the plaintiff and her family carried with them to Indore their personal law, namely, Hindu Law of the Mitakshara applicable to Bombay Province and not Banaras School of Hindu Law.
The question then is whether the plaintiff is an heir to Rakhmaji, the last male holder of the estate left by Sonubai, his widow.
In Bhagirathibai vs Kahnujirav, ILR 11 Bombay 285 the Full Bench held that under the Hindu Law as prevailing in Bombay Presidency, a daughter inheriting from a mother or a father takes as an absolute estate, which passes on her death to her own heirs, and not to those of the preceding owner.
Thereby Hindu female is recognised under the Bombay School of Hindu Law to be an heir to last male holder of the estate and takes the property as an absolute owner.
The immediate question, therefore, is wheth er the plaintiff is an heir as bandhu.
In Mayne 's Hindu Law, 12th edn., revised by Justice Alladi Kuppuswami, Chief Justice (Retd.) of Andhra Pradesh High Court, in paragraph 504 at p. 735 & 736 stated the meaning of the word 'bandhu ' thus: The term 'bandhu ' or 'bandhava ' meant relations in general and included both agnates and cognates though it was sometimes confined to agnates in some of the Smriti texts relating to succession and gotra kinship, as for instance in the Vishnusmriti and in some of the verses in Manusmriti.
The Mitakshara explains that the term 'bandhavas ' in the above test of Manu means Atma Bandhus, Pitrubandhus and Matrubandhus, vide Mit.
on Yajn.
III, 24 (Setlur edn.
1169)Naraharayya 's translation 56.
In paragraph 543, at page 761, dealing with the third division of heirs, namely, 'bandbus ' and of their enumera tion in paragraph 544 it was stated that the enumeration is only illustrative, which read thus: Para 543 "Bandhus The third division of heirs consists of bandhus (Table B).
They are the sapindas related through a female, being within five degrees from and inclusive of common ancestor, in the line or lines in which a female or females intervene (paras 121 126), In the portion of his work relating to succes sion, Vijnanesvara styles them as sapindas of a different gotra.
The term 'bandhu ' has therefore acquired in the system of the Mitak shara a distinctive and technical meaning and signifies bhinnagotra sapindas.
They are the 769 three classes: (1) atmabandhus or one 's own bandhus, (2) pitrubandhus or the father 's bandhus and (3) matrubandhus or the mother 's bandhus.
The relevant passage in the Mitaksha ra is as follows: "Cognates are of three kinds; related to the person himself, to his father, or to his mother, as is declared by the following text.
The sons of his own fa ther 's sister, the sons of his own cognate kindred.
The sons of his father 's paternal aunt, the sons of his father 's maternal aunt, and the sons of his father 's maternal uncle, must be deemed his father 's cognate kindred.
The sons of his mother 's paternal aunt, the sons of his mother 's maternal aunt, and the sons of his mother 's maternal uncle, must be reckoned his mother 's cognate kindred.
Here, by reason of near affinity, the cognate kin dred of the deceased himself, are his succes sors in the first instance; on failure of them, his father 's cognate kindred; or if there by none, his mother 's cognate kindred.
This must be understood to be the order of succession here intended.
Para 544 Enumeration only illustrative Evidently, the enumeration of the above nine bandhus was not intended to be exhaustive, but only illustrative.
When defining sapinda, Vijnanesvara says, "So also is the nephew a sapinda rela tion of his maternal aunts and uncles and the rest, because particles of the same body (the maternal grandfather) have entered into his and theirs; likewise does he stand in sapinda relationship with paternal uncles and aunts and the rest.
In the light of this, his definition of bandhus or bhinnagotra sapindas makes it clear that maternal aunts and uncles and their descendants as well as paternal aunts and their descendants are bandus and that his enumeration is purely illustrative.
Visvarupa and Mitra Misra in his Vir amitrodaya recognised this by including the maternal uncle and the like in the term 'bandhu ' purely by way of illustra tion.
Referring to the maternal uncle 's sons, the Virami trodaya says that it would be extremely im proper that their sons are heirs but they themselves though nearer, are not heirs.
After some fluctuation of opinion, it was finally settled that the enumeration of bandhus in the Mitakshara is not exhaustive but illustrative only.
" In paragraph 536, at page 757, it is stated that in Bombay, the daughters of descendants, ascendants and collat erals within five degree 770 inherit as bandhus in the order of propinquity, such as the son 's daughter, the daughter 's daughter, the brother 's daughter, the father 's sister and so on.
In Raghavachariar 's Hindu Law at page 412 in para 458, it is stated that the daughters of descendants, ascendants and collaterals upto fifth degree are bandhus and the test of nearness of blood is to be applied in ascertaining their order of succession.
In Mitakshara and Dayabhaga by Colebrooke, 1883 Edn., at p. 99, it is stated in Sec.
VI on the succession of cognate kindred, bandhu that on failure of gentiles, the cognates are heirs.
Cognates are of three kinds; related to the person himself, to his father, or to his mother.
At page 100, it is further stated that heir, by reason of near affinity, the cognate kindred of the deceased himself, are his successors in the first instance: on failure of them his father 's cognate kindred: or, if there be none, his mother 's cognate kindred.
This must be understood to be the order of succession here intended.
In Girdhari Lall Roy vs The Bengal Government, [1867] 79 Moore 's Indian Appeals 448 the question arose whether the maternal uncle of the last male holder is a bandhu entitled to succession of the estate of the deceased.
While consider ing the question exhaustively of the texts of Hindu Law on this topic including Sec.
VI of Colebrooke 's referred to above of the order of succession by bandhus, it was held by the Judicial Committee that if for the determination of the question under consideration, their Lordships were confined to the four corners of the Mitakshara, they would feel great difficulty in inferring, from the omission of "the maternal uncle" and "the father 's maternal uncle" from the persons enumerated in this text, that either of those relatives is incapable of taking by inheritance the property of a de ceased Hindu in preference to the King.
Such an inference, in the teeth of the passages which says that the King can take only if there be no relatives of the deceased, seems to be violent and unsound.
For the text does not purport to be an exhaustive enumeration of all Bandhus who are capable to inheriting, nor is it cited as such, or for that purpose, by the Author of the Mitakshara, as is used simply as a proof or illustration of his proposition, that there are three kinds of classes of bandhus, and all that he states further upon it is, the order in which the three classes take, viz., that the bandhus of the deceased himself must be exhausted before any of his father 's bandhus can take, and so on.
Accordingly, it was held that 'the maternal uncle is capable of inheriting the estate.
This view was followed in Muthus wami Mudaliyar & Ors.
vs Sunamedu Muthukumaraswami Mudali yar, [1895] 96 LR 231 A 83.
Accordingly, we hold that the enumeration of bandhus in various schools of Hindu Law of the rule of succession to the estate of the last 771 male Hindu as agnates or cognates or collaterals, are only illustrative and not exhaustive.
The Hindu Law of succession of Mitakshara School prevailing in Bombay Presidency recog nises that a female is an heir as a bandhu to succeed to the estate of the last male holder through her mother 's side within five degrees to the last male holder.
The plaintiff being the only nearest bandhu of Rakhmaji within five de grees through her mother, is entitled to succeed to his estate as an heir.
Accordingly, we hold that the plaintiff is entitled to the possession of the plaint schedule House No. 88 with mesne profits from the respondents.
The contention of Shri Lalit that the mortgagee respondent is entitled, in equity, to a decree for refund of the mortgage money which was admittedly found to have been paid cannot be accepted as the same was not paid to the plaintiff.
So far an the mortgagee 's claim against the mortgagor is concerned, he may pursue any remedy available to him under law.
Accordingly, the appeal is allowed, the decree of the High Court is set aside and that of the trial court is restored to the extent of House No. 88, with proportionate costs throughout.
R.N.J. Appeal allowed.
| One Hariba Bhagwat had a son Appaji and daughter Baja bai.
Appaji in turn had a son Rakhmaji and a daughter Bhiku bai, the plaintiff who had flied a suit for possession and mesne profits of two houses.
The suit was decreed by the Trial Court but on appeal reversed by the High Court.
The Legal representative of the plaintiff then preferred this appeal by special leave confined to one of the houses, the parties having settled their dispute regarding the other house.
Bajabal and her husband Ganpat Rao Page being issueless had adopted Rakhmaji.
All of them belonged to villages situated in Ahmednagar District of Bombay Province, and are Dhangars (Shepards) by caste but had migrated to Indore.
On Rakhmaji 's death Sonubai his childless widow succeeded to the properties as limited owner.
She gifted the suit proper ty i.e. house No. 88 to Shanker Lanke a Brahmin, the first defendant by a registered gift deed dated October 31, 1944.
Shanker Lanke in turn hypothecated the House to one Hira Lal, the first respondent on September 21, 1948.
Sonubai died in 1947.
The case of the plaintiff was that the family is gov erned by the Bombay School of Hindu Law wherein female Bandhu is an heir and thereby she was entitled to succeed to the estate of Rakhmaji; Sonubai, the issueless widow of Rakhmaji as limited owner had no power to dispose of the properties, so the gift deed and mortgage are void and do not bind her and the respondents are in unlawful possession as trespassers.
The material defence relevant for the dis posal of this appeal is that the persons concerned are governed by the Banaras School of Hindu Law under which a female bandhu is not an heir.
Hiralal 's case was that he had no objection to hand over the possession provided he was paid the consideration of Rs. 12,000 borrowed by Shanker Lanke, the donee.
760 The Trial Court came to the conclusion that the parties are governed by the Bombay School and not the Banaras School ,of Hindu Law and the plaintiff is the heir of Rajkhmaji.
The gift deed was declared void and not binding on the plaintiff and the suit was decreed and the claim for refund of the mortgage money was rejected.
Hira Lal appealed.
It was contended before the High Court that the plaintiff 's family belonged to Dhangar caste, being migrants from U.P. (Mathura) to Aurangabad from where they had migrated to Central Province (now Madhya Pradesh) and were governed by the Banaras School of Hindu Law.
This contention found favour with the High Court which placing reliance solely on the recital of the Gazetteer concluded that the parties had migrated from Mathura and thereby they were governed by the Banaras School of Hindu Law under.
which the female Bandhu is not an heir to succeed to the estate of the last male holder.
Reversing the decree passed by the Trial Court, the suit was dismissed.
This Court in allowing the appeal by the legal represen tative of the plaintiff, HELD: In India a Hindu is governed by his personal branch of law which he carries with him where ever he goes.
But the law of the province wherein he resides prima facie governs him and in this case and to this extent only the law of domicile is of relevance or importance.
But if it is shown that a person came from another Province, the presump tion will be that he is governed by the law or the special custom by which he would have been governed in his earlier home at the time of migration.
[767B C] Migration is changing one 's abode, quitting one 's place of birth and settling permanently at another place.
The burden of proving migration lies on the person setting up the plea of migration.
Migration can not be presumed but it mast be established by abduction of evidence.
[764D G] Section 37 of the Evidence Act 1872 postulates that any statement made in Govt.
Gazette of a public nature is a relevant fact.
Section 57(13) declares that on all matters of public history, the Court may resort for its aid to appropriate books or documents of reference and section 81 draws a presumption as to the genuineness of Gazettes coming from proper custody.
[764H; 765A] The State of facts contained in the official Gazetteer made in the course of the discharge of the official duties on private affairs or on 761 historical facts in some cases is best evidence of facts stated therein and is entitled to due consideration but should not be treated as conclusive in respect of matters requiring judicial adjudication.
[766B C] The onus lies on the person alleging that the family had renounced the law of the origin and adopted that prevailing in the place to which he had migrated.
The plaintiff and her family on migration from Ahmednagar carried with them to Indore their personal law, namely the Bombay School of Hindu Law under which a Hindu female is recognised to be an heir to last male holder of the Estate and takes the property as an absolute owner.
The Plaintiff being the only nearest bandhu of Rakhmaji, is entitled to succeed to his estate as an heir and thus entitled to the possession of the House in question with mesne profits.
[767D; 768B; A] Keshao Rao Bapurao & Anr.
vs Sadasheorao Dajiba, AIR 1938 Nagpur 163; Rajah Mattu Ramalinga Setupati vs Peria nayagum Pillai, [1873 74] L.R. 11A 209 at p. 238; Martand Rao vs Malhar Rao, [1927 28] L.R. 551 A 45 at 48; Arunachel lam Chetty vs Venkatachellapathi Guru Swamigal, [1919] L.R. 46 IA 204; Narayan Bhagwantrao Gosavi Balajiwale vs Gopal Vinayak Gosavi & Ors., ; at p. 788; The Poohari Fakir Sadavarthy of Bomdilipuram vs The Commission er, Hindu Religious & Charitable Endowments, [1962] Suppl.
2 SCR 276: Mahant Shri Srinivasa Ramanuj Das vs Surajnarayan Dass & Anr., [1966] Snpp.
SCR 436 at p. 447; Balwant Rao & Ors.
vs Bali Rao & Ors., AIR 1921 P.C. 59; Udebhan Rajaram vs Vikram Ganu, ; Bhagirathibai vs Kah nujirav, ILR 11 Bombay 285; Girdhari Lall Roy vs The Bengal Government, [1867 79] Moore 's Indian Appeals 448 and Muthus wami Mudaliyar & Ors.
vs Sunamedu Muthukumaraswami Muddali yar, [1895 96] LR 23 IA 83, referred to.
|
Appeal No. 901 of 1993.
From the Judgment and Order dated 15.11.91 of the Patna High Court in C.W. C. No. 3430 of 1991.
A. Sharan for the Appellant.
G. Ramaswamy and A.V. Rangam for the Respondents.
The Judgment of the Court was delivered by BHARUCHA, J.
Leave to appeal is granted.
The appeal is directed against the judgment and order of the High Court at Patna dismissing the writ petition filed by the appellant.
The appellant was employed by the respondent.
He was chargesheeted for having granted bank loans to a large number of persons without proper documentation and without verifying their creditworthiness and also with having obtained illegal gratification in that connection.
An en quiry was held.
The Enquiry Officer made a report holding the appellant guilty.
Upon the basis of the enquiry report the appellant was dismissed from service.
The appellant filed a writ petition before the High Court at Patna (being Writ Petition No. C.W.J.C. No. 1979 of 1988) impugning the dis 163 missal.
The High Court allowed the writ petition by judgment and order dated 8th July, 1988.
The enquiry, the court concluded, could not be held to be proper and in accordance with law.
Consequently, the order of dismissal was set aside.
The High Court observed : "This does not mean that the petitioner should be got scot free.
He must face enquiry.
Sufficient time has already lapsed.
The enquiry must be concluded as early as pos sible.
The petitioner will appear before the Enquirying Officer (to be nominated in the meantime) at Patna on 2nd August, 1988 and the prosecution will produce the witnesses examined on his behalf for cross examination.
After the cross examination is over the petitioner will also produce the witnesses when he may like to enquire.
This should be done without any adjournment and the proceed ing should be conducted day to day so that it may be concluded as early as possible.
With this observation this writ application is disposed of.
" The same Enquiry Officer then permitted the appellant to cross examine the witnesses produced in support of the charge and to examine his own witnesses.
He made a report dated 27th March, 1989 in which he held nine charges against the appellant to be proved, one to be partly proved and one not proved.
The disciplinary authority, upon consideration of the enquiry report, passed an order dated 23rd October, 1989, dismissing the appellant from service.
The appellant challenged the order of dismissal dated 23rd October, 1989 on the ground that the enquiry upon the basis of which it had been passed had not been conducted as required by the order of the High Court dated 8th July, 1988.
He also challenged it upon the ground that he had not been furnished with a copy of the Enquiry Report.
The High Court rejected the writ petition.
It held that the judgment of this Court in the case of Union of India and others vs Mohd. Ramzan Khan; , , did not cover an order of dismissal that had been passed before the said judgment was delivered.
Insofar as the enquiry report was concerned, the High Court took the view that the Enquiry Officer had allowed the appellant to participate in the proceedings as also to cross examine witnesses and he had considered all relevant aspects on the record.
164 It will be recalled that the High Court by the judgment and order dated 8th July, 1988 had held that the earlier enquiry was not proper and in accordance with law and had quashed the order of dismissal dated 14th February, 1987 based thereon.
It had directed that the appellant should face an enquiry whereat the prosecution would produce the witnesses it had examined on its behalf for cross examination.
by the appellant.
Thereafter, the appellant could produce such witnesses as he desired.
It is the submission of learned counsel on behalf of the appellant that the Enquiry Officer had in the second enquiry report relied upon the findings of the earlier enquiry, since quashed, and that he had not permitted the appellant to examine three necessary witnesses in support of his case.
There had, therefore, been no real enquiry as contemplated by the High Court 's order dated 8th July, 1988 and that, therefore, the dismissal order passed upon the basis of the second enquiry report should be quashed.
Shri G Ramaswamy, learner senior counsel for the respondent, submitted that the Enquiry Officer had conducted the enquiry as directed by the High Court in its order dated 8th July, 1988, from the point of cross examination of the respondent 's witnesses onward.
The enquiry report made by the Enquiry Officer subsequent to the order of the High Court dated 8th July, 1988 is entitled Additional enquiry report in respect of charges laid against Shri Heera Prasad".
It opens with the sentence, "This enquiry, report is further to the enquiry, report already submitted by me in September 1986".
It says that "the enquiry was reopened".
It says, further, ".As the charges have been dealt with one by one in detail in my previous enquiry report I am confining this report only to the cross examination of prosecution witnesses as also examination/cross examination of defence witnesses.
" The report concludes thus : "After going through the proceedings, hearing the depositions made by the defence witnesses, and hearing the answers given by the prosecution witnesses, I find no reason to change may report as no exonerating fact came out during the enquiry instead it becomes a little darker particularly noting the fact that at least three (03) of the witnesses cited by the charged officer himself refused to come for deposing before the enquiry for reasons best known to the charged officer/witnesses.
As the various 165 exhibits etc. were discussed and analysed by me in my previous report, I am not repeating the analysis once again in this report.
" As aforesaid, the Enquiry Officer held nine of the eleven charges to be proved, one to be partly proved and one to be not proved.
(The Emphasis is supplied).
It is patent that the order dated 8th July, 1988 contemplated a fresh enquiry.
At best, the examination in chief of the witnesses of ' the respondent could be said to have been allowed to be incorporated in the second enquiry proceedings.
The order certainly contemplated that the Enquiry Officer would apply his mind afresh to the evidence on record comprising the examination in chief and cross examination of the respondents witnesses and that of the appellant 's witnesses.
It is patent from the "Additional enquiry report" made by the Enquiry Officer that there has been no fresh application of mind.
It was impermissible for the Enquiry Officer, in these circumstances, to have borne his previous Enquiry Report in mind and to have confined the "Additional enquiry report" only to the cross examination of prosecution witnesses and the examination and cross ex amination of defence witnesses "as the charges have been dealt with one by one in detail in my previous enquiry report".
It was also impermissible for him to have stated that "the findings of the previous enquiry report remain as they are".
Having regard to the High Court 's order dated 8th July, 1988, the Enquiry Officer was bound to consider the material or, record afresh and not to take his earlier report into account and to say that he found "no reason to change that report".
We are, in the circumstances, not satisfied that the appellant has had a fair opportunity of presenting his case to an Enquiry Officer unbiased by pre conceptions.
Having regard to all that has transpired.
we think that it is in the fitness of things that the order of dismissal dated 23rd October, 1989 should be quashed and another Enquiry Officer should be appointed by the respondent who should allow the appellant the opportunity of examining as his witnesses the three persons referred to by the earlier Enquiry Officer in the paragraph of the "Additional enquiry report" subtitled "Conclusion".
He should give to the respondent and the appellant the opportunity of a hearing.
He should then apply his mind to the material on record without in any way being influenced by the earlier enquiry reports, and make his own enquiry report accordingly.
In the result, the appeal is allowed.
The judgment and order under appeal are set aside.
The writ petition is allowed to the extent mentioned in the preceding paragraph.
There shall be no order as to costs.
V.P.R. Appeal allowed.
| On State 's appeal against enhancement of compensation for a compact area of 10 acres of land laid out as building sites with fully formed roads and drainage, and acquired under the Land Acquisition Act, 1894, the High Court reduced the compensation holding that since the roads and drainage occupied a part of the area acquired, proportionate deduction in compensation ought to be made.
The claimant filed appeal by special leave to this Court.
Allowing the appeal, this Court, Held: 1.1.
The High Court was wrong in principle in reducing the compensation on account of roads and drainage.
The fact that these improvements had been made on the land acquired shows that what was acquired was more valuable than what it would have been without the improvements.
[p. 891E F] 1.2.
Accordingly, the judgment of the High Court is set aside and that of the Reference Court is restored.
[p.891F]
|
N: Criminal appeal No. 383 of 1991.
From the Judgment and Order dated 17.7.1990 of the Orissa High Court in Crl.
Rev. No. 382 of 1986.
Janaranjan Das for the Appellants.
A.K. Panda for the Respondent.
The Judgment of the Court was delivered by RAY, J.
Special leave granted.
Arguments heard.
This appeal by special leave is directed against the judgment and order dated July 17, 1990 passed by the High Court of Orissa in Criminal Revision No. 382 of 1986 dismissing the revision and affirming the concurrent findings of the courts below.
The prosecution case in short is that on 19th March, 1983 at about 7.p.m.
while the victim girl Srimanthini Samal (P.W. 2) was going to the house of Rama Samal, for study, the appellant Gagan informed her that the other appellant Prafulla and others had tied her tutor Rabi Babu in a nearby mango grove and her father was present there.
Having believed the version of the appellant Gagan, her agnatic uncle, she accompanied him and ultimately the appellants forcibly took her to a lonely house in hills where she was made to sit on a chair and the appellant Gagan forcibly thrushed in her mouth a liquor bottle and she was made to drink the liquor.
Thereafter both the appellants after having undressed her committed sexual assault on her.
Then she was brought to expression highway from where she was bodily lifted to a truck standing there and left her in the truck.
While the said truck was unloading materials near village Kurujanga, the victim girl stealthily left the truck and concealed her presence near a fence.
Subsequently, one Purusottam Mohanty rescued her and brought her to his house and then she was left to the house of one Niranjan Rout (P.W. 8), who was distantly related to her and took shelter till her father took her back on being 842 informed.
On the information lodged by her father (P.W. 1) in the police station of Badachana a case under sections 363 and 376 read with section 34 of the I.P.C. was registered against the accused appellants and after investigation the I.O. sent the victim girl as well as the appellants for medical examination and after completion of the investigation a charge sheet was submitted against the appellants to stand their trial.
The pleas of the appellants were a total denial of the prosecution case.
The appellant Prafulla took the plea the there was a marriage proposal of the victim girl with him but when it was disclosed that she had illicit relationship with her tutor Rabi, he refused to marry her for which this false case was foisted against him.
The plea of the other appellant Gagan as suggested to the informant, was that due to his previous enmity he was falsely implicated with the alleged crime.
The appellants were committed to the Court of Sessions.
The learned Assistant Sessions Judge after considering the evidences on record rejected the defence pleas, and found that the accused appellants committed rape on the victim girl without her consent relying on the provisions of Section 114(A) of the Evidence Act, and convicted them under section 376(2)(g) I.P.C. and sentenced each of the accused appellants to rigorous imprisonment for three years considering the young age of the appellants.
The Assistant Sessions Judge, however, acquitted the appellants from the charge under section 366 I.P.C. as the victim girl was more than 16 years of age at the time of occurrence.
Against this judgment and order of conviction the appellants filed an appeal being Criminal Appeal No. 153 of 1984 in the Court of First Additional Sessions Judge, Cuttack.
The Additional Sessions Judge considered the pleas of the appellants as well as duly scrutinized and appraised the evidences on record and found that the accused appellants committed rape on the victim girl without her consent and affirmed the conviction and sentence imposed by the Trial Court dismissing the appeal.
The appellants thereafter filed a Revision Case being Criminal Revision No. 382 of 1986 in the High Court of Orissa at Cuttack against the said judgment and order passed by the First Additional Sessions Judge, Cuttack.
The High Court duly considered and appraised the evidences of all the 9 P. Ws. including the deposition of the victim girl Srimanthni Samal (P.W. 2), the evidence of her father (P.W. 1) as well as the evidence of her mother (P.W. 3) and the evidences of the two Doctors (P.W. 4) and P.W. (5) and held that the accused persons committed rap on P.W. 2 forcibly without her con 843 sent.
It has been further found from the reliable evidences of P.Ws. 1 and 3 that as soon as P.W. 2 met her mother, P.W. 3, P.W. 2 told her mother about both the accused persons committing rape on her in a solitary house and also about the accused persons taking her away to the highway and keeping her in a truck, and corroborate the version of P.W. 2 regarding the occurrence of rape committed n her by both the accused persons.
It has been further observed that even though the P.Ws. 7 and 8 became hostile still then their evidences can be safely relied on as the same fully corroborates the version of P.W. 2 that on the relevant night the she, with the help of P.W. 7 had taken shelter in the house of P.W. 8 P.W. 6 who the driver of the truck No. ORG 4839 also stated in his evidence that the accused persons and two others took the victim girl and left her in the truck.
P.W. 6 further admitted that as he stopped the truck at village Ambura for unloading the boulders, the girl had stealthily left his truck and inspite of his searching her, he could not trace her.
This fully supports the version of P.W. 2 that she left the truck and concealed herself near a fence in darkness.
The learned Judge, therefore, held "Hence, on a careful scrutiny of the evidences of the hostile witnesses P.Ws. 6 and 8 it is seen that even they corroborate the evidence of the victim gild, P.W. 2 on material aspects of the prosecution case.
" In cases of rape, generally it is difficult to find any corroborative witnesses except the victim of the rape.
It has been observed by this Court in Bharwada Bhoginbhai Hirjibhai vs State of Gujarat, ; as follows: "Corroboration is not the sine qua non for a conviction in a rape case.
In the Indian setting, refusal to act on the testimony of a victim of sexual assault inthe absence of corroboration as a rule, is adding insult to injury.
Why should the evidence of the girl or the woman who complains of rape or sexual molestation be viewed with the aid of spectacles fitted with lenses tinged with doubt, disbelief or suspicion? To do so is to justify the charge of male chauvinism in a male dominated society.
A girl or a woman in the tradition bound non permissive society of India would be extremely reluctant even to admit that only incident which is likely to reflect on her chastity had ever occurred.
She would be conscious of the danger of being ostracized by the society or being looked down by the society including by her own family members, 844 relatives, friends, and neighbours.
She would face the risk of losing the love and respect of her own husband and near relatives, and of her matrimonial home and happiness being shattered.
If she is unmarried, she would apprehend that it would be difficult to secure an alliance with a suitable match from a respectable or an acceptable family.
In view of these and similar factors, the victims and their relatives are not too keen to bring the culprit to book.
And when in the face of these factors the crime is brought to light there is a built in assurance that the charge is genuine rather than fabricated.
" The above observation has been made by this Court relying on the earlier observations made by this Court in Rameshwar vs The State of Rajasthan, with regard to corroboration of girl 's testimony and version.
Vivian Bose, J, who spoke for the Court observed as follows: "The rule, which according to the case has hardened into one of law, is not that corroboration is essential before there can be a conviction but that the necessity of corroboration, as a matter of prudence, except where the circumstances make it safe to dispense with it, must be present to the mind of the judge, . . . .The only rule of law is that this rule of prudence must be present to the mind of the judge or the jury as the case may be and be understood and appreciated by him or them.
There is no rule of practice that there must, in very case, be corroboration before a conviction can be allowed to stand.
" In the instant appeal as had been stated hereinbefore that P.W. 2, the victim girl has clearly stated in her evidence that she had been taken to a solitary house in the hills by the appellant No. 1 Gagan Bihari Samal and there she was made to drink liquor and thereafter she was undressed and forcibly subjected to sexual intercourse by both the accused appellants one after the other.
He uncontroverted testimony has been accepted by all the courts and the courts concurrently found that she was raped without her consent.
It has been tried to be contended on behalf of the appellants that the amended section 114(A) was brought into the Evidence Act after the commission of the offence for which the appellants were charged and as such no assumption can be made on the basis of this provision.
This submission is of no avail in as much as it is clearly evident that the victim girl protested and 845 struggled while she was subjected to sexual assault forcibly by the accused persons and this clearly evinces absence of consent on part of the victim girl in such sexual intercourse apart from the legal presumption that follows from the provisions of Section 114(A) of the Evidence Act.
The learned counsel on behalf of the appellants further tried to argue on the basis of some minor discrepancies in the evidences of P.W. 2 that the prosecution case was a false one and it has been foisted on the appellants due to enmity and also due to accused Prafulla, one of the appellants, having disagreed to marry the victim girl.
The courts below have clearly found that the defence case was not at all sub stantiated by any cogent evidence.
So this contention is not at all tenable.
It is apropos to mention here the observation made by this Court in the case of State of Orissa vs Nakula Sahu and Ors., ; which are set out herein: "Although the revisional power of the High Court under Section 439 read with section 435 is as wide as the power of Court of appeal under Sec.
423 of the Code, it is now well settled that normally the jurisdiction of the High Court under Section 439 is to be exercised only in exceptional cases when there is a glaring defect in the procedure or there is a manifest error on a point of law which has consequently resulted in flagrant miscarriage of justice.
Inspite of the wide language of Section 435, the High Court is not excepted to act under Section 435 or Section 439 as if it is hearing an appeal.
" The High Court of Orissa referred to the said observation and rightly held that the High Court cannot be expected to re appraise the evidence as a court of appeal.
This Court hearing an appeal by special leave cannot consider and re appraise the evidences once again in the face of concurrent findings of facts arrived at by all the courts below.
For the reasons aforesaid we dismiss the appeal and uphold the conviction and sentence as found by the High Court.
R.P. Appeal dismissed.
| The appellants forcibly took P.W. 2 to a lonely place on 19.3.1983, made her to drink liquor and committed sexual assault on her.
Thereafter they left her in a truck.
While the said truck was unloading materials near a village, the victim stealthily left the truck and concealed herself near a fence.
P.W. 7 rescued her and took her to the house of P.W. 8, one of her distant relative, from where her father P.W. 1 took her back and lodged the report at the police station.
A case under sections 363 and 376 read with section 341.I.P.C. was registered against both the appellants.
After completion of the investigation, a charge sheet was submitted and the appellants were tried for the aforesaid offences.
The appellants denied the prosecution allegations and pleaded that they were falsely implicated because of refusal by one of them to marry the girl and previous enmity with the other.
The Assistant Sessions Judge rejected the defence pleas, and found that the appellants committed rape on the victim without her consent, and relying on section 114A of the Evidence Act, convicted the appellants under section 376(2)(g), I.P.C. and sentenced each of them to rigorous imprisonment for three 840 years.
Since the victim was more than 16 years of age, the appellants were acquitted of the charge under section 363, I.P.C. On dismissal of their appeal against the conviction and sentence by the Addl.
Session Judge, the appellants filed a revision application before the High Court.
The High Court duly considered and appraised the evidence and held that the appellants committed rape on PW 2 forcibly without her consent.
Ultimately the appellants came in appeal by special leave to this Court.
Dismissing the appeal, this Court, HELD: 1.
In cases of rape, generally it is difficult to find any corroborative witnesses except the victim of the rape.
However, corroboration is not the sine que non for a conviction in a rape case.
In the Indian setting, refusal to act on the testimony of a victim of sexual assault in the absence of corroboration as a rule, is adding insult to injury.
[843D F] Bharwada Bhoginbhai Hirjibhai vs State of Gujarat, ; and Rameshwar vs The State of Rajasthan, ; , relied on.
In the instant case, the victim girl clearly stated in her evidence that she had been taken to a solitary house in the hills by appellant No. 1 where she was made to drink liquor and thereafter she was undressed and forcibly subjected to sexual intercourse by both the accused appellants one after the other.
Her uncontroverted testimony was accepted by all the courts and they concurrently found that she had been raped without her consent.
[844F G] 3.
Apart from the legal presumption that flows from the provisions of section 114A of the Evidence Act, it is clearly evident in the instant case, that the victim girl protested and struggled while she was subjected to sexual assault forcibly by the accused persons and this clearly evinces absence of consent on her part in such sexual intercourse.
[844H; 845A] 4.
The High Court rightly held that it cannot be expected to re appraise the evidence as a court of appeal while exercising its revisional power under section 401 Cr.
P.C. [845E F] 841 State of Orissa vs Nakula Sahu and Ors., ; , relied on.
This Court hearing an appeal by special leave cannot consider and re appraise the evidence once again in the face of concurrent findings of facts arrived at by all the courts below.
[845F]
|
Appeals Nos.
664 to 669 of 1967.
Appeals from the judgment and order dated March 22, 1962, July 23, 1962, July 24, 1962, July 12, 1963 and August 14, 1963 in Writ Petitions Nos.
1077 of 1959, 19 and 739 of 1960, 157 of 1961, 970 of 1962 and 594 of 1963.
Jagadish Swarup, Solicitor General, section K. Aiyar and R. N. Sachthey, for the appellants (in all the appeals).
section V. Gupte, A. K. Varma, J. B. Dadachanji, 0.
C. Mathur and Ravinder Narain, for the respondent.
(in C. A. Nos. 664 and 668 of 1967).
O. P. Rana, for the intervener for the State of U.P. M. R. K. Pillai, for the intervener for the State of Kerala.
B. Sen, Santosh Chatterjee and G. section Chatterjee for Sukumar Bose, for the State of West Bengal.
section Govind Swaminathan, Advocate General, Tamil Nadu, A. V. Rangam and M. Subramaniam, for the State of Tamil Nadu.
Lal Narayan Sinha, Advocate General, Bihar, D. P. Singh nad V. J. Francis, for the intervener for the State of Bihar.
K. A. Chitaley, Advocate General, State of Madhya Pradesh, M.N. Shroff and I. N. Shroff, for the intervener for the State of Madhya Pradesh.
E. section Venkataramiah, Advocate General, Mysore and section P. Nayar, for the intervener for the State of Mysore.
J. C. Medhi, Advocate General, Assam and Naunit Lal, for the intervener for the State of Assam.
The Judgment of the Court was delivered by Hidayatullah, C.J.
These six appeals by certificate under article 132(1) of the Constitution are filed against the decision of the High Court of Mysore, declaring that Parliament had no power to legislate with respect to taxes on gift of lands and buildings.
The High Court passed a detailed judgment on two of the petitions by which the competence of Parliament was challenged and followed its own decision in the other four cases.
It is not necessary to give the facts of the six petitions in the High Court.
As illustrative of the facts involved we may mention on W.P. No. 1077 of 1959.
In that case a certain D. H. Nazareth, owner of a coffee plantation, 197 made a gift by registered deed, January 22, 1958, of a coffee plantation and other properties in favour of his four sons.
The market value of the property was Rs. 3,74,080 and the coffee plantation accounted for Rs. 3,24,700.
Gift tax of Rs. 35,612/ was demanded.
If the coffee _plantation was left out of consideration the tax was liable to be reduced by Rs. 3,4,036.
The authority to charge gift tax on the gift of the coffee plantation was challenged and the right of Parliament to impose a gift tax on lands and buildings questioned.
In some of the other cases agricultural or paddy lands or buildings were the subjects of gifts and they were similarly taxed and the tax questioned.
The High Court held that, entry 49 of the State List read with entry 18 of the same list reserved the power to tax lands and buildings to the Legislature of the States and Parliament could not, therefore, use the residuary power conferred by entry 97 of the Union list.
This decision is challenged before us.
The Gift Tax Act was passed in 1958 and subjected gifts made in the year ending March 31, 1958 to tax.
The Act contained the usual exempted limits and other exemptions.
We need not concern ourselves with them here.
We are only concerned with the validity of parliamentary legislation imposing gift tax at all.
To consider the objection to the Gift Tax Act which was sus tained by the High Court a few general principles may be borne in mind.
Under article 245 Parliament makes laws for the whole or any part of the territory of India and the Legislatures of the States for the whole or part of their respective States.
The subject matter of laws are set out in three lists in the Seventh Schedule.
List I (usually referred to as the Union List) enumerates topics of legislation in respect to which Parliament has exclusive power to make laws and List II (usually referred to as the State List) enumerates topics of legislation in respect to which the State Legislatures have exclusive power to make laws.
List III (usually referred to as the Concurrent List) contains topics in respect to which both Parliament and Legislature of a State have power to make laws.
Inconsistency between laws made by Parliament and those made by the Legislatures of the State, both acting under the Concurrent List, is resolved by making Parliamentary law to prevail over the law made by the State Legislature.
So long as the Parliamentary law continues, the State law remains inoperative but becomes operative once the Parliamentary law, throwing it into shadow, is removed.
Then there is the declaration in article 248 of the residuary powers of legislation.
Parliament has exclusive power to make any law in respect to any matter not enumerated in the Concurrent List or State List and this power includes the power of mak ing any law imposing a tax not mentioned in either of those lists.
198 For this purpose, and to avoid any doubts, an entry has also been included in the Union List to the following effect: "97.
Any other matter not enumerated in List II or List III including any tax not mentioned in either of those lists".
It will, therefore, be seen that the sovereignty of Parliament and the Legislatures is a sovereignty of enumerated entries, but within the ambit of an entry, the exercise of power is as plenary as any legislature can possess, subject, of course, to the limitations arising from the Fundamental Rights.
The entries themselves do not follow any logical classification or dichotomy.
As was said in State of Rajasthan vs section Chawla and another(1) the entries in the list must be regarded as enumeratio simplex of broad categories.
Since they are likely to overlap occasionally, it is usual to examine the pith and substance of legislation with a view to determining to which entry they can be substantially related, a slight connection with another entry in another list notwithstanding.
Therefore, to find out whether a piece of legislation falls within any entry its true nature and character must be in respect to that particular entry.
The entries must of course receive a large and liberal interpretation because the few words of the entry are intended to confer vast and plenary _powers.
If, however, no entry in any of the three lists covers it, then it must be regarded as a matter not enumerated in any of the three lists.
Then it belongs exclusively to Parliament under entry 97 of the Union List as a topic of legislation.
The Gift Tax Act was enacted by Parliament and it is admit ted that no entry in the Union List or the Concurrent List mentions such a tax.
Therefore, Parliament purported to use its powers derived from entry 97 of the Union List read with article 248 of the Constitution.
This power admittedly could not be invoked if the subject of taxes on gifts could be said to be comprehended in any entry in the State List.
The High Court has accepted the contention of the tax payers that it is so comprehended in entries 18 and 49 of the State List.
Those entries read 18.
Land, that is to say, rights in or over land, land tenures including the relation of landlord and tenant, and the collection of rents; transfer and alienation of agricultural land; land improvement and agricultural loans; colonization." "49.
Taxes on lands and buildings.
" The argument is that by entry 18, 'land ' of all description is made subject to legislation in the States and by entry 49 taxes of (1) [1959] Supp. 1 S.C.R. 904.
199 whatever description on lands in that large sense and buildings generally fall also in the jurisdiction of the State.
Reference is made to entries 45, 46, 47 and 48 of the State List in which certain taxes are to be imposed on land and agricultural land or income from agriculture exclusively by the States in contrast with entries 82, 86, 87 and 88 where the taxes are imposed on properties other than agricultural land or income from agriculture.
It is submitted, therefore, that the general scheme of division of taxing and other entries by which land particularly agricultural land and income therefrom is reserved for the States shows that taxes on lands and buildings read liberally must also cover taxes in respect of gifts of land particularly agricultural land and buildings.
If the entry so read can be reasonably said to include the tax, then there can be no question of recourse to the residuary powers of Parliament.
The matter is not res integra and however attractive the argument, it cannot be accepted.
Many High Courts in India have considered this matter before the Supreme Court decided it.
The Mysore view was not followed in section Dhandapani vs Addl.
Gift Tax Officer, Cuddalore(1) (Madras High Court); Shyam Sunder vs Gift Tax Officer(2) (disapproved on another point in the Supreme Court).
A contrary view was earlier also expressed in Jupadi Sesharatnam vs Gift Tax Officer, Palacole(3) (Andhra Pradesh High Court) and Joseph vs Gift Tax Officer (4) (Kerala High Court).
In fact the judgment under appeal stands alone.
The subject of entry 49 of the State List in relation to imposition of Wealth Tax came up for consideration in Sudhir Chandra Nawn vs Wealth Tax Officer, Calcutta & ors.(5) and the view of the High Court on the construction of this entry was affirmed.
Although the judgment ' under appeal was not referred to expressly the result is that it must be taken to be impliedly overruled.
In view of the decision of this Court it is not necessary to deal with the matter except briefly.
The Constitution divides the topics of legislation into three broad categories : (a) entries enabling laws to be made, (b) entries enabling taxes to be imposed, and (c) entries enabling fees and stamp duties to be collected.
It is not intended that every entry gives a right to levy a tax.
The taxes are separately mentioned and in fact contain the whole of the power of taxation.
Unless a tax is specifically mentioned it cannot be imposed except by Parliament in the exercise of its residuary powers already mentioned.
Therefore, entry 18 of the State List does not confer additional power (1) (3) (5) (2) A.I.R. 1967 All. 19.
(4) 200 of taxation.
At the most fees can be levied in respect of the items mentioned in that entry, vide entry 66 of the same list.
Nor ,is it possible to read a clear cut division of agricultural land in favour of the States although the intention is to put land in most of its aspects in the State List But however wide that entry, it cannot still authorise a tax not expressly mentioned.
Therefore, either the pith and substance of the Gift Tax Act falls within entry 49 of State List or it does not.
If it does, then Parliament will have no power to levy the tax even under the residuary powers.
If it does not, then Parliament must undoubtedly possess that power under article 248 and entry 97 of the Union List.
The pith and 'substance of Gift Tax Act is to place the tax on the gift of property which may include land and buildings.
It is not a tax imposed directly upon lands and buildings but is a tax upon the value of the total gifts made, in a year which is above the exempted limit.
There is no tax upon lands or buildings as units of taxation.
Indeed the lands and buildings are valued to find out the total amount of the gift and what is taxed is the gift.
The value of the lands and buildings is only the measure of the value of the gift.
A gift tax is thus not a tax on lands and buildings as such (which is a tax resting upon general ownership of lands and buildings) but is a levy upon a particular use, which is transmission of title by gift.
The two are not the same thing and the incidence of the tax is not the same.
Since entry 49 of the State List contemplates a tax directly levied by reason of the general ownership of lands and buildings, it cannot include the gift tax as levied by Parliament.
There being no other entry which covers a gift tax, the residuary powers of Parliament could be exercised to enact a law.
The appeals must, therefore, be allowed but there shall be no order about costs throughout.
The appeal 666/67 however abates as the sole respondent died.
V.P.S. Appeals allowed.
| P was the owner of the suit properties.
He had no children.
He gifted some of his properties to his wife on June 14, 1943.
On April 29, 1946 the first 'respondent instituted a suit for a declaration that he was the adopted son of P and for partition and possession of his share in the family property.
The first respondent claimed to have been adopted on July 12, 1943, P denied the said adoption and alleged that in fact he had adopted the appellant on April 10, 1946.
In view of that allegation the appellant was added as a supplemental defendant in the said suit, but no relief was claimed against him.
During the pendency of that suit P died.
Thereafter the first respondent moved the court to withdraw the suit.
He was permitted to withdraw the 'same with liberty to file a fresh suit on the same cause of action on condition that he paid the defendants ' costs of that suit before instituting a fresh suit.
Thereafter P 's widow bequeathed her properties to the first respondent and died soon after.
On November 29, 1951 the first respondent brought a fresh suit without having paid the costs of the appellant in the earlier suit.
The appellant resisted the suit on several grounds.
However the trial court and the High Court decided in favour of the first respondent.
Thereupon by special leave the present appeal was filed by the appellant.
The main question that fell for consideration was whether the suit under appeal was maintainable when the condition precedent imposed by the court in the earlier suit namely, the payment of defendants ' costs by the plaintiff before bringing a fresh suit on the same cause of action had not been complied with.
HELD : (i) Rule 1, 0.
23, Code of Civil Procedure empowers the courts to permit a plaintiff to withdraw from the suit brought by him with liberty to institute a fresh suit in respect of the subject matter of that suit on such terms as it thinks fit.
The expression 'subject matter ' is not defined in the Code.
It does not mean property.
That expression has a reference to a right in the property which the plaintiff seeks to enforce.
That expression includes the cause of action and the relief claimed.
Unless the cause of action and the relief claimed in the second suit are the same as in the first suit it cannot be said that the subject matter of the second suit is the same as in the previous suit.
[213 G 214 B] (ii) The non fulfilment of the condition imposed by the Court at the time of withdrawal of the first suit did not bar the present suit because the subject matter of the two suits was not the same.
In the first suit the first respondent was seeking to enforce his right to partition and separate possession.
In the present suit he sought to get possession of the suit properties from a trespasser on the basis of his, title.
In the first suit the cause of action was the division of status between the first respondent and his adoptive father and the relief claimed was the conversion of joint possession into separate possession.
In the present suit the plaintiff was seeking possession of the suit properties from a trespasser 212 In the first case his cause of action arose on the day he got separated from his family.
In the present suit the cause of action, namely, the series of transactions which formed the basis of the title to the suit properties arose on the death of his adoptive father and mother.
[214 B D] Mere identity of some of the issues in the two suits did not bring about an identity of the subject matter in the two suits.
[214 D E] The appeal must accordingly be dismissed.
Rakhma Bai vs Mahadeo Narayan, I.L.R. and Singa Reddy vs Subba Reddy, I.L.R. , approved and applied.
|
Appeals Nos. 290 to 292 of 1959.
Appeals by special leave from the judgment and order dated December 6, 1957, of the Kerala High Court in Agricultural Income tax Referred Cases Nos. 15, 18 and 19 of 1955.
C.K. Daphtary, Solicitor General of India, Thomas Vellapally and M. R. K. Pillai, for the appellants (in all the appeals) Sardar Bahadur, for the respondents.
December 15.
The Judgment of the Court was delivered by KAPUR, J.
These three appeals are brought by special leave against the judgment and order of the High Court of Kerala and arise out of a common judgment of that court given in three Agricultural Income tax References Nos. 15, 18 and 19 of 1955.
In the first reference the question raised was: "Whether under the Travancore Cochin Agricul tural Income Tax Act, 1950 in calculating the assessable agricultural income of a rubber estate already planted and containing both mature yielding rubber trees and also immature rubber plants which have not come into bearing, the annual expenses incurred for the upkeep and maintenance of such rubber plants, are not a permissible deduction, and if so, whether the sum of Rs. 42,660 4 1 expended by the assessee in the relevant accounting year 1952, under this head may be deducted." and in the other two the question referred was: 281 "Whether the expenses incurred for the mainte nance and upkeep of immature rubber trees constitute a permissible deduction within the meaning of section 5(j) of Act XXII of 1950?" In all the references the questions were answered in the negative and against the appellant.
The appeals relate to three accounting years 1950, 1951 and 1952 (assessment years 1951 52, 1952 53 and 1953 54).
The appellants have rubber plantations and in the accounting year 1950, corresponding to the assessment year 1951 52, the appellants had under cultivation 3558 84 acres out of which 334 64 acres had immature rubber trees growing and the rest i.e. 3224 20 acres mature rubber yielding trees under cultivation.
In that year a sum of Rs. 19,056 0 9, which was expended for the upkeep and maintenance of immature portion of the rubber plantation, was allowed by the Agricultural Income tax Tribunal and at the instance of the respondent a reference was made to the High Court under section 60(1) of the Agricultural Income tax Act (Act XXII of 1950) hereinafter termed the 'Act ' and that was reference No. 18 of 1955.
During the accounting year 1951 corresponding to the assessment year 1952 53 the appellant had under cultivation.
a total area of 3426,55 acres of which 3091.91acres were mature rubber yielding trees and 334.64 acres had immature rubber trees.
In that year a sum of Rs. 59,271.9 5 was the expenditure incurred for the upkeep and maintenance of immature portion of the rubber estate.
That sum was allowed by the Agricultural Income tax Tribunal and at the instance of the respondent a reference was made under section 60(1) of the Act to the High Court and that was reference No. 19 of 1955.
In Agricultural Income tax Reference No. 15 of 1955 which related to, accounting year 1952 and the assessment year 1953 54, the area under cultivation was 3453,65 out of which 2967,91 acres had mature rubber yielding trees and 485,74 acres had immature rubber growing trees.
In that year the amount expended on the maintenance and tending of the imma ture rubber trees was Rs. 42,660,4 1.
In that case, 36 282 however, the Agricultural Income tax Tribunal rejected the appellant 's claim and disallowed the expenditure.
At the instance of the appellant a case was stated to the High Court under section 60(1) of the Act and was answered in the negative and against the appellant.
In all the cases the assessee company is the appellant and the main question for decision is whether the amount expended for the upkeep and maintenance of the immature, rubber trees is a permissible deduction under section 5(j) of the Act.
The charging section under the Act is section 3 and section 5 relates to computation of agricultural income.
It provides: S.5 "The agricultural income of a person shall be computed after making the following deductions, namely: expenditure (not being in the nature of capital expenditure or personal expenses of the assessee) laid out or expended wholly and exclusively for the purpose of deriving the agricultural income;".
In regard to this income the High Court held: "We find it impossible to say that the 'amounts spent on the upkeep and maintenance of the immature rubber plants were laid out or expended "for the purpose of deriving the agricultural income", much less that they were laid out or expended "wholly and exclusively for that purpose". "The agricultural income", in the context, can only mean the agricultural income obtained in the accounting year concerned and not the agricultural income of any other period." In our opinion the High Court has taken an erroneous view of the relevant provision.
It is not denied that the expenditure claimed as a deduction was wholly and exclusively laid out for the purpose of deriving income but the use of the definite article "the" before agricultural income has given rise to the interpretation that the deduction is to be from the income of the year in which the trees on which the amount claimed 283 was expended bore any income.
In a somewhat similar case Vallambrosa Rubber Co. Ltd. vs Farmer (1) the expenditure of the kind now claimed was allowed under the corresponding provision of the English Income tax Act.
In that case a rubber company had an estate in which in the year of assessment only 1/7 produced rubber and the other 6/7 was in process of cultivation for the production of rubber.
It may be added that rubber trees do not yield any rubber until they are about six years old.
The expenditure for the superintendence, weeding etc.
incurred by the company in respect of the whole estate including the nonbearing rubber estate was allowed on the ground that in arriving at the assessable profits the assessee was entitled to deduct the expenditure for superintendence, weeding etc.
on the whole estate and not only on the 1/7 of such expenditure.
Lord President said at page 534: "Well that is for the case quite correct, but it must be taken, as you must always take a Judge 's dicta, secundum materiam subjectum of the case that is decided.
But to say that the expression of Lord Esher 's lays down that you must take each year absolutely by itself and allow no expense except the expense which can be put against the profit which is reaped for the year is in my judgment to press it much further than it will go." Counsel for the respondent relied upon a judgment of this Court in Assam Bengal Cement Co. Ltd. vs The Commissioner of Income tax, West Bengal (2) and particularly on a passage at page 983 where Bhagwati J. observed: "The distinction was thus made between the acquisition of an income earning asset and the process of the earning of the income.
Expenditure in the acquisition of that asset was capital expenditure and expenditure in the process of the earning of the profits was revenue expenditure.
" But that case has no relevancy to the facts of the present case nor has that passage any applicability to the facts of the present case.
The question there was (1) (2) 284 whether certain payments made were by way of capital expenditure or revenue expenditure.
The assessee acquired a lease from Government for twenty years and in addition to paying the rent and royalties for the lease the assessee had to pay two further sums as 'protection fees ' under the terms of the lease.
Those sums were held to be capital expenditure inasmuch as they were incurred for the acquisition of an asset or an advantage of enduring nature and were no part of the working or operational expenses for carrying on the business of the assessee.
In our opinion the amount expended on the superintendence, weeding etc.
of the whole estate should have been allowed against the profits earned and it is no answer to the claim for a deduction that part of those expenses produced no return in that year because all the trees were not yielding rubber in that year.
We therefore allow these appeals, set aside the judgments and orders of the High Court and answer the questions in favour of the appellant in all the three agricultural Income tax References.
The appellant will have its costs in this Court and the High Court.
One hearing fee in this Court.
Appeals allowed.
| In computing the agricultural income of a person section 5(f) of the Travancore Cochin Agricultural Income tax Act, 1950, allowed deductions of any expenditure "laid out wholly and exclusively for purpose of deriving the agricultural income".
The assessee who had rubber plantations claimed that the amount expended on the maintenance and tending of immature rubber trees should be deducted in computing its agricultural income but this was disallowed on the ground that the use of the article "the" before the words agricultural income implied deduction (1) ; 280 from the income of the year in which the trees on which the amount was expended bore income.
Held, that the assessee was entitled to the deduction claim ed.
It was no answer to the claim for the deduction that these expenses produced no return in the year in question as the trees were not yielding rubber in that year.
Vallambrosa Rubber Co. Ltd. vs Farmer, , followed.
Assam Bengal Cement Co. Ltd. vs The Commissioner of Income tax, West Bengal, , not applicable.
|
ivil Appeal Nos.
2567 70 of 1985.
From the Judgment and Order dated 3.4.1985 of the Hyderabad High Court in Writ Petition No. 9403 of 1984.
Kapil Sibal, Additional Solicitor General, G.L. Sanghi, Anil B. Diwan, G. Ramaswamy, P.A. Choudhary, Kailash Vasudev, Naunit Lal, M.J. Paul, C.S. Vaidyanathan, U.K. Khaitan, Praveen Kumar, section Murlidhar, Vineet Kumar, Vinod Bhagat and Mukul Mudgal for the Appellants.
Shanti Bhushan, V.R. Reddy, Rajendra Choudhary, section Thananjayan, K. Ram Kumar for the Respondents.
V.B. Sharya for the Intervenor.
The Judgement of the Court was delivered by VERMA, J.
These appeals by special leave are by several industrial concerns against the Andhra Pradesh State Electricity Board (hereinafter called 'the Board ') challenging the common judgment of the Andhra Pradesh High Court in writ petitions filed by these concerns challenging the revision of the electricity tariffs by the Board by its proceedings contained in B.P. Ms. No. 1014 (Commercial) dated 649 13.12.1983 which came in to force on 15.1.1984.
Prior to this revision, the tariffs were governed by B.P. Ms. No. 418 (Commercial) dated 12.1.1981.
On 13.12.1983, two separate orders were issued by the Board revising the various tariffs.
By one of them, namely, B.P. Ms. No. 1014, the tariffs for various categories of consumers including H.T. categories I and II were revised.
By the other order of the same date, namely, Memo No. DE/COML/IV/2250/83/I, the tariffs for highly power intensive industries were also revised upwards.
Out of the appellants it was applicable to five units, namely, (1) Nav Bharat Ferro Alloys Ltd., (2) Andhra Sugars Ltd., (3) Ferro Alloys Corporation Ltd., (4) Grindwell Norton Ltd., and (5) A.P. Carbides Ltd. This upward revision of tariffs made by the Board by its two orders dated 13.12.1983 which were made effective from 15.1.1984, was challenged by the appellants in writ petitions filed in the Andhra Pradesh High Court on various grounds.
The High court rejected all the grounds and dismissed the writ petitions by its common judgment now reported in A.I.R. 1985 A.P. 299.
These appeals by special leave are against the High Court Judgment.
The appellants are all H.T. power consumers of one category or other.
The tariffs consist of three parts: Part A, Part B and Part C. Part A provides for H.T. tariffs; Part B for L.T. supply; and Part C provides, inter alia, for miscellaneous and general charges.
H.T. consumers in Part A are broadly classified into three categories: H. T. Category I (Industrial); H.T. Category II (Non Industrial); and H.T. Category III comprising of power intensive consumers and some others.
The Board retained the power to decide in accordance with the guidelines as to which industries were power intensive and which were not.
This was the position in the tariffs of 1975.
Subsequently, the Board began to deal with the power intensive industries by notifying tariffs for them separately from time to time.
In effect, there were four classes of consumers availing H.T. supply; (1) H.T. consumers falling under H.T. Category I (Industrial); (2) H.T. consumers falling under H.T. Category II (Non Industrial); (3) H.T. consumers falling under the category 'power intensive industries '; and (4) H.T. consumers availing supply of electricity for irrigation and agricultural purposes included in Part B.
The tariffs for these different categories of H.T. consumers were enhanced from time to time.
For H.T. Category I (Industrial), it was 21 paise in 1975, increased to 30 paise in 1979, 33 paise in 1980, 40 paise in 1981 and 48 paise in 1984.
Likewise, there was corresponding increase in the energy rates for H.T. Category II (Non Industrial), being 28 paise, 37 paise, 40 paise, 47 paise and 56 paise.
The tariffs for power intensive industries were, however, 650 increased by separate notifications issued by the Board from time to time.
It was 11 paise prior to 1975, raised to 12.2 paise in 1977, 16 paise in 1978, 18.5 paise in September 1979, 21 paise in November 1979, 25 paise in 1980, 32 paise in 1981 and 45 paise in 1984.
The H.T. consumers grouped in Part B were required to pay 15 paise under the 1975 tariffs and 16 paise thereafter.
Besides the energy charges as stated above, the H.T. consumers were also required to pay at different rates effective from 1.9.1982 an additional charge levied as 'fuel cost adjustment charges '.
The H.T. consumers were also required to pay some amount as 'voltage surcharge ' in accordance with the terms of the agreement entered into by the individual consumers with the Board.
The comparison of the aforesaid tariffs shows that the tariffs for power intensive industries to begin with were much less than the tariffs for H.T. Category I (Industrial) and H.T. Category II (Non Industrial).
In course of time, the concession in tariffs for the power intensive industries was progressively withdrawn.
The concessions were, however, continued in respect of consumers availing H.T. or L.T. supply for purposes of irrigation and agriculture or L.T. supply for domestic, cottage industries, public lighting and small poultry farming units.
It is the admitted position that the power generation in the State of Andhra Pradesh is both hydro and thermal, each source contributing almost equally to the total power generation in the State.
The H.T. categories have been consuming more than one half of the total power generated in the State against the much larger number of individual L.T. consumers availing the remaining power.
The main attacks to the upward revision of the tariffs for H.T. consumers in the writ petitions before the High Court were: (1) The Board, as a public utility undertaking, is expected to function in the most efficient and economical manner; (2) It cannot plan its activities with a view to drive any sizeable profits on its undertaking except in accordance with Section 59 of the (hereinafter referred to as 'the Supply Act '); (3) The Board Could not generate a surplus in excess of that specified under Section 59 of the Supply Act which it had been doing; (4) The Board was preparing its financial statement incorrectly in a manner contray to section 59 of the Supply Act by improperly taking into account expenses chargeable to capital by showing such expenses as charged to revenues; (5) The steep upward revision to tariffs from 1980 made by the Board is invalid, being arbitrary and in contravention of Section 49 and 59 of the Supply Act; and (6) There was no justification for the Board to have revised the tariffs either in 1981 or in 1984 or to have levied any 651 fuel surcharge in terms of Section 49 and 59 of the Supply Act.
It was also contended that the tariffs revision was made without prior consultation with the State Electricity Consultative Council as required by Section 16(5) of the Supply Act which also rendered it invalid.
Prior to 30.7.1982, it was usual for the Board to take into account various escalation charges such as pay revisions and increases in the cost of fuel and revise its tariffs from time to time.
This was done in 1975 and 1981.
Thereafter, the Board took the view that to avoid making frequent tariff revisions necessitated by frequent escalations in the cost of fuels like coal and diesel oil, the formula known as "fuel cost adjustment" be evolved.
Accordingly, the Board in its proceedings contained in B.P. Ms. No. 589 dated 30.7.1982, set out the formula known as "fuel cost adjustment".
This formula was introduced as condition No. 11 in H.T. tariffs Part A.
Ever since September 1982, all categories of H.T. consumers in Part A including the power intensive consumers are subject to this condition.
Immediately after 30.7.1982, the fuel cost adjustment was fixed as 2.74 paise per unit, which was increased gradually to 2.95 paise, 3.79 paise and 11.68 paise.
Thereafter, 3.79 paise was absorbed as part of the tariffs applicable to these H.T. consumers and the remaining increase of 7.89 paise alone was indicated as the fuel cost adjustment charges.
The grievance made by all H.T. consumers before the High Court was that: (1) the fuel cost adjustment could not be recovered as part of the tariffs; (2) there is discrimination in recovering the entire fuel cost adjustment from H.T. consumers alone; (3) fairness demands that a reasonable proportion of the burden should be shared also by Part B consumers; and (4) that fuel cost adjustment charge is excessively computed.
The High Court rejected all these contentions.
It held that this was a matter of policy which could be changed from time to time and it was permissible to gradually withdraw the pre existing concessional tariffs given to the power intensive industries for which the tariffs earlier were much lower as compared to the other consumers and even after the increase , they were not excessive.
It was held that electricity was a raw material for power intensive industries and no grievance could be made against the increase of its cost just as such a grievance was untenable against increase in the cost of any other raw material.
The challenge on the ground of discrimination was rejected on the ground that H.T. consumers including power intensive industries formed a separate class and the reason which justified grant of concession to them earlier also justified the gradual withdrawal of that 652 concession.
It held that prior consultation with the State Electricity Consultative Council according to Section 16(5) of the Supply Act was not obligatory before revising the tariffs.
The High Court held that the Board was justified in adjusting its tariffs to ensure progressive minimizing of losses and the failure of the State Government to specify the surplus it could generate in accordance with Section 59 of the Supply Act, did not detract from the Board 's power to adjust its tariffs and generate a surplus on principles of commercial expediency applicable to a public utility undertaking.
Fixation of tariffs was held to be a matter of major policy in respect of which the Government can effectively issue directions under Section 78 A of the Act.
It was held that the H.T. consumers including power intensive industries were bound to pay according to the revised higher tariffs fixed from time to time under the agreement as contemplated by Section 49 of the Supply Act.
The condition of fuel cost adjustment, introduced as condition No. 11 in H.T. tariffs Part A, was held applicable to power intensive consumers also.
An additional argument that this added burden became unbearable for the power intensive consumers was rejected on the ground that such inability of the industry to survive is not a compelling consideration for deciding the Board 's power in adjusting it tariffs.
Accordingly, the High Court dismissed the writ petitions and upheld the revision of tariffs made by the Board by the impugned B.P. Ms. No. 1014 (Commercial) dated 13.12.1983 w.e.f. 15.1.1984.
The High Court having refused to grant a certificate of fitness to appeal to this Court, the appellants have preferred these appeals by special leave.
It may be mentioned at this stage that the controversy raised in these appeals was also the controversy in another bunch of civil appeals arising out of a judgment of the Kerala High Court wherein a similar challenge had been upheld and the Kerala State Electricity Board had come in an appeal to this Court.
In those matters, the contention of the Kerala State Electricity Board which would be the same as that of the Andhra Pradesh State Electricity Board before us, was accepted and the judgment of the Kerala High Court taking the view contrary to that of the Andhra Pradesh High Court was reversed (Kerala State Electricity Board vs M/s. S.N. Govinda Prabhu and Bros. and Others.
, [1986] 4 S.C.C. 198.) All the hearing before us, it was contended by Shri Shanti Bhushan, learned counsel for the Andhra Pradesh State Electricity Board that the Kerala decision concludes these points against the present appellants.
On the other hand, Shri G. Ramaswamy and other learned counsel, appearing for the appellants, made an attempt to 653 distinguish the decision in the Kerala case.
The question, therefore, is: Whether any ground has been made out by the present appellants to persuade us to take a view different from the one taken by this Court in the Kerala case? Before considering the arguments in these appeals, we would refer to the controversies in the Kerala case and the view taken therein.
The decision in Kerala State Electricity Board vs M/s. Govinda Prabhu and Bros. and Others, ; arose out of the decision of the Kerala High Court in a similar situation.
The Kerala High Court struck down the upward revision of tariffs made by the Kerala State Electricity Board unlike the Andhra Pradesh High Court which has upheld the upward revision of tariffs in the present appeals.
The main question in the Kerala case also related to the extent of authority of the Kerala Board to increase the electricity tariffs under the .
The principal ground of challenge which was accepted by the Kerala High Court was that the Kerala State Electricity Board acted outside its statutory authority by formulating a price structure intended to yield substantial revenue to offset not merely the expenditure properly chargeable to the revenue account for the year as contemplated by Section 59 of the Supply Act but also expenditure not so properly chargeable.
The Kerala High Court had held that in the absence of a specification by the Government, the Board was not entitled to generate a surplus at all and it acted entirely outside its authority in generating a surplus to be adjusted against items of expenditure not authorised to be met from revenue receipts.
this view of the Kerala High Court was based primarily on the construction made of section 59 of the .
Accordingly, the Kerala High Court struck down the upward revision of tariffs made by the Kerala State .
Accordingly, the Kerala High Court struck down the upward revision of tariffs made by the Kerala State Electricity Board in the years 1980, 1982 and 1984.
It may here be mentioned that Section 59 of the Supply Act, as it stood prior to 1978, was amended by Act No. 23 of 1978 and thereafter, by Act No. 16 of 1983, which came into effect from April 1, 1985 only.
The Kerala case also was decided on the basis of Section 59 as it stood amended by the 1978 (Amendment) Act, prior to its amendment w.e.f.
April 1, 1985 by Act No. 16 of 1983.
For our purposes also, Section 59 as it stood amended by the 1978 Act, prior to the 1983 amendment, is relevant.
This Court expressly rejected the submission which had found favour with the Kerala High Court that in the absence of a specification by the State Government, the position would be as it was before the 1978 amendment, that is, the Board was to carry on its affairs and 654 adjust the tariffs in such a manner as not to incur a loss and no more.
While rejecting the submission, this Court held as under: "We are of the view that the failure of the government to specify the surplus which may be generated by the Board cannot prevent the Board from generating a surplus after meeting the expenses required to be met.
Perhaps, the quantum of surplus may not exceed that a prudent public service undertaking may be expected to generate without sacrificing the interests it is expected to serve and without being obsessed by the pure profit motive of the private entrepreneur.
The Board may not allow its character as a public utility undertaking to be changed into that of a profit motivated private trading or manufacturing house.
Neither the tariffs nor the resulting surplus may reach such heights as to lead to the inevitable conclusion that the Board has shed its public utility character.
When that happens the court may strike down the revision of tariffs as plainly arbitrary.
But not until then.
Not, merely because a surplus has been generated, a surplus which can by no means be said to be extravagant.
The court will then refrain from touching the tariffs.
After all, as has been said by this Court often enough 'price fixation ' is neither the forte nor the function of the court.
" Further, it said: "Turning back to Section 59 and reading it along with Section 49, 67, 67 A etc.
We notice that the Electricity Supply Act requires the Electricity Board to follow a particular method of accounting and it is on the basis of that method of accounting that the Board is required to generate a surplus.
Broadly, Section 59 requires that a surplus should be left from the total revenues, in any year of account, after meeting all expenses properly chargeable to revenues.
It has to be remembered that apart from subventions which may be received from the State Government, which depend entirely on the bounty of the government, the only revenues available to the Board are the charges leviable by it from consumers.
Bearing this in mind, we may now consider what expenses are properly chargeable to revenues under the Electricity Supply Act.
For this purpose, we may not be justified in having recourse to the principles of corporate 655 accounting or the rules which determine what is revenue expenditure under the Income Tax Act.
It appears to us that the Electricity Supply Act prescribes its own special principles of accounting to be followed by the Board. " This Court also held that the prescribing of different tariffs for high and low tension consumers and for different classes of consumers, such as industrial, commercial, agricultural and domestic, appears to be reasonable and far from arbitrary and is based on an intelligent and intelligible differentia.
Accordingly, the judgment of the Kerala High Court upholding challenge to the validity of the upward revision of tariffs was set aside.
Broadly speaking, the substance of the main arguments advanced before us in these matters was repelled by this Court in the Kerala case.
However, learned counsel for the appellants attempted to distinguish the Kerala decision and also tried to advance some additional arguments.
We shall refer to those arguments presently.
It would be appropriate at this stage to quote the relevant provisions of the , with reference to which the arguments advanced have to be considered.
Section 2 of the act relates to interpretation and give the meaning of the expressions defined therein.
Section 3 deals with the constitution of the Central Electricity Authority.
Section 4 B contains the rule making power of the Central Government.
Section 5 provides for the constitution and composition of State Electricity Boards.
Section 12 provides for the incorporation of the Board.
Section 12 A relates to the capital structure of the Board.
Section 78 contains the rule making power of the State Government.
Section 79 contains the power of the Board to make regulations.
Some of the provisions of the Act which may be quoted in extenso are as under: "4A. Directions by Central Government to the Authority.
(1) In the discharge of its functions, the Authority shall be guided by such directions in matter of policy involving public interest as the Central Government may give to it in writing.
(2) If any question arises as to whether any such direction relates to a matter of policy involving public interest, the decision of the Central Government thereon shall be final." xxx xxx xxx 656 "16.
State Electricity Consultative Council.
(1) The State Government shall constitute a State Electricity Consultative Council for the State, and in cases to which Section 6 and 7 apply, the State Government concerned shall constitute such one or more State Electricity Cousultative Council or Councils and for such areas as they may by agreement determine.
(2) The State Electricity Consultative Council shall consist of the members of the Board and, if there are any Generating Company or Generating Companies operating in the State, one representative of the Generating Company or each of the Generating Companies, to be nominated by the Generating Company concerned, and such other persons being not less than eight and not more than fifteen as the State Government or the State Governments concerned may appoint after consultation with such representatives or bodies of representative of the following interests as the State Government or the State Governments concerned thinks or think fit, that is to say, local self government, electricity supply industry, commerce, industry, transport, agriculture, labour employed in the electricity supply industry and consumers of electricity, but so that there shall be at least one member representing each such interest in the Council.
(3) The Chairman of the Board shall be ex officio Chairman of the State Electricity Consultative Council.
(4) The State Electricity Consultative Council shall meet at least once in every three months.
(5) The functions of the State Electricity Consultative Council shall be as follows: (i) To advise the Board and the Generating Company or Generating Companies, if any, operating in the State on major questions of policy and major schemes; (ii) to review the progress and the work of the Board and the Generating Company or Generating Companies, if any, operating in the State from time to time; 657 (iii) To consider such other matters as the Board or the Generating Company or Generating Companies, if any, operating in the State may place before it; and (iv) To consider such matters as the State Government may by rules prescribe.
(6) The Board shall place before the State Electricity Consultative Council the annual financial statement and supplementary statement, if any, and shall take into consideration any comments made on such statement in the said Council before submitting the same to the State Government under Section 61." xxx xxx xxx "49.
Provision for the sale of electricity by the Board to persons other than licensees.
(1) Subject to the provisions of this Act and of regulations, if any, made in this behalf, the Board may supply electricity to any person not being a licensee upon such terms and conditions as the Board thinks fit and may for the purposes of such supply frame uniform tariffs.
(2)In fixing the uniform tariffs, the Board shall have regard to all or any of the following factors, namely: (a) The nature of the supply and the purposes for which it is required; (b) The co ordinated development of the Supply and distribution of electricity within the State in the most efficient and economical manner, with particular reference to such development in areas not for the time being served or adequately served by the licensee; (c) the simplification and standardisation of methods and rates of charges for such supplies; (d) The extension and cheapening of supplies of electricity to sparsely developed areas.
658 (3) Nothing in the foregoing provisions of this section shall derogate from the power of the Board, if it considers it necessary or expedient to fix different tariffs for the supply of electricity to any person not being a licensee, having regard to the geographical position of any area, the nature of the supply and purpose for which supply is required and any other relevant factors.
(4) In fixing the tariff and terms and conditions for the supply of electricity, the Board shall not show undue preference to any person." xxx xxx xxx Section 59 prior to 1978 "General principles for Board 's finance.
The Board shall not, as far as practicable and after taking credit for any subventions from the State Government under Section 63, carry on its operations under this Act at a loss, and shall adjust its charges accordingly from time to time: Provided that where necessary any amounts due for meeting the operating, maintenance and management expenses of the Board or for the purposes of clauses (i) and (ii) of Section 67 may, to such extent as may be sanctioned by the State Government, be paid out of capital.
" Section 59 as amended by Act No. 23 of 1978 "General principles for Board 's finance.
(1) The Board shall, after taking credit for any subvention from the State Government under Section 63, carry on its operations under this Act and adjust its tariffs so as to ensure that the total revenues in any year of account shall, after meeting all expenses properly chargeable to revenues, including operating, maintenance and management expenses, taxes (if any) on income and profits, depreciation and interest payable on all debentures, bonds and loans, leave such surplus, as the State Government may, from time to time, specify.
(2) In specifying the surplus under sub section (1), 659 the State Government shall have due regard to the availability of amounts accrued by way of depreciation and the liability for loan amortization and leave.
(a) a reasonable sum to contribute towards the cost of capital works; and (b) where in respect of the Board, a notification has been issued under sub section (1) of Section 12 A, a reasonable sum by way of return on the capital provided by the State Government under sub section (3) of that section and the amount of the loans (if any) converted by the State Government into capital under sub section (1) of Section 66A." Section 59 as further amended by Act No. 16 of 1983 "General principles for Board 's finance.
(1) The Board shall, after taking credit for any subvention from the State Government under Section 63, carry on its operations under this Act and adjust its tariffs so as to ensure that the total revenues in any year of account shall, after meeting all expenses properly chargeable to revenues, including operating, maintenance and management expenses, taxes (if any) on income and profits, depreciation and interest payable on all debentures, bonds and loans, leave such surplus as is not less than three per cent, or such higher percentage, as the State Government may, by notification in the Official Gazette, specify in this behalf, of the value of the fixed assets of the Board in service at the beginning of such year.
Explanation.
For the purposes of this sub section, "value of the fixed assets of the Board in service at the beginning of the year" means the original cost of such fixed assets as reduced by the aggregate of the cumulative depreciation in respect of such assets calculated in accordance with the provisions of this Act and consumers ' contribution for service lines.
(2) In specifying any higher percentage under sub section (1), the State Government shall have due regard to 660 the availability of amounts accrued by way of depreciation and the liability for loan amortization and leave (a) a reasonable sum to contribute towards the cost of capital works; and (b) where in respect of the Board, a notification has been issued under sub section (1) of Section 12 A, a reasonable sum by way of return on the capital provided by the State Government under sub section (3) of that section and the amount of the loans (if any) converted by the State Government into capital under sub section (1) of Section 66 A." xxx xxx xxx "61.
Annual financial statement.
(1) In February of each year the Board shall submit to the State Government a statement in the prescribed form of the estimated capital and revenue receipts and expenditure for the ensuing year.
(2) The said statement shall include a statement of the salaries of members and officers and other employees of the Board and of such other particulars as may be prescribed.
(3) The State Government shall as soon as may be after the receipt of the said statement cause it to be laid on the table of the House, or as the case may be, Houses of the State Legislature; and the said statement shall be open to discussion therein, but shall not be subject to vote.
(4) The Board shall take into consideration any comments made on the said statement in the State Legislature.
(5) The Board may at any time during the year in respect of which a statement under sub section (1) has been submitted, submit, to the State Government a supplementary statement, and all the provisions of this section shall apply to such statement as they apply to the statement under the said sub section.
" xxx xxx xxx 661 "63.
Subventions to the Board.
The State Government may, with the approval of the State Legislature, from time to time make subventions to the Board for the purposes of this Act on such terms and conditions as the State Government may determine." XXX XXX XXX "65.
Power of Board to borrow. (1) The Board may, from time to time, with the previous sanction of the State Government and subject to the provisions of this Act and to such conditions, as may be prescribed in this behalf, borrow any sum required for the purposes of this Act.
(2) Rules made by the State Government for the purposes of this section may empower the Board to borrow by the issue of debentures or bonds or otherwise and to make arrangements with bankers, and may apply to the Board with such modifications as may be necessary to be consistent with this Act, the provisions of the (9 of 1914), and the rules made thereunder as if the Board were a local authority.
(3) The maximum amount which the Board may at any time have on loan under sub section (1) shall be ten crores of rupees, unless the State Government, with the approval of the State Legislative Assembly, fixes a higher, maximum amount.
(4) Debentures or bonds issued by the Board under this section shall be issued, transferred, dealt with and redeemed in such manner as may be prescribed." XXX XX XXX "67.
Priority of liabilities of the Board.
The Board shall distribute the surplus referred to in sub section (1) of section 59 to the extent available in a particular year in the following order, namely: (i) repayment of principal of any loan raised (including redemption of debentures or bonds issued) under Section 65 which becomes due for payment in the 662 year or which became due for payment in any previous year and has remained unpaid; (ii) repayment of principal of any loan advanced to the Board by the State Government under Section 64 which becomes due for payment in the year or which became due for payment in any previous year and has remained unpaid; (iii) payment for purposes specified in sub section (2) of Section 59 in such manner as the Board may decide.
67 A. Interest on loans advanced by State Government to be paid only after other expenses.
Any interest which is payable on loans advanced under Section 64 or deemed to have been advanced under Section 60 to the Board by the State Government and which is charged to revenues in any year may be paid only out of the balance of the revenues, if any, of that year which is left after meeting all the other expenses referred to in sub section (1) of Section 59 and so much of such interest as is not paid in any year by reason of the provisions of this section shall be deemed to be deferred liability and shall be discharged it, accordance with the provisions of this section in the subsequent year or year, as the case may be.
Charging of depreciation by Board (1) The Board shall provide each year for depreciation such sum calculated in accordance with such principles as the Central Government may, after consultation with the Authority, by notification in the Official Gazette, lay down from time to time.
(2) Omitted (3) The provisions of this section shall apply to the charging of depreciation for the year in which the Electricity (Supply) Amendment Act, 1978, comes into force." XXX XXX XXX "68 A. Directions by the State Government. (1) In 663 the discharge of its functions, the Board shall be guided by such directions on questions of policy as may be given to it by the State Government.
(2) If any dispute arises between the Board and the State Government as to whether a question is or is not a question of policy, it shall be referred to the Authority whose decision thereon shall be final. ' ' We shall first consider the common arguments advanced by the learned counsel for the appellants in all these matters before taking up some additional arguments advanced in some of these matters.
The first argument is that the requirement of consultation with the State Electricity Consultative Council before the revision of tariffs in accordance with Section 16 of the , not having been made, the upward revision of tariffs is invalid on account of non compliance of Section 16 of the Supply Act.
It was urged that revision of tariffs being a major question of policy as envisaged by clause (i) of Sub section (5) of Section 16, it is one of the functions of the Consultative Council to advise the Board on this question and without such advice of the Consultative Council, the revision in tariffs could not be made.
It was argued that the consumers ' interest is also represented on the Consultative Council as indicated by Sub section (2) of Section 16 providing for its constitution, and therefore, it was necessary to know the viewpoint of the consumers through their representative in the Consultative Council before deciding upon an upward revision of the tariffs for H.T. consumers.
Though the Board may not be bound by the advice of the Consultative Council, yet it was urged, such consultation with the Council was a condition precedent.
It was suggested that Section 16 must be read with Section 61 of the Supply Act which requires the Board to submit to the State Government the annual financial statement in February each year.
It is unnecessary in the present case to decide whether the revision of tariffs falls within the ambit of `major questions of policy ' occurring in Section 16(5)(i) of the Supply Act since the arguments from both sides proceeded on the basis that revision of tariffs for the purpose of this case may be treated as a `question of policy ' which expression finds place also in Section 78 A of the Supply Act.
The question, therefore, reduces itself to this: Whether the failure of the Board to place the matter before and seek the advice of the Consultative Council on this question renders the revision of tariffs made by it 664 invalid? The common premise for the purpose of this case that revision of tariffs by the Board is a question of policy may indicate that it would be open to the Consultative Council to advise the Board also on the question of revision of tariffs, and if such advice is given, then the Board must consider the same before taking the final decision.
That, however, does not necessarily mean that where no such advice was taken from the Consultative Council or was rendered on account of the absence of any meeting of the Consultative Council during the relevant period, it would necessarily render invalid the revision of tariffs made by the Board.
The consequence of non compliance of Section 16 is not provided and the nature of function of the Consultative Council and the force of its advice being at the best only persuasive.
it cannot be said that revision of tariffs without seeking the advice of the Consultative Council renders the revision of tariffs invalid.
It is also significant that the annual financial statement containing all particulars relating to revision of tariffs is required to be submitted to the State Government in February each year and the State Government is required after receipt of such statement to cause it to be laid on the table of the House or Houses of the State Legislature and the said statement is open to discussion therein.
The Board is bound to take into consideration any comments made on the said statement in the State Legislature.
Thus, there is ample provision for discussion on the revised tariffs in the State Legislature with the Board being bound to take into consideration any comments made thereon.
Shri Shanti Bhushan sought to make a distinction between the provisions of sub section (5) of section 16 pertaining to the functions of the `Consultative Council ' empowering or enabling the Council to advice the Board on `major questions of policy ' and the provision in sub section (6) as to the obligation of the Board to place certain matters before the `Council ' to emphasise his point that sub section (6) does not envisage any obligation on the part of the `Board ' to place before the Council the proposal for revision of tariffs.
He sought to distinguish between the functions of the `Council ' to tender advice and the obligation of the Board to specifically seek and invite such advice.
Shri Shanti Bhushan said that the very concept of consultation does imply mandatory obligation or duty attaching the pain of nullity to the transaction.
Provisions of the Electricity Act 1947 in England contain certain express statutory stipulations as to the scope of the Consultative Council 's functions which do not, in terms, obtain in the Indian statute.
For instance, Section 7 of the English Act which contemplates 665 the establishment of `Consultative Council ' specifically provides in Section 7(4) : ``(4) Each of the said Councils shall be charged with the duties (a) of considering any matter affecting the distribution of electricity in the area, including the variation of tariffs and the provision of new or improved services and facilities within the area, . . . (b) xxx xxx xxx (c) of considering any matter affecting the variation of any tariff regulating the charges for the provision of bulk supplies of electricity by the Generating Board for distribution in the area, being a matter which is either the subject of a representation made to them by consumers or other persons requiring supplies of electricity in the area, or which appears to them to be a matter to which consideration ought to be given apart from any such representation, and, where after consultation with the Area Board action appears to them to be requisite as to any such matter, of notifying their conclusions to the Generating Board; (d) xxx xxx xxx (rest of the Section omitted as unnecessary) Section 37(1) of the English statute again provides: ``37 Fixing and variation tariffs (1) The prices to be charged by the Generating Board for the supply of electricity by them to Area Boards shall be in accordance with such tariffs as may be fixed from time to time by the Generating Board after consultation with the Electricity Council; the different tariffs may be fixed for different Area Boards. ' ' (rest of the Section omitted as unnecessary) The pattern of the provisions in the Indian statute is quite different.
666 The `laying procedure ' before the legislature effectively controls the exercise of the delegated power of the Board.
We are of the opinion that though advisable yet failure to seek advice of the Consultative Council before revision of the tariffs does not result in invalidation of the revised tariffs.
This consequence appears to us to be the logical and reasonable view to take of the requirement of Section 16 along with other provisions of the Supply Act.
One of the arguments addressed at length before us relates to Section 78 A of the Supply Act.
It was urged on behalf of the appellant that any direction of the State Government relating to tariffs was on a question of policy within the meaning of Sub section (1), and, therefore, the Board is bound by such direction subject only to the adjudication, if any, in accordance with Sub section (2), if any dispute is raised by the Board in that behalf.
It was urged that in the present case the Board was, therefore, bound by the directions of the State Government granting the concession to the power intensive consumers since no dispute was raised by the Board in accordance with Sub section (2), of Section 78 A. Learned counsel for the Board did not for the purpose of this case, dispute this position, but contended that all directions of the State Government were obeyed by the Board and, therefore, the question does not really arise.
The Board 's contention is that it has acted according to the directions of the State Government and, therefore, the question of non compliance with any such directions giving rise to the argument based on Section 78 A does not arise.
For consideration of the main controversy, it is advisable at this stage to deal with Sections 49 and 59 of the Supply Act.
Section 49 makes provision for the sale of electricity by the Board to persons other than licensees.
Sub section (1) starts with the words `Subject to the provisions of this Act and of regulations, if any, made in this behalf '.
This means that the provision made therein is subject to other provisions of the Supply Act and the regulations.
It then proceeds to say that the Board may supply electricity to any person not being a licensee upon `such terms and conditions as the Board thinks fit ' and may for the purposes of such supply supply frame `uniform tariffs '.
Sub section (2) then enumerates several factors which the Board is required to `have regard to ' in fixing the uniform tariffs.
The meaning of the expression `have regard to ' is well settled.
It means that the factors specifically enumerated shall be taken into account while performing the exercise which in this case is the fixation of uniform tariffs.
Ordinarily, therefore, uniform tariffs are required to be framed by the Board for making such supply.
Sub section (3) then proceeds to 667 say that nothing in the earlier enacted provisions shall derogate from the power of the Board, `if it considers it necessary or expedient to fix different tariffs for the supply of electricity to any person ', having regard to the geographical position of any area, the nature of the supply and purpose for which supply is required and `any other relevant factors '.
Sub section (4) then says that in fixing the tariffs and terms and conditions for the supply of electricity, `the Board shall not show undue preference to any person '.
In other words, Sub section (4) provides against any unreasonable discrimination in fixing the tariffs and terms and conditions for supply of electricity.
The power of fixation of tariffs in the Board is provided in this manner by Section 49 of the Supply Act which requires the fixation of uniform tariffs ordinarily having regard particularly to the specified factors and enables fixation of such tariffs for any person having regard to the factors expressly stated and any other relevant factors, providing further that no unreasonable or undue preference shall be shown to any person by the Board in exercise of its powers of fixing the tariffs.
The next important provision is Section 59 of the Supply Act.
For appreciating the argument based on Section 59, it is necessary to bear in mind the distinction in Section 59 as it stood prior to 1978, as amended by Act No. 23 of 1978 and finally as amended by Act No. 16 of 1983, quoted earlier.
Prior to 1978, Section 59 required the Board, as far as practicable and after taking credit for any subventions from the State Government under Section 63, not to carry on its operations under this ACt at a loss and for this purpose, it was empowered to adjust its charges accordingly from time to time.
Under the provision as it then existed, the main thrust was to avoid the Board incurring any loss and for that purpose, it could adjust its charges accordingly from time to time.
Section 59 as amended by Act No. 23 of 1978 required the Board, after taking credit for any subventions from the State Government under Section 63, to carry on its operations under this Act and to adjust its tariffs so as to ensure that the total revenues in any year meeting all expenses properly chargeable to revenue including those specified, left such surplus as the State Government specified from time to time.
The shift was, therefore, towards having a surplus as the State Government specified from time to time.
Sub section (2) then provided guidelines for the State Government in specifying the surplus under Sub section (1) and mentioned the factors to which regard was to be had for this purpose.
The effect of the amendment made in Section 59 by Act No. 16 of 1983, which came into effect from 1.4.1985, was to provide for a 668 minimum surplus of three per cent or such higher percentage as the State Government is to specify in this behalf.
In other words, prior to 1978 amendment, the requirement from the Board was to avoid incurring any loss, after the 1978 amendment the shift was towards ensuring a surplus as specified by the State Government, and after the 1983 amendment the Board is required to ensure a surplus of at least three per cent unless the State Government specifies a higher surplus.
This is the scheme of Section 59 and it is Section 59 as amended by 1978 Act but prior to its amendment by the 1983 Act, with which we are concerned in the present case.
It cannot be doubted that Section 59 requiring the Board to adjust its tariffs for the purpose of Board 's finance is to be read along with Section 49 which provides specifically for fixation of tariffs and the manner in which that exercise has to be performed while dealing with any question relating to the revision of tariffs.
It was argued on behalf of the appellants that Section 59 as amended by the 1978 Act did not empower the Board to adjust its tariffs to generate any surplus unless the surplus had been specified by the State Government and when specified, the surplus generated could not exceed the specified surplus.
In other words, it was argued that when the State Government did not specify any surplus, the Board had no power to adjust its tariffs in a manner which resulted in generating any surplus.
We are unable to construe Section 59 in this manner.
The general principle for the Board 's finance indicated by Section 59 is that prior to the 1978 amendment, tariffs could be adjusted to avoid any loss, but as a result of the shift made by the 1978 amendment, the power could be exercised to generate a surplus and when the State Government specified the amount of surplus then the Board was bound to adjust the tariffs to ensure generation of the specified surplus.
However, generation of a reasonable surplus in any year of account without specification of the surplus amount by the State Government was not contra indicated in the provision inasmuch as the duty to generate a surplus was implicit with the added obligation to ensure generating surplus to the extent specified by the State Government when it was so specified by the State Government.
It cannot be accepted as a reasonable view that in the absence of specification of the surplus by the State Government, the Board could not adjust its tariffs to generate even a reasonable surplus in any year of account.
The effect of 1983 amendment, which came into force from 1.4.1985, is that the Board is entitled to adjust its tariffs to ensure generating a surplus of not less than three per cent even without such specification 669 by the State Government and when the State Government specifies a higher surplus, then the Board must ensure generating the higher specified surplus.
This is, of course, subject to the accepted norm of the Board acting in consonance with its public utility character and not entirely with a profit motive like that of a private trader.
The pre 1978 concept of the Board 's functioning to merely avoid any loss is replaced by the shift after 1978 amendment towards the positive approach of requiring a surplus to be generated, the quantum of surplus being specified by the State Government, with a minimum of three per cent surplus in the absence of the specification by the Government of a higher surplus, after the 1983 amendment.
This construction made of Section 59, as it stood at different times in Govinda Prabhu 's case (supra) indicated earlier, cannot be faulted in any manner.
In Govinda Prabhu 's case (supra) the same argument which is advanced before us was expressly rejected.
We are of the same view.
It is , therefore, obvious that mere generation of surplus by the Board as a result of adjusting its tariffs when the quantum of surplus has not been specified by the State Government after the 1978 amendment of Section 59 of the Supply Act, cannot invite any criticism unless it is further shown that the surplus generated as a result of the adjustment of tariffs by the Board has resulted in the Board acting as a private trader shedding off its public utility character.
In other words, if the profit is made not merely for the sake of profit, but for the purpose of better discharge of its obligations by the Board, it cannot be said that the public enterprise has acted beyond it authority.
The Board in the present case has shown that the surplus resulting from upward revision of tariffs applicable to the H.T. consumers made in the present case, was for the purpose of better discharge of its other obligations under the Supply Act and in effect, it has merely resulted in a gradual withdrawal of the concessional tariffs provided earlier to the power intensive consumers which do not in its opinion require continuance of the concessional tariffs any longer.
In fact, no material has been placed before us to indicate that this assertion of the Board is incorrect or there is any reasonable basis to hold that the upward revision of tariffs applicable to H.T. consumers is merely with a desire to earn more profits like a private trader and not to generate surplus for utilisation of the funds to discharge other obligations of the Board towards more needy consumers, such as agriculturists or to meet the need of expansion of the supply to deserving areas.
The argument with reference to statistics that the upward revision of tariffs for the H.T. consumers results in earning amounts in excess of the cost of generation does not, therefore, merit a more detailed consideration.
670 It was also contended on behalf of the appellants that the generation of electricity by the Andhra Pradesh Electricity Board is both thermal as well as hydro, the quantity from each source being nearly equal and the entire electricity generated is fed into a common grid, from which is supplied to all categories of consumers.
On this basis, it was argued that the rise in the fuel cost which led to the fuel cost adjustment applicable only to the H.T. consumers was unreasonable and discriminatory since the burden of rise in fuel cost was placed only on the H.T. consumers.
In our opinion, this argument has no merit.
The H.T. consumers, including the power intensive consumers, are known power guzzlers and in power intensive industries, electricity is really a raw material.
This category of consumers, therefore, forms a distinct class separate from other consumers like L.T. consumers who are much smaller consumers.
There is also a rational nexus of this classification with the object sought to be achieved.
Moreover, the power intensive consumers have been enjoying the benefit of a concessional tariff for quite some time, which too is a relevant factor to justify this classification.
Placing the burden of fuel cost adjustment on these power guzzlers, who had the benefit of concessional tariff for quite some time and have also a better capacity to pay, cannot, therefore, be faulted since the consumption in the power intensive industries accounts for a large quantity.
Shri Sibal submitted that the prescription and imposition of disparate tariffs, unrelated to the production cost, on a particular section of consumers would be a case of misplaced philanthrophy on the part of the statutory authority.
The Board, Shri Sibal says, cannot use its powers in order to confer "social or economic benefits on particular sections of the community" at the cost of the other sections.
Shri Sibal contended that while it may be permissible for the Board to supply electricity to the weaker and under privileged sections of the society at prices which may even be lower than the costs of generation and distribution, however subsidies for such social objectives must come from subventions from Government and should not be made good by unjustifiable higher charges on other sections of electricity consumers.
Shri Sibal read to us the following passage in Wade 's Administrative Law (6th Edn.): "Statutory authorities have sometimes made use of their wide general powers in order to confer social or economic benefits on particular sections of the community.
In several such cases they have gone beyond the true limits of their powers.
The policy of the courts is in general hostile to the 671 use of public funds, such as rates, for new social experiments.
Local authorities are subject to a fiduciary duty to use their revenues with due restraint.
" (at p. 424) After referring to decided cases on the point, the learned author says: ".
The idea that runs through these cases is that public money must be administered with responsibility and without extravagance.
This appears to mean it is not available for charity.
The generosity of local authorities, in particular, is restrained by the doctrine that they owe a fiduciary duty to their ratepayers analogous to that of trustees.
This means that, in deciding upon their expenditure, they must hold a balance fairly between the recipients of the benefit and the ratepayers who have to bear the cost." (at p.426) Shri Sibal contends that in the case of class of consumers respecting which the tariff is enhanced, the enhancement is not justified on the ground of making good the loss on supply to others at cheaper rates.
The increase is attributable to higher costs of generation of thermal power.
It is not unreasonable to take the view that the thermal power has become costlier on account of the increase in fuel cost and could nationally be allocated to the consumption by H.T. and power intensive consumers, and, therefore, the fuel cost adjustment is made applicable to them alone.
In our opinion, the argument on behalf of the Board in this behalf is not unreasonable.
It was argued on behalf of the appellants with considerable force that the upward hike of tariff for the H.T. consumers including power intensive was arbitrary and discriminatory inasmuch as it was not related to the cost of generation and was based on irrelevant factors.
It was argued that the L.T. tariffs and agricultural tariffs were relieved of this burden and the liabilities of the Board even of a capital nature were taken into account for increasing the tariff applicable to power intensive units.
The contention is that these factors are irrelevant and do not permit exercise of the power to increase the tariffs.
This arguments was considered at length in Govinda Prabhu 's case before it was 672 negatived.
We agree with the reasons given in that decision to repel this contention.
In Govinda Prabhu, it was pointed out that the Court would not strike down the revision of tariff as arbitrary unless the resulting surplus reaches such a height as to lead to the inevitable decision that the Board has shed its public utility character and is obsessed by the profit motive of private entrepreneur in order to generate a surplus which is extravagant.
The limited power of judicial review in the field of price fixation was also indicated.
This limited scope of judicial review in striking down revision of tariffs resulting in generation of surplus applied in Govinda Prabhu cannot be faulted in view of the long line of decisions of this Court on the point and reiteration of the same principle by a Constitution Bench in Shri Sitaram Sugar Company Limited and Another.
vs Union of India and Others, ; The surplus generated by the Board as a result of revision of tariffs during the relevant period cannot be called extravagant by any standard to render it arbitrary permitting the striking down of the revision of tariffs on the ground of arbitrariness.
We have already indicated that it is not also discriminatory as was the view taken in Govinda Prabhu.
It has been pointed out on behalf of the Board that the Board 's action is based on the opinion of Rajadhyaksha Committee 's Report submitted in 1980 and the formula of fuel cost adjustment is on a scientific basis linked to the increase in the fuel cost.
This is a possible view to take and, therefore, the revision of tariffs by the Board does not fall within the available scope of judicial review.
One of the contentions of Shri G. Ramaswamy, on behalf of the appellant was that the G.Os. issued in respect of the power intensive units amounted to a special tariff for them resulting in their exclusion from the category of H.T. consumers and, therefore, the clause relating to fuel cost adjustment inserted by amendment to the H.T. tariffs did not apply to the power intensive consumers without insertion of a similar clause in the special tariff applicable to them.
It was urged that for this reason the power intensive consumers could not be governed by the clause of fuel cost adjustment made applicable to H.T. tariffs.
Shri Ramaswamy advanced elaborate arguments to distinguish "terms and conditions of supply" from "terms and conditions of tariff".
According to the learned counsel, B.P. Ms. No. 778 dated 18.10.1975 excluded the power intensive units from applicability of the Notification date 17.9.1975 to it.
It is unnecessary to repeat the history of the H.T. tariffs by which power intensive tariffs were separated.
It would be sufficient in this context to quote the relevant portion of Memo.
dated 18.11.1975 which, in our opinion, negatives this argument.
It was provided in this Memo.
, inter alia as under: 673 "With regard to other charges, such as Miscellaneous charges, terms and conditions of supply, not mentioned specifically herein, those applicable to normal H.T. consumers will apply".
The expression "other charges" is wide enough to include within its ambit the fuel cost adjustment admittedly made applicable to all H. T.consumers as a result of the escalation in fuel prices.
The method adopted was to prescribe a formula linking it to the increase in fuel cost so that it was not necessary to revise the tariffs each time as a result of increase in fuel prices, the same being taken care of by the relevant factors in the formula for fuel cost adjustment.
It was in this context that Shri Ramaswamy contended that the `terms and conditions of supply ' are different from the `terms and conditions of tariff ' and fuel cost adjustment being a term or condition of tariff and not a term or condition of supply, the above provision in the Memo dated 18.11.1975 did not have the effect of applying the term relating to fuel cost adjustment to the power intensive tariff.
It is sufficient to state that the Memo dated 18.11.1975 did not merely extend the non specified `terms and conditions of supply ' applicable to normal H.T. consumers to the power intensive consumers but also "other charges" which were merely illustrated by the words following, namely, "such as Misc.
charges, terms and conditions of supply not mentioned herein".
In other words, this express provision in the Memo, dated 18.11.1975 clearly provided that except for the provisions specifically made for power intensive consumers, in respect of all other provisions the power intensive consumers were to be governed by the provisions, by whatever name called, applicable to the normal H.T. consumers.
A further discussion of this distinction sought to be made by Shri G. Ramaswamy of the `terms and conditions of supply ' and `terms and conditions of tariff ' is, therefore, unnecessary.
Shri Ramaswamy also urged that there was no communication to the appellant of the applicability of the term relating to fuel cost adjustment during the relevant period which also relieves the power intensive consumers of this liability.
On the view we have already taken about the applicability of the term relating to fuel cost adjustment to the power intensive tariffs this point is not material.
However, it has also been shown that in the bills issued to the power intensive consumers the same was specifically indicated.
If any communication was needed, this indication in the bills issued to the power intensive consumers satisfied that requirement.
We are, therefore, unable to accept the contention that the term relating to fuel cost adjustment made applicable to H.T. consumers 674 had no application to the power intensive consumers during the relevant period.
Shri Kapil Sibal appearing on behalf of some of the appellants confined the challenge to the mode of exercise of power by the Board.
He laid great emphasis on the effect of absence of consultation with the Consultative Committee under Section 16 of the .
He also claimed that the quantum of increase could at best be justified only to the extent of one half and no more.
Shri Sibal claimed that certain extraneous factors had been taken into account for the purpose of revising the tariffs.
The irrelevant considerations, according to Shri Sibal, taken into account are the capital sums owed by the Board and the overall losses incurred by the Board which according to him is impermissible under Section 59 of the .
He also argued that the upward revision of H.T. tariffs is intended to subsidise another class of consumers which is not permissible.
His arguments are already covered by our earlier discussion.
Similarly, the arguments of Shri K.N. Bhat, for the appellant in C.A. No. 5379 of 1985 to the same effect, need to further discussion.
The details of the several factors taken into account for the revision in tariffs, to the limited extent they can be gone into within the permissible scope of judicial review in such a matter also do not require any further consideration.
Shri Anil Divan, on behalf of the appellant in C.A No. 2569 of 1985, submitted that the increase in tariffs for the power intensive unit in his case was 47 per cent as against 15 per cent for ordinary H.T. consumers.
According to him, even ignoring the FCA, the increase is 40 per cent from 32 paise to 45 paise.
This is disputed on behalf of the Board.
In our opinion, it is unnecessary to go into this question any further for the reasons already given by us.
Shri Divan also contended that the Electricity Board 's stand has been conflicting at different stages.
In our opinion, any detailed decision on this aspect also is unnecessary on the view taken by us about the Board 's power to revise tariffs, no case for striking down the same as arbitrary and discriminatory having been made out.
In view of the earlier decision of this Court in Govinda Prabhu, with the conclusion as well as reasoning of which we respectfully concur and reiteration of the Court 's limited power of judicial review in Shri Sitaram Sugar Company Limited recently decided by a Constitution Bench, we do not find any reason to accept any of the arguments advanced on behalf of the appellants by their learned counsel.
In fact, the decision in Govinda Prabhu con 675 cludes the controversy against the appellants and some detailed discussion by us has become necessary only on account of an attempt on behalf of the appellants to distinguish the decision and the emphasis placed on the requirements of Sections 16, 49 and 59 of the .
We find no merit in these appeals/special leave petition and the same are dismissed.
All interim orders in favour of the appellants/petitioner stand vacated.
No costs.
R.P. Appeals dismissed.
| The partners of the assays firm were members of a HUF, which was carrying on business with borrowed capital.
Consequent on partial partition in the family and partition of the family business, the members formed the assays firm.
There was a debit balance in the capital account of the family which was transferred to the personal accounts of the partners of the firm.
The firm, which continued the family business and took over the business assets and the liabilities of the HUF, claimed that the interest paid on the debit balance was an allowable deduction in the computation of income since it had taken over the debit balance in consideration of the goodwill of the business.
The Appellate Assistant Commissioner held that the HUF business had no goodwill.
On appeal, the Tribunal held that the HUF had a very long standing and flourishing business, and hence the firm could be deemed to have taken over the liability in consideration of the sale of goodwill and the interest paid thereon was an allowable deduction.
On a reference made by the Tribunal the High Court held that the goodwill of the HUF business was never sold or purchased, and that the partners of the firm were bound to take over the HUF 's liability, since it was that of the family of which they were members, and became liable to discharge their share of the debt.
Allowing the appeals preferred by the assessee, this Court HELD: 1.1 Clause (iii) of Section 36(1) of the Income Tax Act, 1922 applies only where capital has been borrowed for the purposes of the business or profession.
The amount of interest paid on the borrowed capital is an allowable deduction.
It cannot be disputed that if the goodwill is purchased out of the borrowed capital, the interest paid on the borrowed capital is an allowable deduction.
[923B] 921 1.2 In the instant case, there was only a partial partition in the family, particularly with regard to HUF business and it was not necessary for the firm to have taken over the debit balance of the HUF, since the HUF had other properties.
[923D] 1.3 The Tribunal has correlated the debit balance to the purchase of goodwill since the firm had taken over the business.
The High Court has held that there was no sale of goodwill by the HUF to the firm in view of the absence of related entries in the books of account of HUF.
The conclusion of the High Court is as much an inference as that the Tribunal on the same set of facts and circumstances.
The Tribunal was right in holding that the firm had taken over the debit balance in consideration of the sale of the goodwill and this conclusion is neither unreasonable or unwarranted, nor arbitrary or unjust.
The High Court ought not to interfere with such conclusion even if another view is possible.
Besides, the relevant point to be considered is the rights of the assessee and not the liability of the individual members of the HUF.
The claim of the assessee for allowable deduction of the interest paid cannot be defeated by the existence of personal liability of the members of HUF.
[923C, E, F]
|
Civil Appeal No. 2147 of 1980.
Appeal by Special leave from the Judgment and order dated the 19th August, 198(), of the Allahabad High Court in C.M.W.P. No. 7578 of 1979.
Pramod Swarup for the Appellant.
M.K. Garg and V.K. Jain for the Respondent.
The Judgment of the Court was delivered by RAANGANATH MISRA, J.
The tenant of one room which is a part of a premises located within the township of Aligrah in the State of Uttar Pradesh is in appeal before this Court after obtaining special leave under Article 136 of the Constitution.
The respondent 218 landlord asked for his eviction on the ground of the tenant having created a sub tenancy of the premises sometime in October, 1976, in favour of M/s. Pavan Trading Company, a soap manufacturing concern.
The tenant denied the allegation of sub letting.
The main issue raised in the proceeding was whether the tenant had sub let the accommodation as alleged by the landlord.
The SCC Judge started dealing with this issue by saying: "Under Sections 12, I S and 20 of the Act if tenant has allotted a non family member to occupy the accommodation, he should be deemed to have sub let the accommodation.
If it is found that Pavan Trading Co. Or if any of his partner is carrying on business in the accommodation, the tenant in fact shall be deemed to leave sub let.
the accommodation.
In Delhi Rent Control Journal 1971 page 492 (Abdul Aziz vs Yakub Khan) it was held by the Court t hat if any person other than a tenant is found sitting in the shop, the tenant has to lead evidence to show that a sitting person is not the sub tenant.
Thus the burden is on the defendant to explain the circumstances under which partner of the Pavan Trading Co. is sitting in the accommodation.
21/C I a photograph has been proved.
Even the defendant has admitted this photograph during his cross examination; the person standing in the shop has been identified by the parties to be the son of the proprietor of Pavan Trading Co. " .
He looked for evidence from the tenant against sub letting by assuming from the presence of the son of the proprietor of Pavan Trading Company that there was a sub tenancy; held against the tenant and directed his eviction from the premises.
The Additional District Judge before whom the tenant 's revision petition came for disposal took note of the erroneous approach of the trial court and came to hold: "In the present case, it has not at all been admitted by the defendant that Pavan Trading Company or any member of the said company has been carrying on business in the shop alongwith him or by himself.
The mere presence of a member of Pavan Trading Company in the shop at a certain time will not be sufficient to say all that the business is being carried on by Pavan Trading Company in the shop.
In these circumstances, it was for the plaintiff to lead good and positive evidence to prove that the business in fact at that shop 219 was being carried on by the Pavan Trading Company and not A by the defendant himself." He looked into the evidence and came to hold: "The evidence of the plaintiff was not at all sufficient to shift the burden of proof to the defendant and on consideration of the evidence of the plaintiff it is not at all possible to say that the plaintiff has been able to prove the fact of Pavan Trading Company carrying on the business at the shop which may amount to sub letting of the shop by the defendant." .
The appellate authority, therefore, allowed the revision and reversed the order of eviction and directed dismissal of the petition of the landlord.
The landlord filed an application under Article 227 of the Constitution.
Referring to the contention of the landlord, the High Court observed: "Learned counsel for the petitioner submitted that the learned Additional District Judge clearly misconceived his jurisdiction under Section 25 of the Provincial Small Cause Court Act.
It is urged that it was not permissible for the learned Judge to, re appraise the evidence on record on the issue purely on fact.
The learned counsel contended that whether it was defendant 'who was doing business in the shop in dispute of M/s. Pavan Trading Company is undoubtedly a pure issue of fact, the findings on which could not be disturb ed in revision under Section 25 of the Provincial Small Cause Court Act", and held: "The Simple question for determination before both the courts below was whether defendant had sub let the shop in dispute to M/s. Pavan Trading Company.
This question depended on the facts of the present case wholly on the answer to the question whether it was the defendant or the proprietor of the said company who was doing business in the disputed shop.
This question was determined by the trial court on the basis of direct oral and documentary evidence adduced by the plaintiff to the effect that in point of fact it was the proprietor of M/s. Pavan Trading Company who was doing business in the shop in question instead of the defen 220 dant.
This finding is not based on any notion of burden of proof.
It was a pure and simple finding arrived at on the analysis of the evidence on record without reference to the question of burden of proof.
On the answer to this question depends entirely the fate of the case in as much as under Section 25 of the U.P. Act No. XIII of 1972 read with Section 12(1)(b) and Section 12(2) of the aforesaid Act, a tenant would be deemed to have sub let the accommodation, if he has allowed it to be occupied by any person who is not a member of his family.
Whether the tenant has allowed the shop to be occupied by someone not a member of his family is indisputably a pure question of fact.
That being so, the learned District Judge exceeded his jurisdiction under Section 25 of the Provincial Small Cause Court Act in setting aside the finding of the trial court on a mere re appraisal of the evidence or record.
The finding of the trial court was not vitiated by any error of law.
The impugned order is thus ex facie illegal." Having heard counsel for the parties we are of the view that the High Court was clearly wrong in reversing the decision of the Additional District Judge.
The application for eviction was based on the allegation of sub tenancy.
The allegation that the premisses had been sub let to Pavan Trading Company had to be proved as a fact by the landlord and merely on the basis of photograph showing the presence of the son.
Of the proprietor of Pavan Trading Company within the room, sub letting could not be presumed.
We must indicate that the approach of the trial Judge was to tally vitiated.
Merely from the presence of a person other than the tenant in the shop sub letting cannot be presumed.
There may.
be several situations in which a person other than the tenant may be found sitting in the shop for instance, he may be a customer waiting to be attendant a distributor who may have come to deliver his goods at the shop for sale; a creditor coming for collection of the dues; a friend visiting for some social purpose or the like.
As long as control over the premises is kept by the tenant and the business run in the premises is of the tenant, sub letting flowing from the presence of a person other than the tenant in the shop cannot be assumed.
The Act does not require the Court to assume a sub tenancy merely from the fact of presence of an outsider.
Obviously the law has intended and we must assume that the rule in the Abdul 221 Aziz 's case (referred to by the trial court) proceed on the footing A that the person was sitting in the shop in exercise or his own right and not in a situation as indicated by us.
The trial court unwarrantedly drew the presumption and looked at the evidence of the tenant to find out whether the presumption had been rebutted.
There is no warrant in law for such a situation.
The Additional District Judge rightly took exception to this approach to the matter by the trial court and since the evidence of the plaintiff had not been scrutinised under the erroneous impression of the legal position, the same was looked into to find out whether the claim of the sub tenancy had been established.
This was nat an attempt to re assess.
evidence but to take into consideration the evidence which had not been looked into by the trial court.
The revisional jurisdiction under Section 25 of the Provincial Small Cause Court Act is not as wide as the appellate jurisdiction under Section 96 of the Code of Civil Procedure; yet in a case of this type we do not think fault could be found with the revisional court for pointing out the legal error committed by the trial court in its approach to this material aspect.
The legal position having been totally misconceived by the trial court and there being an assumption of the position which the landlord was required to prove by evidence, the revisional authority entitled to Point out the legal error and rectify the defect.
This is all that had been done by the Additional District Judge.
In the case of Syed Yakoob vs K.S. Radhakrishna & Ors., a Constitution Bench of this Court indicated the scope of interference in a certiorari proceeding by saying that a writ of certiorari is issued for correcting the errors of jurisdiction committed by the courts or tribunals in cases where they exceed their jurisdiction or fail to exercise it or exercise it illegally or improperly.
i.e. where an order is passed without hearing the party sought to be affected by it or where the procedure adopted is opposed to principles of natural justice.
A caution was indicated by saying that the jurisdiction to issue a writ of certiorari is a supervisory one and in exercising it, the court is not entitled to act as a court of appeal.
That necessarily means that the findings of fact arrived at by the inferior court or tribunal are binding.
An error of law apparent on the face of the record could be corrected by a writ of certiorari, but not an error of fact, however, grave it may appear to be.
The rule in Yakoob 's case when applied to the present facts would lead to the conclusion 222 that the High Court exceeded its jurisdiction in interfering with the order of the Additional District Judge.
We are, therefore, inclined to agree with the appellant 's contention that the High Court . wrongly interfered with the decision of the Additional District Judge that the landlord failed to establish sub tenancy.
The circumstances in which the son of the proprietor of Pavan Trading Company was in the shop have been clearly explained and we are inclined to agree that there is no material on the record to doubt the explanation placed by way of evidence in the proceeding.
The appeal is accordingly allowed and the order of the High Court is vacated and that of the Additional District judge is restored.
The net effect is the application for eviction of the appellant tenant is dismissed with costs throughout.
Hearing fee in this Court is assessed at Rs. 1,000.
H.S.K. Appeal allowed.
| The appellant and the respondents entered into a contract for the construction of Building Dock.
Clause 40 of the General Conditions of Contract entered into between the parties, provided that "all questions and disputes relating to the meaning of the Specifications Estimates Instructions, Designs, Drawing and the quality of the workmanship or materials used in the work or as to another questions, claim, right, matter or thing whatsoever in any way arising out of or relating to the contract or otherwise concerning the execution whether arising during the progress of the work or after completion shall be referred to the Sole Arbitrator etc," During the implementation of the works contract.
disputes arose between the parties in respect of a claim for compensation on account of the increase in the cost of imported pile driving equipment and technical know how fees.
Correspondence was exchanged between the Appellant and Respondent No. 1 and the dispute was referred to the Sole Arbitrator.
The point referred were: (1) Whether the claim of compensation for increase in the cost of imported pile driving equipment and technical know how fees would fall within the purview of the first para of clause 40 of the General Conditions of Contract; and (2) if it does, the quantum of compensation, if any, to which the appellant would be entitled to.
The arbitrator entered upon the reference and after hearing the parties gave his award.
The 119 arbitrator held that the appellant was entitled to compensation for the increase in the cost of imported pile drawing equipment and technical know how fees by a sum of Rs. 99 lakhs which amount shall be payable with interest @ 9.1/2% The award was typed on stamp paper of the value of Rs.150/ The arbitrator forwarded the award to both the parties.
The appellant moved a petition under sections 14 and 17 of the , in the Court of the Subordinate Judge for filing the award and for making it a rule of the Court, while the respondent moved a petition under sections 30 and 33 for setting aside the award contending that: (1) the award was insufficiently stamped, and (2) the arbitrator had exceeded his jurisdiction by misconstruing clause 40.
The Subordinate Judge negatived both the contentions.
It was held that the respondent having submitted the question whether the dispute raised by the appellant was covered by the arbitration clause; could not controvert the jurisdiction of the Arbitrator to decide the dispute; and the award of the arbitrator was modified in the matter of interest from 9.1/2 per cent as awarded by the arbitrator to 6 per cent, and the award was made a rule of the Court.
The respondent preferred an appeal to the High Court, and a Division Bench, agreed with the Subordinate Judge on the question of insufficiency of stamp.
It however held that the question whether the dispute was arbitrable or not could not be finally decided by the arbitrator because it was a matter relating to his jurisdiction, and that the arbitrator cannot by an erroneous interpretation or construction of the clause confer jurisdiction on himself and that the court can go into the question whether the matter in dispute between the parties was covered by the arbitration clause.
It finally held that even though the arbitration clause was very wide, the dispute as to compensation for increase in the cost of imported pile driving equipment and technical know how fees could not be covered by the arbitration clause because under clause 26 every plant, machinery and equipment had to be provided by the contractor and any rise or escalation in the price of such equipment or machinery, cannot be the subject matter of compensation by the respondent.
The appeal was therefore allowed, and the trial court 's order, making the award a rule of the court was set aside and directed that the award be returned to the parties.
In the appeal to this Court it was contended on behalf of the appellant, that though Sec. 16(1)(e) of the may permit the court to remit or set aside the award on the ground that there is an error of law apparent on the face of it, yet where a specific question of law has been referred to the arbitrator for decision, the fact that the decision is erroneous does not make the award bad on its face so as to permit its being set aside.
As a specific question of law touching upon the jurisdiction of the arbitrator was speficially referred to the arbitrator for his decision, the decision of the arbitrator is binding on the parties and the court cannot proceed to inquire whether upon a true construction of the arbitration clause, the dispute referred to the arbitrator for arbitration would be covered by the arbitration clause so as to clothe the arbitrator with the jurisdiction to arbitrate upon the dispute.
On behalf of the respondent, it was contended that the jurisdiction of the arbitrator cannot be left to the decision of the arbitrator so as to be binding on 120 the parties and it is always for the court to decide whether the arbitrator had jurisdiction to decide the dispute, and that the arbitrator cannot by a misconstruction of the arbitration agreement clothe himself with or confer upon himself the jurisdiction to decide the dispute.
Allowing the Appeal; ^ HELD: 1.
A specific question of law touching the jurisdiction of the arbitrator was specifically referred to the arbitrator and therefore the arbitrator 's decision is binding on the parties and the award cannot be set aside on the sole ground that there was an error of law apparent on the face of the award.
It is also established that the claim for compensation made by the contractor which led to the dispute was covered by the arbitration clause.
The quantum of compensation awarded by the arbitrator was never disputed nor questioned.
[170E F] 2.
A question of law may figure before an arbitrator in two ways.
It may arise as an incidental point while deciding the main dispute referred to the arbitrator or in a given case parties may refer a specific question of law to the arbitrator for his decision.
[137G H] Russel: Law of Arbitration Twentieth Edition p.22; Halsbury 's Laws of England Vol.
2 Para 623 4th Edition referred to.
Arbitration has been considered a civilised way of resolving disputes avoiding court proceedings.
There is no reason why the parties should be precluded from referring a specific question of law to an arbitrator for his decision and agree to be bound by the same.
This approach manifests faith of parties in the capacity of the tribunal of their choice to decide even a pure question of law.
If they do so, with eyes wide open, and there is nothing to preclude the parties from doing so, then there is no reason why the court should try to impose its view of law superseding the view of the Tribunal whose decision the parties agreed to abide by.
On Principle it appears distinctly clear that when a specific question of law is referred to an arbitrator for his decision including the one touching upon the jurisdiction of the arbitrator, the decision of the arbitrator would be binding on both the parties and it would not be open to any of the two parties to wriggle out of it by contending that the arbitrator cannot clutch at or confer jurisdiction upon himself by mis construing the arbitration agreement.[138 E G] 4.
If a question of law is specifically referred and it becomes evident that the parties desired to have a decision on the specific question from the arbitrator rather than one from the court, then the court will not interfere with the award of the arbitrator on the ground that there is an error or law apparent on the face of the award even if the view of law taken by the arbitrator does not accord with the view of the court.
[147F] Kelantan Government vs Duff Development Co. Ltd. Re King and Duveen, F.R. Absalom Ltd. vs Great Western (London) Garden Village Society Ltd., ; Durga Prasad Chamria 121 and Anr.
vs Sewkishen das Bhattar and Ors: AIR 1949 Privy Council 334; Seth Thawardas Pherumal vs The Union of India; ; M/s. Alopi Parshad & Sons Ltd. vs The Union of India, ; Champsey Bhara and Company vs Jivraj Balloo Spinning and Weaving Company Ltd .
: Law Report ; Union of India vs A.L. Rallia Ram.
, ; ; M/s.
Kapoor Nilokheri.
, Co op.
Dairy Farm Society Ltd. vs Union of India and Others.
, ; N. Chellappan vs Secretary, Kerala State Electricity Board & Anr., ; ; Produce Brokers Co. Ltd. vs Olympia Oil and Cake Co. Ltd., ; Attorney General For Manitoba vs Kelly and Others.
, (1922) H.E.R. 68; Hirji Muulji vs Cheong Yue Steamship Co. Ltd., ; Heyman & Anr.
vs Darwins Ltd., ; Jivarajbhai Ujamshi Sheth & Ors.
vs Chiniamanrao Balaji & Anr., [1954] 5 S.C.R. 480; Dr. S.B. Dutt vs University of Delhi.
, [1958] S.C.R. 1236; referred to.
The expression 'without prejudice ' carries a technical meaning depending upon the context in which it is used.
An action taken without prejudice to one 's right cannot necessarily mean that the entire action can be ignored by the party taking the same.
[148F G] In the instant case, in the context in which the expression 'without prejudice ' is used, it would only mean that the respondent reserved the right to contend before the arbitrator that the dispute is not covered by the arbitration clause.
It does not appear that what was a contention that no specific question was specifically referred to the arbitrator, On a proper reading of the correspondence, and in the setting in which the term 'without prejudice ' is used, it only means that the respondent reserved to itself the right to contend before the arbitrator that a dispute raised or the claim made by the contractor was not covered by the arbitration clause.
No other meaning can be assigned to it.
[148D E] 6.
In works contract of such magnitude, and which have been undertaken by an Indian contractor for the first time negotiations prior to the finalisation of the contact and the correspondence leading to the formation of contract supply the basis on which the contract was finally entered into.
Undoubtedly, if in the final written contract, there is something contrary to the basic understanding during the formative stage of the contract, the written contract would prevail.
But if the contract does not indicate to the contary and the assumptions appeared to be the foundation of the contract, that aspect cannot be overlooked while determining what were the obligations undertaken the formal contract.
[151H 152B] 7.
Over simplification of the clauses of the contract involving works of large magnitude is impermissible.
The whole gamut of discussions, negotiations and correspondence must be taken into consideration to arrive at a true meaning of what was agreed to between the parties.
[156F] In the instant case, there is no room for doubt that the parties agreed that the investment of the contractor under this head would be Rs. 2 crores and the tendered rates were predicated upon and co related to this understanding.[156G] 122 8.
When an agreement is predicated upon an agreed fact situation, if the latter ceases to exist the agreement to that extent becomes irrelevant of otiose.
[156G] 9.
Phrases such as 'claim arising out of contract ' or 'relating to the contract ' or 'concerning the contract ' on proper construction would mean that if while entertaining or rejecting the claim or the dispute in relation to claim may be entertained or rejected after reference to the contract, it is a claim arising out of contract.
The language of clause 40 shows that any claim arising out of the contract in relation to estimates made in the contract would be covered by the arbitration clause.
If it becomes necessary to have recourse to the contract to settle the dispute one way or the other then certainly it can be said that it is a dispute arising out of the contract.
[157F G] In the instant case, the arbitration clause is so widely worded as disputes arising out of the contract or in relation to the contract or execution of the works that it would comprehend, within its compass a claim for compensation related to estimates and arising out of the contract.
[157H] 10.
(i) A dispute, the determination of which turns on the true construction of the contract, would also seem to be a dispute under arising out of or concerning the contract.
The test is that if in settling a dispute, a reference to the contract is necessary, such a dispute would be covered by the arbitration clause.[158D E] A.M. Mair & Co. vs Gordhandas Sagarmull., [1950] S.C.R. 792; Ruby General Insurance Co. Ltd. vs Pearey Lal Kumar And Another; ; ; referred to.
Where the parties are at one in asserting that they entered into a binding contract, but a difference has arisen between them whether there has been a breach by one side or the other, or whether circumstances have arisen which have discharged one or both parties from further performance, such differences should be regarded as differences which have arisen 'in respect of ' or 'with regard to ' of 'under ' the contract, and an arbitration clause which uses these, or similar expressions should be contoured accordingly.
[159B C] Union of India vs Salween Timber Construction (India) & Ors.
, ; ; Heyman & Anr.
vs Darwins Ltd., at 366; Astro Vencedor Compania Naviora S.A. of Panama vs Mabanaft G.M.B.H.
The Diamianos.
, [1971] 2 Q.B. 588; Gunter Henck vs Andre & CIE. S.A., [1970] 1 Lloyd 's Law Reports 235; referred to In the instant case, from the pleadings, it clearly transpires that both the parties had recourse to the contract.
It is satisfactorily established that the claim made by the contractor would be covered by the arbitration clause.
[160B] 123
|
ION: Civil Appeal No. 140 of 1977.
From the Judgment and Decree dated 31.1.
1973 of the Madras High Court in L.P.A. No. 6 of 1965.
A.T.M. Sampat and P.N. Ramalingam for the Appellants.
Ms. Lily Thomas for the Respondents.
The facts leading to the institution of the suit are as follows: On 3 239 March 1942, one Karuppanna Pillai (hereinafter referred to as "testator") executed his last Will and testament Ext.
Thereunder he disposed of all his properties described in five schedules, A, B, C, D and E. He directed that the properties under A, B .and
C schedules shall be respectively taken and be in the possession of the defendant, the first plaintiff and the second plaintiff.
In respect of E schedule properties, he has made a bequest creating an endowment that after his life time, it should be managed for the purpose and in the manner mentioned therein.
The dispute in the suit was as to the validity of the endowment.
One Palaniammal and Chellammal are the sisters of the plaintiffs and the defend ant.
The testator created a life estate in favour of those sisters in respect of D schedule properties with a direction that after their lifetime the properties shall be dealt with in the same manner as the E schedule properties.
We are not concerned in the present litigation with any of the proper ties in schedules A to D.
We are concerned only with the validity of the disposition of E schedule properties.
The Will is in Tamil but we are helpfully provided with the English translation of the relevant portion.
It is also found incorporated in the judgment of the District Judge.
It runs as follows: "After my lifetime, the aforesaid three persons, Ponnuswami Pillai, Malayalam Pillai and Thangavelu Pillai, shall take and manage the E schedule properties, from out of the income from the said properties pay the kist for the aforesaid E schedule properties, and out of the balance of income for the salvation of my soul after my lifetime, shall enter mY body, after my life is extinct, in the land S.F. No. 68/B, Punjai Thottakurichi Village pertaining to the aforesaid E schedule, build structure therefore and put up light every day shall plant flower plants in the said land and grow them, shall construct a Matam for annual ceremonies, install pictures therein, put up light in the Matam every day, conduct Guru Pooja, distribute saffron coloured clothes and on that day, shall feed the poor.
Since the aforesaid Pon nuswami Pillai is the eldest of the sons, he shall be the Manager, to conduct the above matters.
The surplus income shall be taken in the shares of 2/4 by Ponnuswami Pillai, 1/4 by Malayalam Pillai, and 1/4 by Thangavelu Pillai.
After the said Ponnuswami Pillai 's life, out of his make heirs, the eldest son shall conduct in the same manner as above and the surplus income shall be taken by the said eldest son.
" 240 There then follows a residuary clause which is as under: "The movable and immovable properties belonging to me and not mentioned herein shall be taken and enjoyed by the aforesaid three persons after my lifetime." The plaintiff 's case has been that the testator could not have created on endowment of properties for construction of his own tomb or Samadhi and for performing Pooja and ceremonies thereat.
Since the testator has bequeathed E schedule properties for "Samadhi Kainkaryam", the trust would be invalid and the said properties should be shared by the plaintiffs and defendant under the residuary clause in the Will as if they remain undisposed of by the testator.
The suit is also for account from the defendant regarding the income of the E schedule properties.
The defendant has resisted the suit and sought to justi fy the creation of the trust and its purposes.
It was con tended inter alia, that the Matam and the Samadhi were constructed for different purposes.
They are separated by a respectable distance.
At the Samadhi, there is no perform ance of pooja.
It is only at the Matam, the ceremonies and Guru Pooja are performed with feeding the poor and distribu tion of saffron clothes.
These acts are distinctly and substantially religious and charitable purposes.
It was also contended that the plaintiffs in any event are not entitled to claim partition and separate possession of the Schedule properties.
At the trial, learned Subordinate Judge accepted the plaintiff 's case declaring that the dedication of the E Schedule property for purposes enumerated under the Will was invalid and accordingly he decreed the suit as prayed for.
In appeal, the District Judge took a different view.
He held that the purposes for which the E Schedule properties have been dedicated were charitable or religious in nature.
He dismissed the suit but gave certain directions to the de fendant for rendition of accounts of the surplus income from the properties which the defendant as a manager is obliged to do.
In second appeal to the High Court, the learned single Judge expressed the view that the Trust in respect of the properties for construction of the Samadhi with raising flower garden and lighting up would not be valid as it is not recognised under the Hindu Law.
That part of E Schedule properties referable to the Samadhi and its maintenance should remain as the property undisposed of by the Will.
241 Neither the plaintiffs nor the defendants will be entitled to it under the terms of the Will.
He however, held that the endowment and directions as to application of the property for construction of the Matam and performance of ceremonies and pooja would be valid since they are religious and char itable in nature.
He dismissed the suit for partition while at the same time affirmed the decree for accounting the surplus income from the properties referable to the Matam and charities.
In the Letters Patent Appeal, the Division Bench has disagreed with the views expressed by learned Single Judge.
It has been observed that the Matam is close to the Samadhi and the former has been built for the purpose of providing a convenient place for the purpose of offering worship and performing ceremonies connected with the Samadhi and Matam are covered by one scheme, and therefore, the entire trust must fail.
In support of the conclusion, the Division Bench largely relied upon the decision of the Privy Council in N. Subramania Pillai vs A. Draviyasundaratn Pillai, AIR 1950 PC 37.
In the Privy Council case referred above, the testator by name 'Kanakasabhapathy ' in his Will constituted a Trust of his properties with certain directions as to its applica tion.
He directed that "his body should be buried in a Sa madhi and at the same place where the Samadhi is made, a Matam should be built with a stone inscription in the front portion of the Matam as Kanakesabhapathi Samadhi Matam '.
He also directed that regular worship should be conducted with Guru Pooja and poor feeding.
Construing the terms of the Will, the Privy Council observed that the directions given by the testator were embodied in a single scheme and they were primarily intended to keep his memory alive and to enhance his own posthumous reputation.
Feeding the poor was to be conducted during the daily pooja to be performed in connection with the burial place and it did not provide for any charity apart from the ceremonies to be conducted at his own burial place and therefore the trust must fail.
In Hindu system there is no life of demarcation between religion and charity.
On the other hand, Charity is regarded as a part of religion.
Hindu Law of Religious & Charitable Trusts, by B.K. Mukherjea, 5th Ed.
p. 11.
But "what are purely religious purposes and what religious purposes will be charitable must be entirely decided according to Hindu Law and Hindu notions.
" Mayne 's Hindu Law 10th Ed.
p. 9 12.
242 The perpetual dedication of property for construction of a Samadhi or a tomb over the mortal remains of an ordinary person and the making of provisions for its maintenance and for performing ceremonies in connection thereto however, has not been recognised as charitable or religious purpose among the Hindus.
But the Samadhi of a Saint stands on a different footing.
This was the consistent view taken by the Madras High Court in several cases, namely, Kunhamutty vs T. Ahmad Musaliar & Ors., ILR 1953 Mad. 29; A. Draivaisundram Pillai vs N. Subramania Pillai, ILR 1954 Mad. 854; Veluswami Goundan vs Dandapani, 1946 Mad.
This Court in Saraswati Ammal vs Rajagopl Ammal, ; has approved those decisions of the Madras High Court.
Jagannatha Das, J., who spoke for the Court said (at 289): "We see no reason to think that the Madras decisions are erroneous in holding that perpetual dedication of property for worship at a tomb is not valid amongst Hindus.
" The view taken in Saraswati Ammal case has been reiter ated in Nagu Reddiar & Ors.
vs Banu Reddiar & Ors., ; where Kailasam, J., observed (at 600): "The raising of a tomb over the remains of an ancestor, an ordinary person is not recognised as religious in nature.
The burden is on the person setting up a case of religious practice in the community to prove it.
This prohibition may not apply when an ancestor is cremated and a memorial raised for performing Shradha ceremonies and conducting periodical worship, for, this practice may not offend the Hindu senti ment which does not ordinarily recognise entombing the remains of the dead.
" We are, therefore, inclined to hold that the provision made by the testator for construction of a Samadhi over his burial place and for its maintenance cannot be regarded as valid.
But that however, does not mean that the entire dedica tion of E Schedule properties must fail.
It is one of the cardinal principles of construction of Wilts that wherever it is possible, effect should be given to every bequest of the testator unless it is opposed to law, custom or prac tice.
If the testator has set apart the property intended for endowment and disclosed his charitable intent in any one of his directions, such direction may be extricated leaving aside the directions which are repugnant to the recognised notions of Hindu religion 243 or Hindu Law.
Attempt should be made to give effect to the provisions made for recognised charitable purposes even though the entire scheme of the testator cannot be saved.
In the instant case, the E Schedule has been endowed for con struction of a Samadhi and Matam, and for performing reli gious rites and charitable acts.
The Samadhi and Matam are constructed in the same survey number but are independent of each other, separated by a distance of about 15 feet.
Per formance of annual ceremonies, conducting Guru Pooja, feed ing the poor and distribution of saffron coloured clothes to mendicants appear to be independent and have no connection with the Samadhi.
There is no indication in the Will that Guru Pooja should be performed to the testator.
In fact he has not even indicated that his photo should be kept in the Matam.
His directions are only to install pictures at the Matam, put up light every day in the Matam and perform Guru Pooja once a year with the other charities.
These provisions in the Will are not in close parallel with and indeed far removed from those obtained in the Privy Council decision in Subramania Pillai 's case.
The Division Bench of the High Court was therefore in error in relying upon that decision to invalidate the entire endowment.
Counsel for the plaintiffs nevertheless argued that the defendant has been performing Guru Pooja only to the testa tor and not for the deity.
He referred to us Ext.
A 5 to A 9 which are the invitations sent by the defendant for the annual ceremonies and Guru Pooja to be performed to the testator.
But in construing the validity of an endowment created under a Will, we cannot be guided merely by the acts of the manager or the manner in which the executor of the Will has understood the directions of the testator.
We are required to examine the dominant intention of the testator and that could be ascertained only by the terms of the Will.
The terms of the Will in this case clearly specify the religious or charitable purposes.
The defendant Ponnuswami Pillai (DW 1) in his cross examination has also explained that there was a mistake in the writing of Ext.
A 5 to A 9 for which he was not responsible.
He has testified that he performed really the annual ceremonies on the date of death of the testator and no pooja was performed at Samadhi.
The Poojas are performed only at Matam with Guru Pooja to Lord Subramania on 'Thai Poosam ' every year.
He has further stated that the annual ceremonies of the testator fall on Margali Mrisaseerusham Nakshatram and Guru Pooja is not performed on that day.
It is undisputed that the testator died on Margali Mrigaseerusham Nakshatram.
Ramaswamy Goundar (DW 2) has also deposed 244 that no Guru Pooja was performed on the date of death of the testator and it was performed only to Lord Subramania in Thai month every year.
He used to participate in the Guru Pooja every year alongwith the other villagers.
The evidence of Marudamuthu Pillai (DW 3) also supports these versions.
We have no reason to disbelieve the testimony of the defendant and his witnesses.
Even the evidence from the plaintiff indicates that the Matam is called 'Madam of Sri Subramanya Swami '.
B 2 is a printed marriage invitation of the plaintiff (PW 1) in which it has been expressly stated that the plaintiff 's marriage will be performed at our Madam Sri Subramaniaswami Sannadhi built by our grandfa ther Karuppanna Pillai . "Ext.
A 11 also refers to the Matam as Subramaniaswami Sannadhi.
A 2 is the Commis sioner 's Report.
The Commissioner has stated that there are pictures of Gods in the Matam.
There is pooja room.
Lord Subramania 's picture is also in the pooja room.
The deity of Sri Vinayagar in granite has been installed at a special place with material to indicate that pooja is also being performed to Sri Vinayagar.
It is true that the directions of the testator are in general terms, and there is no particular mention in the Will as to whom Guru Pooja is required to be performed since no particular deity is named in the Will.
But trust cannot be rendered invalid on that ground.
It is for the Court to ascertain the presumed intention of the testator and give effect to it.
As observed by Patanjali Shastri, J., as he then was, in Veluswami Goundan 's case where no deity is named in the deed of endowment, the court should ascertain the sect to which the donor belonged, the tenets which he held, the doctrines to which he was attached and the deity to which he was devoted and by such means the presumed intention of the testator as to the application of the property should be ascertained.
We agree that these are the safe guides.
If we peruse the various terms in the Will and the provisions made for offerings, it will be clear that the testator was a great devotee of Lord Subramaniaswami.
He has made provisions to perform annual pooja to Lord Subramanias wami and Sri Vinayagar in the different temples out of the income from A to C Schedules.
The Matam also goes by the name of "Subramanya".
The evidence of DW 1 to DW 2 further indicates that Guru Pooja is being performed to Lord Subra manya followed by poor feeding and distribution of saffron coloured clothes.
The endowment with regard to these pur poses must therefore be upheld.
245 The permanent dedication of properties for performance of annual ceremonies of the testator is equally valid.
Whether one terms it as annual Shradha or anniversary, it is certainly a religious rite and it is not uncommon among the Hindu testators to make provisions in their Wills for cele bration or performance of such anniversaries of themselves or their ancestors.
We are, therefore, unable to agree with the decision of the Division Bench of the High Court.
We are on the other hand in agreement with the views expressed by learned Single Judge.
In the result, the appeal is allowed.
In reversal of the judgment of the Division Bench, the judgment and decree of the learned Single Judge are restored.
The respondents must pay the costs of this appeal to the appellants.
T.N.A. Appeal al lowed.
| The writ petitioners/appellants had been appointed as Government Counsel (Civil, Criminal, Revenue) by the State of U.P.
By its circular dated 6.2.1990 the State terminated the appointment of all Government Counsel with effect from 28.2.
1990 irrespective of the fact whether the term of the incumbent had expired or was subsisting.
At the same time the Government directed preparation of fresh panels to make appointments in place of existing incumbents.
The appellants challenged the validity of this State action, which was rejected by the High Court.
Before this Court it was contended inter alia on behalf of the petitioners/appellants that the relationship of the Government Counsel with the Government was not merely one of client and counsel as in the case of a private client, but one of status in the nature of public employment or appoint ment to a `public office ' so that termination of the ap pointment of a Government Counsel could not be equated with the termination by a private litigant of his Counsel 's engagement, which was purely contractual.
without any public element attaching to it.
On behalf of the State it was urged that: (i) the rela tionship of the appointees to these offices of Government Counsel in the districts was purely contractual depending on the terms of the contract and was in the nature of an en gagement of a Counsel by a private party who could be changed at any time at the will of the litigant, with there being no right in the counsel to insist on continuance of the engagement; (ii) there was no element of public employ ment in such appointments and the provisions in the Legal Remembrancer 's Manual and Section 24 of the Code of Criminal Procedure were merely to provide for making a suitable choice; (iii) the appointment of a District Government Counsel was only professional engagement terminable at will on either side and not appointment to a post under the Government, and the Government had 626 the power to terminate the appointment at any time `without assigning any cause ' and hence this circular did not suffer from the vice of arbitrariness.
Allowing the writ petitions and the appeals, this Court, HELD: (1) The provisions in the Legal Remembrancer 's Manual clearly show that the Government Counsel in the districts are treated as law Officers of the State who are holders of an `office ' or `post '.
These provisions further indicate that the appointment and engagement of District Government Counsel is not the same as that by a private litigant of his counsel and there is obviously an element of continuity of the appointment unless the appointee is found to be unsuitable either by his own work, conduct or age or in comparison to any more suitable candidate available at the place of appointment.
(2) All Government Counsel are paid remuneration out of the public exchequer and there is a clear public element attaching to the `office ' or `post '.
(3) Clause 3 of para 7.06 of the L.R. Manual which enables the Government to terminate the appointment `at any time without assigning any cause ' merely means that the termination may be made even during the subsistence of the term of appointment, and the expression `without assigning any cause ' means without communicating any cause to the appointee whose appointment is terminated.
(4) The non assigning of reasons or the non communica tion thereof may be based on public policy, but termination of an appointment without the existence of any cogent reason in furtherance of the object for which the power is given would be arbitrary and, therefore, against public policy.
Liberty Oil Mills vs Union of India, ; , referred to.
(5) In the case of Public Prosecutors, the public ele ment flowing from statutory provisions in the Code of Crimi nal Procedure, undoubtedly, invest the Public Prosecutors with the attribute of holder of a public office `which cannot be whittled down by the assertion that their ' engage ment is purely professional between a client and his lawyer with no public element attaching to it.
627 Mahadeo vs Shantibhai, ; Mundrika Prasad Sinha vs State of Bihar, [1980] 1 S.C.R. 759; Mukul Dalaiand Others vs Union of India and Others, ; and Malloch vs Aberdeen Corporation, , referred to.
(6) The presence of public element attached to the `office ' or `post ' of District Government Counsel of every category covered by the impugned circular is sufficient to attract Article 14 of the Constitution and bring the ques tion of validity of the impugned circular within the scope of judicial review.
(7) The scope of judicial review permissible in the present case does not require any elaborate consideration since even the minimum permitted scope of judicial review on the ground of arbitrariness or unreasonableness or irration ality once Article 14 is attracted, is sufficient to invali date the impugned circular.
(8) Even otherwise and sans the public element so obvi ous in these appointments, the appointment and its concomi tants viewed as purely contractual matters after the ap pointment is made, also attract Article 14 and exclude arbitrariness permitting judicial review of the impugned State action.
(9) The personality of the State, requiring regulation of its conduct in all spheres by requirements of Article 14, does not undergo such a radical change after the making of a contract merely because some contractual rights accrue to the other party in addition.
It is not as if the require ments of Article 14 and contractual obligations are alien concepts, which cannot co exist.
(10) The scope and permissible grounds of judicial review in such matters, and the relief which may be avail able are different matters but that does not justify the view of its total exclusion.
This is more so when the modern trend is also to examine the unreasonableness of a term in such contracts where the bargaining power is unequal so that these are not negotiated contracts but standard form con tracts between unequals.
(11) To the extent challenge is made on the ground of violation of Article 14 by alleging that the impugned act is arbitrary, unfair or unreasonable, the fact that the dispute also falls within the domain of contractual obligations would not relieve the State of its obligation to comply with the basic requirements of Article 14.
628 (12) It is significant to note that emphasis now is on review ability of every State action because it stems not from the nature of function, but from the public nature of the body exercising that function; and all powers possessed by a public authority, howsoever conferred, are possessed `solely in order that it may use them for the public good '.
Jones vs Swansea City Counsel, [1990] 1 W.L.R. 54, referred to.
(13) It can no longer be doubted at this point of time that Article 14 of the Constitution of India applies also to matters of governmental policy and if the policy or any action of the Government, even in contractual matters, fails to satisfy the test of reasonableness, it would be unconsti tutional.
Ramana Dayaram Shetty vs The International Airport Authority of India, ; ; Kasturi Lal Lakshmi Reddy vs State of Jammu and Kashmir, ; and Col. A.S. Sangwan vs Union of India, [1980] Supp.
SCC 559, referred to.
(14) The basic requirement of Article 14 is fairness in action by the State and it is difficult to accept that the State can be permitted to act otherwise in any field of its activity, irrespective of the nature of its function, when it has the uppermost duty to be governed by the rule of law.
Non arbitrariness, in substance, is only fair play in ac tion.
This obvious requirement must be satisfied by every action of the State or its instrumentality in order to satisfy the test of validity.
M/s Dwarkadas Marlaria and Sons vs Board of Trustees of the Port of Bombay, ; and Mahabir Auto Stores (15) There is a presumption of validity of the State action and the burden is on the person who alleges violation of Article 14 to prove the assertion.
However, where no plausible reason or principle is indicated nor is it dis cernible and the State action, therefore, appears to be exfacie arbitrary, the initial burden to prove the arbi trariness is discharged shifting onus on the State to justi fy its action as fair and reasonable.
(16) The wisdom of the policy or the lack of it or the desirability of a better alternative is not within the permissible scope of judicial review in such cases.
It is not for the courts to recast the policy or to substitute it with another which is considered to be more appropriate, once the attack on the ground of arbitrariness is success fully repelled by 629 showing that the act which was done was fair and reasonable in the facts and circumstances of the case.
Council of Civil Service Union vs Minister for the Civil Service, ; (17) Arbitrariness is the very negation of the rule of law.
Satisfaction of this basic test in every State action is sine qua non to its validity and in this respect.
the State cannot claim comparison with a private individual even in the field of contract.
(18) Every State action must be informed by reason and it follows, that an act uninformed by reason, is arbitrary.
Rule of law contemplates governance by laws and not by humour, whims or caprices of the men to whom the governance is entrusted for the time being.
(19) Irrespective of the nature of appointment of the Government Counsel in the districts in the State of U.P and the security of tenure being minimal as claimed by the State, the impugned circular, in order to survive, must withstand the attack of arbitrariness and be supported as an informed decision which is reasonable.
S.G. Jaisinghani vs Union of India, ; (20) In the present case.
the initial burden on the petitioners appellants has been discharged by showing that there is no discernible principle for the impugned action at the district level throughout the State of U.P. since there is nothing in the circular to indicate that such a sweeping action for all districts throughout the State was necessary which made it reasonable to change all Government Counsel in the districts throughout the State.
even those whose tenure in office had not expired.
(21) Non application of mind to individual cases before issuing a general circular terminating all such appointments throughout the State is itself eloquent of the arbitrariness writ large on the face of the circular.
John Wilkes 's case (22) Arbitrariness is writ large in the impugned circu lar issued by the State of Uttar Pradesh.
It gives the impression that this action was 630 taken under the mistaken belief of applicability of "spoils system" under our Constitution and the cavalier fashion in which the action has been taken gives it the colour of treating the posts of D.G.Cs.
as bounty to be distributed by the appointing authority at its sweet will.
Nothing worth while has been shown on behalf of the State of U.P. to support the impugned action as reasonable and non arbitrary.
|
Civil Appeal No. 1877 of 1970.
From the judgment and order dated the 10th January, 1968 of the Madhya Pradesh High Court at Jabalpur in Misc.
Civil Case No. 221 of 1962.
V. section Desai, B. B. Ahuja and section P. Nayar, for the appellant.
M. C. Chagla, B. Sen, A. K. Chitale, A. K. Verma, Ravinder Narain J. B. Dadachanji and O.C. Mathur, for respondent.
The Judgment of the Court was delivered by MATHEW, J.
This is an appeal from the judgment of the High Court of Madhya Pradesh in a reference made at the instance of the assessee M/s. Sutlej Cotton Mills Supply Agency Ltd. (hereinafter referred to as the 'assessee ') by the Income Tax Appellate Tribunal (hereinafter referred to as the 'Tribunal ') under section 66(1) of the Indian Income Tax Act.
The question referred was: Whether the inference of the Tribunal that the profit of Rs. 2,13,150/ arising from the sale of 1,58,200 shares of the Gwalior Rayon Silk Manufacturing (Weaving) Co. Ltd., is assessable as business profit is correct ?".
When the reference came up for hearing before the High Court, the High Court found that although the Tribunal was of the view that the question referred was a mixed question of law and fact, it had not stated all the facts and circumstances on which it based its conclusion that the profit of Rs. 2,13,150/ was a business profit and so the Court called for a supplementary statement of the case and a supplementary statement of the case was submitted to the Court by the Tribunal.
The material facts in the statement of the case were as follows.
The assessee is a public limited company and it is controlled by the Birlas.
the assessee applied for certain shares of the Gwalior Rayon Silk Manufacturing (Weaving) Company Limited (hereinafter referred to as the "Rayon Company"), also a company controlled by the Birlas.
This company was floated on 25 8 1947 with a paid up capital of Rs. 5 lakhs made up of 50,000 ordinary shares of Rs. 10/ each.
in the year ending 31 12 1951, the Rayon Company issued certain new shares for paid up capital of Rs. 1,17,25,000/ made up as follows: Rs. 7,60,000 Ordinary shares of Rs. 10/ each 76,00,000 fully paid up.
1 50,000 Ordinary shares of Rs.10/. each 3,75,000 with paid up at Rs. 2/8/ each.
1,50,000 6% preference shares of Rs. 100/ 37,50,000 each paid up at Rs 25/ each (redeemable at par at the company 's option after specified date by giving one Year 's notice).
129 The assessee which was interested in the Rayon Company and which had already purchased 1,000 ordinary shares, subscribed for 3,49,000 shares of the new issue and paid Rs. 8,72,500/ as application money on the 25th and 21th February, 1951, and paid Rs. 26,17,500/ as final call money on 10 8 1951.
These purchases were authorized by a resolution of the assessee dated 7 2 1951.
The assessee sold a part of its stock viz., 1,58,200 shares at a profit of Rs. 2,13,150/ .
For the assessment year 1956 57 (accounting year ending on 31 3 1956), the Income Tax Officer sought to assess the amount on the basis that it was profit accruing to the assessee from an adventure L in the nature of business.
The assessee contended that the amount re presented capital gain as the shares were purchased by way of investment and that the same cannot be taxed as revenue receipt.
The Income Tax Officer rejected the contention.
the assessee filed in appeal before the Appellate Assistant Commissioner.
He confirmed the order.
The assessee then went up in appeal before the Appellate Tribunal.
The Tribunal came to the conclusion, after considering all the circumstances, that the transaction was in the nature of a business ad venture and that profits were liable to be taxed.
The reasons which induced the Tribunal to come to this conclusion were: The assessee was authorised by clauses 12, 13, 28 and 29 of paragraph 3 of its Memorandum of Association to buy and sell shares; there were specific resolutions of the Company authorising a director of the assessee to purchase and sell these shares; the assessee had included the profit of Rs. 2,13,150/ in the profit and loss account without taking it to any reserve account or specifically set it apart for any other purpose; the assessee had purchased the shares from borrowed funds and not with money readily available to it; the assessee did not make the sales on account of any pressing necessity to meet existing liabilities but had in fact kept a part of the sale proceeds as liquid cash in the United Commercial Bank Ltd.; the assessee had.
in the past, dealt in shares as business transaction and had claimed for the assessment year 1951 52 Rs. 1.29,214/ as loss on account of its dealing in shares of M/s. Titagarh Paper Mills Ltd.; it also claimed Rs. 6,30,000/ as loss on account of devaluation of the shares of M/s. Pilani Investment Corporation though that was not allowed; there had recently grown a business practice of investing large sums of money in shares in new ventures with an eye on their appreciation for obtaining by sale substantial pro fits in future.
The High Court, in its judgment, said that there was no provision in clauses 10, 12, 13, 28 and 29 of paragraph 3 of Memorandum of Association of the assessee which authorised the carrying on of the business of purchasing and selling shares, although some of these clauses did authorise the assessee to acquire and sell shares in other similar companies.
that the inclusion of the profit of Rs. 2,13,150/ in the profit and loss account without taking it into any reserve specifically was not conclusive of the question whether it was a capital asset or a revenue receipt; that the true nature and character of the moneys received was to be determined not by the manner in which the assessee treated it but by its inherent character, and, that it was wholly immaterial 130 as to how the assessee treated the amount in question; and that there was no evidence that the shares were purchased out of borrowed funds as the assessee had a fixed deposit of Rs. 31,75,000/ in the United Commercial Bank Ltd. and a deposit of Rs. 8,76,008 2 0 in the current account of the Bank.
The High Court was of the view that the finding of the Tribunal that the sale of shares in 1955 was made not on account of any pressing necessity to meet existing liabilities was based on materials placed before the Tribunal.
The Court, however, said: "It may be that, at that time, the liabilities of the assessee company existed, but it is quite another matter to say that it was obliged to sell the shares in order to meet those liabilities.
" The High Court was also of the view that the conclusion of the Tribunal that the assessee had claimed Rs. 1,29,214/ as loss on account of dealing in shares of M/s. Titagarh Paper Mills Ltd. for the assessment year 1951 52 and that the claim was allowed by the Income Tax officer must be accepted as correct, but said that this solitary transaction cannot be taken as conclusive of the fact that the sale of shares in question here was an adventure in the nature of trade.
The main reason which impelled the High Court to hold that the transaction was not an adventure in the nature of trade was that the dominant intention of the assessee in acquiring the shares was to boost the shares of a sister concern viz, the Rayon Company, and thus render it assistance for setting it up as a going concern and when that was accomplished, the assessee started selling the investment which had in the mean time enhanced in value.
The question which the Tribunal had to consider in the appeal and which was referred to the High Court was a mixed question of law and fact, namely.
whether the profit from sale of the shares in question was a revenue or a capital receipt.
The distinction between capital accretion and income has been explained by Rowlatt, J. in Thew vs South West Africa Cc.
Ltd.(1).
The learned judge said that for the purpose of ascertaining whether profits made upon a sale of an article are taxable profits.
the question to be asked is: "Is the article acquired for the purpose of trade ?.
If it is, the profit arising from its sale must be brought into revenue account and that the profit is chargeable as capital gains if the sale is of a capital asset, and as business profit if the sale is in the course of business or the transaction constitutes an adventure in the nature of trade.
The line between capital sales and sales producing income has been drawn by Lord Justice Clerk in Californian Copper Syndicate vs Harris(2) in a passage which has become classical: "It is quite a well settled principle in dealing with questions of assessment of income tax that where the owner of an Ordinary Investment chooses to realise it, and obtains a greater price for it than he originally acquired it at, the enhanced price is not profit. assessable to income tax.
but it is equally well established that enhanced values obtained from realisation or conversion of securities may be so assessable where what is done is not merely a realisation or change of investments but an act done in what is truly the carrying on, l I or carrying out, of a business.
What is the line which 131 separates the two classes of cases may he difficult to define, and each case must be considered according to its facts.
the question to be determined being Is the sum of gain that ha been made a mere enhancement of value by realising a security or is it a gain made in an operation of business in carrying, out a scheme for profit making ?" In the absence of any evidence of trading activity in cases of purchase and resale of shares, it has been held that profit arising from the resale is an accretion to the capital.
If a transaction is in the assessee`s ordinary line of business there can be no difficulty in holding that it is in the nature of trade.
But the difficulty arises where the transacting is outside the assessee 's the of business and then, it must depend upon the facts and circumstances of each case whether the transaction is in the nature of a trade.
It is not necessary to constitute trade that there should be a series of transactions both of purchase and of sale.
A single transaction of purchase and sale outside the assessee 's line of business may constitute an adventure in the nature of trade.
Neither repetition nor continuity of similar transactions is necessary to constitute a transaction an adventure in the nature of trade.
If there is repetition and continuity, the assessee would be carrying on a business and the question whether the activity is an adventure in the nature of trade can hardly arise.
A transaction may be regarded as isolated although a similar transaction may have taken place a fairly long time before [see 1.
R. vs Reinhold(1)].
The principles underlying the distinction between a capital sale and an adventure in the nature of trade were examined by this Court In Venkataswami Naidu & Co. vs C.l.
T.(2), where this Court said that the character of a transaction cannot be determined solely in the application of any abstract rule, principle or test but must depend upon all the facts and circumstances of the case.
Ultimately, it is a matter of first impression with Court whether a particular transaction is in the nature of trade or not it has been said that a single plunge may be enough provided it is shown to the satisfaction of the Court that the plunge is made in the waters of the trade; but mere purchase/sale of shares if that is all that is involved in the plunge may fall short of anything in the nature of trade.
Whether It is in the nature f trade will depend on the facts and circumstances.
Where the purchase of any article or of any capital investment, for instance, shares.
is made without the intention to resell at a profit.
a resale under changed circumstances would only be a realisation of capital and would not stamp the transaction with a business character [see C.l.
T. vs P.K.N. Co., Ltd.(3)].
Where a purchase is made With the intention of resale, it depends upon the conduct of the assessee and the circumstances of the case whether the venture is on capital account or in the nature of trade.
A transaction is not necessarily in the nature of trade because the purchase 132 was made with the intention of resale [see Jenkinson vs Freeland(1); Radha Debi Jalan vs C.l.
T.(2); India Nut Co. Ltd. vs C.l.
T.(3); M/s. Sooniram Poddar vs C.l.
T.(4); Ajax Products Ltd. vs C.l.
T.(5); Gustad Irani vs C.l.T.(5); and Mrs. Alexander vs C.l.
T.(7);].
A capital investment and resale do not lose their capital nature merely because the resale was foreseen and contemplated when the investment was made and the possibility of enhanced values motivated the investment [see Leeming vs Jones(8) and also the decisions of this Court in Saroj Kumar Mazumdar vs C.l.
T.(9) and Janki Ram Bhadur Ram vs C.I.T.(10)].
In I. R. vs Fraser(11) Lord Norman said: "The individual who enters into a purchase of an article or commodity may have in view the resale of it at a profit, and yet it may be that this is not the only purpose for which he purchased the article or the commodity nor the only purpose to which he might turn it if favourable opportunity for sale does not occur.
An amateur may purchase a picture with a view to its resale at a profit, and yet he may recognise at the time or afterwards that the possession of the picture will give him aesthetic enjoyment if he is unable ultimately, or at his chosen time, to realise it at a profit . " An accretion to capital does not become income merely because the original capital was invested in the hope and expectation that it would rise in value.
if it does so rise, its realisation does not make it income.
Lord Dunedin said in Leeming vs Jones(8) at p. 360: "The fact that a man does not mean to hold an investment may be an item of evidence tending to show whether he is carrying on a trade or a concern in the nature of trade in respect of his investments, but per se it leads to no conclusion whatever." This Court laid down in Venkataswami Naidu & Co. vs C.l.
T.(12) that the dominant or even sole intention to resell is a relevant factor and raises a strong presumption, but by itself is not conclusive proof, of an adventure in the nature of trade.
The intention to resell would, in conjunction with the conduct of the assessee and other circumstances, point to the business character of the transaction.
In the light of the principles above referred to, it is necessary to examine whether the Tribunal had approached the question from the right perspective, viz., whether on the basis of its finding on questions of fact, the inference that the transaction was an adventure in the nature of trade was justified.
133 The Tribunal relied on the following circumstances for coming to the conclusion.
The assessee has been dealing in shares from 1951 to 1953.
For the assessment year 1951 52, the assessee claimed a sum of Rs. 1,29,214/ which was shown in the profit and loss account and the balance sheet of the company for the year ending 31 3 1951 as a loss in the dealing of shares of M/s. Titagarh Paper Mills Ltd. This claim was allowed by the Income Tax officer.
According to the Tribunal, this would show that the assessee had been buying and selling shares even though as an isolated adventure in the nature of business The High Court has not upset this finding, but has only said that this is an isolated transaction.
That apart, in the same year, a sum of Rs. 6,30,000/ was debited to the profit and loss account on devaluation of the shares of M/s. Pilani Investment Corporation.
Such a debit was permissible only on the footing that the shares constituted the stock in Trade of the assessee.
It is no doubt true that the Department did not allow this claim.
But that was on the basis that the claim that the shares leave fallen in value was not proved to the satisfaction of the Income Tax officer, and not on the basis that the shares were not held as stock in trade as the High Court wrongly thought.
The Tribunal also referred to the resolutions passed by the assessee authorising one of its directors to purchase and sell the shares in the Rayon Company The finding of the High Court that the clauses of the Memorandum o Association viz., clauses 10, 12, 13, 28 and 29 and not authorize the company to acquire and sell shares as business has no relevance in view of the aforesaid resolution of the assessee and of the fact that it had been dealing in shares in a commercial spirit as is evident from its claim for loss in dealings in the shares of M/s. Titagarh Paper Mills Ltd. and devaluation of shares of M/s. Pilani Investment Corporation on the basis that they had fallen in value.
Secondly, the Tribunal said that from 1947 to 1956, no dividend had been declared by the Rayon Company and that the money which went into the purchase of these shares was borrowed by the assessee.
In other words, the view of the Tribunal was, it was with borrowed funds that the assessee purchased the shares.
It is no doubt true that there was no evidence to show that the money was specifically borrowed for the purpose of buying shares.
But there was evidence before the Tribunal for its finding that the liabilities of the assessee exceeded its assets.
The finding, therefore, that the shares were purchased with borrowed funds on which the assessee was paying interest, was a finding supported by evidence.
The reasoning of the Tribunal that it is most improbable that the assessee would be investing borrowed money on which interest would have to be paid in shares which yielded no dividend, was correct.
We cannot say that this was not a relevant circumstance for the Tribunal to take into consideration for coming to the conclusion that the transaction was an adventure in the nature of business.
Looking into all the circumstances, the Tribunal negatived the case of the assessee that it had invested its funds with a view to earn dividend.
The case of the assessee throughout was that the purchase of the shares was by way of investment and the sale was forced by necessity because the creditors were pressing for repayment of the loan.
The 134 Tribunal found that the shares were not sold to liquidate the debts of the assessee as the balance sheet as on 21 3 1956 showed that the proceeds were kept is liquid cash in the United Commercial Bank Ltd. As already stated, the main reason why the High Court came to a different conclusion.
is stated as follows in the judgment : " .
Undoubtedly, there are some elements which are contra indicative of investment but there are other considerations which detract from their value as elements indicating an adventure in the nature of trade, the main being, that the assessee company, which is controlled by the Birlas, purchased the shares with a view to assisting a sister company controlled by the same persons, and not to embark upon a venture in the nature of trade.
" At no time had the assessee a case that the shares were purchased with a view to help a sister company controlled by the Birlas.
No such case was set up by the assessee either before the Income Tax officer or the Appellate Assistant Commissioner; nor was it urged before the Appellate Tribunal.
Nowhere in the statement of case or the supplementary statement of case prepared by the Tribunal and filed in the High Court was there any finding on the question.
The whole conclusion of the High Court is based on unwarranted assumption of facts which must have been taken from the argument of the assessee before the High Court.
The danger of failing to recognize that the jurisdiction of the High Court in these matters is only advisory and that conclusion of facts are conclusions on which the High Court is to exercise the advisory jurisdiction is illustrated by this case.
Mr. Chagla for the respondent contended that the only question to be asked and answered is : What was the dominant intention of the assessee when it purchased the shares ? If the dominant intention was to carry on an adventure in the nature of business, the profit can be taxed.
Otherwise not.
In other words, the question is whether the assessee purchased the shares in a commercial spirit with a view to make profit by trading in them.
The Tribunal found, after taking in to account all the relevant circumstances that the dominant intention of the assessee was to make profit by resale of the shares and not to make an investment.
The finding that loss or profit is a trading loss or profit is primarily a finding of fact, though in reaching that finding the Tribunal has to apply the correct test laid down by law When we see that the Tribunal has considered the evidence on record and applied the correct test there is no scope for interference with the finding of the Tribunal (see C. 1.
T. vs Ashoka Marketing Co.(l).
We do not think that the High Court was right in interfering with the judgment of the Tribunal.
In the result we reverse the judgment of the High Court and allow the appeal with costs.
P.B.R. Appeal allowed.
| The election for Pandhurna Constituency for the M.P. legislative Assembly took place in March, 1970.
There were 6 candidates who contested the election.
The main contest was between respondents nos.
1 and 2.
Respondent No. 1 was declared elected.
The appellant, a voter, filed an Election Petition challenging the election on the grounds that respondent No. 1 published and circulated a leaflet containing defamatory and false averments against respondent No. 1 and it was calculated to prejudice the election prospects of respondent No. 2.
The leaflet it was alleged contained the statement of fact about the personal character or conduct of respondent No. 2.
In the leaflet it was mentioned that respondent No. 2 committed rape and he was carrying on with another woman.
The ties of respondent No. 2 were stated to have driven his wife into insanity.
Reference was also made to some other shady and unethical activities.
Before the High Court the appellant wanted to file a photostat copy of the manuscript of the leaflet which according to the appellant was written by respondent No. 1.
The High Court did not admit the aforesaid photostat copy in evidence on the ground that there was no sufficient reason for allowing the appellant to lead secondary evidence.
The High Court also held that though the material contained in the leaflet related to the personal character and conduct of respondent No. 2, the appellant failed to prove that its contents were false to The knowledge of respondent No. 1, and he did not believe them to be true and that, therefore, the corrupt practice defined in section 123(4) of the Representation of the People Act was not proved.
While dismissing the appeal this Court held: ^ Under section 65(a) of the Indian Evidence Act, secondary evidence may been of the existence, condition or contents of a document when the original is shown or appears to be in the possession or power of the person against whom the document is sought to be proved or when a person refuses to produce it.
There was no affidavit that the original document was in possession of respondent No. 1.
The photostat copy appeared to the High Court to be not above suspicion.
In view of all the circumstances, the High Court rightly came to the conclusion that no foundation was laid by the appellant for leading secondary evidence in the shape of photostat copy.
There is no evidence on record to show that the contents of the leaflet were false.
The respondent No. 2 was not examined as a witness.
No other evidence was also led of any person who knew about the character or conduct of respondent No. 2 to show that the statements contained in the leaflet in question were false.
Apart from the other requirements, it is of the essence of section 123(4) of the Representation of the People Act.
1951 that the impugned statement of fact in relation to the personal character or conduct of a candidate.
which is alleged to have been published should be false [249D, F 250D]
|
iminal Appeal No. 78 of 1959.
Appeal by special leave from the judgment and order dated November 25, 1958, of the former Bombay High Court in Criminal Revision Application No. 1393 of 1958 arising out of the judgment and order dated September 18, 1958, of the Presidency Magistrate 11 Class, Mazagaon at Bombay in Case No. 1101/P of 1958.
R. H. Dhebar, for the appellant.
The respondent did not appear.
October 18.
The Judgment of the Court was delivered by 28 HIDAYATULLAH J.
This is an appeal by the State of Bombay, with the special leave of this Court, against the order of acquittal by the High Court of Bombay of the respondent, Vishnu Ramchandra, who was prosecuted under section 142 of the Bombay Police Act and sentenced to six months ' rigorous im prisonment by the Presidency Magistrate, 2nd Court, Mazagaon, Bombay.
On November 16, 1949, Vishnu Ramehandra was convicted under section 380 and 114 of the Indian Penal Code, and sentenced to one month 's rigorous imprisonment.
On October 15, 1957, the Deputy 'Commissioner of Police, Bombay, acting under section 57(a) of the Bombay Police Act (22 of 1951), passed an order against Vishnu Ramchandra which was to operate for one year, externing him from the limits of Greater Bombay.
At that time, a prosecution under section 411 of the Indian Penal Code was pending against Vishnu Ramchandra, and he was not immediately externed, to enable him to attend the case.
This prosecution came to an end on July 10, 1958, and resulted in his acquittal.
Immediately afterwards, a constable took him outside the limits of Greater Bombay, and left him there.
The prosecution case was that he returned to Greater Bombay, and was arrested at Pydhonie on August 24, 1958.
He was prosecuted under section 142 of the Bombay Police Act.
His plea that he was forcibly brought back to Pydhonie and arrested was not accepted by the Presidency Magistrate, and he was convicted.
He filed a revision application, which was heard by a learned single Judge of the High Court of Bombay.
Three contentions were raised before the High Court.
The first was that the Deputy Commissioner of Police had not applied his mind to the facts of the case before making the order of externment.
The second was that section 57 of the Bombay Police Act was prospective, and could not be made applicable, unless the conviction on which the action of externment was based, took place after the coming into force of that Act.
The third was that the belief entertained by the Deputy Commissioner that Vishnu Ramchandra was 29 likely to engage himself in the commission of an offence similar to that for which he was prosecuted was based on the prosecution which was then pending, and that that ground disappeared after his acquittal.
The High Court did not consider the first and the third grounds, because it held that the second ground was good.
Section 57 of the Bombay Police Act reads as follows: " Removal of persons convicted of certain offences If a person has been convicted (a) of an offence under Chapter XII, XVI or XVII of the Indian Penal Code (XLV of 1860), or (b) twice of an offence under section 9 or 23 of the Bombay Beggars Act, 1945 (Bom.
XXIII of 1945,) or under the Bombay Prevention of Prostitution Act, 1923 (Bom.
XI of 1923), or (c) thrice of an offence within a period of three years under section 4 or 12A of the Bombay Prevention of Gambling Act, 1887 (Bom.
IV of 1887), or under the Bombay Prohibition Act, 1949 (Bom.
XXV of 1949) the Commissioner, the District Magistrate or the Sub Divisional Magistrate specially empowered by the State Government in this behalf, if he has reason too believe that such person is likely again to engage himself in the commission of an offence similar to that for which he was convicted, may direct such person to remove himself outside the area within the local limits of his jurisdiction, by such route and within such time as the said officer may prescribe and not to enter or return to the area from which he was directed to remove himself ".
In reaching his conclusion the learned single Judge observed that the legislature had used the present participle " has been " and not the past participle in the opening portion of the section, and that this indicated that the section was intended to be used only where a person was convicted subsequent to the coming into force of the Act.
He further observed that being a penal section, it had to be interpreted prospectively.
He repelled an argument of the Assistant 30 Government Pleader that section 57 merely re enacted the provisions of section 27 of the City of Bombay Police Act, 1902, and that a liability incurred under the older Act was preserved by section 167 of the Bombay Police Act of 1951.
Observing further that the Deputy Commissioner of Police at the time of the passing of the order could not be said to have entertained a belief about the activities of Vishnu Ramchandra based upon his conviction in the year 1949, he held that the order of externment must be regarded as invalid for that reason and also on the ground that the conviction was not after the coming into force of the Act.
At the hearing before us, the respondent was not represented.
We have heard Mr. Dhebar in support of the appeal, and, in our opinion, the High Court was not right in the view it had taken of section 57 of the Act.
The question whether an enactment is meant to operate prospectively or retrospectively has to be decided in accordance with well settled principles.
The cardinal principle is that statutes must always be interpreted prospectively, unless the language of the statutes makes them retrospective, either expressly or by necessary implication.
Penal statutes which create new offences are always prospective, but penal statutes which create disabilities, though ordinarily interpreted prospectively, are sometimes interpreted retrospectively when there is a clear intendment that they are to be applied to past events.
The reason why penal statutes are so construed was stated by Erle, C. J., in Midland Rly.
Co. vs Pye (1) in the following words: "Those whose duty it is to administer the law very properly guard against giving to an Act of Parliament a retrospective operation, unless the intention of the legislature that it should be so construed is expressed in clear, plain and unambiguous language; because it manifestly shocks one 's sense of justice that an act, legal at the time of doing it, should be made unlawful by some new enactment ".
This principle has now been recognised by our Constitution and established as a Constitutional restriction on legislative power.
(1) ; , 191.
31 There are, however, statutes which create Do new punishment, but authorise some action based on past conduct.
To such statutes, if expressed in language showing retrospective operation, the principle is not applied.
As Lord Coleridge, C. J., observed during the course of arguments in Rex vs Birthwhistle (1): " Scores of Acts are retrospective, and may without express words be taken to be retrospective, since they are passed to supply a cure to an existing evil." Indeed, in that case which arose under the Married Women (Maintenance in Case of Desertion) Act, 1886, the Act was held retrospective without express words.
It was said: " It was intended to cure an existing evil and to afford to married women a remedy for desertion, whether such desertion took place before the passing of the Act or not." Another principle which also applies is that an Act designed to protect the public against acts of a harmful character may be construed retrospectively, if the language admits such an interpretation, even though it may equally have a prospective meaning.
In Queen vs Vine (2), which dealt with the disqualification of persons selling spirits by retail if convicted of felony, the Act was applied retrospectively to persons who were convicted before the Act came into operation.
Cock burn, C. J., observed: "If one could see some reason for thinking that the intention of this enactment was merely to aggravate the punishment for felony by imposing this disqualification in addition, I should feel the force of Mr. Poland 's argument, founded on the rule which has obtained in putting a construction upon statutes that when they are penal in their nature they are not to be construed retrospectively, if the language is capable of having a prospective effect given to it and ' is not necessarily retrospective.
But here the object of the enactment is not to punish offenders, but to protect the public against public houses in which spirits are retailed being kept by persons of doubtful character .
On looking at the Act, the words used seem (1) (1889) 58 L.J. (N.S.) M.C. 158.
(2) 32 to import the intention to protect the public against persons convicted in the past as well as in future; the words are in effect equivalent to 'every convicted felon '.
" In the same case, Archibald, J., expressed himself forcefully when he observed: " I quite agree, if it were simply a penal enactment, that we ought not to give it a retrospective operation ; but it is an enactment with regard to public and social order, and infliction of penalties is merely collateral.
" Similarly, in Ex Parte Pratt (1), which dealt with the words " a debtor commits an act of bankruptcy " to enable the Court to make a receiving order, Cotton, L. J., gave the words a retrospective operation, observing: " I think that no reliance can be placed on the words I commits ' as showing that only acts of bankruptcy committed after the Act came into operation are intended.
" In the same case, the observations of Bowen, L. J., were: " I think that the more the Act is studied the more it will be found that it is framed in a very peculiar way.
I do not mean to say that it is inartistically framed.
I think it is framed on the idea that a bankruptcy code is being constructed, and when the present tense is used, it is used, not in relation to time, but as the present tense of logic.
" Fry, L. J., added : " I entirely agree with Bowen, L. J., as to the meaning of the present tense in the section ; it is used, I think, to express a hypothesis, without regard to time." In Bourke vs Nutt (2), Lord Esher, M. R., speaking of these observations of Bowen and Fry, LL. J., observed : " . the case seems to show that when the present tense is used in this statute (section 32 of the Bankruptcy Act, 1883) the time to be considered is the time at (1) (2) [1894] I Q.B. 725.
33 which the Court has to act, and not the time at which the condition of things on which it has to act came into existence.
" Applying the above principles, Lord Esher, M. R., held that the section was not retrospective but prospective, because the important time was that at which it had to be considered whether the person was disqualified and it related to a time after the passing of the Act.
He, however, added that " even if it could be said that it is retrospective its enactments are solely for the public benefit, and the rule that restricts the operation of a penal retrospective statute does not apply, because this statute is not penal." These principles, though not unanimously expressed, have been accepted in later cases both in England and in India.
In Ganesan vs A. K. Joscelyne (1), Chakravarti, C. J., observed, Sarkar, J. (as he then was), concurring: " I may state, however, that in spite of the ordinary and I might almost say cardinal rule of construction that statutes, particularly statutes creating liabilities, ought not to be so construed as to given them a retrospective operation unless there is a clear provision to that effect or a necessary intendment implied in the provisions, there is another principle on which Courts have sometimes acted.
It has been held that where the object of an Act is not to inflict punishment on anyone but to protect the public from undesirable persons, bearing the stigma of a conviction or misconduct on their character, the ordinary rule of construction need not be strictly applied.
" In Taher Saifuddin vs Tyebbhai Moosaji (2), the same principles were applied by Chagla, C. J. and Bhagwati, J. (as he then was), and reference was made also to The Queen vs Inhabitants of St. Mary Whitechapel (3) where Lord Denman, C. J., in his judgment observed: " . it was said that the operation of the statute was confined to persons who had become widows after (1) A.1 R. ,38.
(2) A.I.R. 1953 Bom.
183, z86, 187.
(3) [1848) ; 12 Q.B. 120 (B): 34 the Act passed, and that the presumption against a retrospective statute being intended supported this construction; but we have before shown that the statute is in its direct operation prospective, as it relates to future removals only, and that it is not properly called a retrospective statute because a part of the requisites for its action is drawn from time antecedent to its passing." Now section 57 of the Bombay Police Act, 1951, does not create a new offence nor makes punishable that which was not an offence.
It is designed to protect the public from the activities of undesirable persons who have been convicted of offences of a particular kind.
The section only enables the authorities to take note of their convictions and to put them outside the area of their activities, so that the public may be protected against a repetition of such activities.
As observed by Phillimore, J., in Rex vs Austin (1), "No man has such a vested right in his past crimes and their consequences as would entitle him to insist that in no future legislation shall any regard whatever be had to his previous history.
" An offender who has been punished may be restrained in his acts and conduct by some legislation, which takes note of his antecedents; but so long as the action taken against him is after the Act comes into force, the statute cannot be said to be applied retrospectively.
The Act in question was thus not applied retrospectively but prospectively.
It remains only to consider if the language of the section bars an action based on past actions before the Act was passed.
The verb "has been" is in the present perfect tense, and may mean either " shall have been " or " shall be ".
Looking, however, to the scheme of the enactment as a whole and particularly the other portions of it, it is manifest that the former meaning is intended.
The verb " has been " describes past actions, and, to borrow the language of Fry, L.J., in Ex Parte Pratt (2), " is used to express a hypothesis, without regard to time ".
An externment order, however, to satisfy the (1) , 556.
(2) [1884] 12 Q.B 334 35 requirements of section 57 of the Bombay Police Act, must be made bona fide, taking into account a conviction which is sufficiently proximate in time.
Since no absolute rule can be laid down, each case must depend on its own facts.
In the result, we set aside the acquittal, and remit the case to the High Court for disposal on the other points urged before it and in the light of observations made here by us.
Appeal allowed.
| On November 16, 1949, the respondent was convicted under sections 38o and II4 of the Indian Penal Code.
On October 5, 1957, the Deputy Commissioner of Police, Bombay, acting under section 57(1) of the Bombay Police Act passed an order externing him from the limits of Greater Bombay.
Later he was prosecuted and convicted under section 142 of the Bombay Police Act by the Presidency Magistrate for returning to the area from which he was externed.
On an application for revision the High Court acquitted the respondent upholding his contention that section 57 of the Bombay Police Act was not retrospective and was not applicable unless the conviction on which the externment was based took place after the Act came into force.
On appeal by the appellant with the special leave of this Court it was 27 Held, that though statutes must ordinarily be interpreted prospectively unless the language makes them retrospective, either expressly or by necessary implication, and penal statutes creating new offences are always prospective, penal statutes creating disabilities though ordinarily interpreted prospectively are sometimes interpreted retrospectively when the intention is not to punish but to protect the public from undesirable persons whose past conduct is made the basis of future action.
Midland Ry.
Co. vs Pye, IO C.B. (N.S.) 179, Rex vs Birth whistle, (1889) 58 L.J. (N.S.) M.C. 158, Queen vs Vine, [1875] IO Q.B. 195, Ex Parte Pratt, , Bourke vs Nutt, [1898] I Q.B. 725, Ganesan vs A.K. Joscelyne, A.I.R. 1957 Cal.
33, Taher Saifuddin vs Tyebbhai Moosaji, A.I.R. 1953 Bom.
183, The Queen vs Inhabitants of St. Mary Whitechapel, ; : ; and Rex vs Austin, , considered and applied.
Section 57 of the Bombay Police Act did not create a new offence but was designed to protect the public from the activities of undesirable persons convicted of particular offences and enabled the authorities to take note of their activities in order to put them outside the areas of their activities for preventing any repetition of such activities in the future.
The verb " has been " as used in section 57 meant " shall have been Legislation which takes note of a convicted offender 's antecedents for restraining him from his acts cannot be said to be applied retrospectively as long as the action taken against him is after the Act comes into force.
The Act in question was thus not applied retrospectively but prospectively.
An externment order must be bona fide and must relate to a conviction which is sufficiently proximate in time.
|
Criminal Appeal No. 258 of 1981.
869 From the Judgment and Order dated 12th Feb. 1981 of the Madhya Pradesh High Court in Misc.
Criminal Case No. 617 of 1980.
Appellant in person.
Uma Nath Singh for the Respondent.
The Judgment of the Court was delivered by section RATNAVEL PANDIAN,J.
The appellant, Mr. Pritam Pal Dhingra is a practising Advocate in the High Court of Madhya Pradesh at Jabalpur, having joined the Bar on 4.2.1979.
Earlier to joining the Bar, he was serving in the Army and retired on 23.12.65.
Thereafter, he was re employed in the Defence Accounts Department on 7.2.1966 as U.D.C. (Auditor).
On 29.2.76, the appellant served three months ' notice of resignation upon the departmental authorities for the reasons mentioned in the said notice and also requested to pay him the contributory provident fund benefits for his 10 years service though the date of his superannuation in the said post was 30.9.1986.
The Department not only refused to accept his resignation but also did not relieve him even after the expiry of three months.
According to the appellant, there was neither any departmental enquiry pending nor contemplated against him during those three months i.e. between 29.2.76 and 31.5.76.
However, a charge sheet dated 21.12.76 for imposing a major penalty on a complaint by Jt.
C.D.A. Vehicle Factory was served on him to which he submitted his written statement.
Then he served a final quit notice w.e.f. 8.1.77.
Though on the basis of the show cause notice, an enquiry was started, nothing came out of it.
Therefore, the appellant moved the High Court of Madhya Pradesh at Jabalpur by filing Writ Petition M.P. No. 786 of 1978 under Article 226 of the Constitution of India sworn on 27.11.78 requesting several prayers inclusive of issuance of directions to the respondent therein (the departmental authorities) to accept his resignation so as to enable him to take any other profession of his liking and to declare the retention of his service against his will after 31.5.1976 as illegal and malafide and to re imburse pay and allowances for the period of his enforced absence after the expiry of three months notice period etc.
The High Court issued show cause notice to the respondents 1 to 3 in the Writ Petition.
The respondent No. 3 thereafter accepted the resignation dated 29.2.76 of the appellant w.e.f. 15.1.79 by 870 which time the appellant claims to have completed 31 years of combined military and civil service i.e. from 29.11.47 to 15.1.79.
Meanwhile, the departmental enquiry initiated against him was dropped.
Then the appellant submitted supplemental applications praying that his resignation should be converted into one of voluntary retirement and that his military services should be counted with civil service and that he should be given all service benefits like pension, gratuity etc.
as well as consequential benefits on account of the delay in acceptance of his resignation.
Two applications being I.A.No. 908/79 and I.A. No. 4246/78 were filed by the appellant, they being one for amendment of the petition and the other for taking some additional grounds.
Both applications were allowed by a Division Bench of the High Court comprising of Mr. Justice J.S. Verma (as he then was) and Mr. Justice U.N. Bachawat, as the counsel for the respondents had no objection and granted one week time for incorporating the amendments in the petition.
At the request of the counsel for the respondent, Shri R.P. Sinha, the Court granted two weeks time to file the additional return by order dated 16.3.79.
The case was listed for further hearing on 2.4.79 on which date the writ petition was dismissed.
The appellant then on 16.4.79 moved an application to review the order dated 2.4.79.
The application was registered as M.C.C. No. 209 of 1979.
This application was too dismissed on 23.4.79 with the following observation: "The grievance of the petitioner in this review petition is that the writ petition (M.P. No. 786/78) was dismissed in motion hearing without hearing the petitioner.
The substance of the order dismissing the Writ Petition in motion hearing as stated earlier indicates that this averment made by the petitioner is not correct.
We also distinctly recollect that the petitioner was heard fully on the question of admission and it was only thereafter that the petition was dismissed by dictating that order in the Court in the presence of the petitioner.
We would, therefore, reiterate that this grievance of the petitioner that he was not heard at the time of motion hearing is wholly incorrect.
The submissions made by the petitioner in support of this review application are (1) that there is error apparent on the face of the record because the writ petition was dismissed in motion hearing without hearing the petitioner; (2) that, sum 871 marily dismissal of the writ petition was arbitrary because after notice had been issued to the respondents 1 to 3 show cause why the petition be not admitted, it was incumbent on the Court to admit the writ petition and hear both sides at length before passing any order; and (3) that, on account of above position, the petitioner was not given a fair deal before dismissing the writ petition in motion hearing.
As earlier stated, the petitioner was heard fully at the end of motion hearing and so also the counsel for respondents Nos. 1 to 3, Shri R.P. Sinha.
The main averment on the basis of which all the aforesaid submissions are based, i.e. lack of full opportunity to the petitioner is, therefore, wholly non existent.
We are constrained to observe that in making these submissions, the petitioner who is now enrolled as an Advocate, has not been fair to the Court.
The petitioner who is now enrolled as a lawyer was expected to exhibit at least the minimum decorum and sense of responsibility which is expected from a members of this noble profession.
We are pained to observe that the petitioner took a very unreasonable attitude and exhibited a behaviour which could not be appreciated even by the member of the Bar who were present when this order was being dictated in the Court room after the hearing.
However, taking into account the fact that the petitioner is a new entrant in the Bar, we have chosen not to take serious notice of the conduct of the petitioner in the hope that the petitioner having now become a member of the Bar will try to follow the high traditions of the Bar which he has chosen to join.
There is no merit in this Review application.
It is summarily dismissed.
" On being aggrieved by the above order of dismissal dated 2.4.79, the appellant filed Special Leave Petition No. 570 of 1979 before this Court but was not successful as the SLP was dismissed on 25.7.79.
The appellant on being disturbed by the dismissal of his Writ Petition moved a Contempt Petition on 16.4.80 under Section 16 of the (hereinafter referred to as `the Act ') making some 872 serious allegations against the two Hon 'ble Judges of the High Court who dismissed his Writ Petition on 2.4.79 and thereafter the Review Petition on 23.4.79 and also impleaded Shri R.P. Sinha as the third respondent in that petition.
According to the appellant, the contempt petition was registered as M.C.C. No. 136 of 1980 and placed before a Division Bench on 29.4.1980 which after hearing the appellant summarily dismissed contempt petition.
While it was so, the Registry of the High Court examined the allegations made in the affidavit filed by the appellant in M.C.C. No. 136/80 under Rule 5 of Rules regarding contempts framed by the High Court (Notification No. 8958 Nagpur dated the 24th October, 1953) and placed the matter before the learned Chief Justice of the said High Court who on that motion/reference passed an order on 2.5.1980 to place the matter before a Division for further action.
The Division Bench before which the matter was placed took cognizance of criminal contempt and directed issue of notice on 13.5.80 to the appellant directing to show cause as to why he should not be punished for contempt of Court to which the appellant filed his reply raising certain preliminary objections stating that the notice was bad for the reasons, namely, (1) The Section of the Act under which cognizance had been taken was not specifically mentioned; (2) Though the offending portions are marked the notice does not show sufficient cause as to why the words and expressions used therein have been construed as contemptuous; (3) The procedure followed by the High Court was contrary to the rules framed by it; and (4) No consent of the Advocate General has been obtained.
The appellant, on the basis of the above objections prayed to discharge the rule of contempt.
On 11.7.80 when the case came up for hearing, the learned Advocate General filed his reply to the preliminary objection and served a copy of the same to the appellant.
On the same day, the High Court passed an order reading thus: ". .
The Government Advocate further gives notice to the respondent that the contempt proceedings are under article 215 of the Constitution.
Let the respondent take inspection of the original record in case he would like to know the offending portions marked both 873 underlined and side marked and let him file his reply on merits within 15 days.
" Admittedly, the appellant inspected the Court records relating to this matter.
Even thereafter when the appellant persistently requested as under what Section of the Act he has been charged, he was informed that the proceedings were under the provisions of Article 215 of the Constitution of India.
For the proper understanding of the issue in question, we feel that it would be necessary to reproduce the offending words and passages as appearing in the contempt petition.
They are as follows: "7.
That on 2.4.79, when the case came up for hearing, the judicial process required that it was the non applicant, Shri R.P.Sinha who should have been heard in the first instance and he should have been asked by the Court whether he has filed the addition return but on account of misfortune of the petitioner and misconduct of the Presiding Judge, Justice Shri J.S. Verma that he while coming out of the chamber and occupying the seat in the temple of justice called out the petitioner and told him that after the acceptance of the resignation, the petition had become infructuous as such he was dismissing it summarily.
The petitioner was shocked to witness the most illegal and unconstitutional legal process adopted by the Hon 'ble Judge. . . . . . . . .
When the petitioner started arguing his case that his Fundamental Rights were infringed, the Hon 'ble Presiding Judge not only stopped the petitioner from arguing his case but threatened him for dire consequences in case the petitioner argued any more.
This amounts to desacrilege the sanctity of his own Court by the Judges.
. . . . . 9.
The Review Petition was heard by the same Bench in utter disregard of judicial cannon since no person against whom serious allegations have been levelled (against) can be a Judge in his own case.
The Review Petition was also 874 rejected summarily repeating the false averments more in explicit terms that they heard the petitioner as well as the counsel for the respondents thus super imposing the seal of truth over the falsehood.
GROUNDS 1.
The petitioner charges the Hon 'ble Court especially Justice J.S. Verma for adopting a most illegal and unconstitutional judicial process in utter disregard of cannons and principles of adjudication, for showing rude behaviour towards the petitioner.
The amounts to desacrilege the sanctity of his Court.
That when the attention of Justice Verma was drawn on 2.4.79, that he was violating the legal process, he misbehaved with the petitioner without any valid reason which amounts to misconduct of the Judges.
That again on 23.4.1979 when the Review Petition was being argued, he threatened the applicant/petitioner for dire consequences for no valid reasons.
That the High Court is a Temple of Justice and the Judges who occupy the seat of justice are just like Dharamraj.
Dharamraj 's are not supposed to utter falsehood atleast while occupying this sacred seat of Justice.
The Hon 'ble Judges have not only uttered falsehood in their order dated 2.4.79 ( Annexure `B ') but super imposed their false averments in their order dated 23.4.79 in which they stated that they distinctly recollect that the petitioner as well as the counsel for the respondents were heard.
The petitioner 's charge that they do not remember as to what they heard. . . 5.
. . . . . . . . . 6.
The charge against Justice U.N. Bachawat (the associate Judge) is that he silently witnessed the proceedings throughout.
He never uttered a single word or intervened when his senior faltered out and succumbed to the false averments 875 of the Presiding Judge as if was not an independent Judge but serving faithfully and obediently to his master.
. . . . . . . . . 8.
That the petitioner avers that both the contemner Judges have acted and bad faith and have fouled the seat of justice by clear malafides act of theirs and as such no protection can be extended to them under cover a bonafide act done in good faith as Judges.
That both the Judges have violated the sanctity attached to the seat of Justice and have committed a Contempt of their own Court.
Both have acted malafidely in bad faith.
PRAYER It is, therefore, prayed that Contempt Proceedings under Section 16 of the Contempt of Court Act, 1971, may be initiated against Justice J.S. Verma and Justice U.N. Bachawat of the Madhya Pradesh High Court on the aforesaid grounds.
" The High Court after examining the above scandalising remarks made by the appellant in his contempt petition rejected the objections of the appellant/contemner holding that the cognizance of the criminal contempt was taken by it on suo moto, that the contemner was informed that the Court was invoking its jurisdiction under Article 215 of Constitution of India to punish him for contempt, that the does not confer any new jurisdiction by its authority, that in a suo moto action by the High Court, consent of the Advocate General was not necessary, that non quoting of the provisions Section in the notice is immaterial and that the contemner had full notice of the charge of contempt levelled against him and concluded, "We see no defect in the notice served upon the contemner, nor do we find defect in the procedure followed." Then after referring to certain decisions of this Court in Perspective Publications vs State of Maharashtra, ; ; C.K. Daphtary vs O.P. Gupta, ; and Baradakanta Mishra vs Registrar of 876 Orissa High Court; , , the High Court made the following observation with reference to the facts of the case: "16.
The offending portions in paras 7 and 9, and repeated in grounds 1,2,3 and 4,8 and 9 attribute to Mr. Justice J.S. Verma (a) improper motive, (b) unfairness and undue basis in dealing with the case, (c) being a Judge who administers justice in a cursory manner without giving thought to the points involved, (d) of being intemperate in language, impatient and unjust, (e) who would arise false proceedings and when falsity has been brought his notice, would have the audacity to stick to the falsehood.
If the words have this import, the inevitable effect is undermining the confidence of the public in the judiciary.
The person who has indulged in scurrilous abuse of the Judge, must suffer in punishment.
" On the basis of the above observations, the High Court recorded its finding thus: "20.
In our reading of the offending portions duly marked in paras 7,9 and grounds 1,2,3 and 4,8 and 9 of the application dated 16.4.1980 in the context in which they have been written, there are imputations of malafides, bias and prejudice against Mr. Justice J.S. Verma.
The contempt involved in these passages is grossly scandalous.
Coming to the allegations in Ground No. 6 relating to Mr. Justice Bachawat, it was said that "he silently witnessed the proceedings.
He never uttered a single word or intervened when his senior faltered and succumbed to false averments of the Presiding Judge as if he was not an independent Judge but serving faithfully and obediently his master." Finally, the High Court held that the contemner, Mr. Pritam Lal is guilty of criminal contempt of not only scandalising the Court and lowering its authority but also substantially interfering with the due course of justice.
Coming to the question of sentence, the High Court taking note of the defiant attitude of the contemner who even did not think it necessary to 877 apologise but tried to justify the aspersions, sentenced the contemner to suffer simple imprisonment for two months.
Hence the present appeal.
The Contemner, Mr. Pritam Lal appeared before us in person and advanced his arguments which are similar to the submissions made before the High Court, inter alia contending that the impugned order of the High Court should be set aside with costs and suitable compensation on the ground of procedural irregularities in that (1) that the offending remarks have not been communicated to him as per Rules 5 and 9 framed by the High Court; (2) that the cognizance of the criminal cotmpt has not been taken in conformity with Section 15 of the Act; (3) that the procedure after cognizance as prescribed under Section 17 of the Act has not been followed; and (4) that Article 215 of the Constitution of India does not prescribe any procedure to be followed.
According to him he has not been given a fair and full hearing but on the other hand, the learned Judges have browbeaten and unjustly convicted him ignoring the well settled principle that every person has got an inalienable right of making fair criticism.
He has further added that the impugned order was pre conceived and pre judged one.
In addition to the oral arguments, he has filed detailed written arguments, signed on 15.11.88 citing a number of decisions which in our view, do not have any relevance to the facts of the case.
In the written submissions also, he has again made certain outrageous and contemptuous remarks about the Judges of the High Court, in attempting to justify his action which has led to the initiation of the proceedings of contempt of Court before the High Court.
As rightly pointed out by the High Court, these contentions in our opinion do not merit any consideration since every High Court which is a Court of Record is vested with `all powers ' of such Court including the power to punish for contempt of itself and has inherent jurisdiction and inalienable right to uphold its dignity and authority.
Whilst Article 129 deals with the power of the Supreme Court as Court of Record, Article 215 which is analogous to Article 129 speaks of the power of the High Court in that respect.
Prior to the , it was held that the High Court has inherent power to deal with a contempt of itself summarily and 878 to adopt its own procedure, provided that it gives a fair and reasonable opportunity to the contemner to defend himself.
But the procedure has now been prescribed by Section 15 of the Act in exercise of the powers conferred by Entry 14, List III of the Seventh Schedule of the Constitution.
Though the contempt jurisdiction of the Supreme Court and the High Court can be regulated by legislation by appropriate Legislature under Entry 77 of List I and Entry 14 of List III in exercise of which the Parliament has enacted the Act 1971, the contempt jurisdiction of the Supreme Court and the High Court is given a constitutional foundation by declaring to be `Courts of Record ' under Articles 129 and 215 of the constitution and, therefore, the inherent power of the Supreme Court and the High Court cannot be taken away by any legislation short of constitutional amendment.
In fact, Section 22 of the Act lays down that the provisions of this Act shall be in addition to and not in derogation of the provisions of any other law relating to contempt of courts.
It necessarily follows that the constitutional jurisdiction of the Supreme Court and the High Court under Articles 129 and 215 cannot be curtailed by anything in the Act of 1971.
The above position of law has been well settled by this Court in Sukhdev Singh Sodhi vs The Chief Justice and Judges and Judges of the PEPSU High Court, ; holding thus: "In any case, so far as contempt of a High Court itself is concerned, as distinct from one of a subordinate Court, the Constitution vests these rights in every High Court, so no Act of a legislature could take away that jurisdiction and confer it afresh by virtue of its own authority.
" It has been further observed: "The High Court can deal with it summarily and adopt its own procedure.
All that is necessary is that the procedure is fair and that, the contemner is made aware of the charge against him and given a fair and reasonable opportunity to defend himself." In R.L. Kapur vs State of Madras, ; a question arose did the power of the High Court of Madras to punish contempt of itself arise under the so that under Section 25 of the , Sections 63 to 70 of the Penal Code and 879 the relevant provisions of the Code of Criminal Procedure would apply.
This question was answered by this Court in the following words: "The answer to such a question is furnished by Article 215 of the Constitution and the provisions of the themselves.
Article 215 declares that every High Court shall be a court of record and shall have all powers of such a court including the power to punish for contempt of itself.
Whether Article 215 declares the power of the High Court already existing in it by reason of its being a court of record, or whether the article confers the power as inherent in a court of record, the jurisdiction is a special one, not arising or derived from the , and therefore, not within the purview of either the Penal Code or the Code of Criminal Procedure.
" After giving the above answer to the query raised, this Court has reiterated the view held in the case of Sukhdev Singh Sodhi (referred supra).
The view expressed in Sukhdev Singh Sodhi and followed in R.L. Kapur been referred with approval in a recent decision in Delhi Judicial Service Association vs State of Gujarat, ; , holding that the view of this Court in Sukhdev Singh Sodhi is "that even after the codification of the law of contempt in India, the High Court 's jurisdiction as a Court of Record to initiate proceedings and take seisin of the matter remained unaffected by the contempts of Courts Act, 1926.
" Beg, C.J. in Re section Mulgaokar, ; has explained the special power of the Supreme Court under Article 129 stating. "This Court is armed, by Article 129 of the Constitution, with very wide and special powers, as a Court of Record, to punish its contempts.
" In Delhi Judicial Service Association case (supra), it has been pointed out as follows: "Article 129 provides that the Supreme Court shall be a court of record and shall have all the powers of such a court including the power to punish for contempt of itself.
Article 215 contains 880 similar provisions in respect of a High Court.
Both the Supreme Court as well as High Courts are courts of record having powers to punish for contempt including the power to punish for contempt of itself.
" Yet another question whether the provisions of the Code of Criminal Procedure are applicable to such Proceedings, has been negatively answered by this Court in Sukhdev Singh Sodhi case (supra) stating thus: "We hold therefore that the Code of Criminal Procedure does not apply in matters of contempt triable by the High Court.
The High Court can deal with it summarily and adopt its own procedure.
All that is necessary is that the procedure is fair and that the contemner is made aware of the charge against him and given a fair and reasonable opportunity to defend himself.
" See also Brahma Prakash Sharma and Others vs The State of Uttar Pradesh, From the above judicial pronouncements of this Court, it is manifestly clear that the power of the Supreme Court and the High Court being the Courts of Record as embodied under Articles 129 and 215 respectively cannot be restricted and trammelled by any ordinary legislation including the provisions of the and their inherent power is elastic, unfettered and not subjected to any limit.
It would be appropriate, in this connection, to refer certain English authorities dealing with the power of the superior Courts as Courts of Record.
The 1884 edition of Belchamber 's Practice of the Civil Court says at page 241 that "Every superior court of record, whether in the United Kingdom, or in the colonial possessions or dependencies of the Crown has inherent power to punish contempts, without its precincts, as well as in facie curiae. . ." In 9 Halsbury 's Law of England (4th Edition) by Lord Hailsham at page 3 under the caption "Criminal Contempt", the following passage is found: 881 "The superior courts have an inherent jurisdiction to punish criminal contempt. ." It is further stated at page 3 itself that the power to commit by summary process is arbitrary and unlimited, but that power should be exercised with the greatest caution.
In Re Clements and the Republic of Costa Rica vs Erlanger, at page 383, Lord Jessel, M.R. said: ". this jurisdiction of committing for contempt being practically arbitrary and unlimited should be most jealously and carefully watched, and exercised. ," Reference also may be bad to a decision of the Division Bench of the Bombay High Court in State of Bombay vs P., 1958 Bom.
Law Reporter, (60) Page 873 wherein it has been held that the jurisdiction which each Judge of the High Court possesses and uses as constituting a Court of Record is a jurisdiction which is inherent in the Court itself for punishment for contempt of Court, whether it is ex facie the Court or otherwise and that for the exercise of that jurisdiction it is not necessary to refer either to the Letters Patent or the Rules framed by the Court thereunder and that it is a jurisdiction which is being exercised in the same manner as was exercised in the Court of King 's Bench Division in England.
In special feature of the procedure to be followed in a contempt proceeding is the summary procedure which is recognised not only in India but also abroad.
It is an outstanding characteristic of the law of contempt both in England and Scotland that it makes use of a particular and summary procedure which is unknown to any other branch of those countries.
In England, this summary procedure began to be adopted by the common law Courts inspite of trial by jury and that the trial by jury for contempt has steadily declined and has now fallen entirely into disuse.
In other words, consequent upon the use of the summary procedure in England, a person alleged to be in contempt does not enjoy the benefit of some of the safeguards of the ordinary criminal law such as those provided by the Judges ' Rules in England and Wales and the right to trial by jury.
882 Rule 42 of the Federal Rules of Criminal Procedure of United States reads that ``A criminal contempt may be punished summarily if the Judge certifies that he saw or heard the conduct constituting the contempt and that it was committed in the actual presence of the Court." In Ex parte Terry, ; , 307; , , 80 (1888) and in Matsusow vs United States, ; , 339 (5th Cir.
1956), it has been ruled that "If the contempt be committed in the face of the court, the offender may be instantly apprehended and imprisoned at the discretion of the judges, without any further proof or examination.
" In the Contempt of Court by Oswald, the following passage relating to the summary power of punishment is found: "The summary power of punishment for contempt has been conferred on the courts to keep a blaze of glory around them, to deter people from attempting to render them contemptible in the eyes of the public.
These powers are necessary to keep the course of justice free, as it is of great importance to society.
" In the year 1899, Lord Moriss in delivering the judgment of the Judicial Committee in Mc Leod vs St. Aubin said: "The power summarily to commit for contempt is considered for the proper administration of justice." This has long been the practice in India also.
The power under Articles 129 and 215 is a summary power as held in the cases of Sukhdev Singh Sodhi, C.K. Daphtary (referred to above) and in Hira Lal Dixit vs State of U.P., ; Peacock, C.J.laid down the rule quite broadly in the following words in Re Abdool vs Mahtab, 1867 (8 WR) Cr. 32 at page 33: "there can be no doubt that every court of record has the power of summarily punishing for contempt.
" The above view is re stated in a number of decisions of this Court.
In the case of Sukhdev Singh Sodhi it has been observed: 883 ". .the power of a High Court to institute proceedings for contempt and punish where necessary is special jurisdiction which is inherent in all courts of record and section 1 (2) of the Code expressly excludes special jurisdiction from its scope.
" The position of law that emerges from the above decisions is that the power conferred upon the Supreme Court and the High Court, being Courts of Record under Articles 129 and 215 of the Constitution respectively is an inherent power and that the jurisdiction vested is a special one not derived from any other statute but derived only from Articles 129 and 215 of the Constitution of India (See D.N. Taneja vs Bhajan Lal, ; and therefore the constitutionally vested right cannot be either abridged by any legislation or abrogated or cut down.
Nor can they be controlled or limited by any statute or by any provision of the Code of Criminal Procedure or any Rules.
The caution that has to be observed in exercising this inherent power by summary procedure is that the power should be used sparingly, that the procedure to be followed should be fair and that the contemner should be made aware of the charge against him and given a reasonable opportunity to defend himself.
If we examine the facts of the present case in the backdrop of the proposition of law, the contentions raised by the appellant challenging the procedure followed by the High Court do not merit any consideration since the appellant has been served with a notice of contempt and thereafter permitted to go through the records and finally has been afforded a fair opportunity of putting forth his explanation for the charge levelled against him.
Incidently, we may say that the submission of the contemner that the impugned order is vitiated on the ground of procedural irregularities and that Article 215 of the Constitution of India is to be read in conjunction with the provisions of Sections 15 and 17 of the Act of 1971, cannot be countenanced and it has to be summarily rejected as being devoid of any merit.
The remaining important question for consideration are whether the statements which we have extracted in the preceding part of this judgment, made by the contemner amount to a scurrilous attack on the integrity, honesty and judicial impartiality of the learned Judges of the High Court and whether the contemner by his conduct as well as by making such 884 written scandalising statements and invective remarks have interfered and seriously disturbed the system of administration of justice by bringing it down to disrespect and disrepute.
There is an abundance of empirical decisions upon particular instances of conduct which has been held to constitute contempt of Court.
We shall now refer to a few.
Lord Russel of Killowen, L.C.J. has laid down the law of Contempt in at 40 as follows: "Any act done or writing published calculated to bring a Court or a Judge of the Court into contempt, or to lower his authority, is a Contempt of Court.
" The above proposition has been approved and followed by Lord Atkin in Andre Paul vs Attorney General, AIR 1936 PC 141.
Lord Justice Donovan in Attorney General vs Butterworth, , after making reference to Reg.
vs Odham 's Press Ltd., ex parte A.G. said, "Whether or not there was an intention to interfere with the administration of justice is relevant to penalty, not to guilt." This makes it clear that an intention to interfere with the proper administration of justice is an essential ingredient of the offence of contempt of court and it is enough if the action complained of is inherently likely so to interfere.
In Morris vs The Crown Office, at page 1081, Lord Denning M.R. said: "The course of justice must not be deflected or interfered with.
Those who strike at it strike at the very foundations of our society.
" In the same case, Lord Justice Salmon spoke: "The sole purpose of proceedings for contempt is to give our courts the power effectively to protect the rights of the public by ensuring that the administration of justice shall not be obstructed or prevented." 885 Frank Further, J in Offutt vs U.S., ; expressed his view as follows: "It is a mode of vindicating the magesty of law, in its active manifestation against obstruction and outrage." In Jennison vs Baker, at page 1006, it is stated: "The law should not be seen to sit by limply, while those who defy it go free, and those who seek its protection lose hope." Chinnappa Reddy, J. Speaking for the Bench in Advocate General, Bihar vs M.P. Khair Industries, ; citing those two decisions in the ases of Offut and Jennison (supra) stated thus: ". it may be necessary to punish as a contempt, a course of conduct which abuses and makes a mockery of the judicial process and which thus extends its pernicious influence beyond the parties to the action and affects the interest of the public in the administration of Justice.
The public have an interest, an abiding and a real interest, and a vital stake in the effective and orderly administration of justice, because, unless justice is so administered, there is the peril of all rights and liberties perishing.
The Court has the duty of protecting the interest of the public in the due administration of justice and, so it is entrusted with the power to commit for Contempt of Court, not in order to protect the dignity of the Court against insult or injury as the expression "Contempt of Court" may seem to suggest, but to protect and to vindicate the right of the public that the administration of justice shall not be prevented, prejudiced, obstructed or interfered with." Krishna Iyer, J. in his separate Judgment in re section Mulgaokar (supra) while giving the broad guidelines in taking punitive action in the matter of Contempt of Court has stated: ". .if the Court considers the attack on the judge or judges scurrilous, offensive, intimidatory or malicious beyond condonable limits, the strong arm of the law must, in the name of public interest and public justice, strike a blow on him who 886 challenges the supremacy of the rule of law by fouling its source and stream." In the case of Brahma Prakash (supra), this Court after referring to various decisions of the foreign countries as well as of the Privy Council stated thus: "It will be an injury to the public if it tends to create an apprehension in the minds of the people regarding the integrity, ability or fairness of the Judge or to deter actual and prospective litigants from placing complete reliance upon the Court 's administration of justice, or if it is likely to cause embarrassment in the mind of the Judge himself in the discharge of his judicial duties.
It is well established that it is not necessary to prove affirmatively that there has been an actual interference with the administration of justice by reason of such defamatory statement; it is enough if it is likely, or trends in any way, to interfere with the proper administration of law." In Ashram M.Jain vs A.T. Gupta, the facts were thus: The petitioner who filed a special leave petition accompanying by an affidavit affirming the statement made in the said SLP indulged in wild and vicious diatribe against the then Chief Justice of the High Court of Maharashtra.
When the SLP was heard, this Court directed notice to be issued to the petitioner as to why he should not be committed for contempt under the .
After hearing the parties and then not accepting the unconditional apology of the petitioner, this Court convicted the petitioner for contempt and sentenced him to suffer simple imprisonment for a period of two months.
In that case, Chinnappa Reddy, J. speaking for the Bench said: "The strains and mortification of litigation cannot be allowed to lead litigants to tarnish, terrorise and destroy the system of administration of justice by vilification of judges.
It is not that judges need be protected; judges may well take care of themselves.
It is the right and interest of the public in the due administration of justice that has to be protected." 887 Reference may be made to a recent decision of this Court in M.B. Sanghi vs High Court of Punjab and Haryana, ; In that case, the appellant, a practising advocate having failed to persuade the learned Subordinate Judge to grant an ad interim injunction pending filing of a counter by the opposite party, made certain derogatory remarks against the learned Judge who instead of succumbing to such unprofessional conduct made a record of the derogatory remarks and forwarded the same to the High Court through the District Judge to initiate proceedings for Contempt of Court against the appellant.
The High Court holding that the remarks made on the learned Sub Judge are disparaging in character and derogatory to the dignity of the judiciary found the appellant guilty of Section 2 (c) (i) of the .
The appellant therein though denied to have made the remarks, however, offered an unqualified apology.
But the High Court without accepting the apology punished the appellant therein with a fine of Rs. 1,000.
Ahmadi, J. of this Court in his separate judgment has observed: "The tendency of maligning the reputation of judicial officers by disgruntled elements who fail to secure the desired order is ever on the increase and it is high time it is nipped in the bud.
And, when a number of the profession resorts to such cheap gimmiks with a view to browbeating the judge into submission, it is all the more painful.
When there is a deliberate attempt to scandalise which would shake the confidence of the litigating public in the system, the damage caused is not only to the reputation of the concerned judge but also to the fair name of the judiciary.
Veiled threats, abrasive behaviour, use of disrespectful language and at times blatant condemnatory attacks like the present one are often designedly employed with a view to taming a judge into submission to secure a desired order.
Such cases raise larger issues touching the independence of not only the concerned judge but the entire institution.
The foundation of our system which is based on the independence and impartiality of those who man it will be shaken if disparaging and derogatory remarks are made against the presiding judicial officers with impunity.
It is high time that we realise that the much cherished judicial independence has to be protected not only from the executive or 888 the legislature but also from those who are an integral part of the system." After having made the above observation, the learned judge concerned with the conclusion of Agarwal, J. dismissing the appeal and while doing so, he expressed his painful thought as follows: "When a member of the bar is required to be punished for use of contemptuous language it is highly painful it pleases none but painful duties have to be performed to uphold the honour and dignity of the individual judge and his office and the prestige of the institution.
Courts are generally slow in using their contempt jurisdiction against erring members of the profession in the hope that the concerned Bar Council will chasten its member for failure to maintain proper ethical norms.
If timely action is taken by the Bar Councils, the decline in the ethical values can be easily arrested.
" We are in full agreement with the above view.
Reverting to the facts of the case, the offending criticism and the scandalising allegations made by the appellant/contemner are most fatal and dangerous obstruction of justice shaking the confidence of the public in the administration of justice and calling for a more rapid and immediate punitive action.
These calculated contemptuous remarks and the sweeping allegations which we have extracted above are derogatory in character not only to the dignity of the learned Judges casting aspersions on their conduct in the discharge of their judicial functions but also wounds the dignity of the Court.
It is highly painful to note that the appellant/contemner who is none other than an Advocate practising in the same highest Court of the state after having failed to wrench a decision in his favour in his own cause which he prosecuted as party in person has escalatingly scandalised the Court by making libellous allegations which are scurrilous, highly offensive, vicious, intimidatory, malacious and beyond condonable limit.
Even a cursory reading of the remarks made against the learned Judge of the High Court unambiguously show that the potentially prejudicial utterances and the outrageous allegations rumbustiously and invectively made by the contemner with malacious design of attempting to impair 889 the administration of justice have struck a blow on the judiciary and also seriously sullied the image, dignity and high esteem which the office of the Judge of the High Court carries with it and thus impeded the course of justice by fouling its source and steam.
In our opinion, the incident in question is a flagrant onslaught on the independence of the judiciary, destructive of the orderly administration of justice and a challenge to the supremacy of the Rule of Law.
The maxim "Salus populi suprema lex", that is "the welfare of the people is the supreme law" adequately enunciates the idea of law.
This can be achieved only when justice is administered lawfully, judicially, without fear or favour and without being hampered and thwarted, and this cannot be effective unless respect for it is fostered and maintained.
To punish an Advocate for Contempt of court, no doubt, must be regarded as an extreme measure, but to preserve the proceedings of the Courts from being deflected or interfered with, and to keep the streams of justice pure, serene and undefiled, it becomes the duty of the Court, though painful, to punish the contemner in order to preserve its dignity.
No one can claim immunity from the operation of the law of contempt, if his act or conduct in relation to Court or Court proceedings interferes with or is calculated to obstruct the due course of justice.
In view of the above heinous type of scandalising the Court, we unhesitatingly confirm the finding of the High Court that the appellant/contemner has made himself guilty of criminal contempt.
Coming to the question of sentence, it appears from order of the High Court that the appellant had adopted a defiant attitude and tried to justify the aspersions made by him even without thinking it necessary to apologise.
Before this Court also, the appellant has neither expressed any contrition nor has he any repentance for the vicious allegations made against the learned Judges of the High Court.
But on the other hand, he has exhibited a dogged determination to pursue the matter, come what may.
A reading of his memorandum of grounds and the written and signed arguments show that he was ventured into another bout of allegations against the High Court Judges and persisted in his campaign of vilification.
His present conduct has aggravated rather than mitigating his offence.
890 Therefore, having regard to the sentencing policy that punishment should be commensurate with the gravity of the offence, we hold that the sentence of 2 months, imprisonment in no way calls for interference and accordingly the sentence is confirmed.
For the reasons aforementioned, the Criminal Appeal is dismissed.
N.P.V. Appeal dismissed.
| The appellants were alleged to have kidnapped, wrongfully confined and raped S, the daughter of PWs 5 and 6.
They were prosecuted for offences punishable under section 363, 366 and 376 of the Indian Penal Code.
S was examined before the Magistrate where she stated that because of the threat given by the appellants and as instructed by them she lodged a false report at the police station implicating some other persons, whereas infact she was kidnapped, wrongfully confined and raped by the appellants.
The Magistrate, discharged the first appellant, and committed the second appellant alone to take his trial.
On a revision preferred against the order of discharge of the first appellant both the appellants were 314 put up for trial before the third Additional Sessions Judge, Bhopal.
During the said trial both appellants were on bail.
The case was fixed for 21.8.1972 on which date the victim S was to be examined as a prosecution witness.
While the matter stood thus S lodged a report at the Police Station complaining that the second appellant had forcibly entered into the backyard of her house, but took to his heels when she raised a hue and cry.
However, it was alleged that on the night of 20.8.72, i.e. immediately before the day when the case was fixed and victim S was to be examined as a prosecution witness, the first appellant armed with a pistol and the second appellant with a `farsa ' entered into the house of S and the first appellant fired a shot causing instantaneous death of section The appellants were prosecuted for murder.
The Sessions Judge acquitted both the appellants.
The State preferred an appeal before the High Court.
The High Court allowed the appeal, set aside the acquittal order and convicted the first appellant under Section 302 and the second appellant under section 302, read with Section 34 IPC and sentenced each of them to undergo imprisonment for life.
The appellants preferred an appeal to this Court under section 379 of the Code of Criminal Procedure and Section 2 (a) of the and it was contended on their behalf (i) that the High Court erred in reviewing the evidence and reversing the order of acquittal; (ii) that the prosecution has failed to prove the motive of the crime; (iii) the victim 's parents were inimical towards the appellants and their evidence cannot be relied upon because they were interested witness.
Dismissing the appeal, this Court, HELD : 1.
The Trial Court was wrong in jettisoning the entire evidence in a very scanty and unsatisfactory manner with unsound reasoning.
Whilst the Trial Court 's conclusion was arrived at by abjuring the unimpeachable and reliable evidence of parents of the deceased on speculative reasons and unreasonable grounds, the contrary conclusion of the High Court based on the evolution of the evidence does not suffer from any illegality or manifest error or perversity nor is it erroneous.
Further, independent analysis of the evidence by this Court shows that there are absolutely no substan 315 tial and compelling reasons to brush aside the testimony of these two eye witnesses and to take a contrary finding to that of the High Court.
[331 C D; F G] 1.1 The organic synthesis of the events, circumstances and facts of the case lead only to one conclusion, namely, that the prosecution has satisfactorily proved the guilt of the accused beyond any shadow of doubt and consequently the judgment of the High Court does not call for any interference.
[334 C D E} Tarachand vs State of Maharashtra, ; = ; ; Kishan and Ors.
vs State of Maharashtra.
; ; Mahebub Beg and Ors.
vs State of Maharashtra, (S.C.) ; Babu vs State of UP.
, ; 2 S.C.R. 771; Podda Narayana and Ors.
vs State of Andhra Pradesh, ; [1975] Supp.
S.C.R. 84; Ram Kumar Pande vs The State of Madhya Pradesh, ; 3 S.C.C. 815; Rajendra Prasad State of Bihar A I R SC 10 59 = = [1977]3 SCR 68; Kishore Singh and Anr.
vs The State of Madhya Pradesh, A.I.R. 1977 S.C. 2267 = [1978] 1.S.C.R. 635; Bhajan Singh and Ors.
vs State of Punjab, [1978] 4 S.C.C. 77; Dinanath Singh & Ors.
vs State of Bihar, A.I.R. 1980 S.C. 1199 = ; Pattipati Venkaiah vs State of Andhra Pradesh ; Sita Ram and Ors.
vs State of U.P., [1979] 2 S.C.C. 656; Rajput Ruda Meha and Ors.
vs State of Gujarat, ; referred to.
Roop Singh and ors.
vs State of Punjab; , = ; ; Dargahi and ors.
vs State of U.P., A.I.R. 1973 S.C. 2695 = ; Barati vs State of U.P., ; = [1974] 3 S.C.R. 570; G.B. Patel vs State of Maharashtra, A.I.R. 1979 S.C. 135 = ; ; Kanwali vs State of U.P. ; referred to. 2.
There is overwhelming evidence both oral and documentary in clearly establishing a strong motive for the appellants to put an end to the life of the deceased.
The several impelling circumstances attending the case namely, the prior incident of kidnapping and rape, the conduct of the deceased in giving her statement supporting the case of the prosecution, the lodging of the complaint by S against the second appellant and lastly the posting of the case for recording the evidence of S when taken in conjunction with the evidence of parents of the victim unevasively and unerringly show that these two appellants had strong motive to snap the life thread 316 of the victim so that she could not give evidence on the next date in the case of kidnaping and rape.
[327 C D E; 328 A D C] State of Punjab vs Pritam Singh. ; relied on.
Interested witnesses are not necessarily false witnesses though the fact that those witnesses have personal interest or stake in the matter must put the court on its guard, that the evidence of such witnesses must be subjected to close scrutiny and the Court must access the testimony of each important witness and indicate the reasons for accepting or rejecting it and that no evidence should be at once disregarded simply because it came from interested parties.
[330 A B] Siya Ram Rai vs State of Bihar, ; Sarwan Singh vs State of Punjab, ; Birbal vs Kedar, ; = ; ; Gopal Singh v State of U.P. A I R 1979 S.C.1822=[1978] 3 S.C.C. 327; Hari Obulla Reddy & Ors.
vs State of Andhra Pradesh, ; Anvaruddin & Ors.
vs Shakoor & Ors., [1990] 2 Judgments today S.C. 83; relied on.
3.1 The evidence of parents of the deceased cannot be thrown over board simply on the ground that their evidence is of the interested party because when the occurrence had taken place inside the house, that too at dead of night, it would be futile to expect of the prosecution to produce independent outsiders as witnesses.
The parents of the victim are the natural and probable eye witnesses as the incident had occurred in the odd hours inside their house.
Being the parents of the victim, they would be the least disposed to falsely implicate the appellants or substitute them in place of the real culprit.
[330 D; 328 E; 331 E] 3.2 The chronology of events narrated and the factual conspectus recounted by the parents of the deceased are unshakable and the intrinsic quality of the evidence of these two witnesses compel this Court to implicitly rely on their testimony and to accept the same.
In spite of the fact that these two witnesses have been subjected to intensive and incisive cross examination, nothing tangible has been brought for discarding their testimony.
No doubt, the earlier conduct of the appellants in kidnapping and forcibly raping their daughter, the victim should have inflicted deeper wounds in minds of these two witnesses, but that cannot in any way destroy the value of their evidence which is cogent and trustworthy.
[330 H; 331 A B] 317
|
ivil Appeal No. 2083 of 1972.
70 From the Judgment and Order dated 24.9.
1971 of the Allahabad High Court in Income Tax Appeal No. 535 of 1970.
S.C. Manchanda and Mrs. A Subhashini for the Appellant.
Ms. Rachna Gupta and S.K. Bagga for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal arises out of the decision of the Allahabad High Court dated 24.9.1971.
The High Court by the order impugned dismissed an application under section 256(2) of the Income Tax Act, 1961 (hereinaf ter called the 'Act ').
The assessee, a firm of two partners was at the relevant time a licence vender of country liquor.
For the assessment year 1965 66, the Income tax Officer rejected its account books on the ground that sales and expenses were not verified and the margin of profit shown was low.
It may not be inappropriate in view of the conten tions urged before us, to refer to the order of the Inspect ing Assistant Commissioner for the assessment year 1965 66 under section 271(1)(c) read with section 274(2) of the Act.
For the assessment year 1965 66, the Income Tax Officer, as noted by the Inspecting Assistant Commissioner, rejected the book result showing sales of country liquor at Rs.5,82,234 and the profit margin at 4% for lack of verifia bility of sales and expenses and low margin of profit.
The Income Tax Officer estimated the sales at Rs.7,60,000 being Rs.6,50,000 in Lakhibagh shop and Rs. 1,10,000 in Magra shop, and adopted the net profit rate at 8% thereby comput ing the profit at Rs.60,800 and the total income was comput ed at Rs.60,936 after addition of Rs. 136 for interest receipts.
On appeal, the Appellate Assistant Commissioner confirmed the order of the IncomeTax Officer.
As the total income returned was less than 80% of the correct income computed, the case fell within the ambit of the Explanation to section 271(1) of the Act.
In pursuance to the notice under section 274 read with section 271 of the Act for default under section 271(1)(c) the assessee showed cause.
It was urged on behalf of the assessee before the Inspecting Assistant Commissioner that the returned income was based on the books of accounts and excise registers maintained by the assessee firm and the income was estimated.
It was further urged that the failure to return the correct income if any, did not arise from any fraud or gross 71 or wilful neglect on the part of the assessee firm.
The Inspecting Assistant Commissioner, however, held that by producing what the Inspecting Assistant Commissioner termed to be defective account books, it could not be said that the assessee had shown correct income.
The Inspecting Assistant Commissioner further noted that the sales and expenses were unverifiable.
The Inspecting Assistant Commissioner was further of the opinion that the addition made by the Income tax Officer was due to non production of the material data which the assessee firm ought to have produced for proper determination of its income.
In arriving at the net profit @ 8%, the Income tax Officer had made the allowance for expenses and purchases at 92% of the sales at Rs.7,60,000 i.e. at Rs.6,99,200 which covered all the ex penses and purchases found reasonable.
The Inspecting As sistant Commissioner was, therefore, of the opinion that the assessee firm was grossly negligent and had not discharged the onus of proving that the said difference between the income returned and the correct come did not arise from any gross or wilful neglect on the part of the assessee and as such, in view of the Explanation to section 271(1), the provisions of section 271(1)(c) were clearly attracted.
On this basis the Inspecting Assistant Commissioner levied a penalty of Rs.8,300 under section 271(1)(c) read with sec tion 274(2) of the Act.
The assessee went up in appeal before the Tribunal.
The Tribunal noted the facts.
It may be noted that subsequent to the order of the Inspecting Assistant Commissioner, that is to say on 26th September, 1968, the quantum appeal was heard and partly allowed by the Appellate Tribunal.
By its order dated 26th September, 1968 the Tribunal held that when viewed in the light of the licence fee paid by the assessee, estimates of the turnover were on the high side.
The lower rates of profit were placed in cases of other liquor con tractors and that in the circumstances, the rate of net profit for both the shops should be 7% on estimated sales of Rs.6,25,000 for Lakhi Bagh shop and of Rs. 1,00,000 for the Magra shop.
In view of this order, the income finally deter mined for the assessment year was Rs.50,750.
It is the case of the appellant that 80% of the income finally assessed is Rs.40,600 which is much higher than the income returned at Rs.30,138.
However, on behalf of the assessee, it was contended that the assessee did not conceal the particulars of income nor furnish inaccurate particulars thereof, that the income returned was based on the books of account maintained in the regular course of business, that the assessee could only declare the income as reflected in the books of account, that the difference between the re turned income and the 72 assessed income did not arise from any fraud or gross or wilful neglect on the part of the assessee and that it could not be considered in the circumstances that the assessee came within the mischief of Explanation to section 271(1)(c) of the Act.
After reviewing certain other cases, the Tribunal was of the view that like the cases referred to by the Tribunal 's order, the assessee had maintained certain types of books of account and it had appeared that it had honestly believed that the same were sufficient for the true ascertainment of his profits and from the facts he disclosed it could not be said that he had been grossly or wilfully negligent in filing such a return of income as he did and as such there was no fraud.
In conformity with the other orders referred to by the Tribunal in the impugned order, it was held by the Tribunal that in the instant case, the Inspecting Assistant Commissioner had erred in his finding and therefore, the penalty order was cancelled.
From this decision of the Tribunal under section 256(1), a reference was sought to the High Court on the following question: "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in cancelling the penalty imposed under section 271(1)(c)?" The Tribunal found that it was clear from a perusal of the order passed by the Tribunal that it was not in doubt that the assessee returned the income on the books of ac count maintained in the regular course of business and that the difference between the income returned and the income assessed arose mainly on account of excess profit, in view of the various defects in the account books and the applica tion of a higher net profit rate on estimated turnover.
Following the earlier orders of the Tribunal in similar cases, the Tribunal held that if the assessee maintained certain types of books of account and honestly believed the same to be sufficient for the true ascertainment of his profits, it could be considered as making an estimate of income on a proper basis and it could not be said that in filing the return of income as reflected in the books of account, the assessee was grossly or wilfully negligent, much less fraudulent.
The penalty order was vacated on this basis.
The Tribunal was of the opinion that on this finding no question of law arose and as such there was no scope for reference of the said question to the High Court.
the appli cation under section 256(1) was, therefore, rejected.
The revenue went up before the High Court under section 256(2) 73 of the Act seeking a reference on the question mentioned hereinbefore.
The High Court by the judgment under appeal after referring to the facts mentioned hereinbefore was of the view that no question of law arose in this case.
The High Court opined in the impugned judgment that the finding of the Tribunal that the assessee acted honestly notwith standing the defective nature of the account books main tained by him was a finding of fact.
In the premises, the reference application was dismissed.
As mentioned hereinbe fore, this appeal arises from the said decision of the High Court.
After amendment by the Finance Act, 1964, section 271 of the Act along with the Explanation reads as follows: "271: Failure to furnish returns, com plying with notices, concealment of income, etc.
(1) If the Income tax Officer or the appellate Assistant Commissioner, in the course of any proceedings under this Act, is satisfied that any person ( i i ) . . . . . . . . . (c) has concealed the particulars of his income or furnished inaccurate particulars of such income, he may direct that such person shall pay by way of penalty, (iii) In the cases referred to in clause (c) in addition to any tax payable by him a sum which shall not be less than 20% but shall not exceed one and a half times the amount of tax, if any, which would have been avoided if the income as returned by such person had been accepted as correct income.
Explanation: Where the total income returned by any person is less than 80% of the total income (hereinafter in this explanation re ferred to as the correct income) as assessed under section 143 or section 144 or section 147 (reduced by the expenditure incurred bona fide by him for 74 the purpose of making or earning any income included in the total income, but which has been disallowed as a deduction), such person shall, unless he proved 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 particulars of his income or furnished inaccu rate particulars of such income for the pur pose of clause (c) of this sub section.
" It is clear that if the Income Tax Officer and the Appellate Assistant Commissioner were satisfied that the assessee had concealed the particulars of his income or furnished inaccurate particulars of such income, he can direct that such person should pay by a penalty the amount indicated in sub clause (ii) of clause (c) of section 271(1) of the Act.
Before the amendment, difficulty arose and it is not necessary to trace the history, under the law as stood prior to the amendment of 1964, the onus was on the revenue to prove that the assessee had furnished inaccurate particu lars or had concealed the income.
Difficulties were found to prove the positive element required for concealment under the law prior to amendment, this positive element had to be established by the revenue.
To obviate that difficulty the explanation was added.
The effect of the explanation was that where the total income returned by any person was less than 80% 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 concealed the particulars of his income or furnished inaccurate particulars, for the purpose of section 271(1).
The position is that the moment the stipulated difference was there, the onus that it was not the failure of the assessee or fraud of the assessee or neglect of the assessee that caused the difference shifted on the assessee but it has to be borne in mind that though the onus shifted, the onus that was shifted was rebuttable.
If in an appropriate case the Tribunal or the fact finding body was satisfied by the evidence on the record and inference drawn from the record that the assessee was not guilty of fraud or any gorss or wilful neglect and if the revenue had not adduced any further evidence then in such a case the assessee cannot come within the mischief of the section and suffer the imposition of penalty.
That is the effect of the provision.
Our attention was drawn to several decisions to which out of deference, to Shri Manchanda who argued before us on behalf of the revenue, we shall refer.
Vishwakarma Indus tries vs Commissioner of 75 Income Tax, Amritsar 1, is a decision of the Full Bench of the Punjab and Haryana High Court where Sand hawalia, C.J. speaking for the Full Bench observed that the object and intent of the legislature in omitting the word "deliberately" from clause (c) of section 271(1) of the Income Tax Act, 1961 and adding an Explanation thereto by the Finance Act, 1964, was to bring about a change in the existing law regarding the levy of penalty so as to shift the burden of proof from the department on to the assessee in the class of cases where the returned income of the assessee was less than 80% of the assessed income.
The learned Chief Justice noted that the significant thing about the change made in clause (c) of section 271(1) was the designed omission of the word "deliberately" therefrom, whereby the requirement of a designed furnishing of inaccu rate particulars of income was obliterated.
According to the learned Chief Justice, the language of the Explanation indicated that for the purposes of levying penalty the legislature had made two clear cut divisions.
This had been done by providing a strictly objective and an almost mathe matical test.
According to the Chief Justice, the touchstone therefor was the income returned by the assessee as against the income assessed by the department which was designated as "the correct income".
The case where the returned income was less than 80% of the assessed income can be squarely placed into one category.
Where, however, such a variation is below 20% that would fall into the other category.
To the first category, where there is a larger concealment of income, the provisions of the Explanation become at once applicable with the resultant attraction of the presumptions against such an assessee.
Once the Explanation is held to be applicable to the case of an assessee, it straightaway raises three legal presumptions, viz. (i) that the amount of the assessed income is the correct income and it is in fact the income of the assessee himself; (ii) that the failure of the assessee to return the correct assessed income was due to fraud; or (iii) that the failure of the assessee to return the correct assessed income was due to gross or wilful neglect on his part.
But it must be emphasised that these are presumptions and become rule of evidence but the presumptions raised are not conclusive presumptions and are rebuttable.
We are of the opinion that the view of the Full Bench of the Punjab and Haryana High Court is a correct view when it states that it only makes a presumption but the presumption is rebuttable one and if the fact finding body on relevant and cogent materials comes to the conclusion that in spite of the presumption the assessee was not guilty, such conclu sion does not raise any question of law.
76 Our attention was drawn to the decision of the Division Bench of the Allababad High Court in Addl.
Commissioner of Income Tax, Lucknow vs Lakshmi Industries and Cold Storage Co. Ltd., There the High Court found that the assessee had not given any explanation.
So, on the facts found, the inference of the Tribunal that the amounts had been added and the evidence had been found unsatisfactory was not correct.
Penalty was exigible in that case and the High Court found that the Tribunal was wrong in cancelling the penalty.
As mentioned hereinbefore, it depends upon the facts and circumstances of each case.
If a party comes within the mischief of the Explanation then there is a presumption against him and the onus to discharge the presumption lies on the assessee but being a presumption it is a rebuttable one and if on appropriate materials, that presumption is found to be rebutted no question of law can be said to arise.
The Full Bench of the Andhra Pradesh High Court in Commissioner of Income Tax vs
H. Abdul Bakshi & Bros., again reiterated that the presumption spelt out becomes a rule of evidence.
Presumptions raised by the Explanation to section 271(1)(c) are rebuttable presump tions.
The initial burden of discharging the onus of rebut tal is on the assessee.
Once that initial burden is dis charged, the assessee would be out of the mischief unless further evidence was adduced.
Here there was none.
Similarly, the Full Bench of the Patna High Court in the case of Commissioner of Income Tax, Bihar vs Nathulal Agar wala and Sons, had occasion to consider this.
The High Court reiterated that the onus to discharge the presumption raised by the Explanation was on the asses see and it was for him to prove that the difference did not arise from any fraud or wilful neglect on his part.
The court should come to a clear conclusion whether the assessee had discharged the onus or rebutted the presumptions against him.
The Patna High Court emphasised that as to the nature of the explanation to be rendered by the assessee, it was plain on principle that it was not the law that the moment any fantastic or unacceptable explanation was given, the burden placed upon him would be discharged and the presump tion rebutted.
We agree.
We further agree that it is not the law that any and every explantion by the assessee must be accepted.
It must be acceptable explanation, acceptable to a fact finding body.
77 Mrs. Gupta, appearing for the assessee, drew our atten tion to the observations of the Division Bench of the Gau hati High Court in Commissioner Income Tax, Assam, Nagaland, Manipur & Tripura vs Chhaganlal Shankarlal, Our attention was also drawn on behalf of the assessee to the decision of the Division Bench of the Allahabad High Court in Commissioner of Income Tax vs Nadir Ali and Company There the court observed that under section 271( 1)(c) read with the Explanation, a penalty could be imposed if the income returned was less than 80% if the assessee did not prove that the disparity between the income assessed and the income returned by him was not due to gross neglect or fraud.
The fact that the assessee was not main taining his books of account in a particular way did not show that he was guilty of gross neglect.
The Income tax Act did not prescribe the manner in which the account books should be maintained.
When the assessee filed his return on the basis of accounts which were maintained in the regular course of business it could not be said that he was guilty of gross negligence.
It could not be expected from the assessee to file a return showing a higher income than what was worked out merely because the department had applied a higher rate of profit in the earlier years.
It was held by the Allahabad High Court that on the facts, the assessee had sufficiently discharged the burden.
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 wilful neglect or 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 relevancy.and sufficiency of the materi als.
If such a fact finding body beating the aforesaid principles in mind comes to the conclusion that the assessee has discharged the onus, it becomes a conclusion of fact.
No question of law arises.
In this case the Tribunal has borne in mind the relevant principles of law and has also judged the facts on record.
It is not a case that there was no evidence or there was such evidence on which no reasonable man could have accepted the explanation of the assessee.
In that view of the matter, in our opinion, the Tribunal tight ly rejected the claim for reference under section 256(1) and the High Court correctly did not entertain the application for reference under section 256(2) of the Act.
The appeal, therefore, fails and is accordingly dismissed with costs.
M.L.A. Appeal dis missed.
| The Income tax Officer rejected the account books of the respondent assessee on the ground that the sales and ex penses were not verified and the margin of profit shown was low.
He adopted the net profit rate at 8% thereby com puting the profit at Rs.60,800 and the total income was computed at Rs.60936 after addition of Rs. 136 for interest receipts.
On appeal the Appellate Assistant CommiSsioner confirmed this order of the Income tax Officer.
As the total income returned was less than 80% of the correct income computed, he held that the case feb within the ambit of s.27 1(1) of the Act, and issued a show cause notice under sec tion 274 read with section 271 to the assessee.
It was contended on behalf of the assessee before the Appellate Assistant Commissioner (i) that the assessee did not conceal the particulars of income nor furnish inaccurate particu lars; (ii) that the income returned was based on the books of account maintained in the regular course of business; (iii) that the assessee could only declare the income as ref1ected in the books of account; (iv) that the difference between the returned income and the assessed income did not arise from any fraud or gross or unlawful neglect on the part of the assessee; and (v) that it could not be consid ered in the circumstances that the assessee came within the mischief of s.27 1(1)(c) of the Act.
The Appellate Assistant Commissioner rejected these contentions, confirmed the order of the Income tax Officer and in view of the Explanation to section 271(1) levied a penalty of Rs.8,300 under section 271(D(c) read with section 274(2) of the Act.
The respondent assessee went up in appeal to the Tribu nal which cancelled the penalty order 'and finally deter mined the income of the assessee at Rs.50,750 holding: (a) that the assessee had maintained certain types of books of account and had honestly believed that the same were suffi cient for the true ascertainment of his profits and, from 68 the facts he disclosed, it could not be said that he had been grossly or wilfully negligent in filing the return of income and as such there was no fraud; (b) that the differ ence between the income returned and the income assessed arose mainly on account of excess profit, in view of the various defects in the account books and the application of a higher profit rate on estimated turnover.
The application of the appellant revenue seeking refer ence under s.256( D of the Act, was rejected by the Tribunal on the ground that no question of law arose.
The appellant revenue went before the High Court under section 256(2) of the Act seeking a reference on the ques tion of cancelling the penalty imposed under sec.
271(1)(c) of the Act, and this application was also dismissed on the ground that the finding of the Tribunal that the assessee acted honestly notwithstanding the defective nature of the account books maintained by him was a finding of fact and therefore no question of law arose.
Dismissing the appeal of the appellant revenue, this Court, HELD: 1. I If the Income tax Officer and the Appellate Assistant Commissioner were satisfied that the assessee had concealed the particulars of his income or furnished inaccu rate particulars of such income, he can direct that such person should pay by way of a penalty the amount indicated in sub clause (ii) of clause (c) of section 271(1).
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.
Difficulties were found to prove the positive ele ment required for concealment under the law prior to amend ment.
This positive element had to be established by the revenue.
To obviate that difficulty, the explanation was added.
The effect of the Explanation is that where the total income returned by any person is less than 80% of the total income assessed, the onus is on such person to prove that the failure to file the correct income does not arise from any fraud or any gross or wilful neglect on his part and unless he does so, he should be deemed to have concealed the particulars of his income or furnished inaccurate particu lars, for the purpose of section 271(1).
The position is that the moment the stipulated difference was there, the onus that it was not the failure of the assessee or fraud of the assessee or neglect of the assessee that caused the difference shifted on 69 the assessee but it has to be borne in mind that though the onus shifted, the onus that was shifted was rebuttable.
1.3 If in an appropriate case the Tribunal or the fact finding body was satisfied by the evidence on the record and inference drawn from the record that the assessee was not guilty of fraud or any gross or wilful neglect and if the revenue had not adduced any further evidence then in such a case the assessee cannot come within the mischief of the section and suffer the imposition of penalty.
That is the effect of the provision.
1.4 Presumptions raised by the Explanation to section 271(1)(c) are rebuttable presumptions.
The initial burden of discharging the onus of rebuttal is on the assessee.
Once that initial burden is discharged, the assessee would be out of the mischief unless further evidence was adduced.
1.5 If the returned income is less than 80% of the assessed income, the presumption is raised against the assessee that the assessee is guilty of wilful neglect or 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 relevancy and suffi ciency 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.
No question of law arises.
In the instant case, the Tribunal has borne in mind the relevant principles of law and has also judged the facts on record.
It is not a case that there was no evidence or there was such evidence on which no reasonable man could have accepted the explanation of the assessee.
In that view of the matter the Tribunal rightly rejected the claim for reference under section 256(1) and the High Court correctly did not entertain the application for reference under sec tion 256(2) of the Act.
If a party comes within the mischief of the Explana tion to section 27 1 then there is a presumption against him and the onus to discharge the presumption lies on the asses see but being a presumption ' it is a rebuttable one and if on appropriate materials, the Tribunal has rebutted that presumption, no question of law can be said to arise.
|
iminal Appeal No. 33 of 1955.
Appeal under Articles 132 (1) and 134 (1) (c) of the Constitution of India from the Judgment and Order dated June 30, 1954, of the Court of Judicial Commissioner, Kutch in Criminal Revision Application No. 13 of 1952.
Porus A. Mehta and B. H. Dhebar, for the appellant.
H. J. Umrigar, for the respondent.
March 7.
The Judgment of the Court was delivered by KAPUR J.
Two important questions arise for decision in this case of a small magnitude and the State has filed this appeal not for the purpose of obtaining a conviction but because of the importance of the questions raised and implications of the judgment 747 of the Judicial Commissioner.
The respondent was convicted of an offence under section 12(a) of the Bombay Prevention of Gambling Act (Act IV of 1887 hereinafter termed the Bombay Act) as applied to Kutch and was sentenced to a fine of Rs. 50 or in default simple imprisonment for 15 days and for feiture of the amounts recovered from the respondent at the time of the commission of the offence.
He took a ' revision to the Judicial Commissioner of Kutch, who hold that the Act under which the respondent had been convicted had not been validly extended to and was not.
in force in the State of Kutch.
It is the correctness of this decision which has been canvassed before us.
There was sufficient evidence against the respondent which was accepted by the trying magistrate; and if the Act was validly extended to and was in operation in the State of Kutch, his conviction by the learned magistrate was correct and his acquittal by the learned Judicial Commissioner erroneous.
On June 7, 1951, the respondent, it was alleged committed the offence he was charged with He was convicted by the magistrate on July 26, 1951, and his revision to the Sessions Judge was dismissed.
He then took a revision to the Judicial Commissioner of Kutch who allowed his petition on June.
30, 1954, and granted a certificate under articles 132(1) and 134(1) of the Constitution.
Kutch before 1948 was what was called an Indian State.
The Maharao of Kutch handed over the gover.
nance of the State to the Dominion of India on June 1, 1948 and thus the whole administration of the State passed to the Dominion and it became a Centrally administered area.
On July 31, 1949, the then Central Government issued under section 4 of the Extra Provincial Jurisdiction Act (Act XLVII of 1947), an order called the Kutch (Application of Laws) Order, 1949.
Under cl. 3 of this order certain enactments were applied to Kutch with effect from the date of the commencement of the order.
One of these enactments was the Bombay Act.
Clauses 4 and 6 of this order are important and may be quoted; 748 4.
"Except as otherwise specifically provided in the first schedule to this order the enactments applied by this order shall be construed as if references therein to the authorities and territories mentioned in the first column of the table hereunder printed were references to the authorities and territories, respectively, mentioned opposite thereto in the second column of the said table.
TABLE.
Provincial Government, Governor The Chief Commissioner of Kutch.
or Chief Controlling Revenue Authority.
Government The Central Government or the Chief Commissioner, as the con text may require.
High Court Court of the judicial Commissioner, Kutch.
Provinces of India, any Province Kutch or any part thereof of India or any part thereof.
The Province or Presidency of Kutch or any part thereof.
Bombay or any part thereof.
" Any Court may construe the provisions of any enactment, rule, regulation, general order or byelaw applied to Kutch or any part thereof by this order, with such modifications not affecting the substance as may be necessary or proper in the circumstances.
" On August 1, 1949, Kutch became a Chief Commissioner 's province under the States Merger (Chief Commissioners Provinces) Order, 1949.
Clause 2(1)(c) of this order is as follows: " As from the appointed day, the parts of States specified in the Second Schedule to this order shall be administered in all respects as if they were a Chief Commissioner 's Province, and shall be known as Chief Commissioner 's Province of Kutch.
" The Second Schedule gives the parts of the pre 1947 Indian States which were to comprise the Chief Commissioner 's Province of Kutch.
Under el. 4 of this Order all laws which were in force including orders made under section 4 of the Extra Provincial Jurisdiction Act of 1947, were to continue in force until replaced.
On January 1, 1950, Merged States ' Laws Act (Act LIX of 1949), came into force.
By this Act certain Central Acts were extended to the province of Kutch 749 including the General Clauses Act (Act X of 1897).
On January 26, 1950, the Constitution of India came into force and Adaptation of Laws Order, 1950, was promulgated the same day.
Clause 4(1) of this order provides: "Whenever an expression mentioned in column 1 of the table hereunder printed occurs (otherwise than in a title or preamble or in a citation or description of an enactment) in an (existing Central or Provincial Laws) whether an Act, Ordinance or Regulation mentioned in the Schedule to this Order or not, then, unless that expression is by this Order expressly directed to be otherwise adapted or modified, or to stand unmodified, or to be omitted, there shall be substituted therefor the expression set opposite to it in column 2 of the said Table, and there shall also be made in any sentence in which the expression occurs such consequential amendments as the rules of grammar may require." The necessary portions of the table are: Province (except where it occurs in any expression mentioned above) State Provincial. . .
State Provinces (except where it occurs in any expression mentioned above).
States Clauses 15 and 16 in (Part III) Supplementary, are as follows: 15.
" Save as is otherwise provided by this Order, all powers which under any law in force in India or any part thereof were, immediately before the appointed day, vested in or exercisable by any person or authority shall continue to be so vested or exercisable until other provision is made by some legislature or authority empowered to regulate the matter in question." 16.
" Subject to the provisions of this Order any reference, by whatever form of words in any existing law to any authority competent at the date of the passing of that law to exercise any powers or authorities, or to discharge any functions, in any part of India shall, where a corresponding new authority has been constituted by or under the Constitution, have 750 effect until duly repealed or amended as if it were a reference to that new authority.
" On November 28, 1950 the Chief Commissioner of Kutch issued the following notification: In exercise of the powers vested in him under section I of the Bombay Prevention of Gambling Act, '1887 (IV of 1887) as applied to Kutch by the Kutch (Application of Laws) Order, 1949 the Chief Commissioner has been pleased to order that all the provisions of the said Act shall come into force throughout the whole of Kutch with immediate effect.
" On a consideration of all the Acts and Orders as well as the above mentioned Adaptation of Laws Order, of 1950, the learned Judicial Commisioner was of the opinion that , all such powers vested in or exercisable by any other person or authority before 26 1 1950 ceased to be so vested or exercisable by that person or authority ", and, therefore, only the President, whether exercising the powers himself or through the Chief Commissioner, could exercise the powers of a State Government and the Chief Commissioner himself could not.
His finding therefore was that the Chief Commissioner could not issue the above notification of November 28, 1950.
In its appeal against the Order of acquittal by the learned Judicial Commissioner, the State has raised two questions: (1)that the Bombay Act had been validly extended to and was in force in the whole of Kutch because of the Kutch (Application of Laws) Order, 1949 and thus any contravention of that Act became punishable under the Act, and (2)That even if the Bombay Act was not thus extended to Kutch, the Act became applicable to the State of Kutch by the issuing of the notification of November28, 1950, and therefore, the respondent was rightly convicted and the conviction was wrongly set aside by the learned Judicial Commissioner.
In: order to decide the first contention we have to see what is the effect of the various provisions of the Acts and Orders above referred to.
In cl. 4 of the 751 Kutch (Application of Laws) Order, 1949, the words; used are shall be construed as if reference therein. .
In our opinion all that these words mean is I shall be read as ' and if that is how these words are understood then wherever in the Bombay Act the words 'Provincial Government ' are used they have to be read as the Chief Commissioner of Kutch; the word Government has to be read as the " Chief Commissioner of Kutch"; and the Province or the " Presidency of Bombay " as " Kutch or any part thereof ".
If the Bombay Act is so read, then at the time when the Constitution came into force the words Provincial Government or Government or Province or Presidency of Bombay were no longer in the Act which had become applicable to the State of Kutch.
On the other hand, the words there must be taken to be Chief Commissioner of Kutch, and Kutch or any part thereof, respectively.
The fallacy in the learned Judicial Commissioner 's judgment lies in this that due effect was not given to these words which had become substituted, but emphasis was laid on the words 'shall be construed as ' as if these words had been used for the purposes of interpretation of the different words in the Bombay.
Act rather than implying substitution of the corresponding words.
In this view of the matter cl. 2 (1) (c) of the States Merger (Chief Commissioners ' Provinces) Order, 1949 which provided for the administration of the State of Kutch as if it was a Chief Commissioner 's Province, would not affect the position nor would the extension of the General Clauses Act under the Merged States ' Laws Act.
Clause 4 of the Adaptation of Laws Order, 1950 only substituted in place of the words Province, Provincial and Provinces the words State or States, wherever they occurred in any existing law, and the effect of cls.
15 and 16 of that order was the continuance of the powers vested in the authorities in whom they had previously been vested.
The position which therefore emerges on a combined reading of these various clauses is that in Bombay Act, as applied to Kutch, the words I Presidency of Bombay ' were to be replaced by the.
words 'Kutch or any part thereof ' and the I Provincial 752 Government ' by the I Chief Commissioner of Kutch ' and the powers which had been given to the different authorities under the different Acts were to continue to remain in the person or persons in whom they were already vested.
As the powers had been vested in the Chief Commissioner under the provisions of these various Acts and Orders, they continued to remain so vested and the General Clauses Act did not have any operational effect on these various words which were used in the Bombay Act as modified and applied to Kutch. ,SO understood, section 1 of the Bombay Act would read as follows: " This Act may be cited as the Bombay Prevention of Gambling Act, 1887.
All or any of its provisions may be extended from time to time by the Chief Commissioner of Kutch by an order published in the " Official Gazette " to any local area in Kutch or any part thereof." The Chief Commissioner of Kutch may, from time to time, by an order published as aforesaid, cancel or vary any order made by it under this section.
" The portion of this section, viz., "It extends to the city of Bombay, to the Island of Salsette, to all Railways and railway Station houses without the said city and island and to all places not more than three miles distant from any part of such station houses respectively " would not continue in the Act as applied to Kutch because these parts are not in the State of " Kutch or any part thereof " and cl. 6 of the Kutch (Application of Laws) Order, 1949 would come into operation for the purpose.
It was then contended that by the mere application of the Bombay Act to Kutch it became operative and came into force in the whole of Kutch.
This argument suffers from the infirmity that in its application to Kutch section 1 of the Bombay Act would have to be excluded which would be an incorrect way of looking at the question.
The true position is that the whole of the Act including amended section 1 as given above, became applicable to Kutch and therefore a notification 753 ,was necessary before it could be brought into force in any part of Kutch.
It was applied to Kutch, but its provisions were not in operation before the notification; and in our opinion, the judgment of Baxi J. C. in Agaria Osman Alarakhya vs The Kutch State (1) which has been followed in the case now before us, to the extent that it dealt with the necessity of a notification under section 1 of the Bombay Act, was correctly decided; and therefore, the first contention raised by counsel for the appellant is unsustainable and we hold that without a notification, the Bombay Act, could not be held to have been validly applied to the State of Kutch.
This brings us to the second question, i.e., the validity of the notification issued on November 28, 1950.
The learned Judicial Commissioner held: " The Chief Commissioner of a Part C State can act to such extent as he is authorised by the President to do.
These being the provisions of the Constitution, the Bombay Act must be construed with the adaptation that the rule of construction mentioned in the Kutch (Application of Laws) Order, 1949 is deleted.
Hence, even if substitution of expression as mentioned in para 4 of the Adaptation of Laws Order, 1950 is not made, the rule of construction mentioned in the Kutch (Application of Laws) Order, 1949 for construing the expression I Provincial Government ' as the I Chief Commissioner, Kutch ' does not survive.
" Article 239 of the Constitution relates to administration of Part C States and provides: " Subject to the other provisions of this Part, a State specified in Part C of the First Schedule shall be administered by the President acting, to such extent as he thinks fit, through a Chief Commissioner or a Lieutenant Governor to be appointed by him. . .
This Article has been relied upon for urging that in a Part C State, the administration had to be carried on by the President acting through a Chief Commissioner.
But this does not take away the powers of the Chief Commissioner given to him under any other Statute or (1) A.I.R. (1951) Kutch 9.
97 754 Order.
The Chief Commissioner of Kutch under section I of the Bombay Act, had the power to issue notifications making that Act operative in Kutch or any part of Kutch and those powers were not affected by article 239 of the Constitution particularly because of el.
15 of the Adaptation of Laws Order, 1950, which preserved these powers of the Chief Commissioner.
Therefore, the notification issued by the Chief Commissioner on November 28, 1950 was valid and issued under legal authority; and the Act came into force in the parts to which the notification made it so applicable.
We have therefore, come to the conclusion that the learned Judge was in error in holding that the notification was not a valid one and in so far as that was the basis of the acquittal of the accused, the judgment under appeal must be set aside.
In the result the appeal of the State is allowed, the judgment of the learned Judicial Commissioner acquitting the respondent is set aside and that of the learned Magistrate sentencing him to a fine of Rs. 50 and sentence in default and of forfeiture restored.
Appeal allowed.
| The appellant was a senior.
advocate.
He was required to appear before the Special Judge to make his submission on the question of sentence to be imposed upon his client who was convicted for an offence under s.5(2) of the Prevention of Corruption Act, 1947.
As he appeared in a shirt and trouser outfit and not in Court attire, the Judge asked him to appear in the prescribed formal attire for being heard in his professional capacity.
The appellant took umbrage and left the Court.
Some other advocate appeared in the matter and the accused having being found guilty of the charge of corruption the Judge imposed a sentence of four years R.I.
The appellant made a written application to the Judge couched in scurrilous language making the imputation that the Judge was a 'corrupt Judge ' and added that he was 'contaminating the seat of justice '; and forwarded copies of the application, without occasion or need to the Administrative Judge, Chief Secretary and other authorities.
The High Court initiated contempt proceedings, found the appellant guilty of having committed criminal contempt under section 2(c)(1) of the and after affording full opportunity of hearing, imposed a sentence of simple imprisonment for one week and a fine of Rs. 500.
Dismissing the Appeal, ^ HELD: 1.
Considerations regarding maintenance of the independence of the judiciary and the morale of the Judges demand that the appellant should not escape with impunity on the mere tendering of an apology which in any case.
does not wipe out the mischief.
If such a apology were to be accepted, as a rule, and not as an exception, it would virtually be tantamount to issuing a 'licence ' to scandalize courts and commit contempt of court with impunity.
The High Court was justified in imposing a substantive sentence and the said sentence cannot be said to be excessive or out of proportion.[838E; 837E, 838F] 834 No Judge can take a decision which does not displease one side or the other.
By the very nature of his work he has to decide matters against one or other of the parties.
If the fact that he renders a decision which is resented to by a litigant or his lawyer were to expose him to such a risk, it will sound the death knell of the institution.
The day must be dreaded when a Judge cannot work with independence by reason of the fear that a disgruntled member of the Bar can publicly humiliate him and heap disagree on him with impunity, if any of his orders, or the decision rendered by him displeases any of the Advocates appearing in the matter.
A line has therefore to be drawn some where, some day, by some one.
That is why the Court is impelled to act (rather than merely sermonise) much as the Court dislikes imposing punishment whilst exercising the contempt jurisdiction, which no doubt has to be exercised very sparingly and 'with circumspection.
[837H; 838A B] 2.
An attitude of unmerited leniency cannot be adopted at the cost of principle and at the expense of the Judge who has been scandalized.
To pursue a populist line of showing indulgence is not very difficult in fact it is more difficult to resist the temptation to do so rather than to adhere to the mail studded path of duty.
Institutional perspective demands that considerations of populism are not allowed to obstruct the path of duty.
[338C] In the instant case, the appellant sought to justify his conduct before the High Court on the ground of the treatment alleged to have been meted out to him by the Special Judge.
No remorse was felt.
No sorrow was expressed.
No apology was offered: He expressed his sorrow only before this Court, saying that he had lost his mental balance, and was granted an opportunity to tender an apology.
He appeared before the Special Judge and tendered a written apology indicating that he was doing so: "as directed by the Hon 'ble Supreme Court.
" This circumstance shows it was a 'paper ' apology, and that the expression of sorrow came from his pen, not from his heart.
It is one thing to "say" sorry it is another to "feel" sorry.
This Court cannot subscribe to the 'slap say sorry and forget ' school of thought in administration of contempt jurisdiction.
[886H; 837A C]
|
ivil Appeal No. 651 of 1976.
(Appeal by Special Leave from the Judgment and Order dated 19 6 1974 of the Bombay High Court in S.C.A. No. 1251 of 1970.) M.N. Phadke, Girish Chandra and M.N. Shroff, for the appellants.
S.V. Gupte, N. Kamalakar and A.G. Ratnaparkhi, for the respondent.
The Judgment of the Court was delivered by CHANDRACHUD, J.
On the reorganisation of States on November 1, 1956 the respondent who was working as an Agri cultural Overseer in the then State of Madhya Pradesh was allocated first to the State of Bombay and later to the State of Maharashtra.
By a resolution dated February 17, 1958 the Government of Bombay equated the post of Agricul tural Overseer with that of an Agricultural Assistant, Grade II.
In July 1958 the respondent was promoted as an Agricul tural Supervisor and in April 1967 he was appointed to the post of an Agricultural Officer.
On the reorganisation of States, a provisional combined seniority list of Agricultural Assistants, Grade II, was published by the Government of Maharashtra in 1961.
That list was revised from time to time, and ultimately the Government of India approved the final seniority list which came to be published on May 29, 1973.
The respondent has no grievance against ' his placement in that list, but his case is that under the seniority lists prepared from time to time by the State Government, he was erroneously accorded a lower place of seniority with the result that persons who were in fact junior to him came to be promoted on the assumption that they were senior to him.
The respondent therefore filed the present writ petition on October 14, 1970 asking for due recognition of his seniority.
He later amended that peti tion and asked for arrears of pay and allowances retrospece tively from the date on which he ought to have been promoted in accordance with the seniority list approved by the Cen tral Government.
The writ petition having been allowed by the Nagpur Bench of the Bombay High Court, the State of Maharashtra has filed this appeal by special leave.
The sole question which arises for determination in this appeal is whether the respondent is entitled to arrears of pay with effect from the date on which he would, in the normal course, have been promoted if his seniority Were recognised as it eventually came to be 589 recognised under the seniority list approved by the Central Government in 1973.
The answer to this question depends on whether the rights of the respondent are governed by the circular dated March 10, 1960 or by the circular dated February 25, 1965.
The case of the State Government is that the former, and not the latter circular, applies whereas the respondent contends that he is entitled to arrears of salary for the entire period under the latter circular.
We find it impossible to accept the respondent 's conten tion, which has found favour with the High Court, that the circular of February 25, 1965 governs the matter.
That circular reads thus: "Retrospective promotions of those who had been superseded earlier.
GOVERNMENT OF MAHARASHTRA GENERAL ADMINISTRATION DEPARTMENT Circular Memorandum No. SRV 1064 .D, Sachiva laya, Bombay 32 (B.R.) 25th February, 1965/Falgune 6, 1886.
CIRCULAR MEMORANDUM OF GOVERNMENT A question has been raised whether in cases in which Government servants who were super seded for promotion to the higher post are later promoted on the orders of higher author ities who consider the supersession unjusti fied and who having powers to set aside the order of supersession, do so, their promotion should be effective from the date on which they are actually promoted or from the date they should have been promoted had they not been wrongly superseded.
The Government has, considered this question and decided that in such cases, the Government servants concerned, should be deemed to have been promoted to higher post from the date from which they would have been promoted, but for their wrong ful supersession i.e. from the date from which their juniors who were promoted by superseding them started to officiate in such posts and they should be allowed pay in such post as if they were promoted on the dates on which their juniors were promoted and also paid arrears of pay and allowances from such dates.
(2) Orders in paragraph 1 above apply also to the cases of persons, who are superseded for promotion to gazetted post within the pur view of the Public Service Commission ordered by Government but are later promoted when their earlier supersession is considered in consultation with the Commission unjustified.
(3) Pending cases should be regulated in accordance with these orders in paragraphs 1 and 2 above, and arrears of 590 pay and allowances should be paid to the persons concerned provided that if the arrears relate to any period prior to the 1st May 1960, the payment is restricted to the period after that date, i.e. after the st May 1960.
(4) This Circular Memorandum issues with the concurrence of the Finance Department VIDE that department unofficial reference No. 581/V, dated the 2nd February, 1965.
By Order and in the name of Government of Maharashtra.
Sd/ K.P. Nadkarni, Deputy Secre tary to Govt.
" The language of this circular is singularly inappropriate to cover cases concerning equation and seniority consequent upon formation of new States.
The circular deals with cases where government servants who are superseded for promotion to the higher post are later promoted on orders of higher authorities who considered the supersession unjusti fied and who, having powers to set aside orders of superses sion, have set aside such orders.
In such cases, the circu lar provides, the government servant concerned should be deemed to have been promoted to the higher post from the date from which he would have been promoted but for his wrongful supersession.
There is no question in the present case of the respondent being promoted on the basis of any order passed by a higher authority.
Nor indeed did any higher authority consider the so called supersession of the respondent as unjustified.
While approving the revised seniority list in which the respondent occupied a much higher place than previously, the Central Government did not set aside any order of the respondent 's supersession nor did it pass any order directing that the respondent be promoted to a higher post.
We are clear that the circular of Febru ary 25, 1965, on which judgment.of the High Court rests, is not intended to govern questions of seniority and superses sion arising as a result of reorganisation of States.
That circular, by its language, is designed to meet cases in which a government servant, apart from the provisions of the States Reorganisation Act and apart from problems arising out of reorganisation of States, was denied his rightful seniority but is later accorded a due and appropriate place in the seniority list.
Paragraph 2 of the circular which speaks also of posts within the purview of the Public Serv ice Commission affords some indication that the circular is intended to apply only to cases of routine supersessions in the normal course of a service career.
If the circular of February 25, 1965 were intended to apply to a case like the present, it would have atleast referred to the circular of March 10, 1960 which specifical ly governs matters relating to fixation of seniority conse quent upon the reorganisation of States.
That circular, insofar as relevant, reads thus: 591 "Fixation of Seniority and pay on promotion according to final gradation lists.
GOVERNMENT OF BOMBAY Political and Services Department Circular No. SR INT 1059 VI Sachivalaya, Bombay, 10th March, 1960 CIRCULAR OF GOVERNMENT Promotions made on and after the 1st November, 1956, have been treated as provi sional pending absorption of the personnel and finalisation of gradation lists in accordance with the allocated Government Servants ' (Absorption, Seniority, Pay and Allowances) Rules 1957.
They are also subject to review in the light of the changes that may be made in the gradation lists as a result of the decisions on the representations Submitted by the Government Servants concerned.
Question has been raised as to how seniority and pay in the promotion post should be fixed in the case of a Government servant who in the light of the final gradation list, is promoted later than the date on which he was due for promo tion.
Government is pleased to direct that seniority and initial pay on promotion according to the final gradation list should be fixed as if the Government servant had been promoted on the date on which he would have been promoted had the gradation list been finalised on the 1st November 1956.
The date on which he would have been promoted should be admitted on the basis of a certificate given by the appointing authority specifying the date.
No arrears of pay should, however, be paid for the period prior to the date of actual promotion.
" Under this circular, the seniority and initial pay of the respondent has to be fixed as if he was promoted on the date on which he would have been promoted if the gradation list had been finalised on November 1, 1956.
But no arrears of pay can be paid to him for the period prior to the date of actual promotion.
The State Government relied upon this circular by their counter affidavit filed in the High Court but no challenge was made by the respondent to the vires or the validity of that circular even though he had his peti tion amended in order to ask for arrears of salary.
On the assumption that the circular is within the powers of the State Government, we have no doubt that the respondent 's case .must fail within that circular, in which case he would not be entitled to the arrears of salary for the period prior to the date of his actual promotion.
Mr. Gupte appearing on behalf of the respondent relies upon rule 21 of "The Allocated Government Servants ' (Absorption, Seniority, Pay and Allowances) Rules, 1957" and argues that since 592 under that rule the respondent is entitled to draw .his pay and allowances with effect from the date of his promotion to the higher post including the deemed date of promotion, the Government of Maharashtra has no power, in view of the proviso to section 115(7) of the States Reorganisation Act, to alter his conditions o[ service to his prejudice.
This argument is being advanced for the first time in this Court, but, apart from that, we are unable to agree either that rule 21 has the effect contended for or that the circular issued by the State Government fails within the mischief of the proviso to.
section 115(7).
By rule 21, the arrears of pay and allowances "which may become due to an allocated govern ment servant" on the fixation of his pay as on November 1, 1956 shall be payable only with effect from the date from which he became available for service in the State of Bombay or would have been so available but for the causes mentioned in rule 2(d).
Rule 21 is not in the nature of an entitle ment.
On the other hand, it restricts the right of the allocated government servant to receive pay and allowances "only with effect from the date" from which he became avail able for service in the State of Bombay or would have been so available except for the causes mentioned in rule 2(d).
The circular issued by the Government of Maharashtra on February 25, 1965 does not take away from the respondent the right, if any, which was available to him under rule 21.
For these reasons we set aside the judgment of the High Court, allow this appeal and direct that the respondent 's writ petition shall stand dismissed.
In view of the order passed at the time when special leave was granted, appel lant shall pay the costs of the appeal to the respondent.
Appeal allowed.
| The constitutional validity of the Madhya Pradesh Dharma Swatantraya Adhiniyam, 1968, was challenged in the High Court of Madhya Pradesh and the constitutional validity of the Orissa Freedom of Religion Act, 1967 was challenged in the High Court of Orissa.
The two Acts prohibit forcible conversion and make the offence punishable.
The Madhya Pradesh High Court upheld the validity of the Act.
The Orissa High Court held that article 25(2) of the Constitution guarantees propogation of religion and conversion is a part Christian religion; that the State Legislature has no power to enact the impugned legislation which in pith and sub stance is a law relating to religion; and that entry 97 of List I would apply.
Upholding the validity of both the Acts, HELD: (1) Article 25 guarantees to all persons right to freedom and conscience and the right freely to profess, practice and propogate religion subject to public order, morality and health.
The word 'propogate ' has been used in the Article as meaning to transmit or spread from person to person or from place to place.
The Article does not grant right to convert other person to one 's own religion but to transmit or spread one 's religion by an exposition of its tenets.
The freedom of religion enshrined in article 25 is not guaranteed in respect of one religion only but covers all religions alike which can be properly enjoyed by a person if he exercises his right in a manner commensurate with the like freedom of persons following other religion.
What is freedom for one is freedom for the other in equal measure and there can, therefore, be no such thing as a fundamental right to convert any person to one 's own religion.
[616 B F, 617 A B] (2) The Madhya Pradesh Act prohibits conversion from one religion to another by use of force, allurement or fraudu lent means and matters incidental thereto.
Similarly, the Orissa Act prohibits conversion by the use of force or by inducement or by any fraudulent means.
Both the statutes, therefore, clearly provide for the maintenance of public order because if forcible conversion had not been prohibited that would have created public disorder in the States.
The expression "public order" has a wide connotation.
[617 C E] Ratilal Panachand Gandhi vs The State of Bombay & Ors. ; Ramesh Thappar vs The State of Madras ; ; Ramjilal Modi vs State of U.P. ; and Arun Ghosh vs State of West Bengal ; , followed.
(3) If an attempt is made to raise communal passions, e.g. on the ground that someone has been forcibly converted to another religion it would in all probability give rise to an apprehension of a breach of the public order affecting the community at large The impugned Acts therefore fall within the purview of Entry 1 of List II of the Seventh Schedule as they are meant to avoid 5 112SCI/77 612 disturbance to the public order by prohibiting conversion from one religion to another in a manner reprehensible to the conscience of the community.
The two Acts do not provide for the regulation of religion and do not fall under Entry 97 of List I. [618 A C]
|
Appeal No. 846 and 1343 of 1972.
Appeal by special leave from the judgment 'and order dated November 22, 1971 of the Delhi High Court in S.A.0.
No. 83 D of 1965 And Civil Appeal No. 1343 of 1973 Appeal by Special leave from the judgment and order dated November 22, 1971 of the Delhi High Court in SAO No. 239 D of 1965.
V.M. Tarkunde, section section Shukla and A. P. Gupta, for the appellant (in C. A. No. 846).
S.P. Pandey, Shiv Prakash Pandey and section section Shukla, for the ,appellant (in C. A. No. 1343).
D. N. Mukherjee, for respondent (in C. A. No. 846).
Bakshi Man Singh and Harbans Singh, for the respondent (in C.A. No. 1343).
456 Sardar Bahadur Saharya, Vishnu Bahadur Saharaya and Y. Khushalani, for the Intervener (in C.A. No. 846).
The Judgment of the Court was delivered by ALAGIRISWAMI, J.
These two appeals by special leave are against the judgment of the High Court of Delhi allowing the ,appeals filed by the two respondents.
The respondents are landlords of two houses in the Karol Bagh area of Delhi.
The houses are built on lands given on long lease by the Delhi Improvement Trust to the rights, liabilities and assets ,of which the Delhi Development Authority has since succeeded.
Under the terms of the lease, subject to revision of rent, the lessees were to put up residential buildings on the leased lands.
,and the lessees undertook : "(vi) not to use the said land and buildings that may be erected thereon during the Said term for any other purpose than for the purpose of residential house without the consent in writing of the said lessor; provided that the lease shall become void if the land is used for any purpose than that for which the lease is granted not being a purpose subsequently approved by the lessor.
" The present landlords are not the original lessees but their successors in interest.
Portions of buildings have been leased for commercial purposes, a barber shop in C.A. 846 and a scooter repair shop in C.A. 1343.
The Delhi Development Authority appears to have given notice to them drawing their attention to the provision of the lease extracted above and that as they had permitted the buildings to he used for commercial purposes contrary to the terms of the lease deed, the lease was liable to be determined and called upon them to discontinue the use of the land for commercial purposes, failing which they were asked to show cause why their lease should not be determined 'and the land, together with the buildings thereon, reentered upon without any compensation to them.
Thereupon the landlords issued notice to the tenants asking them to stop the com mercial use of the buildings and later instituted the proceedings out of which these appeals arise.
In both these cases the buildings had been put to commercial use even before 1957 when the Delhi Development Authority Act of 1957 came into force.
The Controller dismissed the petitions filed by the landlords and the appeals filed by them were dismissed.
They thereupon filed appeals to the High Court.
A learned single Judge of the High Court taking a view contrary to two earlier decisions in 457 Smt.
Uma Kumari vs Jaswant Rai Chopra(1) and section P. Arora vs Ajit Singh (2 ) referred the question that arise in these appeals to a Division Bench which took a view contrary to that taken in the two earlier decisions above referred to, and decided in favour of the landlords.
The question that arises for decision in these cases is this : Are the landlords estopped or otherwise prohibited from getting possession of the property from the tenants because they themselves had let it out for commercial purposes.
We shall set out the relevant portion of the statutory provisions regarding this question.
Section 14 of the Delhi Rent Control Act 1958, which deals with the question of protection to tenants against eviction, in so far as it is relevant, is as follows : "14.
(1) Notwithstanding anything to the con trary contained in any other law or contract, no order or decree for the recovery of possession of any premises shall be made by any court or Controller in favour of the landlord against a tenant : Provided that the Controller may, on an application made to him in the prescribed manner, make an order for the recovery of possession of the premises on one or more of the following grounds only, namely (c) that the tenant has used the premises for a purpose other than that for which they were let (i) if the premises have been let on or after the 9th day of June, 1952, without obtaining the consent in writing of the landlord; or (ii)if the premises have been let before the said date without obtaining his consent.
(k) that the tenant has, notwithstanding previous notice, used or dealt with the premises in a manner contrary to any condition imposed on the landlord by the Government or the Delhi Development Authority or the Municipal Corporation of Delhi while giving him a lease, of the land on which the premises are situate.
" Sub section 11 of the same section, which is also relevant, reads " (11) No order for the recovery of possession of any premises shall be made on the ground specified in clause (k) of the proviso to sub section (1), if the tenant, within such time as may be specified in this (1) P.L.R. (1960) 460.
(2) I.L.R. (1970) 11 Delhi 130.
458 .lm15 behalf by the Controller, complies with 'the condition imposed on the landlord by any of the authorities referred to in that clause or pays to that authority such amount by way of compensation as the Controller may direct.
" Section 14 of the Delhi Development Act 1957 is as follows "14.
After the coming into operation of any of the plans in a zone no person shall use or permit to be used any land or building in that zone otherwise than in conformity with such plan : Provided that it shall be lawful to continue to use upon such terms and condition as may be prescribed by regulations made in this behalf any land or building for the purpose and to, the extent for and to which it is being used upon the date on which such plan comes into force." Before this Act was passed the United Provinces Town Improvement Act 1919 was in force in Delhi and the Delhi Improvement Trust was constituted thereunder.
It was this Trust which had leased the lands to the predecessors of the two landlords in the present appeals.
The Delhi Development Authority established under the Delhi Development Act 1957 succeeded to the asets, rights and liabilities of the Delhi Improvement Trust.
We shall deal first with the question that arises under the Delhi Rent Control Act.
Clause (k) of the proviso to sub section (1) of Section 14 provides that the Controller may, on an application made to him in the prescribed manner, make an order for the recovery of possession of the premises on the ground that the tenant has, notwithstanding previous notice, used or dealt with the premises in a manner contrary to any condition imposed on the landlord by the Government or the Delhi Development Authority or the Municipal Corporation of Delhi while giving him a lease of the land on which the premises are situate.
In this case the lease granted by the Delhi Improvement Trust, the predecessors in interest of the Delhi Development Authority, to the predecessors in interest of the landlords contains a condition that any building to be erected on the land shall not be used for any purpose other than residential purpose.
There is no dispute that part of each of the buildings is being used in a manner contrary to that condition.
The landlord has also given notice asking the tenant to cease using the building for that purpose.
The two earlier decisions referred to held that notwithstanding this provision the landlord was not entitled to get possession of the land because he himself had leased the building for a commercial purpose and was, therefore, estopped from 459 claiming possession.
The result will be this : The Delhi Development Authority can enforce the conditions of the lease and forfeit the leased land with the buildings thereon.
In that case both the landlord as well as the tenant stand to lose.
The landlords point but this situation and say that they are not interested in evicting the tenants but are interested only in seeing that the tenants do not use the buildings for commercial purpose with the consequences that they may have to lose the land and the buildings and the tenants also cannot any longer use it for a commercial purpose.
It has been argued on behalf of the tenants that this clause will apply only where the tenant has used the land after previous notice from the landlord, i.e., if the landlord had told him at the 'beginning of the tenancy that the building was not to be, used for commercial purpose and notwithstanding that the tenant used it for a commercial purpose.
They, therefore, contend that as in this case both the landlord and the tenant were aware of the use to which the ' building was to be put there is no question of any notice from the landlord asking the tenant not to use the building for commercial purpose and by merely issuing such notice the landlord cannot take advantage of clause (k).
This is really another way of putting the argument that the landlord having granted the lease for a commercial purpose is estopped from contending that the tenant should not use it for commercial purpose.
While the argument appears to be plausible we are of opinion that there is no substance in this argument.
If it is a case where the tenant has contrary to the terms of his tenancy used the building for a commercial purpose the landlord could take action under clause (c).
He need not depend upon clause (k) at all.
These two clausesare intended to meet different situations.
There was no need for anadditional provision in clause (k) to enable a landlord to get possession where the tenant has used the building for a commercial purpose contrary to the terms of (the tenancy.
An intention to put in an useless provision in a statute cannot be imputed to the Legislature.
Some meaning would have to be given to that provision.
The only situation in which it can take effect is where the lease is for a commercial purpose agreed upon by both the landlord and the tenant but that is contrary to the terms of the lease of the land in favour of the landlord.
That clause does not come into operation where there is no provision in the lease of the land in favour of the landlord, prohibiting its use for a commercial purpose.
The legislature has clearly taken note of the fact that enormous extents of land have been leased by the three authorities mentioned in that clause, and has expressed by means of this clause its anxiety to see that these lands are used for the purpose for which they were leased.
The policy of the legislature seems to be to put an 14 L79 6Sup C.I./73, 460 end to unauthorised use of the leased lands rather than merely to enable the authorities to get back possession of the leased lands.
This conclusion is further fortified by a reference to sub section 11 of section 14.
, The lease is not forfeited merely because the building put upon the leased land is put to an unauthorised use.
The tenant is given an opportunity to comply with the conditions imposed on the landlord by any of the authorities referred to in clause (k) of the proviso to sub section (1).
As long as the condition imposed is complied with there is no forfeiture.
It even enables the Controller to direct compensation to be paid to the authority for a breach of the conditions.
Of course, the Controller cannot award the payment of compensation to the authority except in the presence of the authority.
The authority may not be prepared to accept compensation but might insist upon cessation of the unauthorized use.
The sub section does not also say who is to pay the compensation, whether it is the landlord or the tenant.
Apparently in awarding compensation the Controller will have to apportion the responsibility for the breach between the lessor and the tenant.
The provision of clause (k) of the proviso to sub section (1) of section 14 is something which has to be given effect to whatever the original contract between the landlord and the tenant.
The leases were granted in 1940, and the buildings might have been put up even before the Delhi and Ajmer Rent Control Act 1952 came into force.
It was that Act that for the first time provided the kind of remedy which is found in clause (k).
The relevant provision in that Act enabled the landlord to get possession where the tenant whether before or after the commencement of the Act used or dealt with the premises in a manner contrary to any condition imposed on the landlord by the Government or the Delhi improvement Trust while giving him a lease of the land on which the premises are situate notwithstanding previous notice.
The anxiety of the legislature is to prevent unauthorized user rather than protection of the tenant or strengthening the hands of Development Authority in effecting forfeiture.
The Development Authority can always resort to the terms of the lease.
There is no estoppel here because both the landlord and the tenant know that the tenancy was not one permitted under the terms of the lease of the land.
In any case there can be no estoppel against the statute.
It would not benefit the tenant even it it is held that the landlord cannot, under the circumstances, evict him.
The landlord will lose Ms property and the tenant also will lose.
He cannot, after the Development Authority takes over the building use it for a commercial purpose.
We thus reach the conclusion that the leased in its inception was not void nor is the landlord estopped from claiming possession because he himself was a party to the breach of the conditions under which the land was leased to him.
461 Neither the clear words of the section, as in Waman Shriniwas Kini vs Rati Lal Bhagwandas(1), nor a consideration of the policy of the Act lead us to the conclusion that the lease was void in its inception if it was for an unauthorised user.
We are also of the opinion that the High Court was not justified in leaving to the Controller no option but to pass.
an order for eviction.
That would make the alternative provided in subsection (11) of section 14 useless.
The High Court is not correct in saying that since the Authority has no power to legalize the misuser of land contrary to the plans by acceptance of compensation under the Development Act, the Controller cannot order the payment of compensation by the tenant to the Delhi Development authority.
This is in effect nullifying part of the provisions contained in sub section (11) of section 14.
The High Court has arrived at its conclusion on the basis that section 14 of the Delhi Development Act applies to this Case.
We shall presently show that that section has no relevance to the decision of this case.
It is under the terms of the lease granted by the Delhi Improvement Trust that the use of this building for commercial purpose is prohibited and not under the Delhi Development Act.
"Furthermore, section 14 applies not only to lands leased by authorities like the Delhi Development Authority containing conditions against unauthorised user as well as to lands which do not belong to that category.
Its provisions are not intended to enforce the conditions in those leases.
The proviso to that section deals with the use to which a land or building may continue to be put after the coming into force of any plan subject to such terms and conditions as may be prescribed by regulations, provided that building or land had been used for that purpose prior to the coming into force of the plan.
The section does not therefore contemplate complete prohibition of the use of a land or building for purposes other than that permitted in the plan.
Such uses can be continued subject to the terms and conditions prescribed by the regulations provided it had been so used even before the plan.
It is admitted that no such regulations have been framed.
Therefore, if a plan had come into operation in this area, the previous use can be continued till the regulations are framed and after the regulations are framed, they will be subject to the terms and conditions of those regulations.
We are of opinion, therefore, that section 14 of the Development Act has no relevance in deciding the question at issue in his case.
" The appeals are allowed and the judgment of the High Court is set aside.
The matter will have to go back to the Controller for (1`) ; 462 deciding the question under sub section ( 1 1 ) of section 14 whether he should exercise the one or the other of the two alternatives mentioned therein.
As already mentioned, no order awarding compensation under the second alternative given in that sub section can be made except in the presence of the Delhi Development Authority.
In the circumstances of this case we direct the parties to bear their own costs.
G.C. Appeals allowed.
| On receipt of information the police searched the appellants house on May 14, 1968.
In the central room of that house there was an almirah of which the key was produced by the appellant and handed over to the Inspector of Police.
When the almirah was opened with the key it was found to contain a bag with live cartridges and a gun.
As no licence or permit for their possession was produced, the appellant was prosecuted and was convicted under Ss. 25(1)(a) and 27 of the and the appellant was sentenced to imprisonment for two years R.I.
His appeal to the High Court was dismissed summarily.
Special leave to appeal to this Court was granted and the accused was on bail pending disposal of the appeal.
HELD: (1) The High Court has the power to dismiss an appeal in limine where in its opinion there is no substance in the appeal.
But in cases where ,questions of fact or law, which are arguable and which are not unsubstantial, are ,raised, it is desirable that the High Court, while dismissing summarily, should indicate broadly the reasons which prevailed with it.
In such cases not only the reasons recorded by the High Court would be helpful to this Court in better understanding and appreciating the High Court 's 'line of approach but it would also serve to assure the accused that the arguable points in his appeal have been properly argued and duly considered by the High Court.
[64D F] Mushtak Hussain vs Bombay ; and Mushtaq Ahmed Hussain ,and Mukhtar Hussain Ali Hussain vs The State of Guj., Cr.
A. No. 9 of 1973 decided on 13 3 73 followed.
(2) However, it is undesirable and unnecessary in the larger interests of justice to send the present case back to the High Court for re decision.
The appellant was convicted in June 1969 and the High Court 's decision was shortly there after.
Undue delay in final disposal of criminal appeals tends to some extent to defeat the very purpose of criminal justice.
Speedy disposal of criminal cases for commission of offences promotes confidence of the society in the administration of criminal justice which is essential for sustaining the faith of the law abiding members of the society in the effectiveness of the rule of law.
It also saves the accused from avoidable harassment inherent in unreasonably prolonged trials and appeals.
[64F H; 65A B] (3) On the evidence on the record it is not possible to hold that the existence of the arms in the almirah was without the appellant 's knowledge and that his possession of the arms was unconscious.
Therefore, his conviction under section 25(1) (a) was justified.
[65E F] (4) There is no evidence in support of the conviction for the offence under section 27, and therefore, his conviction under that section cannot be sustained.
[65F G] (5) There is no evidence of any undesirable antecedents of the appellant, and the possession of the arms has not been shown to be inspired by any sinister purpose.
Since more than 4 years had elapsed since the date of the offence it would be in the ends of justice if the sentence of imprisonment was reduced to that already undergone and a sentence of fine is, imposed in addition.
[65H; 66A D]
|
No. 281 of 1951.
Appeal under article 132 of the Constitution of India from the Judgment and Order dated the 1st August, 1951, of the High Court of Judicature at Madras in Criminal Miscellaneous Petitions Nos.1261 and 1263 of 1951.
K. Rajah Iyer (R. Ganapathy Iyer and M. section K. Aiyangar, with him) for the appellant/petitioners, 1145 H.J. Umrigar and section, Subramaniam for respondent No. 2. 1954.
March 18.
The Judgment of the Court was delivered by BOSE J.
The question in this case is whether an appeal lies to this court under section 476B of the Criminal Procedure Code from an order of a Division Bench of a High Court directing the filing of a complaint for perjury.
Two persons, Govindan and Damodaran, filed petitions under section 491 of the Criminal Procedure Code for release claiming that they had been illegally detained by two Sub Inspectors of Police who are the appellants before us.
Govindan said he was being detained by one Sub Inspector and Damodaran said he was being detained by the other.
Both the Sub Inspectors said that the petitioners were not in their custody.
The first Sub Inspector, who was concerned with Govindan, said that Govindan had never been arrested by him and had not been in his custody at.
any time.
The other denied that Damodaran was in his custody.
He admitted that he had arrested him at one time but said that he had been released long before the petition.
Each swore an affidavit in support of his return.
In view of this conflict between the two_ sets of statements the High Court directed the District Judge to make an enquiry.
Considerable evidence was recorded and documents were filed and the District Judge reported that in his opinion the statements made by the two Sub Inspectors were correct.
The High Court disagreed and, after an elaborate examination of the evidence, reached the conclusion that the petitioners were telling the truth and not the Sub Inspectors.
The petitioners were however regularly arrested after their petitions and before the High Court 's order; one was released on bail and the other was remanded to jail custody by an order of a Magistrate.
Accordingly their petitions became infructuous and were dismissed.
After this, the petitioners applied to the High Court under section 476 of the Criminal Procedure Code and 1146 asked that the Sub InsPectors be prosecuted for perjury under section 193, Indian Penal Code.
The applications were granted and the Deputy Registrar of the High Court was directed to make the necessary complaints.
The Sub Inspeetors thereupon asked for leave to appeal to this court.
Leave was refused on the ground that no appeal lies, but leave was granted under article 132 as an interpretation of articles 134 (1) and 372 of the Constitution was involved.
The Sub Inspectors have appealed here against that order as also against the order under section 476.
In addition, as an added precaution, they have filed a petition for special leave to appeal under article 136 (1).
The first question we have to decide is whether there is a right.
of appeal.
That turns on the true meaning of section 476B of the Criminal Procedure Code read with section 195 (3).
The relevant portion of the former reads thus : "Any person against whom a complaint has been made" [under section 476] "may appeal to the court to which such former court is subordinate within the meaning of section 195 (3). " The latter section reads "For the purpose of this section, a court shall be deemed to be subordinate to the court to which appeals ordinarily lie from the appealable decrees or sentences of such former court. . " The rest of the section does not concern us.
Two things are evident.
First, that a right of appeal has been expressly conferred by section 476B provided there is a higher forum to which an appeal can be made; and second that the appellate forum has been designated in an artificial way.
The appeal lies to the court to which the former court is subordinate within the meaning of section 195 (3).
But "sub.
ordinate" does not bear its ordinary meaning.
It is used as a term of art and has been given a special meaning by reason of the definition in section 195 (3): a fiction has been imposed by the use of the word "deemed".
, We have accordingly next to examine the content of the fiction.
1147 The section says that the court making the order under section 476 shall be deemed to be subordinate to the court (a) to which appeals ordinarily lie (b) from the appelable decrees or sentences of such former court.
Now the former court in this case is a Division Bench of the High Court.
The only court to which an appeal ordinarily lies from the appealable decrees and sentences of a Division Bench of a High Court is this court.
Therefore, a Division Bench of a High court is a court "subordinate" to this court within the meaning of section 195 (3); accordingly an appeal lies to this court from an order of a Division Bench under section 476.
It was contended that there is no ordinary right of appeal to this court and that such rights as there are those expressly conferred by the Constitution in a very limited and circumscribed set of circumstances, therefore, such appeals as lie to this court cannot be said to lie "ordinarily".
We do not agree.
Such an argument concentrates attention on the word "ordinarily" and ignored the words "appealable decrees or sentences".
Before we can apply the definition we have first to see whether there is a class of decrees or sentences in the court under consideration which are;at all open to appeal.
If there are not, the matter ends and there is no right of appeal under section 476.B.
If there are, then we have to see to which court those appeals will "ordinarily" lie.
It is evident that the only court to which the appealable decrees and sentences of a Division Bench of a High Court can lie is the Supreme Court.
There is no other court to which an appeal can be made.
It follows that is the ordinary course in the case of all appealable decrees and sentences and that consequently this is the court to which such appeals will ordinarily lie.
As there is a right of appeal we have next to consider the matter on its merits and there the only relevant consideration is whether "it is expedient in the interests of justice" that an enquiry should be 1148 made and a, complaint filed.
That involves a careful balancing of many factors.
The High Court has scrutinised the. evidence minutely and has disclosed ample material on which a judicial mind could reasonably reach the conclusion that there is matter here which requires investigation in a criminal court and that it is expedient in the interests of justice to have it enquired into.
We have not examined the evidence for ourselves and we express no opinion on the merits of the respective cases but after a careful reading of the judgment, of the High Court and the report of the District Judge we can find no reason for interfering with the High Court 's discretion on that score.
We do not intend to say more than this about the merits as we are anxious not to prejudge or prejudice the case of either side.
The learned Judges of the High Court have also very rightly observed in their order under section 476 that they were not expressing any opinion on the guilt or innocence of the appellants.
We were informed at the hearing that two further sets of proceedings arising out of the same facts are now, pending against the appellants.
One is two civil suits for damages for wrongful confinement.
The other,is two criminal prosecutions under section 344, Indian Penal Code, for wrongful confinement, one against each Sub Inspector.
It was said that the simultaneous prosecution of these, matters will embarrass the accused.
But after the hearing of the appeal we received information that the two criminal prosecutions have been closed with liberty to file fresh complaints when the papers are ready, as the High Court records were not available on the application of the accused As these prosecutions are not pending at the moment, the objection regarding them does not arise but we can see that the simultaneous prosecution of the present criminal proceedings out of which this appeal arises and the civil suits will embarrass the accused.
We have therefore to determine which should be stayed.
As between the civil and the criminal proceedings we are of the opinion that the criminal matters should 1149 be given precedence.
There is some difference of opinion in the High Courts of India on this point.
No hard and fast rule ban.
be laid down but we do not consider that the possibility of conflicting decisions in the civil and criminal courts is a relevant consideration.
The law envisages such an eventuality when it expressly refrains from making the decision of one court binding on the other, or even relevant, except for certain limited purposes, such as sentence or damages.
The only relevant consideration here is the likelihood of embarrassment.
Another factor which weighs with us is that a civil suit often drags on for years and it is undesirable that a criminal prosecution should wait till everybody concerned has forgotten all about the crime.
The public interests demand that criminal justice should be swift and sure; that the guilty should be punished while the events are still fresh in the public mind and that the innocent should be absolved as early as is consistent with a fair and impartial trial.
Another reason is that it is undesirable to let things glide till memories have grown too dim to trust.
This,however, is not a hard and fast rule.
Special considerations obtaining in any particular case might make some other course more expedient and just.
For example, the civil case or the other criminal proceeding may be so hear its end as to make it inexpedient to stay it in order to give precedence to a prosecution order of under section 476.
But in this case we are of the view that the civil suits should be stayed till the criminal proceedings have finished.
The result is that the appeal fails and is dismissed but with no order about costs.
Civil Suits Nos. 311 of 1951 to 314 of 1951, in the Court of the Subordinate Judge, Coimbatore, will be stayed till the conclusion of the prosecution under section 193, Indian Penal Code.
As the plaintiffs there are parties here, there is no difficulty about making such an order.
The petition for special leave is dismissed.
Appeal dismissed.
| Section 5 of the East Punjab Sales Tax Act, 1948, as originally enacted, conferred on the Government power to levy tax at such rates as the Government might fix.
The section was amended by Act 18 of 1952, with retrospective effect, fixing the rate of tax at "not exceeding two piece in a rupee".
Section 2(ff) of the Act as amended by Act 13 of 1959, define , "purchase" as the "acquisition" of the goods "for use in the manufacture of goods for sale, for cash or deferred payment or other valuable consideration otherwise than under a mortgage hypothecation, charge or pledge".
The appellants ' petition in the High Court challenging the imposition of purchase tax for the years 1958 59 and 1959 60 on the purchase of oil seeds, steel scrap and cotton for manufacture of goods for sale, were dismissed, and they appealed to this Court.
Mean while, the High Court had considered the validity of the Act in a Sales Tax Reference and declared section 5, as it originally stood, void.
In this Court it was contended : (i) since section 5 as originally enacted, was declared void,that being the charging section, the entire act was void and the Amending Act of 1952 could not revive an Act which was non est, and (ii) section 2(ff) was invalid for want of legislative competence.
HELD : (i) Section 5 as it stood before the amendment was void, but the section as amended by the Amending Act of 1952 is valid.
An Act conferring a power to fix rates of taxation must lay down clear legislative policy or guide lines in that regard and the doctrine of constitutional and statutory needs would not afford reasonable guidelines in the fixation of such rates.
There was nothing in the provisions of the Act, including the preamble disclosing any policy or guidance to the State for fixing rates.
Section 5 as it stood before the Amendment conferred on the Government an uncontrolled power in the matter of fixation of rates and was therefore void.
[565 G 566 B; 569 F] Corporation of Calcutta vs Liberty Cinema, , explained.
State of Madras, vs Gannon Dunkerlev & Co. (Madras) Ltd. ; , 435, Vasantlal Maganbhai Sanjanwala vs State of Bombay.
558 ; and The Union of India vs M/s. Bhana Mal Gulzari .Mal; , , referred to.
Although section 5 was void, the entire Act was not void.
Section 4 is the 'Charging section and Section 5 dealt only with the quantification of tax, that is, the charging section was intact and what was struck down was only the section providing for rates.
The fact that section 4 is made subject to section 5 does not render the former void on the principle of non severability, because, under the Act, there is a clear distinction between chargeability and the quantification of tax.
Therefore, striking out section 5 only made section 4 unenforceable.
The amendment of section 5 has, in substance, the effect of amending an existing Act.
[567 G H; 568 F G; 569 B C] B. Shama Rao vs The Union Territory of Pondicherry, [1967] 2 S.C.R., distinguished.
Kesoram Industries and Cotton Mills Ltd. vs Commissioner of Wealth Tax (Central) Calcutta, ; , referred to.
Conferment of a reasonable area of discretion by a fiscal statute is permissible and the discretion to fix the rate between 1 pice and 2 pice cannot be said to exceed the permissible limits.
[569D F] Khandige Sham Bhat vs The Agricultural Income Tax Officer, ; , referred to.
(ii) Clause (ff) of section 2 is not void for want of legislative competence.
Although the words "acquisition" and "valuable consideration in the definition of "purchase" in section 2(ff) of the Act indicate, prima facie, that this definition is wider in scope than the definition "sale", these expressions in the context must be given a restricted meaning.
The expression "acquisition" in the definition means only "transfer" and the expression "valuable consideration" takes colour from the preceding expression "cash or deferred payment" and can only mean some other monetary payment in the nature of cash or deferred payment.
[571 F G; 572 B] The State of Madras vs Gannon Dunkerley & Co. (Madras) Ltd. ; , Sales Tax Officer vs Budh Prakash, A.I.R. and George Oakes vs State of Madras, A.I.R. , referred to.
Purchase tax, under the Act is leviable on the purchase of goods and not in respect of manufacture of goods and therefore is not an excise duty.
The purpose for which goods are purchased is only relevant for fixing the taxable event and the taxable event is fixed before the goods are actually manufactured.
[572 H 573 B] M/s. Shinde Bros. vs The Deputy Commissioner, Raichur, C.As.
1580 1586 and 1590 1600 of 1955 (decided on 26 9 1966), referred to.
The Act does not enable levy of tax on the same goods at more than one stage and therefore is not in conflict with section 15 of the Central Sales Tax Act 1596.
Manufacture changes the identity and the goods purchased and the goods sold are not identical and therefore the same goods are not taxed at two stages.
Further, cl.
(ff) of section 2 of the Act during.
the periods relevant to the present case, in terms, fixed the stage for taxation, i.e., the stage of purchase by a dealer for use in the manufacture of goods.
[573 B C; 576 B] 559 The fact that the same goods when purchased by a manufacturer would be taxed but would not be taxed when purchased by a person other than a manufacturer would not violate article 14 of the Constitution as section 2(ff) discloses a reasonable classification.
[572C E]
|
Civil Appeal No. 741 of 1987.
From the Judgment and order dated 6.2.1987 of the Rajasthan High Court in D.B. Civil Writ Petition No. 1632, 1758, 1826, 340, 1723, 344, 342, 343, 1755, 1756, 1757, 1982 of 1986, 170/87 and S.A. No. 341 of 1986 V.M. Tarkunde, Mrs. M. Karanjawala and Ezaz Maqbool for the Appellant in C.A. No. 741/87 Dushyant Dava, Ezaz Maqbool, Mrs. Manik Karanjawala for the Petitioners in W.P. No. 286/87.
C.M. Lodha, P.P. Rao, Badri Das Sharma, Raj Kumar Gupta and P.C. Kapur for the Respondents.
P.K. Jain for the Intervener in W.P. No. 286/1987.
The Judgment of the Court was delivered by VENKATACHALIAH, J.
These appeals by Special Leave, arise out of the judgment, dated, February 6, 1987 of the Division Bench of High Court of Rajasthan, disposing of by a common judgment a batch of writ appeals and writ petitions, in which was involved the question of the validity of certain provisions of the Recruitment Rules made and promulgated under the proviso to Article 309 of the Constitution by which, in respect of the scheme of competitive examinations to be conducted by the Public Service Commission for recruitment to certain branches of the civil services under the state, certain minimum qualifying marks in the viva voce test were prescribed.
The Division Bench, by its judgment under appeal, declared as arbitrary and unconstitutional this prescription in the rules which required that the candidates for selection to Administrative Service, the Police Service, and the Forest Service of the State should secure a minimum of 33% of the marks prescribed for the viva voce examination.
In these appeals the correctness of the High Court 's view is questioned by the State of Rajasthan, its Public Service Commission and the successful candidates whose selections were, in consequence of invalidation of the rule, quashed by the High Court.
The Writ Petition No. 286 of 1987 before us, is by another batch of candidates selected by the Public Service Commission for issue of a writ of mandamus, directing the State to effectuate the selection and 382 issue orders of appointment.
By an inter locutory order, dated 13.3.1987 the operation of the judgment under appeal was stayed by this court.
The result of this stay is that there was no impediment to effectuate the Select List dated 17.7.1986.
The Rajasthan State and Subordinate Services (Direct Recruitment by Combined Competitive Examinations) Rules 1962, ( '1962 Rules for Short '); the Rajasthan Administrative Service Rules 1954, the Rajasthan Police Service Rules 1954, the Rajasthan Forest Service Rules 1962 contain a provision, special to the said three services, and not applicable to other services, that candidates, other than those belonging to Scheduled Castes and Scheduled Tribes, should secure a minimum of 33% of marks in the viva voce test.
It is this Rule which is the centre of controversy.
The Rules also stipulate that candidates for these three services must also secure 50% in the written examinations; but that is not in the area of controversy.
Proviso (1) to Rule 15 of the '1962 rules ' which is the relevant Rule brings out the point.
It provides: 15.
Recommendations of the Commission (1) The Commission shall prepare for each Service, a list of the candidates arranged in order of merit of the candidates as disclosed by the aggregate marks finally awarded to each candidate.
If two or more of such candidates obtain equal marks in the aggregate, the Comission shall arrange their names in the order of merit on the basis of their general suitability for the service: Provided that: (i) the Commission shall not recommend any candidate for the R.A.S./R.P.S. who has failed to obtain a minimum of 33% marks in the personality and viva voce examination and a minimum of 50% marks in the aggregate.
It shall also not recommend any candidate for other services who has failed to obtain a minimum of 45% marks in the aggregate.
(ii) (2) Notwithstanding anything contained in proviso (i), the Commission shall in case of candidates belonging to the Scheduled Castes or Scheduled Tribes recommend the names of such candidates, upto the 383 number of vacancies reserved for them for amongst.
those who have qualified for interview, even if they fail to obtain the minimum marks in viva voce or the aggregate prescribed under proviso (i) above. " (emphasis supplied) Similar is the purport of Proviso (i) to Rule 25 of the Rajasthan Administrative Service Rules 1954; the Rajasthan Police Service Rules 1954; the Rajasthan Forest Service Rules 1962 and the Rajasthan Forest Subordinate Service Rules 1963.
The Rajasthan Public Service Commission conducts the competitive examination for selection for appointment to these and several other services under the State.
The maximum marks for the written examination is 1400 and for the viva voce and personality test is 180, which constitutes 11.9% of the aggregate marks.
Rules in relation to the Administrative Police and Forest Services require that candidates should secure 33% as minimum qualifying marks in the viva voce.
The High Court has struck down these provisions stipulating the minimum cut off marks at the viva voce.
In the year 1985 the Rajasthan Public Service Commission initiated proceedings for selection to 16 services including the said three services.
The written examinations were conducted in october 1985 the results of which were published in April, 1986.
The viva voce examinations and personality test were conducted between June 11 & July 11, 1986.
The final Select List was published on 17.7.1986.
The five appellants in CA 741 of 1987 secured, respectively, 19th 23rd, 20th, 12th and 11th places.
The 5 petitioners in WP 286 of 1987 secured 10th, 13th, 14th, 17th and 18th places respectively in the Select List.
Some of the candidates who failed to secure .
the requisite minimum of 60 marks out of the 180 marks prescribed for the viva voce and could not, therefore, make the grade in the said three services challenged before the High Court.
The Select List on the ground of the unconstitutionality of the provision in the Rules stipulating such minimum cut off marks.
They filed Writ Petitions 1632 of 1986, 1723 of 1986, 1826 of 1986, 1842 of 1986, 1982 of 1986 and 170 of 1987 in the High Court.
The petitions were referred to and came before a Division Bench and were heard along with the special Appeals 340 to 344 of 1986 which had been preferred against an earlier decision on the same question by a single judge of the High Court.
We have heard Sri C.M. Lodha, Sri Tarkunde, and Sri Shanti Bhushan, learned Senior Advocates respectively, for the State of 384 Rajasthan, the Public Service Commission and the selected candidates; and Shri P.P. Rao Learned Senior Advocate for the unsuccessful candidates at whose instance the Select List was quashed by the High Court.
It was contended for the appellants that the High Court, in reaching such conclusions as it did on the constitutionality of Proviso (i) to Rule 15 of the " 1962 rules" and of the corresponding Provisions in the Rules pertaining to the other services wholly misconceived the thrust and emphasis of the pronouncements of this court in Ajay Hasia vs Khalid Mujib Sehravardi & Ors. etc.
; , ; Lila Dhar vs State of Rajasthan & Ors., [1982] 1 SCR 320 and Ashok Kumar Yadav vs State of Haryana and Ors.
, [1985] Suppl.
1 SCR 657.
It was urged that the High Court fell into a serious error in importing into the present case, principles laid down in a wholly different context and that in the said three decisions the question whether a minimum qualifying marks could be prescribed for a viva voce examination or not did not fall for consideration much less decided, by this court.
What was considered in those cases, counsel say, pertained to the proposition whether the setting apart of an excessive and disproportionately high percentage of marks for the viva voce in comparison with the marks of the written examination would be arbitrary.
Learned Counsel further submitted that reliance by the High Court on the Report of the Kothari Commission on the basis of which the prescription of minimum qualifying marks for the viva voce was done away with in the Competitive Examinations for the Indian Administrative Service, Police Service and other central services was erroneous as that report was merely an indication of a policy trend.
It was submitted that even the Kothari Commission had itself advised further evaluation of the matter.
It was further submitted for the appellants that the prescription of minimum qualifying marks for the written examination or the viva voce or for both, is a well recognised aspect of recruitment procedures and that a prescription of a maximum of 11.9% of the total marks for the viva voce examination, with a condition that the candidate must get at least, 33% out of these marks for selection to the three key services would not violate any constitutional principle or limitation; but on the contrary would, indeed, be a salutary and desirable prescription, particularly having regard to the nature of the services to which recruitment is envisaged.
It was submitted that personnel recruited to the high echelons of Administrative, Police and Forest services with the prospect, with the passage of time, of having to assume higher responsibilities of administration in these three vital departments of Government, should be tried men with dynamism and special attain 385 ments of personality.
It was pointed out that though the pay scale of the Accounts Service and Insurance Service are the same as that of the Administrative Service, such a prescription is not attracted to the selection to these other services.
Shri P.P. Rao, learned Senior Advocate, appearing for the candidates who had failed to secure the minimum at the viva voce and whose challenge to the selection had been accepted by the High Court, submitted that the principles which the High Court had accepted were sound and that the decision under appeal would require to be upheld.
Sri Rao submitted that the principles enunciated in the Ajay Hasia, Lila Dhar and Ashok Kumar Yadav acquire an added dimension in the context of the increasingly denuded standards of probity and rectitude in the discharge of public offices and that attempts to vest a wide discretion in the selectors should not be too readily approved.
According to Sri Rao, the real thrust of the principle laid down in these cases is that any marking procedure that make the oral test determinative of the fate of a candidate is, in itself, arbitrary.
Shri Rao relied upon the following passage in Ashok Kumar Yadav 's case [1985] Suppl.
1 SCR 657 at 697 98): ".
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 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. " (emphasis supplied) Shri Rao submitted that the correct test, flowing from the earlier decisions, is to ask whether the viva voce tended to become the determing factor in the selection process.
If so, it would be bad.
If this test is applied to the present case Sri Rao says, the requirement of minimum, cut off marks in the viva voce makes that viva voce a "de 386 termining factor" in the selection process and falls within the dictum of the earlier cases and the decision reached by the High Court accordingly is unexceptionable.
Sri Rao, sought to demonstrate how the Rule operated in practice and as to how candidates at the top of the results in written examination had failed even to secure the minimum in the viva voce, particularly in the Interview Board presided over by a certain Sri Khan.
He showed with reference to several instances how the performance in the written examination and the viva voce bear almost an inverse proportion.
The High Court accepted those grounds urged in invalidation of the impugned rule and held: " .
The question before us is slightly different and relates to the essential requirement of obtaining the prescribed minimum qualifying one third marks out of those allotted for the viva voce test, since the percentage of marks allot ted for the viva voce test as compared to the written test is within the permissible limit.
The test of arbitrariness even in such a case is however, indicated by the ratio decidendi of Ashok Kumar Yadav case (supra).
It was clearly held by the Supreme Court in Ashok Kumar Yadav 's case (supra) that any method which makes the viva voce test a determining factor in the selection process resulting in a candidate securing high marks in the written examination being easily knocked out in the race by awarding him low marks in the viva voce test and vice versa is arbitrary and is liable to be struck down on that ground .
We may now examine the merits of the rival contentions.
The modern state has moved far away from its concept as the 'Leviathan ' with its traditional role symbolised by the two swords it wielded one of war and the other of justice.
The modern, pluralist, social welfare state with its ever expanding social and economic roles as wide ranging as that of an Economic Regulator, Industrial Producer and Manager, Arbitrator, Educationist, Provider of Health and Social Welfare services etc., has become a colossal service corporation.
The bureaucracy, through which the executive organ of the state gives itself expression, cannot escape both the excitement and the responsibility of this immense social commitment of the Welfare State.
Today the bureaucracy in this country carries with it, in a measure never before dreamt 387 Of, the privilege and the burden of participation in a great social and economic transformation, in tune with the ethos and promise of the constitution for the emergence of a new egalitarian and eclectic social and economic order a national commitment which a sensitive, devoted and professionally competent administrative set up alone can undertake.
A cadre comprised of men inducted through patronage, nepotism and corruption cannot, morally, be higher than the methods that produced it and be free from the sins of its own origin.
Wrong methods have never produced right results.
What, therefore, should impart an added dimension and urgency to the Recruitment to the services is the awareness of the extraordinary vitality and durability of wrong selections.
With the constitutional guarantee of security, the machinery for removal of a Government Servant on grounds of in efficiency and lack of devotion remains mostly unused.
The authors of a work on "Britain 's Ruling Class"*** say: "ONE OF THE MAIN ATTRACTIONS of working for the Civil Service is job security.
Once they let you in, you have to do something spectacularly improper to get kicked out.
In 1978 out of 5,67,000 non industrial civil servants, just 55 were sacked for disciplinary reasons; 57 were retired early 'on grounds of inefficiency or limited efficiency '; 123 were retired early on grounds of redundancy '.
In practice, a modest dose of common sense and propriety allows you to stay a civil servant until you retire.
In the middle and senior administration grades many do just that.
82 per cent of permanent Secretaries have been in the Civil Service for 25 years or more; so have 79 per cent of Deputy Secretaries, 62 per cent of Under Secretaries and 70 per cent of Senior Executive officers." ".
Recruiting civil servants means picking as many potential high flyers as possible and at the same time as few potential albatrosses.
It is a task carried out by the Civil Service Commission with scrupulous honesty, but questionable efficiency.
" The history of the evolution of the civil services in some countries is in itself study in contrasts as fascinating as it is disquieting.
*** The Civil Servants; An Inquiry into Britain 's Ruling Class: Peter Kellnor and Lord Crowther Hunt at 388 In France, until the Revolution, almost every office, central or local, excepting the dozen or so of the highest offices were attainable only by private purchase, gift or inheritance.
All Public officer were treated as a species of private property and voluminous jurisprudence governed their transmission.
Of this spectacle, a learned authority on Public Administration says: "Prices rose, but there was a frantic buying.
Ministers made the most of their financial discovery.
As it soon be came too difficult to invent new offices, the old ones were doubled or trebled that is, divided up among several holders, who exercise their functions in rotation, or who did what the seventeenth and eighteenth centuries were too fond of doing, employed a humble subordinate to carry them out "offices were sought, then, with a frenzied energy, and they were created with synicism Desmarets, one of Louis XIV 's Comptroller Generals, had proposed to the King the establishment of some quite futile offices, and the latter asked who would ever consent to buy such situation? 'Your Majesty ' replied Desmarets, 'is forgetting one of the most splendid of the prerogatives of the Kings of France that when the King creates a job God immediately creates an idiot to buy it." (See Theory and Practice of Modern Government Herman Finer page 751) The much desired transformation from patronage to open competition is later development, to which, now, all civilised governments profess commitment.
However, though there is agreement in principle that there should be a search for the best talent particularly in relation to higher posts, however, as to the methods of assessment of efficiency, promise and aptitude, ideas and policies widely vary, though it has now come to be accepted that selection is an informed professional exercise which is best left to agencies independent of the services to which recruitment is made.
The 'interview ' is now an accepted aid to selection and is designed to give the selectors some evidence of the personality and character of the candidates.
Macaulay had earlier clearly declared that a youngmen who in competition with his fellowmen of the same age had shown superiority in studies might well be regarded as having shown character also since he could not have pre 389 pared himself for the success attained without showing character eschewing sensual pleasures.
But the interview came to be recognised A as an essential part of the process of selection on the belief that some qualities necessary and useful to public servants which cannot be found out in a written test would be revealed in a viva voce examination.
In justification of the value and utility of the viva voce, the committee on Class I examinations in Britain said: B ". .
It is sometimes urged that a candidate, otherwise well qualified, may be prevented by nervousness from doing himself justice viva voce.
We are not sure that such lack of nervous control is not in itself a serious defect, nor that the presence of mind and nervous equipoise which enables a candidate to marshall all of his resources in such conditions is not a valuable quality.
Further, there are undoubtedly some candidates who can never do themselves justice in written examinations, just as there are others who under the excitement of written competition do better than on ordinary occasions .
We consider that the viva voce can be made a test of the candidate 's alertness, intelligence and intellectual outlook, and as such is better than any other . " As to the promise as well as the limitations of the viva voce, Herman Finer says: E "If we really care about the efficiency of the civil service as an instrument of government, rather than as a heaven sent opportunity to find careers for our brilliant students, these principles should be adopted.
The interview should last at least half an hour on each of two separate occasions.
It should be almost entirely devoted to a discussion ranging over the academic interests of the candidate as shown in his examination syllabus, and a short verbal report could be required on such a subject, the scope of which would be announced at the interview.
As now, the interview should be a supplementary test and not a decisive selective test.
The interviewing board should include a business administrator and a university administrator.
The interview should come after and not before the written examination, and if this means some inconvenience to candidates and examiners, then they must remember that they are helping to select the government of a great state, and a little inconvenience H 390 is not to be weighed against such a public duty . (See Theory and Practice of Modern Government Herman Finer at page 779) The problems of assessment of personality are indeed, complicated.
On the promise as well as dangers of the purely 'personal interview ' method, Pfiffner Presthus in his 'Public Administration ' at page 305 says: "Pencil and paper tests that measure some aspects of personality are now available.
Notable among these are the so called temperament or personality inventories.
These consist of questions in which the applicant is asked to evaluate himself relative to certain aspects of psychiatry and abnormal psychology.
Such tests are subject to a great deal of controversy however, and there is a school of experimental psychologists which condemns them, mainly on two grounds.
First, individuals will not give honest answers in a competitive test that asks them to describe their abnormal and intimate behaviour or beliefs.
Second, it is maintained that the value of these tests lies in their use as the repeutic or clinical aids rather than as vehicles for com petition . ".
Appointing officers are afraid that examining procedures will fail to give proper attention to such qualifications.
The result is that they often feel they could do a better job of selection using only the personal interview.
There are at least two reasons why this cannot be allowed.
The first relates to the protective tendency of civil service; appointing officers may appoint brothers in law or personal favourites.
In addition, psychological research has shown that the interview is of questionable validity, even in the hands of an experienced executive.
The arguments in the case on the legality of the prescription of minimum qualifying marks in the viva voce turned more on the undesirability of such a condition in the background of the increasing public suspicion of abuse of such situations by the repositories of the power.
The standards of conduct in public life, over the years, have, unfortunately, not helped to lessen these suspicions.
Tests of this kind owing to be repeated on sloughts on the sensibilities of the public in the 391 past, tend themselves too readily to the speculation that on such occasions considerations other than those that are relevant prevail.
On a careful consideration of the matter, we are persuaded to the view that the prescription of minimum qualifying marks of 60 (33%) out of the maximum marks of 180 set apart for the viva voce examination does not, by itself, incur any constitutional infirmity.
The principles laid down in the cases of Ajay Hasia, Lila Dhar, Ashok Kumar Yadav, do not militate against or render impermissible such a prescription.
There is nothing unreasonable or arbitrary in the stipulation that officers to be selected for higher services and who are, with the passage of time, expected to man increasingly responsible position in the core services such as the Administrative Services and the Police Services should be men endowed with personality traits conducive to the levels of performance expected in such services.
There are features that, distinguish, for instance, Accounts Service from the Police Service a distinction that draws upon and is accentuated by the personal qualities of the officer.
Academic excellence is one thing.
Ability to deal with the public with tact and imagination is another.
Both are necessary for an officer.
**Administrative and Police Services constitute the cutting edge of the administrative machinery and the requirement of higher traits of personality is not an unreasonable expectation.
Indeed in Lila Dhar vs State of Rajasthan, [1982] 1 SCR 320, this Court observed: "Thus, the written examination assessees the man 's intellect and the interview test the man himself and 'the twain shall meet ' for a proper selection.
If both written examination and interview test are to be essential feature of proper selection the question may arise as to the weight to be attached respectively to them.
In the case of admission to a college, for instance, where the candidates 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 life, greater weight has per force to be given to performance in the written examination.
The importance to be attached to the interview test must be minimal.
That was what was decided by this Court in Periakaruppan vs State of Tamil Nadu; Ajay Hasia etc.
vs Khalid Mujib Sehravardi & ** The dose that is demanded may vary according to the nature of the service .
392 Ors.
and other cases.
On the other hand, in the case of A service 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 . " (emphasis supplied) " .
There are, of course, many services to which recruitment is made from younger candidates whose personalities are on the threshold of development and who show signs of great promise, and the discerning may in an interview test, catch a glimpse of the future personality in the case of such services, where sound selection must combine academic ability with personality promise? some weight has to be given, though not much too great weight, to the interview test.
There cannot be any rule of thumb regarding the precise weight to be given.
It must vary from service to service according to the requirement of the service, the minimum qualifications prescribed, the age group from which the selection is to be made, the body to which the task of holding the interview test is proposed to be entrusted and host of other factors.
It is a matter for determination by experts.
It is a matter for research.
It is not for courts to pronounce upon it unless exaggerated weight has been given with proven or obvious oblique motives.
The Kothari Committee also suggested that in view of the obvious importance of the subject, it may be examined in detail by the Research Unit of the Union Public Service Commission." (emphasis supplied) This Court indicated that in matters such as these, which reflect matters of policy, judicial wisdom is judicial restraint.
Generally matters of policy have little adjudicative disposition.
Indeed, the point raised in the appeals admits of the answer found in the pronouncement of this court in State of U.P. vs Rafiquddin & Ors., Judgments Today where this Court considered the permissibility of the prescription of minimum qualifying or cut off marks in viva voce examination, while dealing with clause (ii) of the proviso to Rule 19 (as it stood prior to the 1972 amendment) of the U.P. Civil Service (Judicial Branch) Rules 1951.
The provision required the selection committee, inter alia, to ensure that persons who did not secure sufficiently high marks in the interview were not 393 recommended for the posts.
Pursuant to the power thus reserved to it, the selection committee, prescribed certain minimum cut off marks for the interview.
This court upholding the validity of the prescription observed at page 264 and 265: " .
Aggregate marks obtained by a candidate determined his position in the list, but the proviso of the rule required the Commission to satisfy itself that the candidate had obtained such aggregate marks in the written test as to qualify him for appointment to service and further he had obtained such sufficiently high marks in viva voce which would show his suitability for the service.
The scheme underlying Rule 19 and the proviso made it apparent that obtaining of the minimum aggregate marks in the written test and also the minimum in the viva voce was the sine qua non before the Commission could proceed to make its recommendation in favour of a candidate for appointment to the service.
The Commission in view of clause (ii) of the proviso had power to fix the minimum marks for viva voce for judging the suitability of a candidate for service.
Thus a candidate who had merely secured the minimum of the aggregate marks or above was not entitled to be included in the list of successful candidates unless he had also secured the minimum marks which had been prescribed for the viva voce test ".
The Commission had, therefore, power to fix the norm and in the instant case it had fixed 35 per cent minimum marks for viva voce test.
The viva voce test is a well recognised method of judging the suitability of a candidate for appointment to public services and this method had almost universally been followed in making selection for appointment to public services.
Where selection is made on the basis of written as well as viva voce test, the final result is determined on the basis of the aggregate marks.
If any minimum marks either in the written test or in viva voce test are fixed to determine the suitability of a candidate the same has to be respected.
Clause (ii) of the proviso to Rule 19 clearly confers power on the Commission to fix minimum marks for viva voce test for judging the suitability of a candidate for the service.
We do not find any constitutional legal infirmity in the provision." (emphasis supplied) 394 This should, in your opinion, conclude the present controversy in favour of the appellants.
Shri Rao 's reference to and reliance upon the observations in Yadav 's case is somewhat out of context.
The context in which the observations were made was that the spread of marks for the viva voce was so enormous, compared with spread of marks for the written examination, that the viva voce test 'tender to become the determining factor '.
The reference was to the possibility of a candidate underservedly being allotted high marks at the interview.
That is a very different thing from the question whether a candidate should acquire at least a certain minimum percentage of marks at the viva voce.
The distinction in the two sets of situations is brought out in the words of an administrator Sir Ross Barket: "My experience, which has been chiefly confined to cases in which the number of candidates was not so large, is that the whole process is dangerous and infinitely hazardous.
I think most selection committees on which I have served have been very doubtful about the results of what they had done.
They have done their best on insufficient materials.
The process is I think fairly successful in weeding out the worst candidates . " (emphasis supplied) (See 'Union Public Service Commission M.A. Muttalib page 135) 11.
It is important to keep in mind that in his case the results of the viva voce examination are not assailed on grounds of mala fides or bias etc.
The challenge to the results of the viva voce is purely as a consequence and incident of the challenge to the vires of the rule.
It is also necessary to reiterate that a mere possibility of abuse of a provision, does not, by itself, justify its invalidation.
The validity of a provision must be tested with reference to its operation and efficacy in the generality of cases and not by the freeks or exceptions that its application might in some rare cases possibly produce.
The affairs of Government cannot be conducted on principles of distrust.
If the selectors had acted mala fide or with oblique motives, there are, administrative law remedies to secure reliefs against such abuse of powers.
Abuse vitiates any power.
We think that on a consideration of the matter, the High Court was in error in striking down the impugned rules.
Accordingly, these 395 appeals are allowed and the judgement dated 6.2.1987 of the Division A Bench of the High Court is set aside and the writ petitions filed before it challenging the validity of the impugned rules are dismissed.
It is not necessary to issue express directions in W.P. 286 of 1987 in view of the fact that pursuant to the orders of stay dated 13.3.1987, the select list dated 17.7.1986 became amenable to be acted upon.
With the setting aside of the Judgment of the High Court under appeal, the impediment in the effectuation of select list dated 17.7.1986 stands removed.
In the circumstances of these cases, there will be no order as to costs.
R.S.S. Appeals allowed.
| This appeal by special leave against the judgment of the High Court in writ petition, and the writ petition filed in this Court were directed against an order of detention passed by the District Magistrate against the appellant under sub section
(2) of section 3 of the Gujarat Prevention of Anti Social Activities Act, 1985 with a view to preventing him from acting in any manner prejudicial to the maintenance of public order.
The appellant was a comission agent or broker engaged in illicit business of liquor traffic at Godhara in the State of Gujarat where there is total prohibition by importing liquor from Vanswada in Rajasthan.
On prior information that the appellant was about to import liquor in a truck on the night between 29th/30th December, 1986, the Gujarat police intercepted the truck and found it laden with cases containing bottles of whisky and beer, etc.
It was evident from the statements of the driver and the cleaner that the appellant had purchased the liquor from Vanswada.
The appellant could not be traced till 2nd February, 1987, when he was arrested but later released on bail.
On 28th May, 1987, the District Magistrate, Godhara, passed an order of detention and served it alongwith the grounds of detention on the appellant on the 30th when he was taken into custody.
The immediate and proximate cause for the detention was that on 29th/30th December, 1986, he had transported in bulk foreign liquor from Vanswada in Rajasthan for delivery in the State of Gujarat and indulged in anti social activities by doing illicit business of foreign liquor.
The grounds furnished particulars of two other criminal cases, namely (i) Criminal Case No. 303/82 on account of recovery of 142 bottles of foreign liquor seized from his residence on 21st July, 1982, which had ended in acquittal as the prosecution witnesses turned hostile, and (ii) Criminal Case No. 150/86 relating to seizure of 24 bottles of foreign liquor from his house on 30th May, 1986, which was still pending.
288 The appellant filed the writ petition in the High Court assailing the order of detention.
The High Court declined to interfere.
The appellant then filed in this Court the appeal by special leave against the decision of the High Court and the writ petition, against the order of detention.
Dismissing the appeal and the writ petition, the Court ^ HELD: When any person is detained in pursuance of an order made under any law of preventive detention, the authority making the order shall, as soon as may be, communicate to such person the grounds of detention and afford him the earliest opportunity of making a representation against the order.
The power of preventive detention underany law for preventive detention is necessarily subject to the limitations enjoined on the exercise of such power by article 22(5) as construed by this Court.
The Court must be circumspect in striking down an order of detention where it meets with the requirements of article 22(5) of the Constitution.
[294C E; 295D E] Since preventive detention is a serious inroad on individual liberty and its justification is the prevention of inherent danger of activity prejudicial to the community, the detaining authority must be satisfied as to the sufficiency of the grounds which justify the taking of the drastic measure of preventive detention.
The requirements of article 22(5) are satisfied once 'basic facts and materials ' which weighed with the detaining authority in reaching his subjective satisfaction are communicated to the detenu.
There is apt to be some delay between the prejudicial activity complained of in section 3(1) of the Act and the making of an order of detention.
When a person is detected in the act of smuggling or foreign exchange racketeering, the Directorate of Enforcement has to make a thorough investigation into all the facts with a view to determining the identity of the persons engaged in these operations.
Their statements have to be recorded; their books of accounts and other related documents have to be examined.
Sometimes such investigation has to be carried on for months together.
The Directorate has to consider whether there is necessity in the public interest to direct the detention of a person under section 3(1) of the Act with a view to preventing him from acting in any manner prejudicial to the conservation and augmentation of foreign exchange or from engaging in smuggling of goods, etc.
The proposal has to be cleared at the highest quarter and then placed before a Screening Committee.
If the Screening Committee approves, the proposal is placed before the detaining authority.
The detaining authority would necessarily insist upon sufficiency of grounds which 289 would justify the preventively detaining of the person.
Viewed from this prospective, the Court emphasised for the guidance of the High Courts that a distinction must be drawn between delay in making an order of detention under a law relating to preventive detention and the delay in complying with the procedural safeguards of article 22(5) of the Constitution.
The rule as to unexplained delay in taking action is not inflexible.
The Courts should not merely on account of delay in making an order of detention assume that the delay, if not satisfactorily explained, must necessarily give rise to an inference that there was no sufficient material for the subjective satisfaction of the detaining authority or that such subjective satisfaction was not genuinely reached.
Taking of such a view would not be warranted unless the Court finds that the grounds are 'stale ' or illusory or that there is no real nexus between the grounds and the order of detention.
The decisions to the contrary by the Delhi High Court in Anil Kumar Bhasin vs Union of India & Ors., Crl.
W. No. 410/86 dated 2.2.1987; Bhupinder Singh vs Union of India & Ors., ; Anwar Esmail Aibani vs Union of India & Ors., Crl.
W. No. 375/86 dated 11.12.1986; Surinder Pal Singh vs M.L. Wadhawan Delhi Administration, Crl.
W. No. 43/84 dated 16.4.1984 and Cases taking the same view did not lay down good law and were overruled.
In this case, the appellant was arrested on 2nd February, 1987.
The order of detention of the appellant was passed on 28th May, 1987.
Though there was no explanation for the delay between 2nd February and 28th May, 1987, it could not give rise to a legitimate inference that the subjective satisfaction arrived at by the District Magistrate was not genuine or that the grounds were stale or illusory or that there was no rational connection between the grounds and the impugned order of detention.
[295F G; 296B H; 297A G; 298C D] It could not be said that there was lack of awareness on the part of the District Magistrate on 28th May, 1987 in passing the order of detention as he did.
There was a mention in the grounds of the two criminal cases against the detenu Criminal Case No. 303/82 and Criminal Case No. 150/86 and also a recital of the fact that he was continuing his business surreptitiously and he could not be caught easily and, therefore, there was compelling necessity to detain him.
[300D] The contention regarding lack of certainty and precision on the part of the detaining authority as to the real purpose of detention and that they were 'all rolled up into one ' was of little or no consequence.
The purpose of detention is to prevent the appellant from acting in any manner prejudicial to the maintenance of public order.
It was disputed 290 that the prejudicial activities of the appellant answered the description of a 'bootlegger ' as defined in section 2(b) and, therefore, he came within the purview of sub section
(1) of section 3 of the Act by reason of sub section
(4) thereof.
Sub section
(4) of section 3 with the explanation thereto gives an enlarged meaning to the words 'acting in any manner prejudicial to the maintenance of public order '.
The district magistrate in passing the impugned order recorded his subjective satisfaction that with a view to preventing the appellant from acting in any manner prejudicial to the maintenance of public order, it was necessary to make an order that he be detained.
In the accompanying grounds of detention this was the basis for the formation of his subjective satisfaction, and it was stated therein that unless the order of detention was made he would not stop his illicit liquor traffic on brokerage and, therefore, it was necessary to detain him under section 3(2) of the Act.
[300E G; 301C D] The contention that there was unexpected delay in the disposal of the representation made by the appellant to the State Government was wholly misconceived.
The representations were made by the appellant on 8th June, 1987.
The State Government acted with promptitude and rejected them on 12th June, 1987.
There was no delay.
[301F G] The appeal and the writ petition failed.
Khudiram Das vs State of West Bengal, ; ; Narendra Purshottam Umrao vs B.B. Gujral, ; ; Olia Mallick vs State of West Bengal, ; Golam Hussain @ Gama vs Commissioner of Police, Calcutta & Ors., ; ; Odut Ali Miah vs State of West Bengal, ; Vijay Narain Singh vs State of Bihar, [1954] 3 SCC 14; Gora vs State of West Bengal, ; ; Raj Kumar Singh vs State of Bihar & Ors., ; ; Hemlata Kantilal Shah vs State of Maharashtra, ; ; Bal Chand Bansal vs Union of India & Ors., J.T. ; Ramesh Yadav vs District magistrate, Etah, and Suraj Pal Sahu vs State of Maharashtra, ; , referred to.
Anil Kumar Bhasin vs Union of India & Ors., Crl.
W. No. 410/86 dated 2.2.1987; Bhupinder Singh vs Union of India & Ors., ; Anwar Esmail Alibani vs Union of India & Ors., Crl.
W. No. 375/86 dated 11.12.1986; Surinder Pal Singh vs M.L. Wadhawan & Ors., Crl.
W. No. 444/86 dated 9.3.1987 and Ramesh Lal vs Delhi Administration, Crl.
W. No. 43/84 dated 16.4.1984, overruled.
|
Civil Appeal No. 1274 of 1988.
From the Judgment and order dated 7.10.1986 of the Bombay High Court in W.P. No. 1143 of 1985.
Masodkar and A.K. Gupta for the Appellant.
V.S. Desai and A.S. Bhasme for the Respondents The Judgment of the Court was delivered by RANGANATHAN, J.
1.
We grant special leave and proceed to dispose of the appeal after hearing both counsel 2.
The point raised in the appeal is a very short one.
The lands, belonging to the petitioners were among those sought to be acquired under the Land Acquisition Act, 1894 (hereinafter referred to as 'the Act ') by means of a notification under Section 4 issued on 22nd June, 1982.
This was followed up by a declaration under Section 6 dated 15th March, 1983.
The petitioners challenged both the notification and the 443 declaration in writ petition No 947 of 1983 before the High Court The notification under Section 4 was challenged on the ground of mala fides and the declaration under Section 6 on the short ground that the petitioners ' objections had not been heard before the making of the declaration.
When this writ petition came up for hearing, a statement was made on behalf of the Government that the notification under Section 6 was being withdrawn.
On this statement being made, the writ petition was withdrawn and disposed of accordingly.
Thereafter the petitioners were heard under Section 5 A of the Act and a fresh declaration under Section 6 was issued on 4th April, 1985.
The petitioners again filed a writ petition in the High Court, being writ petition No. 1143 of 1985, the judgment in which forms the subject matter of the present appeal.
In this writ petition they again challenged the notification under Section 4 as vitiated by mala fides and non application of mind.
The High Court has found no merit in this contention and rejected the same.
We see no reason to interfere with this conclusion of the High Court.
However, another question was also raised by the petitioners, namely, that the withdrawal of the earlier declaration dated 15.3.1983 had the automatic effect of also rendering the notification under Section 4 dated 22.6.1982 ineffective and infructuous.
On the strength of the decision of this Court in State vs Vishnu Prasad Sharma, ; , it was contended that, once a declaration under section 6 was issued, the notification under Section 4 exhausted itself.
It made no difference, it was said, that the notification issued under section 6 had been withdrawn.
Reliance was also placed on the decision of the Bombay High Court in Ajit Singh vs State, AIR 1972 Bombay 177 in support of this proposition.
This contention, however, was rejected by the High Court and hence the present appeal.
We are of opinion that the decision of the High Court is correct and should be upheld.
The Bench has rightly pointed out that Ajit Singh 's case (supra) had failed to take note of the decisions of this Court in Girdhari Lal Amrit Lal vs State, ; State vs Haider Bux, ; and State vs Bhogilal Keshavlal, ; and therefore, does not represent the correct law.
In Vishnu Prasad Sharma 's case (supra) the question for consideration of this Court was whether there could be successive declarations in respect of various parcels of land covered by a notification under Section 4(1).
Considering the scheme of the Act as it then stood, 444 the Court held that the Act envisaged a single declaration under Section 6 in respect of a notification under Section 4 and that, when once a declaration under Section 6 particularising the area in the locality specified in the notification under Section 4(1) is issued, the remaining non particularised area stands automatically released.
The Court also referred to the provisions of Section 48 of the Act in this context.
The following observations appear in the judgment of Sarkar J. ". .
It seems to me that if the correct interpretation is that only one declaration can be made under section 6, that also would exhaust the notification under section 4; that notification would no longer remain in force to justify successive declarations under section 6 in respect of different areas included in it.
There is nothing in the Act to support the view that it is only a withdrawal under section 48 that puts a notification under section 4 completely out of the way.
The effect of section 48 is to withdraw the acquisition proceedings.
including the notification under section 4 with which it started We are concerned not with a withdrawal but with the force of a notification under section 4 having become exhausted " 7.
The High Court was correct in pointing out that the above observations were made in the context of a valid declaration under S 6 The Court held that once there is a valid declaration under section 6, the scope of the notification under S 4 will got exhausted This principle cannot clearly apply to a case where the declaration under S 6 proves to be invalid.
ineffective or infructuous for some reason.
It has been so held by this Court in a number of decisions.
In Girdhari Lal Amrir Lal 's case (supra) which was decided about a week earlier to Vishnu Prasad Sharma 's case, this Court held that.
where a notification under section 6 is invalid, the Government may treat it as ineffective and issue in its place a fresh notification under S 6 and that there is nothing in S 48 of the Act to preclude the Government from doing so This view has been repeated in State vs Haider Bux, ; and State vs Bhogilal Keshavlal, ; These decisions have clearly pointed out the distinction between a case where there is an effective declaration under section 6 (which precludes the issue of further declarations in respect of other parts of the land covered by the notification under section 4 not covered by the declaration issued under S 6) and a case where? for some reason, the declaration under S 6 is invalid.
It is true that in the present case there was no occasion for the High Court in the earlier writ petition to pronounce the declaration 445 dated 15.3.1983 to be invalid.
But the validity of the declaration had been challenged on the ground that the petitioners had not been heard under section 5A, an irregularity, which ex facie rendered the declaration invalid.
The State Government obviously acknowledged this and withdrew the declaration on its own instead of obtaining a judgment to that effect from the Court.
In principle, there is no distinction between a case where a declaration under section 6 is declared invalid by the Court and a case in which the Government itself withdraws the declaration under section 6 when some obvious illegality is pointed out.
The point in issue in this appeal is thus directly governed by the three earlier decisions of this Court and the High Court was fully justified in dismissing the writ petition on this ground.
Before concluding we must refer to one circumstance which was brought to our notice by learned counsel for the petitioners and which has also been noticed in the judgment of the High Court.
It appears that, between the date of withdrawal of the earlier writ petition (namely, 23rd August, 1983) and the issue of the second declaration under section 6 (namely, 4.4.1985), the Government had issued a fresh notification under section 4 for the acquisition of certain lands.
The lands in the two notifications under section 4 do not completely overlap but it appears that some fields are common in both.
No declaration under section 6 appears to have been issued in furtherance of the second notification under section 4 when the High Court heard the matter.
Learned counsel for the petitioners points out that, at least in respect of such of the lands comprised in the section 4 notification dated 22.6.1982 as are also covered by the subsequent notification under section 4, it is legitimate to infer that the State Government has superseded the earlier notification by the latter one.
This contention is clearly well founded.
We would, therefore, like to make it clear that in respect of the lands covered by the first notification under section 4 which are also covered by or comprised in, the second notification under section 4, further proceedings regarding acquisition should be taken, in accordance with law, only in pursuance of the latter notification and the proceedings initiated in respect of such lands by the first notification dated 22.6.1982 should be deemed to have been superseded.
With the above clarification, we affirm the order of the High Court had dismiss this appeal.
In the circumstances, however, we make no order to costs.
G.N. Appeal dismissed.
| The appellant was granted a permanent Commission in the Indian Army in 1958 and appointed as a Second Lieutenant.
He rose to the level of Lt. Colonel on 27th February, 1975.
In March, 1976 he was directed to report to the Military Hospital for his psychiatric examination, where his medical classification was reduced from shape I to shape III, and he was posted as GLO and treated as Major.
There was however no specific order reducing him in rank.
In December, 1976, appellant 's Classification was upgraded to shape II and in September, 1977 to shape I.
But it was decided that he should be subjected to special review before restoration of his rank.
In a special report the Brigade Commander recorded appreciation of the appellant 's work, and recommended his promotion as Lt. Colonel.
But the Army Headquarters directed the appellant to the Military Hospital for further examination on the ground that an earlier incident of 1963 had been overlooked when the appellant was graded as shape I.
On this examination, the appellant was permanently downgraded as shape II.
In 1980, the appellant filed a writ petition in this Court, challenging the action of Army Headquarters and his downgrading.
This Court directed that he should be restored to the rank of Acting Lieutenant Colonel from the date he was reverted and that his claims to advancement, pay, arrears of pay, etc. should be considered and disposed of within six months (See After lodging his claims, the appellant waited for a reasonable time and then filed a writ petition in the High Court.
The respondent contended that there was nothing wrong in the recategorisation and the directions of the Supreme Court had been fully complied with.
The High Court dismissed the writ petition.
647 In this appeal by special leave, the appellant contended that a prejudicial approach developed against him in the Headquarters establishment without any justification and he had been unduly subjected to psychiatric examination from time to time, and on the basis of the records built up against him adverse opinion had been forthcoming which resulted in recategorisation from shape I to shape II.
To remove the apprehension of bias, this Court directed that the appellant may be examined by a Board consisting of three Experts with an outsider as Chairman.
After considering the report of the Experts Committee this Court allowed the appeal in part and, ^ HELD: 1.
The appellant 's medical category shall be taken as being continued to be shape I from 1977 and on that basis his promotional entitlements shall be finalised by the respondents within three months hence.
It is open to the respondents to release the appellant from service after this has been done.
[655F] 2.
The report of the Expert Committee makes it clear that there was no justification for the appellant to be subjected to psychiatric test in 1978 following which he was recategorised as shape II.
[654G] 3.
This subject of categorisation on the basis of psychiatric test is technical and should ordinarily be left to experts available in the Defence Department and the guidelines indicated by the Department should be followed.
This Court has no intention to disturb the discipline of the Defence Department, but on the basis of material available on the record and on the basis of the report of the Committee of Experts, the appellant is entitled to limited relief.
Though there was no order reducing him from the rank of Acting Lieutenant Colonel to Major, he was treated as having been so reduced.
Then followed the frequent psychiatric examinations without any real justification.
This recategorisation, in these circumstances, was without any justification.
[654H; 655A B] [Reiterating that it would like the discipline of the Defence Department to be maintained by itself in the interest of the nation, this Court observed that this case may not be taken as a precedent.] [655F G]
|
vil Appeal Nos.6230 and 6231 of 1983.
321 From the Judgment and Order dated 20.6.1983 of the Orissa High Court in O.J.C. Nos. 237 and 46 of 1983.
F.S. Nariman, A.K. Ganguli, S.N. Kacker, R.F. Nariman, A. Patnaik and M.M. Kshatriya for the Appellants.
G. Ramaswamy, Additional Solicitor General and R.K. Mehta for the Respondents.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
On December 12, 1967, the State of Orissa granted 'a license for collection of Sal Seeds ' from eleven Forest Divisions to M/s. Utkal Contractors and Joinery Private Limited.
The agreement provided for the sale and purchase of Sal Seeds failing on the ground naturally in the forests.
There was a stipulation that the company should establish solvent extraction units in the backward areas of Mayurbhanj and Sambalpur.
There was also an option for renewal of the lease for a further period of ten years.
It was later agreed that the period from October 1, 1967 to September 30, 1969 should be treated as experimental period and the lease should be deemed to have commenced from Octo ber 1, 1969 and to last for a period of ten years.
The Orissa Oil Industries Limited, a public limited company, was floated by the Utkal Contractors and Joinery Private Limited and it was agreed that the State Government should also contribute to the share capital of the company.
It was agreed that the Utkal Contractors and Joinery Private Limit ed should supply Sal Seeds to the two solvent extraction plants of the Orissa Oil Industries Limited, one set up at Bairangpur in Mayurbhanj District with a capacity to crush 21,000 M.T. Sal Seeds and the other at Sasan in Sambalpur District with a capacity to crush 21,000 M.T. sal seeds.
Thereafter on May 25, 1979, agreements renewing the leases for the purchase and removal of sal seeds from the eleven Forest Divisions for a further period of ten years from October 1, 1979 to September 30, 1989 were entered into by the Utkal Contractors and Joincry Private Limited and the Government of Orissa.
This was followed up by an agreement between the Utkal Contractors and Joinery Private Limited and the Orissa Oil Industries Limited for the supply of the entire collection of sal seeds from the eleven Forest Divi sions by the Utkal Contractors to the Orissa Oil Industries.
While so the Orissa Forest Produce (Control of Trade) Bill 1981 was introduced in the Legislative Assembly of Orissa State.
The Statement of Objects and Reasons was as follows: 322 "Smuggling of various forest pro duces is increasing day by day.
The present provisions of the Orissa Forest Act, 1972 for checking, hoarding and transport of forest produce are not adequate to bring the culprits to book.
The said Act is not adequate for imposition of any restrictions of control on trade in forest produce by framing rules thereunder.
Barring few items like sal seeds.
most of the important items of minor forest produce such as Mahua flower, Tamarind, Charmaji, Karanja and the like are grown in private holdings as well as in the forest areas owned by Government.
Unscrupulous trad ers take advantage of this situation and evade the law under the cover that the produce relates to private land and not to forests under the control of Government.
Instances of smuggling in such cases are too many and the smugglers are escaping with impunity because of absence of any legislation providing for State monopoly in forest produce.
Enactment of a separate legislation for the purpose is, therefore, absolutely necessary.
The Bill seeks to achieve the above purpose.
" It appears from a perusal of the Statement of Objects and Reasons that the object of the proposed Act was to prevent smuggling of forest produce like Mahua flowers, Tamarind, Charmaji, Karanja, etc.which were grown both in private holdings and Government forests.
The object of the legislation was to prevent smuggling in such forest produce and to provide for State monopoly therein.
It is seen that the Statement of Objects and Reasons expressly mentions sal seeds as a forest produce which is grown in Government Forests and not in private holdings.
The Orissa Forest Produce (Control of Trade) Act, 1981 received the assent of the President of India on August 21, 1981.
Under section 1(3) of the Act, the State Government is empowered from time to time to issue a notification specify ing the area or areas, the forest produce in relation to which and the date with effect from which the Act shall come into force.
Purporting to act under this provision, a notification was issued by the Government of Orissa on December 9, 1982 directing that the Act shall come into force at once in the whole of the State of Orissa in relation to sal seeds.
We are told that this is the only notification issued so far under section 1(3) of the Act, despite the fact that in the very Statement of Objects and Reasons it was expressly 323 recited that sal seeds was not a forest produce grown in Government forests.
In fact, we find that even after the commencement of the Act and before the issue of the Notifi cation, there were negotiations between the Utkal Contrac tors and Joinery Private Limited and the State Government for long term agreements for purchase _and sale of sal seeds in Athagarh and Puri Forest Divisions.
Such agreements were in fact entered into in relation to Parlakhemundi Forest Division between the State of Orissa and Indo East Extraction Limited.
On December 24, 1982, the Government refused to accept royalty from Utkal Contractors and Joinery Private Limited in respect of Dhenkanal and Sambalpur Forest Divi sion on the ground that the Notification dated December 9, 1982 had the effect of rescinding the contract between the company and the Government.
Thereupon Utkal Contractors and Joinery Private Limited and Orissa Oil Industries Limited filed a writ petition in the Orissa High Court for a decla ration that the Notification dated December 9, 1982 did not have the effect of rescinding the contracts which they had with the State Government.
The Writ Petition was dismissed by the Orissa High Court.
The Utkal Contractors and Joinery Private Limited and Orissa Oil Industries Limited have filed Civil Appeal No. 6230 of 1983.
In another case, on similar facts the Orissa Minor Oil Private Limited have filed Civil Appeal No. 6231 of 1983.
On behalf of the appellants, it was submitted by Shri F.S. Nafiman in Civil Appeal No. 6230 of 1983 and Shri S.N. Kacker in Civil Appeal No. 6231 of 1983 that the Orissa Forest Produce (Control of Trade) Act, 1981 had no applica tion to forest produce grown in Government forests.
The Act was aimed at creating a monopoly in forest produce in the Government.
Since the Government was already the owner of forest produce in Government forests all that was necessary to create a monopoly in all forest produce in the Government was to vest in the Government the exclusive right to pur chase forest produce grown in private holdings.
That was precisely what was done by the Orissa Forest Produce (Con trol of Trade) Act, 1981 according to the learned counsel.
It was further argued that even otherwise Explanation II to section 5(1) saved such contracts for the purchase of specified forest produce from Government forests also.
It was also brought to our notice that such contracts were entered into in pursuance of the avowed Industrial Policy of the Govern ment of Orissa.
Shri G. Ramaswamy, learned Additional Solic itor General argued that Orissa Forest Produce (Control of Trade) Act, 1981 was a comprehensive Act intended to control and regulate trade in forest produce whether grown in Gov ernment forest or land held by private owners.
He urged 324 that the language of section 5(1)(a) was so wide as to be incapa ble of any construction other than to say that all contracts relating to trade in forest produce shall stand rescinded irrespective of whether the contract related to forest produce grown in Government forests or forest produce grown on private lands.
He urged that Explanation II, properly viewed, was an explanation to section 5(1)(b) only and not to section 5(1)(a) He argued that in any event the contract was for the collection and not for the purchase of forest produce and therefore, not saved by the explanation.
He further urged that the agents contemplated by section 4 of the Act were not agents to act on behalf of the Government.
They were "public agents", named as such, to carry on the activity of purchas ing and trading in specified forest produce.
They could purchase from and sell to the Government.
We may straight away say that it was never the case of the Government in the High Court that the character of the agents was as suggested by the learned Additional Solicitor General.
We do not, therefore, propose to consider the submission of learned Additional Solicitor General whatever justification there may be for the submission on the language of section 4.
The learned Additional Solicitor General further submitted that even if the agreement which Utkal Contractors and Joinery Private Limited had with the Government was saved by Expla nation II, the further agreement by which the Utkal Contrac tors and Joinery Private Limited was required to supply sal seeds to Orissa Oil Industries Limited and the latter was required to purchase from the former was not saved by Expla nation II and therefore, no relief could be granted to the appellants.
This submission again is a new point raised for the first time in this Court.
We do not think we will be justified in permitting the Additional Solicitor General to raise the question at this stage.
Such a question was not raised in the High Court probably because the contract between Utkal Contractors and Joinery Private Limited and Orissa Oil Industries Limited appears to have been entered into at the behest of the Government.
The questions for consideration, therefore, are whether purchase of sal seeds grown in Government forests is outside the purview of the Orissa Forest Produce (Control of Trade) Act, 1981 and whether, in any event, a contract such as the one with which we are concerned is saved by Explanation II to section 5(1).
We have already referred to the Statement of Objects and Reasons of the Orissa Forest Produce (Control of Trade) Act.
We have noticed that ' the object was to prevent smuggling of those varieties of forest produce as were grown both in Government forests and private lands.
We also notice that it was expressly mentioned in the Statement of Objects and Reasons that such varieties of forest 325 produce were unlike sal seeds which were grown only in Government forests.
Even so we notice that the only notifi cation ever issued under the Act was in respect of sal seeds and no other forest produce.
We can only comment that curi ous indeed are the ways of the powers that be.
Section 1(3) of the Act declares that the Act shall come into force in such area or areas and in relation to such forest produce and on such date or dates as the State Gov ernment may, from time to time, by notification, specify in that behalf.
Section 2(c) defines 'forest produce ' and enumerates various items of forest produce.
One of them is sal seeds.
Section 2(d) defines "growers of forest produce" to mean "(i) in respect of forest produce grown on land owned by any person, the owner of such land, and (ii) in all other cases the State Government." Section 2(h) and 2(i) define 'specified area ' and 'specified forest produce ' in the following terms: "(h) "specified area" in relation to a specified forest produce means the area speci fied in the notification under sub section (3) of section 1 for such specified forest produce ;" "(i) "specified forest produce" in relation to a specified area means the forest produce specified in the notification issued under sub section (3) of section 1 for such specified area.
" Section 4 authorises the Government to appoint one or more agents for the purchase of and trade in specified forest produce in respect of one or more subdivisions of a speci fied area.
It is also provided that any person including a Gram Panchayat, a Cooperative Society or the State Tribal Development Corporation may be appointed as an agent.
Sec tion 5 is important and we are particularly concerned with subsections (1) and (3) of section 5 which may be fully extracted here.
They are as follows: "5.Restriction on purchase and transport and rescission of subsisting contracts (1) On the issue of a notification under sub section (3) of section 1 in respect of any area (a) all contracts for the purchase, sale, gathering or collection of specified forest produce grown or found in the said area shah stand rescinded, and 326 (b) no person other than (i) the State Government, (ii) an officer of the State Government autho rised in writing in that behalf, or (iii) an agent in respect of the unit in which the specified forest produce is grown or found shall purchase or transport any specified forest produce in the said area.
Explanation 1 "purchase" shall include pur chase by barter.
Explanation II Purchase of specified forest produce from the State Government or the aforesaid Government Officer or agent or a licensed vendor shall not be deemed to be a purchase in contravention of the provisions of this Act.
Explanation III A person having no interest in the holding who has acquired the right to collect the specified forest produce grown or found on such holding shall be deemed to have purchased such produce in contravention of the provisions of this Act.
(2) . . . . . . . (3) Any person desiring to sell any specified forest produce may sell them to the aforesaid Government Officer or agent at any depot situated within the unit wherein such produce was grown or found: Provided that State Government, the Government Officer or the agent shall not be bound to repurchase specified forest produce once sold.
(4). . . . . . . We notice that though section 5(1)(a) is in general terms and declares that 327 all contracts for the purchase and sale of forest produce shall stand rescinded and clause (b) bans purchase and transport of forest produce by any person other than the State Government or its officers or agents.
Explanation II is clear that purchase of specified forest produce from the State Government or its officers or agents is not to be deemed to be a purchase in contravention of the provisions of the Act.
Explanation III, we see, declares that a person having no interest in the holding but acquires the right to collect the specified forest produce grown or found on such holding shall be deemed to have purchased such produce in contravention of the provisions of the Act.
It is obvious that the reference to holding here is to land held by a person other than the Government and not to land owned by the Government.
We are primarily concerned in this case with the effect of section 5(1)(a) and (b) in the light of Explanation II.
Sub section (3) of section 5 also, we further notice, refers to sale to the officers, or agents of the Government by individuals and not sale by the Government or its offi cers or agents to individuals.
Section 5(2), which we have not extracted, is an excep tion to the ban imposed by section 5(1)(b) on transport of speci fied forest produce.
Section 5(2)(b) provides that notwith standing anything contained in sub section(1), any person may transport any specified forest produce within the prescribed limits from the place of purchase of any such produce to the place where such produce is required for bona fide use or for consumption.
It is further provided that any specified forest produce purchased from the State Government or any Officer or agent or any person for manufacture of goods within the State in which such specified forest produce is used as raw material or by any person for sale outside the State may be transported in accordance with the terms and conditions of a permit issued by the prescribed authority.
Section 6 provides for the constitution of an Advisory Committee in respect of each specified forest produce for each Revenue Division.
The object of the Committee is to advise the Government "in the matter of fixation of fair and reasonable price of each specified forest produce at which such produce may be purchased by the State Government or its authorised officers or agents when they are offered for sale in such division in accordance with the provisions of this Act.
" Section 7 enables the State Government, after consul tation with the Advisory Committee to fix the price at which specified forest produce may be purchased by it or by its officers or agents.
Again we see that the price to be fixed is in regard to authorised produce that may be purchased by the State Government and not forest produce that may be sold by the 328 State Government.
Section 8 enables the State Government to open depots for the convenience of the growers of specified forest produce and section 9 obliges the State Government to purchase at the price fixed under section 7 any specified forest produce offered for sale at the depot.
Section 10 enables growers of forest produce to get themselves registered.
Section 11 enables every manufacturer who uses any specified forest produce as a raw material and every trader or consum er to get himself registered.
Section 12 enables the State Government to dispose of specified forest produce purchased by the State Government or its officers or agents by sale or otherwise as the State Government may direct.
Section 13 bans any person from engaging himself in retail sale of any specified forest produce except under a licence granted under this section.
Section 15 provides for searches and seizures.
Section 16 provides for penalties.
Section 22(1) rovides "Nothing contained in the Orissa Forest Act, 14 of 1972 shall apply to specified forest produce in respect of matters for which provisions are made under this Act.
" In considering the rival submissions of the learned counsel and in defining and construing the area and the content of the Act and its provisions, it is necessary to make certain general observations regarding the interpreta tion of statutes.
A statute is best understood if we know the reason for it.
The reason for a statute is the safest guide to its interpretation.
The words of a statute take their colour from the reason for it.
How do we discover the reason for a statute? There are external and internal aids.
The external aids are Statement of Objects and Reasons when the Bill is presented to Parliament, the reports of Commit tees which preceded the Bill and the reports of Parliamen tary Committees.
Occasional excursions into the debates of Parliament are permitted.
Internal aids are the preamble, the scheme and the provisions of the Act.
Having discovered the reason for the statute and so having set the sail to the wind, the interpreter may proceed ahead.
No provision in the statute and no word of the statute may be construed in isolation.
Every provision and every word must be looked at generally before any provision or word is attempted to be construed.
The setting and the pattern are important.
It is again important to remember that Parliament does not waste its breath unnecessarily.
Just as Parliament is not expected to use unnecessary expressions, Parliament is also not expected to express itself unnecessarily.
Even as Parliament does not use any word without meaning something, Parliament does not legislate where no legislation is called for.
Parliament cannot be assumed to legislate for the sake of legislation, nor can it be assumed to make pointless legis lation.
Parliament does not indulge in legislation merely 329 to state what it is unnecessary to state or to do what is already validly done.
Parliament may not be assumed to legislate unnecessarily.
Again, while the words of an enact ment are important, the context is no less important.
For instance, "the fact that general words are used in a statute is not in itself a conclusive reason why every case falling literally within them should be governed by that statute, and the context of an Act may well indicate that wide or general words should be given a restrictive meaning" (see Halsbury, 4th edn. 44 para 874).
In Attorney General vsH.R.H. Prince Augustus, , Viscount Simonds said, "My Lords, the contention of the Attorney General was, in the first place, met by the bald, general proposition that, where the enacting part of a statute is clear and unambiguous, it cannot be cut down by the preamble, and a large part of the time which the hearing of this case occupied was spent in discussing authorities which were said to support that proposition.
I wish, at the outset, to express my dissent from it, if it means that I cannot obtain assistance from the preamble in ascertaining the meaning of the relevant enacting part.
For words, and partic ularly general words, cannot be read in isola tion; their colour and content are derived from their context.
So it is that I conceive it to be my right and duty to examine every word of a statute in its context, and I use context in its widest sense which I have already indicated as including not only other enacting provisions of the same statute, but its preamble, the existing state of the law, other statutes in pari materia, and the mis chief which I can, by those and other legiti mate means, discern that the statute was intended to remedy."
In Chertsey, U.D.C.v.Mixnam 's Properties, , Lord Reid said that the general effect of the au thorities was properly stated in Maxwell 's Interpretation of Statutes as follows: "General words and phrases ,therefore, however wide and comprehensive they may be in their literal sense, must usually be construed as being limited to the actual objects of the Act.
" Though no reference was made to Maxwell this Court in Em press Mills vs Municipal Committee, Wardha, ; stated the same proposition: 330 "It is also a recognised principle of construction that general words and phrases however wide and comprehensive they may be in their literal sense, must usually be con strued as being limited to the actual objects of the Act."
In Maunsell vs Olins, , Lord Wilber force observed, " . .I am not, myself, able to solve the problem by a simple resort to plain meaning.
Most language, and partic ularly all languages used in rent legislation, is opaque: all general words are open to inspection, many general words demand inspection, to see whether they really bear their widest possible meaning.
" But we think that when we rely upon rules of construc tion we must always bear in mind ' Lord Reid 's admonition in Maunsell vs Olins (supra) to the following effect: "Then rules of construction are relied on.
They are not rules in the ordinary sense of having some binding force.
They are our serv ants not our masters.
They are aids to con structions, presumptions or pointers.
Not infrequently one 'rule ' points in one direc tion, another in a different direction.
In each case we must look at all relevant circum stances and decide as a matter of judgment what weight to attach to any particular 'rule '.
" Bearing these broad rules in mind, we may now examine the Act and the argument.
The reason for the Act is not far to seek.
Earlier we have set out the Statement of Objects and Reasons.
The Statement of Objects and Reasons is explic it that the Act was proposed to be enacted to prevent smug gling of forest produce grown in Government lands under the guise of produce grown on private lands.
This was sought to be achieved, as stated in the preamble by the creation of a State monopoly.
Since the State was already the owner of the forest produce grown in Government land, what was necessary and sufficient to be done by the proposed legislation was to vest in the Government the exclusive right to purchase forest produce grown on private land.
We may now proceed to examine the scheme and the provisions of the Act to find out whether this was not precisely what was done.
At the outset, we notice that 'grower of forest produce ' is 331 defined to include the State Government but on an examina tion of the remaining provisions of the Act we find that the expression 'grower of forest produce ' is not found in any other provision except sec.5(2)(a) and section 10.
Section 5(2)(a) provides for the transport of produce by the grower of forest produce from a place within one unit to another place within the unit.
Section 10 requires every grower of specified forest produce to get himself registered in the prescribed manner.
Obviously neither section 5(2)(a) nor section 10 has any application to the Government.
Therefore, the cir cumstance that grower of forest produce is defined so as to include the Government appears to us to be of no consequence in determining whether the Act is applicable to forest produce grown on Government lands.
On the other hand, from the extracts and summary of the other provisions of the Act that we have given earlier, we find that section after section deals with purchase of forest produce which, in the circumstances, can only refer to purchase of forest produce grown on private holdings since there can be no question of or providing for the purchase by the Government of forest produce grown on Government lands.
Section 4 enables the appointment by the State Government of agents for the pur chase of and trade is specified forest produce.
Section 5(1)(b) refers to purchase or transport of specified forest produce by the State Government, its officers and agents.
Section 5(3) refers to sale of forest produce to the Govern ment, its officers or agents.
Section 7 refers to the fixa tion of price at which the Government, its officers or agents may purchase forest produce.
Section 8 enables the opening of depots for the purchase of forest produce by the Government, its officers and agents.
Section 9 deals with the obligation of the State Government, its agents and officers to purchase specified forest produce.
All these provisions, we see, deal with purchase of forest produce by the State Government.
As stated by us earlier, this can only be of forest produce grown in private holdings and not in Government forests.
The only provision which deals with sale of forest produce by the State Government is section 12 and that again is confined to the sale of specified forest produce purchased by the State Government, its officers or agents.
Thus, section 4, section 5(1)(b), section 5(3), section 7, section 8, section 9, section 10 and section 12, all deal with the forest produce grown in private holdings and all these provisions except sections 10 and 12 deal with purchase of forest produce by the Govern ment, its officers or agents.
Section 10, as we have already seen, deals with registration of growers of forest produce and section 12 with sale of forest produce purchased by the Government.
Thus none of these provisions deals with forest produce grown in Government lands nor is there any other provision in the Act which expressly deals with forest produce grown in Government lands.
The scheme of 332 the Act is, therefore, fully in tune with the object set out in the Statement of Objects and Reasons and in the Preamble, namely, that of creating a monopoly in forest produce by making the Government the exclusive purchaser of forest produce grown in private holdings.
It was argued by the learned Additional Solicitor General that section 5(1)(a) was totally out of tune with the rest of the provisions and, while the rest of the provisions dealt with forest produce grown in private holdings, the very wide language of section 5(1)(a) made it applicable to all forest produce whether grown in private holdings or Government forests.
We do not think that it is permissible for us to construe section 5(1) (a) in the very wide terms in which we are asked to construe it by the learned Additional Solicitor General because of its wide language, as that would merely introduce needless confusion into the scheme of the Act.
Having scanned the object and the scheme of the Act, having examined each of the provisions of the Act textually and contextually, we do not think that it is proper for us to construe the words of section 5(1)(a) in their literal sense; we think that the proper way to construe section 5(1)(a) is to give a restricted meaning to the wide and general words there used so as to fit into the general scheme of the Act.
Section 5(1)(a) and 5(1)(b) are connected by the conjunction 'and ', and having regard to the circumstances leading to the enactment and the policy and design of the Act, we think that clauses (a) and (b) must be construed in such a way as to reflect each other.
We have no doubt that the contracts relating to specified forest produce which stand rescinded are contracts in rela tion to forest produce grown in private holdings only.
If the very object of the Act is to create a monopoly in forest produce in the Government so as to enable the Government, among other things, to enter into contracts, there was no point in rescinding contracts already validly entered into by the Government.
Again section 5(1) does not bar any future contracts by the Government in respect of forest produce; if so, what is the justification for construing section 5(1)(a) in such a way as to put an end to contracts already entered into by the Government.
Viewing section 5(1)(a) and 5(1)(b) together and in the light of the preamble and the Statement of Objects and Reasons and against the decor of the remain ing provisions of the Act, we have no doubt that section 5(1), like the rest of the provisions, applies to forest produce grown in private holdings and not to forest produce grown in Government lands.
One of the submissions of the learned Additional Solici tor General was that despite noticing in the Statement of Objects and Reasons that 'sal seeds ' were grown in Govern ment lands only yet 'sal seeds ' were included in the defini tion of forest produce and this was a clear indication that forest produce grown in Government lands was 333 also meant to be dealt with by the Act.
We do not think that the mere inclusion of 'sal seeds ' in the definition of forest produce can lead to such consequences in the teeth of the several provisions of the Act.
Several species of forest produce were included in the definition of forest produce and among them 'sal seeds ' were also included so as to eliminate even the remote possibility of the existence of some stray private holdings in which sal seeds may have been grown.
In the view that we have taken it is unnecessary for us to consider the further submission that Explanation II to section 5(1) saves the present contract or t, hat Explanation II is an explanation only to section 5(1)(a) and not to section 5(1)(b).
We declare that the Act and the notification issued under the Act do not apply to forest produce grown in Government forests and that it was not therefore, open to the Govern ment to treat the contract dated May 25, 1979 as rescinded.
As a result of the attitude of the Government in treating the contract as rescinded from the date of the notification the appellants were not able to collect and purchase the sal seeds from the Government forests which they have taken on lease for a period of about four years.
The question arises whether any further relief in addition to declaration may be granted by us.
It was suggested on behalf of the appellants that their lease should be extended by another period of four years.
We do not think that it is permissible for us to extend the lease for a further period of four years in that fashion.
We can only leave it open to the parties to work out their rights in the light of the declaration granted by us.
We find that various interim orders were made from time to time.
The rights of the parties will naturally have to be worked out after taking into account the interim orders.
Civil Appeal No. 6231 is an appeal by other persons similarly placed as the appellants in Civil Appeal No. 6230 of 1983 in respect of a different contract.
Both the appeals are allowed with costs in the manner indicated above.
We mentioned at the outset that although several species of forest produce were included in the definition of forest produce under the Act, the only notification issued under the Act in respect of any specie of forest produce was in respect of sal seeds, an item in respect of which no notifi cation whatsoever was necessary if what was stated in the Statement of Objects and Reasons was correct.
We are not a little surprised that the only occasion for using the ma chinery of Orissa Forest Produce (Control of Trade) Act, 1981 was to issue a notification in respect of sal seeds and not in respect of other forest produce, leaving an uneasy feeling with us that the notification was issued only with the object of putting an end to 334 these contracts solemnly entered into by the Orissa Govern ment for the avowed purpose of encouraging the setting up of certain industries in the State of Orissa.
The allegation of the appellants is that this has been done with a view to help certain industrialists outside the State.
We desire to express no opinion on this allegation.
P.S.S. Appeals allowed.
| The Petitioner 's husband, Mohan Lal Jatia, was detained by an 47 order passed under sub section
(1) of section 3 of the (COFEPOSA) by the Additional Secretary to the Government of India, Ministry of Finance on being satisfied that it was necessary to detain him 'with a view to prevent ing him from acting in any manner prejudicial to the augmen tation of foreign exchange '.
The residential premises of one Subhash Gadia, a very rich and prosperous businessman of Bombay, the brother in law of the detenu, were searched on the basis of intelli gence gathered by the Directorate of Revenue Intelligence that he was under invoicing imports of yarn from Japan and it resulted in seizure of certain documents.
As the seized documents not only revealed violation of the provisions of the Customs Act but also indicated certain payments and transactions in violation of the Foreign Exchange Regulation Act, 1973 (FERA), the matter was referred to the Enforcement Directorate Investigation from the FERA angle.
Subhash Gadia was summoned under section 40 of the FERA and his statement was recorded by Shri R .C.
Singh, an officer of the Enforcement Directorate.
The incriminating documents seized from the residential premises of Subhash Gadia and the revelations made by him during his examination in relation to the docu ments seized which revealed that the detenu Mohan Lal Jatia was engaged in foreign exchange racketeering to the tune of several crores of rupees formed the basis of the aforesaid order of detention.
The petitioner approached the High Court with petitions under article 226 of the Constitution seeking to challenge the impugned order of detention.
Upon the dismissal of the first of these petitions by the High Court, the petitioner had approached this Court under article 136, and, the Court, while declining to grant special leave to appeal, had directed that the detenu should appear before the Commissioner of Police and, upon his doing so, he should immediately be released on parole for a period of ten days.
Thereafter, the petitioner filed the second petition under article 226 with an application for extending the period of parole which was rejected by the High Court.
The petition filed under article 136 against refusal of interim relief by the High Court was also rejected by this Court.
Thereafter, the High Court dismissed the writ petition, against which, the petitioner sought special leave to appeal and also filed a petition under article 32 challenging the order of detention.
While issuing notice on the petitioner, the Court directed the release of the detenu on parole for a week and by a subse quent order further extended the period of parole.
Both the special leave petition and the writ petition were heard together.
48 In the writ petition filed before the High Court from which the petition for special leave petition arose, the petitioner had challenged the order of detention on two grounds: that there was no material on which the satisfac tion of the detaining authority could be reached that the detention of the detenu was necessary; and, that there was total non application of mind on the part of the detaining authority to the material on record, and in particular, to the factual mis statements contained in paragraph 44 of the grounds of detention as detailed in entries 'A ' to 'F '.
The writ petition filed before this Court was principally based on the ground that there was information of the Constitu tional Safeguard Contained in article 22(5) of the Constitution inasmuch as there was failure on the part of the detaining authority to consider an alleged representation made by the detenu under section 8(b) read with section 11 01 ' the COFEPOSA against the order of detention addressed to the President of India which was presented through one Ashok Jain at the President 's Secretariat.
The other substantial question raised was that R.C. Singh was not a gazetted officer of Enforcement within the meaning of section 40 of the FERA and therefore the statements recorded by him could not be re garded as valid statements under the aforesaid section 40 and thus could not form the basis upon which the satisfaction of the detaining authority could be reached.
Alternatively, it was contended that the statements recorded by him could not be treated as statements recorded under section 39.
The respondents not only denied that the detenu had addressed any representation to the President of India but made an application under section 340, Cr.
P.C. for prosecution of persons responsible for forgoing the document purporting to be the alleged representation made by the detenu and for making certain interpolations in the Dak Register kept at the President 's Secretariat.
The respondents also placed on record an order showing that R.C. Singh had been appointed an officer of enforcement on ad hoc basis three years before he had summoned Subhash Gadia for examination.
Dismissing both the petitions, HELD: 1. (a) The expression 'officers of Enforcement ' as defined in section 3 of the Foreign Exchange Regulation Act, 1973, embraces within itself not only (a) a Director (b) Additional Director (c) Deputy Director and (d) Assistant Director of Enforcement but also (e) such other class of officers of Enforcement as may be appointed for the purpose or ' the Act.
Obviously, R.C. Singh who was Assistant En forcement Officer having been appointed as an officer of Enforcement on an ad hoc basis 49 in 1982 tell within the category 'such other class of offi cers ' covered by section 3(e).
Sub section
(1) of section 4 provides that the Central Government may appoint such persons, as it thinks fit, to be officers of Enforcement.
Sub section
(2) there of provides for delegation of such power of appointment by the Central Government to a Director of Enforcement or an Additional Director of Enforcement etc., to appoint officers of Enforcement below the rank of an Assistant Director of Enforcement.
Sub section
(3) of section 4 provides that subject to such conditions and limitations as the Central Government may impose, an officer of Enforcement may exercise the powers and discharge the duties conferred or imposed on him under the Act.
Undoubtedly R.C. Singh was discharging his duties and functions as a gazetted officer of Enforcement under section 40(1) when he recorded the statements in question.
The expression 'gazetted officer of Enforcement ' appearing in section 40(1) must take its colour from the context in which it appears and it means any person appointed to be an offi cer of Enforcement under section 4 holding a gazetted post.
There is no denying the fact that R.C. Singh answered that de scription.
[69G H; 70A D] (b) Even if the contention that R.C. Singh was not a gazetted officer of Enforcement within the meaning of section 40(1) were to prevail, it would be of little consequence.
If evidence is relevant the Court is not concerned with the method by which it was obtained.
There is a long line of authority to support the opinion that the Court is not concerned with how evidence is obtained.
The rule is however subject to an exception.
The Judge has a discretion to exclude evidence procured, after the commencement of the alleged offence, which although technically admissible appears to the Judge to be unfair.
This being the substan tive law, it follows that the detaining authority was enti tled to rely upon the statements recorded by R.C. Singh under section 40(1).
Even if R.C. Singh was not competent to record such statements under section 40(1), the statements were clearly relatable to section 39(b) of the Act.
It cannot there fore be said that there was no material on which the detain ing authority could have based his subjective satisfaction.
[70E H] Barindra Kumar Ghose vs Emperor, ILR ; Kuruma vs Reginam, ; R.V. Sang; , ; Magruder Patodia vs R.K. Birla & Ors.
, ; ; R.M. Malkani vs State of Maharashtra, ; ; and Pooran Mal, etc.
vs Director of Inspection; , ; referred to.
(c) Where an office exists under the jaw, it matters not how the appointment of the incumbent is made, do far as validity of its acts are 50 concerned.
It is enough that he is clothed with the insignia of the office, and exercises its powers and functions.
The official acts of such persons are recognised as valid under the de facto doctrine, born of necessity and public policy to prevent needless contusion and endless mischief.
[69B C] Gokaraju Rangaraju vs State of Andhra Pradesh, ; ; Pulin Behari vs King Emperor, [1912] 15 Cal.
ZJ 517; and P.S. Menon vs State of Kerala & Ors., AIR (1970) Kerala 165; referred to.
(a) It has long been established that the subjective satisfaction of the detaining authority as regards the factual existence of the condition on which the order of detention can be made, i.e., the grounds of detention con stitutes the foundation for the exercise of the power of detention and the Court cannot be invited to consider the propriety or sufficiency of the grounds on which the satis faction of the detaining authority is based.
Nor can the Court, on a review of the grounds, substitute its own opin ion for that of the authority.
But this does not imply that the subjective satisfaction of the detaining authority is wholly immune from the power of judicial review.
It inferen tially follows that the subjective satisfaction being a condition precedent for the exercise of the power conferred on the executive, the Court can always examine whether the requisite satisfaction was arrived at by the authority; if it is not, the condition precedent to the exercise of the power would not be fulfilled and the exercise of the power would be bad.
The simplest case is where the authority has not applied its mind at all; in such a case, the authority could not possibly be satisfied as regards the tact in respect of which it is required to be satisfied.
[66E H] Emperor vs Shibnath Banerjee & Ors., AIR (1943) FC 75 and Khudi Ram Das vs State of West Bengal & Ors.
, ; , referred to.
In this case, it is quite apparent that the so called factual mis statements listed as items 'A ' to 'F ' in para graph 44 of the grounds of detention are not mis statements at all.
The High Court rightly held that the alleged mis takes or infirmities pointed out were not so material or serious in nature as to vitiate the impugned order of deten tion and rightly observed that the facts stated in paragraph 44 of the grounds cannot be read in isolation and the grounds of detention have to be read as a whole with the accompanying documents and material.
The grounds of deten tion was only one, viz., that the detenu was engaged 51 in activities prejudicial to the augmentation of foreign exchange and therefore it became necessary in the public interest to place him under detention.
It cannot be said on a perusal of the grounds that there was no material on which the detaining authority could have acted.
[74E; 78A B] (b) The contention that, even if one of the grounds or reasons which led to the subjective satisfaction of the detaining authority is non existent or misconceived or irrelevant, the order of detention would be invalid since it is not possible to predicate as to whether the detaining authority would have made an order for detention even in the absence of non existent or irrelevant ground, cannot be accepted.
That principle was enunciated by this Court some 30 years ago.
With the change in law brought about by the introduction of section 5A of the COFEPOSA Act that though one or more of the grounds of detention were found to be vague, non existent, not relevant, not connected, irrational or invalid for any other reason whatsoever, the detention could be sustained on the remaining grounds, that principle no longer holds goods.
[63A C] Shibban Lal Saxena vs State of Uttar Pradesh & Ors.
, ; ; Dr. Ram Manohar Lohia vs State of Bihar & Ors., ; and Pushkar Mukherjee & Ors.
vs State of West Bengal; , ; referred to.
Mohd. Shakeel Wahid Ahmed vs State of Maharashtra & Ors.
, ; ; Asha Devi vs K. Shivraj, Addi tional Chief Secretary; , and Kurjibhai Dhanjibhai Patel vs State of Gujarat, ; distinguished.
(c) Sufficiency of grounds is not for the Court but for the detaining authority for the formation of his subjective satisfaction that the detention of a person under section 3(1) of the COFEPOSA Act is necessary with a view to preventing him from acting in any manner prejudicial to the augmentation of foreign exchange.
The Act is a law relating to preventive detention.
That being so, the power of detention exercisable under sub section
(1) of section 3 of the Act is subject to the limi tations imposed by the Constitution.
When the liberty of the subject is involved, it is the bounden duty of the court to satisfy itself that all the sate guards provided by the law have been scrupulously observed and that the subject is not deprived of his personal liberty otherwise than in accord ance with law.
Nevertheless, the community has a vital interest in the proper enforcement of its laws, particularly in an area such as conservation of foreign exchange and prevention of smuggling activities in dealing effectively with persons engaged in such smuggling and foreign exchange 52 rackteering by ordering their preventive detention and at the same time, in assuring that the law is not used arbi trarily t9 suppress the citizen of his right to life and liberty.
The Government must therefore ensure that the constitutional safeguards of article 22(5) read with subs.
(1) of section 3 of the Act are fully complied with.
[65A B] Mangalbhai Motiram Patel vs State of Maharashtra, ; and Narendra Purshotam Umrao vs B.B. Gujral, ; ; relied on.
In the instant case there was no failure on the part of the Government to discharge its obligation under article 22(5).
The relevant records of the Enforcement Directorate placed before us clearly show that there was sufficient material for the formation of the subjective satisfaction of the detaining authority under sub s.(1) of section 3 of the Act.
They also show that the detenu was afforded a reasonable opportu nity for making an effective representation against his detention.
[66C D] 3.
(a) Preventive detention is an extraordinary measure resorted to by the State on account of compulsive factors pertaining to maintenance of public order, safety of public life and the welfare of the economy of the country.
The need for this extraordinary measure was realised by the founding fathers of the Constitution as an inevitable necessity and hence a specific provision has been made in cl.
(3) of article 22 providing for preventive detention.
Placing the interests of the nation above the individual liberty of the anti social and dangerous elements who constitute a grave menace to society by their unlawful acts, the preventive detention laws have been made for effectively keeping out of circula tion the detenus during a prescribed period by means of preventive detention.
The underlying object cannot be achieved if the detenu is granted parole and brought out of detention.
Even if any conditions are imposed with a view to restrict the movements of the detenu while on parole, the observance of those conditions can never lead to an equation of the period of parole with the period of detention.
Due to the spectacular achievements in modern communication system, a detenu, while on parole, can sit in a room in a house or hotel and have contracts with all his relations, friends and confederates in any part of the country or even any part of the world and thereby pursue his unlawful activities if so inclined.
It will, therefore, be futile to contend that the period of parole of a detenu has all the trappings of actual detention in prison and as such both the periods should find a natural merger and they stand denuded of their distinctive characteristics.
It will not be out of place to point out here that inspite of the Criminal Procedure Code providing 53 for release of the convicted offenders on probation of good conduct, it expressly provides, when it comes to a question of giving set off to a convicted person in the period of sentence, that only the actual pre trial detention period should count for set off and not the period of bail even if bail had been granted subject to stringent conditions.
In contrast.
in so far as preventive detentions under the COFEPOSA Act are concerned.
it has been specifically laid down in section 12(6) that a person against whom an order of detention has been passed shall not be released on bail or bail bond or otherwise and that any revocation or modifica tion of the order of detention can be made by the Government in exercise of its power under section 11.
[78E H; 79G] (b) The question whether the period of parole should be treated as part of the detention period itself was elabo rately considered by this Court in Smt.
Poonam Lata vs M.L. Wadhawan & Ors., and it was held therein that the period of parole has to be excluded in reckoning the period of deten tion under sub section
(1) of section 3 of the COFEPOSA Act.
[78C] Smt.
Poonam Lata vs M.L. Wadhawan & Ors.
J.T., , relied on.
The respondents have placed sufficient material before the Court to show that the alleged representation addressed to the President of India was neither filed by the detenu nor was it received at the President 's Secretariat.
The attempt to assail the order of detention on the ground of violation of the constitutional sate guard enshrined in article 22(5) and the violation of section 11 of the Act by the Central Government is a well planned and ingenuous move on the part of the detenu.
The facts revealed not only warrant an inference that the detenu and his associates have gone to deplorable lengths to create evidence favourable to the detenu but arouse convulsive thoughts in our minds about the efficiency and integrity of the concerned sections of the President 's Secretariat.
The case with which and the fascile manner in which the detenu 's agent Ashok Jain claims to have entered the President 's Secretariat and delivered the Dak and obtained an endorsement of acknowledgement in a copy of the representation and the length to which the concerned Secretariat staff have gone to give credence to the version of Ashok Jain not only reveals the deep fall in standards but also lack of security and vigilance.
We feel fully persuaded to hold that this is a fit case in which the detenu, the petitioner, Ashok Jain and all other persons responsible for the fabrication of false evidence should be prosecuted lot the offences committed by them.
We defer the passing of 54 final orders on the application filed under section 340, Cr.
P.C. till the investigation by the Central Bureau of Investiga tion is completed.
[80E F; 82F H; 83A B]
|
Appeal No. 153 of 1958.
Appeal by special leave from the judgment and order dated January 9, 1956, of the Bombay High Court in Special Civil Application No. 2258 of 1955 J. B. Dadachanji, section N. Andley, and Rameshwar Nath, for the appellant.
section P. Sinha, M. I. Khowaja and A. C. Dave, for respondent No. 1. 1961.
March 27.
The Judgment of the Court was delivered by WANCHOO J.
This appeal by special leave against the judgment of the Bombay High Court raises a question of the interpretation of a. 34 (2 A) of the 569 Bombay Tenancy and Agricultural Lands Act, No. LXVII of 1948 (hereinafter called the Act).
The brief facts necessary for present purposes are these: The appellant is the landlord and the respondent a protected tenant.
The appellant gave notice of termination of tenancy to the respondent on December 31, 1951, under section 34(1) of the Act.
The notice was for one year as required by section 34(1) and the tenancy was to terminate from after March 31, 1953.
The landlord therefore made an application on April 7, 1953, under section 29(2) of the Act for obtaining possession of the land to the Mamlatdar.
In the meantime, an amendment.
was made to the Act by the insertion of sub section
(2 A) to section 34 by the Amending Act No. XXXIII of 1952, which came into force on January 12, 1953.
By this amendment certain further restrictions were placed on the right of the landlord to terminate the tenancy of a protected tenant.
The relevant part of sub section
(2 A) is in these terms: "If the landlord bona fide requires the land for any of the purposes specified in sub section (1) then his right to terminate the tenancy shall be subject to the following conditions, namely (1) The land held by the protected tenant on lease stands in the record of rights in the name of the landlord on the first day of January, 1952, as the superior holder.
(2) If the land held by the landlord is in area equal to the agricultural holding or less, the landlord shall be entitled to terminate the tenancy of the protected tenant, in respect of the entire area of such land.
(3) If the land held by the landlord is more than the agricultural holding in area, the right of the landlord to terminate the tenancy of the protected tenant shall be limited to an area which shall, after such termination, leave with the tenant half the area of the land leased.
(4) The tenancy in respect of the land left with the protected tenant after termination under this section shall not at any time be liable to be terminated on the ground that the landlord bona fide 72 570 requires the said land for any of the purposes specified in sub section (1).
Explanation.
The "agricultural holding" shall mean sixteen acres of jirayat land or four acres of irrigated or paddy or rice land, or lands greater or less in area than the aforesaid areas in the same proportion: The restriction contained in sub section
(2 A) is in addition to the restrictions in sub section
(2), which lays down that the landlord shall have no right to terminate the tenancy of a protected tenant, if the landlord at the date on which the notice is given or at the date on which the notice expires has been cultivating personally other land fifty acres or more in area, provided that if the land which is being cultivated personally is less than fifty acres, the right of the landlord to terminate the tenancy of the protected tenant and to take.
possession of the land leased to him shall be limited to such area as will be sufficient to make the area of the land which he has been cultivating to the extent of fifty acres.
When therefore the landlord applied for possession of the land under section 29(2) of the Act, the tenant objected and claimed the benefit of the third clause of subs.
(2 A), and the question that arose for determination was whether the tenant was entitled to the protection contained in this clause The Mamlatdar to whom the application under section 29 (2) was made allowed the application.
The respondent thereupon appealed but his appeal was dismissed.
He then went in revision to the Revenue Tribunal, which was rejected.
The tenant then filed an application under article 227 of the Constitution before the High Court and contended that the provision of section 34(2 A) should have been taken into consideration by the Revenue Courts in deciding the application of the landlord under section 29(2) and that the revenue courts were wrong in the view they had taken that that sub section did not apply to the present proceedings.
The High Court allowed the application of the tenant, relying on its previous Full Bench decision in Durlabbhai Fakirbhai vs Jhaverbhai Bhikabhai (1), where it was held that as the tenancy had (1) 571 terminated and the right to obtain possession had accrued to the landlord after the coming into force of the Amending Act, the Amending Act applied and therefore the landlord, if he fails to satisfy the further conditions under the Amending Act, would not be entitled to possession.
It further held that the Amending Act would apply to all proceedings where the period of notice had expired after the Amending Act had come into force and that what tile Amending.
Act did was that it imposed a new limitation on the tight of the landlord to obtain possession and if the landlord failed to satisfy the court at the date when the tenancy expired and he became entitled to possession that he was so entitled in law as it then stood, he could not claim relief from the court.
It is the correctness of this view which is being challenged before us in the present appeal.
The contention on behalf of the appellant is that section 34(1) gives a right to the landlord to terminate the tenancy by one year 's notice, which was given in this case in December 1951 before the Amending Act came into force.
Therefore the notice having been given before the Amending Act came into force, the further limitation put on the right of the landlord by subs.
(2 A), introduced by the Amending Act, would not apply to notices given before the Amending Act came into force.
The appellant further contends that the right to terminate a tenancy having arisen when the notice was given, the law to be applied, in case of notices given before the Amending Act came into force, would be the law existing on the date of notice.
We are of opinion that there is no force in this contention.
If we look at the words of sub section
(2 A), it provider, certain conditions subject to which the right to terminate the tenancy shall be exercised.
It may be that section 34(1) requires one year 's notice in order to exercise this right to terminate, but flubs.
(2 A) imposer, restrictions on the landlord 's right to terminate the tenancy and does not speak of any notice at all.
Therefore, when we have to look to the application of sub section
(2 A) it is the date on which 572 the tenancy terminates which determines its application.
The restriction by sub section
(2 A) is on the right to terminate the tenancy and this restriction would come into play on the day on which the landlord 's right to terminate the tenancy is perfected, namely, the day on which the tenancy actually terminates in consequence of the notice given to terminate, it.
A notice under section 34(1) is merely a declaration to the tenant of the intention of the landlord to terminate the tenancy; but it is always open to the landlord not to carry out his intention.
Therefore, for the application of the restriction under sub section
(2 A) on the right of the landlord to terminate the tenancy, the crucial date is not the date of notice but the date on which the right to terminate matures, that, is, the date on which the tenancy stands terminated.
It is on ', $hat date that the court has to enforce the right of the landlord arising out of the notice of termination and therefore the court has to see whether the termination is in accordance with the restrictions imposed by subs.(2 A) on the date the right is to be enforced.
Nor are we impressed by the argument that by applying sub section
(2 A) to notices issued before the Amending Act came into force we would be taking away the vested right of the landlord.
As we have already pointed out, the notice under section 34 (1) is merely a declaration to the tenant of the landlord 's intention to terminate the tenancy and no further proceedings may be taken by the landlord in consequence thereof It is only when the period of notice has expired and the tenancy has terminated that the landlord acquires a vested right to obtain possession of the land.
Therefore, the Amending Act did not affect any vested right of the landlords till the tenancy actually stood terminated after the expiry of the notice.
Consequently, the provisions of the Amending Act which came into force before the tenancy stood terminated by the notice will have to be taken into consideration in determining the right of the landlord in the matter of the termination of tenancy, for the Amending Act put certain fetters on this right of termination.
In the circumstances, we are of opinion 573 that the view taken by the High Court is correct and sub section
(2 A) would apply to all cases where notices might have been given but where the tenancy had not actually terminated before the coming into force of the Amending Act.
This view, which appears to us to be plain enough on the words of sub section
(2 A), is further enforced by another consideration, even if there is any doubt as to the meaning of sub section
(2 A).
That consideration is that the Amending Act is a piece of beneficent legislation meant for the protection of tenants.
Therefore, if there is any doubt about the meaning of sub section
(2 A) that doubt should be resolved in favour of the tenant, for whose benefit the Amending Act was passed.
In this view it is obvious that the legislature could not have intended that the benefit of this beneficent measure should not be extended to tenants in whose cases the tenancy had not yet terminated, though notices had been given, when the further restrictions were being put on the right to terminate the tenancy.
Learned counsel for the appellant has drawn our attention in this connection to Jeebankrishna Chakrabarti vs Abdul Kader Chaudhuri (1).
In that case, the Bengal Tenancy Act was amended and the amendment provided that a tenant would be liable to ejectment on one year 's notice by the landlord.
The earlier law provided for a notice of ejectment but did not provide that the notice should be for one year; it pro vided no period of notice whatsoever and it was sufficient under it to give notice expiring with the end of an agricultural year in order to effect ejectment, howsoever short might be the period of notice.
The question therefore arose whether the amendment applied to notices given under the old law, and the Calcutta High Court held that it did not.
The circumstances under which that decision was given are entirely different from the circumstances of the present case.
In that case the contents of notice were changed; while formerly what was required was a notice without any particular period, the amendment required a notice of one year.
There was no provision in the (1) (1933) I.L.R. LX Cal.
1037 574 Amending Act making notices which were in accordance with the previous law ineffective.
In these circumstances the Calcutta High Court was right in holding that the amendment did not affect notices already given.
No such question however arises in the present case.
The period of notice is the same before and after the amendment in the present case, and what we have to see is whether the crucial date for the application of the new sub section (2 A) is the date of the notice or the date of the termination of the tenancy.
We have already held that that date must be the date of the termination of the tenancy.
In the circumstances the appeal fails and is hereby dismissed with costs.
Appeal dismissed.
| F, the appellant, and A his brother, were partners in a business of hides and skins.
On August 10, 1949, A executed a deed of sale in respect of some immoveable properties in Orissa and Madras in favour of F. A deed of dissolution of the partnership was also executed on August 12, 1949, wherein it was inter alia stated that the partners bad agreed that the said partnership shall stand dissolved as from November 2, 1948.
On receipt of information that A had migrated to Pakistan after transferring his properties to his brother F, the Assistant Custodian of Evacuee Property, issued a notice to F under section 7(1) of the Ordinance 27 of 1949 in respect of immoveable properties in Orissa including the properties covered by the sale deed and the business in hides and skins and certain immoveable properties standing in the name of the firm.
In reply F contended that he had become the sole proprietor of the business with all assets and liabilities, with effect from November 2, 1948, when the partnership was dissolved 457 and that while some of the immoveable properties as mentioned in the notice had been conveyed to him by a deed of sale by A, the rest being assets of the firm, had vested in him after the dissolution of partnership.
The Assistant Custodian held that though the transfer of the properties mentioned in the sale deed was for adequate and valuable consideration it was not at all bona fide; as regards other properties and the hides and skins business itself, A had no interest as the partnership had been dissolved on November 2, 1948.
Against this decision F appealed to the Custodian, who held that these properties were rightly declared as evacuee properties and that as regards the transfer of other properties, the same amount of mala fides was present and as such these should also be included in the list of evacuee properties.
The appeal to Custodian General was rejected and the appellant moved the Supreme Court by special leave.
Four contentions were urged by the appellant: Firstly, that the Custodian General should have held that the Custodian acted without jurisdiction in interfering with the order passed by the Assistant Custodian that the hides business and the properties mentioned in Sch.
A III of the notice were not evacuee properties and should be released.
Secondly, that as against the Assistant Custodian 's order in respect of the hides business and the immoveable properties in Sch.
A III the Custodian Department had not preferred any appeal, so that the Custodian could not interfere with it, in exercise of his appellate jurisdiction.
The Custodian 's order in respect of these properties could not have been passed, in exercise of the revisional jurisdiction conferred on him by section 27 of the Administration of Evacuee Property Act as no notice of such intention to examine the records in revision had been issued to F. Thirdly, once the partnership business was dissolved, there could be no question of declaring the dissolved partnership as an evacuee property, in view of section 43 of the Indian Partnership Act.
Fourthly, the transaction evidenced by the two deeds, viz., the sale deed and the dissolution were merely in furtherance of the winding up of the affairs of the dissolved partnership and therefore in determining the validity or otherwise of the transactions, F could not resist the claim of the other partner to wind up.
Held, that where the Custodian had made an order against that portion of the order of the Assistant Custodian which was not before him in appeal it must be taken to have been passed in the exercise of the Custodian 's revisional jurisdiction and the mere fact that this was riot expressly stated in the order could 58 458 be no ground for holding that he was not exercising his revisional jurisdiction.
It was quite another matter whether in the exercise of the revisional jurisdiction, he proceeded in accordance with law.
The Custodian in exercising his revisional jurisdiction must give the party concerned a reasonable opportunity of being heard before any order prejudicial to him is made in revision.
If this reasonable opportunity of being heard cannot be given without the service of notice, a notice must be served for otherwise the omission to serve the notice would be fatal, even though section 26 of the Administration of Evacuee Property Act did not specifically provide for service of notice by the Custodian.
But in cases where the party affected is before the Custodian and has knowledge of the proceedings before him and is heard, the failure to issue a formal notice is immaterial or does not vitiate the order passed.
Once the fact of dissolution is accepted, the declaration as regards the business must necessarily be construed as a declaration that the property that remained in the evacuee on the dissolution of the firm was evacuee property.
Held, further, that where a deed of transfer by an 'evacuee ' was without good faith, section 40 of the Administration of Evacuee Property Act would come into operation, making the transfer of no effect and in the case of a firm its property on dissolution would become an evacuee property from the date of the execution of the deed of dissolution of the partnership and vest in the Custodian with all the rights under the provisions of the Partnership Act and the Custodian was not bound by the statements made in the deed of dissolution as regards the settlement of account.
In the present case the Custodian did not act without juris diction or exercise his jurisdiction irregularly.
|
Appeal No. 2881 of 1993.
From the Judgment are Order dated 16.1.85 of the Bombay High Court in W.P. No. 1755 of 1983 V.M. Tarkunde, R. Karanjawala, Rajesh Kumar and Ms. Suruchi Aggarwal for the Appellant.
S.B. Bhasme and A.S. Bhasme for the Respondent.
AHMADI, J. Special leave granted.
The appellant, landlord, filed an eviction suit No. 419 of 1968 for possession of the demised premises mainly on the ground of arrears of rent under section 12(3) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (hereinafter called 'the Act ').
That suit was settled between the parties, the relevant terms whereof read as under: (1) The possession of the suit premises is to be given by the defendant to the plaintiff by 10th October, 1970.
If the defendant does not give possession, then the plaintiff is to take possession by execution on the basis of this decree.
(2). . . . . (3)The defendant is given a concession that if the defendant paid the entire amount mentioned in clause (2) above, i.e., the amount involved in the suit, future mesne profits, electricity charges, water charges, the rent of the godown, expenses of the suit by 10th October, 1970, the plaintiff will not execute the decree for possession.
" Under clauses (2) and (4) of the compromise terms the rent in respect of the suit premises was to be calculated on the basis of standard rent of Rs. 30 per month, the rent of the store room (godown) was to be calculated at the standard rent of Rs. 9 per month and electricity and water charges at Rs. 3 per month and so calculated.
the entire arrears had to be paid on or before 10th October, 1970 to avail of the concession given in clause (3) of the compromise terms.
The Trial Court passed a decree in terms of the compromise.
733 The arrears so calculated worked out to Rs. 3353.
as on 10th October, 1970.
The tenant, however, paid a sum of Rs. 2040only on 9th February, 1970 and, therefore, did not comply with the terms regarding payment of entire arrears on or before 10th October, 1970.
Thereupon, the decree holder filed execution proceedings on 2nd November, 1970.
The tenant raised objections in regard to the executability of the decree.
The Executing Court rejected the objections raised by the tenant and issued a warrant for possession of the demised premises under order 21 Rule 35 of the Code of Civil Procedure, 1908 (hereinafter called 'the Code ').
The tenant preferred an appeal against the order of the Executing Court which came to be allowed.
The order of the Executing Court was set aside and the prayer for eviction was dismissed.
The decree holder moved the High Court under Article 227 of the Constitution.
The High Court set aside the order of the Appellate Court and remitted the matter to the Appellate Court with a direction to decide the character of the compromise terms on the basis of which eviction was sought.
After the matter went back to the Appellate Court that court reconsidered the matter and once again allowed the appeal setting aside the order of the Executing Court directing issuance of warrant under Order 21 Rule 35 of the Code.
The Appellate Court dismissed the execution proceedings altogether.
Against that order passed by the Appellate Court the decree holder once again moved the High Court under Article 227 of the Constitution.
The High Court considered the various submissions made before it by the rival parties and summarised the propositions emerging from the relevant provisions and the case law in paragraph 32 of the judgment as under "(1) If by a consent decree the status of a landlord and tenant is established between the plaintiff and the dependent, the Court in exercise of its equitable jurisdiction is not precluded from granting relief against forfeiture of a term contained in the consent decree.
(2)Where the question is not one of the creation of a tenancy or the continuation of a tenancy and where a decree passed either by consent or in invitum permits payment of the decrement amount in installments and provides that the decretal amount becomes payable at once in the event of failure in the payment of one or more installments, there is no question of granting relief.
The Courts are bound to execute the decree in accordance with its terms.
(3)Where.
however, the relationship of landlord and tenant is continued between the parties by a compromise decree.
the judo 734 ment debtor, who is a tenant.
would be entitled to relief against forfeiture resulting from his failure to pay the rent on the stipulated date.
(4)Where the consent decree provides for the continuance of the possession of the tenant up to a particular date beyond which he has no right to remain in possession at all and on which date the landlord is entitled to execute the decree for possession, the time given from the date of the decree till the other date is by way of concession and in such a case, there is no creation of new tenancy or continuation of the existing tenancy. ' ((5) If the consent decree provides possession for the continuation of ' the of the tenant on certain terms up to a particular date and also provides for the continuation of the tenant 's possession after the date if lie complies with certain conditions, then such a decree provides for the continuance of the possession of the tenant from the date of the consent decree itself.
In such a case, it cannot be said that the plaintiffs allowing the defendant to continue up to and beyond that specified date is by way of concession.
" The High Court, therefore, concluded that the refusal by the Appellate Court to exact the tenant on the basis of the consent decree was correct in law and hence it was not required to interfere with the order of the Appellate Court.
It came to the conclusion, on a true interpretation of the relevant clauses of the consent decree, that the clause by which eviction was permitted was penal in nature and, therefore, not enforceable.
Clause (3) of the compromise term was treated is granting relief ' against forfeiture.
In this view of the matter the judgment creditor, landlord, having failed to secure possession of the demised premises by putting the consent decree to execution, has approached this Court under Article 136 of the Constitution.
The Act was enacted to amend and consolidate the law relating to the control of rents and of evictions from demised premises.
It imposes certain restrictions on the right of the landlord from recovering possession so long as the tenant pays or is ready and willing to pay standard rent and permitted increases and observes and performs the other conditions of ' the tenancy which are consistent with the provisions of the Act.
If the tenant has failed to pay the rent and permitted increases due from him he can be evicted for that neglect in the manner set out in section 12 735 of the Act.
The other provision which confers a right of eviction is section 13 of the Act with which we are not concerned in this case.
The facts of the case clearly reveal that the landlord had sought eviction under section 12of the Act as the tenant had committed a breach of sub section ( 1) thereof, in that, he had failed to pay the rent to the landlord.
To comply with the requirement of sub section (2) of that provision the landlord had served the tenant with a notice prior to the institution of the suit seeking eviction under section 12(3) of the Act.
This sub section is in two parts and may be extracted for ready reference "12 (3) (a) Where the rent is payable by the month and there is no dispute regarding the amount of standard rent or permitted in creases, if such rent or increases are in arrears for a period of six months or more and the tenant neglects to make payment thereof until the expiration of the period of one month after notice referred to in sub section (2), the court may pass a decree for eviction in any such suit for recovery of possession.
12(3) (b) In any other case no decree for eviction shall be passed in any such suit if on the day of hearing of the suit or on or before such other date as the court may fix, the tenant pays or tenders in court the standard rent and permitted increases then due and thereafter continues to pay or tender in court regularly such rent and permitted increases till the suit is finally decided and also pays costs of the suit as directed by the court.
" Clause (a) sets out the circumstances in which the tenant forfeits the protection of the statute and entitles and landlord to evict him.
If the case does not fall within the scope of clause (a) the question to be considered is whether eviction should be ordered under clause (b).
This is clear from the opening words, "in any other case," If, however, the tenant satisfies the conditions of the said clause, the law protects him from eviction as is clear from the words, "no decree of eviction shall be passed in any such suit".
The suit in the present case was filed under section 12(3) of the Act but before the court could adjudicate whether clause (a) or clause (b) was attracted the parties arrived at a settlement, the relevant terms hereof have been extracted hereinbefore.
It is well settled that a decree passed on the basis of a cc, promise by and between the parties is essentially a contract between the names which derives supporting by the court superadding its seal to the contract.
But all the same the consent terms retain all the elements of a contract to which the court 's imprimatur is affixed to give it the sanctity of an executable court 736 order.
We must, however, point out that the court will not add its seal to the compromise terms unless the terms are consistent with the relevant law.
But, if the law vests exclusive jurisdiction in the court to adjudicate on any matter, e.g. fixation of standard rent, the court will not add its seal to the consent terms by which the parties have determined the standard rent unless it has applied its mind to the question and has satisfied itself that the rent proposed by consent is just and reasonable.
In such a case it is the independent satisfaction of the court which changes the character of the document from a mere contract to a court 's adjudication which will stop the tenant from contending otherwise in any subsequent proceedings and operate as resjudicata.
If the standard rent is fixed solely on the basis of agreement between the parties, such a decree in invitum will not preclude the tenant from contending in any subsequent proceeding that the rent is excessive and require the Court to fix the standard rent.
Therefore, the character of the consent decree will depend on the nature of the dispute resolved and the part played by the court while superadding its seal to it.
Under clause (a) of section 12 (3) of the Act, if the conditions stated therein are satisfied, the court has to pass a decree to evict the tenant from the demised premises.
So also under clause (b) of that sub section, if the tenant fails to pay or tender in court the standard rent and permitted increases due on the first date of hearing of the suit or on or before such date as the court may fix, the court has to pass a decree for ejectment.
In the present case the suit was governed by section 12(3) of the Act and even if we assume that it fell within the purview of clause (b), the tenant was liable to be evicted as admittedly the tenant had failed to pay or tender in court the standard rent and permitted increases due to the landlord as is obvious from clause (2) of the consent terms.
It is for this reason that the tenant suffered a decree for eviction and agreed to deliver possession of the suit premises by 10th October, 1970.
By clause (2) of the consent terms the tenant further agreed to pay to the landlord by 10th October, 1970 the entire amount due including legal fees and expenses from the date of the suit till delivery of possession.
Clause (3) of the consent terms carries the crucial term that the tenant is given a concession, and that concession is that if he pays the entire amount mentioned in clause (2) by 10th October, 1970, the landlord will not execute the decree for possession.
That has given rise to the question whether clause (1) of the consent decree is in the nature of a penalty for non payment of the outstanding dues upto 10th October, 1970 or clause (3) of the consent decree is merely a concession given to the tenant if he complies with the terms or requirements of that provision.
Now as pointed out earlier the ejectment suit was filed on the allegation that the tenant had neglected to pay the rent and other charges in respect of the demised 737 premises.
The suit was, therefore, founded on the right to evict conferred by section 12(3) of the Act.
We will assume that it was a case to which clause (b) to that sub section was attracted.
It is evident from the terms of the compromise that even on the date of the compromise in July 1970 the tenant was in arrears of rent.
If the suit had gave to trial the landlord may have secured a decree in ejectment for the tenant 's failure to comply with the requirements of clause (b) of section 12(3) of the Act.
By clause (1) of the compromise decree it was, therefore, provided that the tenant will vacate and deliver possession of the demised premises by 10th October, 1970.
Failure to deliver peaceful possession by that date would entitle the landlord 'to take possession by execution ' of the decree.
Clause (2) indicates the rate at which the arrears will be calculated and clause (4) describes those rates as standard rent.
Clause (4) describes those rates as standard rent.
Clause (3) which is the crucial clause gives a concession.
What is that concession? It is that if the tenant pays up the entire amount of arrears, i.e., the amount involved in the suit meaning thereby the claim of arrears set out in the suit, future mesne profits, electricity and water charges, the rent of the godown, cost of the suit, by 10th October, 1970, the landlord will not execute the decree for possession.
Counsel for the appellant argued that as the tenant had failed to clear the arrears of rent and other charges payable under the terms of the lease, he was liable ton be evicted under clause (b) of section 12(3) of the Act.
That is reflected in clause (1) of the compromise terms.
However, the landlord gave a concession by clause (3) to the effect that if the entire arrears are cleared by 10th October, 1970, he would not execute the decree for possession.
This, counsel argued, does not show that the decree for possession was provided for as in terrorism to be construed as a penalty and not a concession.
Counsel contended that while a penal stipulation on cannot be enforced, a grant of a concession cannot undo the main operative part of the eviction decree unless it is shown that the tenant had done all that was necessary to avail of the concession.
Counsel for the tenant, however, insisted that the provision for delivery of possession is in the nature of a penalty and was, therefore, unenforceable.
He supported the judgment of the High Court and submitted that the appeal should be dismissed with costs.
It is settled law that unless the terms of contract are ambiguous the intention of the parties must be gathered from the terms themselves.
It is only where the terms are ambiguous and capable of more than one meaning that evidence aliunde can be permitted to gather the intention of the parties.
In our view, the terms forming the basis of the consent decree in the instant case are clear and unambiguous and do not call for extrinsic material to gather the intention of the parties.
Two questions, therefore, arise for consideration, namely, (i) did the parties to the compromise intend to create or continue the relationship of landlord and tenant? 738 and, (ii) is the Clause providing for eviction penal in character? Now.
as pointed out earlier by clauses (1) and (2) of the compromise terms, the tenant is required to deliver vacant possession of the demised premises to. ,ether with arrears of rent etc.
by 10th October, 1970.
It is further provided that if the tenant fails to deliver possession and defaults in paying the arrears due from him by 10th October, 1970, the landlord will be entitled to recover both possession and arrears of rent, etc., by executing the decree.
Thus by the first two clauses of the consent terms, the landlord secured a decree for possession as well as arrears of rent, etc. , giving a grace period to the tenant to comply therewith by 10th October, 1970.
Thereafter by clause (3) of the consent terms, the tenant is given a concession, in that, if he pays the entire arrears of rent, mesne profits, electricity and water charges, cost of the suit, etc.
by 10th October, 1970, the landlord agrees not to execute the decree for possession.
In other words on the fulfillment of the obligation to clear the entire arrears of rent and other charges by 10th October, 1970, the tenant is given a concession that the decree for possession passed against him will not be put to execution.
Such a clause cannot, in our opinion, be said to be penal in character.
It is necessary to understand when a clause in the contract can be described as penal in character.
Let us illustrate by taking two concrete situations.
A plaintiff files a suit to recover Rs. 20,000 with interest and costs from the defendant.
They enter into a compromise, the terms whereof are as under: Situation 1: The defendant shall pay to the plaintiff a sum of Rs. 15,000 and costs on or before 31st December, 1993.
If, however, he fails to pay the said amount of Rs. 15,000 with costs within the time stipulated, the plaintiff will be at liberty to recover the entire sum of Rs. 20,000 with interest and costs from the defendant by executing the decree.
The latter clause of such a decree will clearly be in terrorem and, therefore, penal in character.
No court will execute the same.
Situation 2: The decree provides that the defendant shall pay Rs. 20,000 with interest and costs to the plaintiff.
However, if the defendant pays Rs. 1 5,000 and costs on or before 3 1 st December, 1993 to the plaintiff, the plaintiff will treat the decree as fully satisfied and will not claim the balance amount from the defendant.
In such a case the latter clause operates as a concession and the 739 plaintiff waives his right to the balance amount.
Such a decree will be executable to the full extent if the defendant fails to avail of the concession by paying Rs. 15,000 and costs on or before 3 1 st December, 1993.
From the above two illustrations it should become clear that if the defendant is required to suffer the consequence for his failure to abide by the terms by a stipulated date such a consequence would be penal in nature but on the other hand if the defendant gets some benefit by complying with the requirement by the stipulated date such a clause granting benefit can never be treated as penal in character.
Applying this test to the decree in question, it is obvious that by the first two clauses of the consent terms a decree for possession of the demised premises as well as arrears of rent, etc.
is passed and the tenant.
is given a grace period upto 10th October, 1970 to comply with the same failing which the landlord is given the right to put the decree to execution and obtain possession of the premises and recover the arrears of rent, etc.
through court.
By clause (3) of the consent terms, however, the tenant is granted a concession that if he pays the entire rent etc.
due from him by 10th October, 1970, the landlord will not put the decree to execution for recovery of possession.
This stipulation is clearly to secure his dues i.e. arrears of rent, etc.
Depending on the situation in which a landlord is placed, he may grant the concession to the tenant to ensure that the huge amount of arrears is not lost.
If he grants such a concession and agrees that if the entire arrears is cleared by a. stipulated date he will not insist on possession that will not render the clause penal in nature.
In a given situation where the tenant is in financial difficulty and is not in a position to comply with the requirement of section 12(3) of the Act, he can request the landlord to grant him a concession in the nature of relief against forfeiture.
If such a concession is to be read as penalty rendering the decree nonexecutable even where the tenant fails to satisfy the requirements of availing the concession, no landlord will in future grant such a concession, thereby causing hardship in deserving cases.
We are, therefore, of the opinion that the First Appellate Court as well as the High Court were in error in treating clause (3) of the consent terms as penal in character and incapable of execution.
If the condition precedent for availing of the benefit or concession under clause (3) of the consent terms is satisfied, the relationship of landlord and tenant continues but if the tenant fails to comply with the condition precedent for availing of the benefit or concession the forfeiture operates and the tenant becomes liable for eviction under the decree.
The High Court has placed reliance on the Full Bench decision in Krishnabai vs Hari, 8 BLR 8 13 and Gajanand Govind vs Pandurang Keshav, 53 BLR 100.
in 740 taking the view that the Executing Court can rant relief against forfeiture on the strength of section 114 of the .
The High Court seems to think that in execution of a consent decree, such as the one with which we are concerned, it is open to the Executing Court to go behind the decree by invoking section 114, T.P.Act, notwithstanding section 12(3) of the Act.
In our view After the enactment of clause (b) to section 12(3) which is a special provision incorporating the equity provision contained in section 1 14,T.P.Act, in a modified form, cases governed under the Act must be resolved in accordance with section 12(3) of the Act and not under section 1 14, T.P.Act The landlord 's right to seek eviction has been drastically reduced and circumscribed by section 12 and 13 of the Act.
Similarly the tenant must also seek protection from eviction by complying with the requirements of the Act.
If such is not the legal position, section 12(3) (a) of the Act which mandates the Court to pass a decree for eviction if the requirements of that clause are satisfied would be rendered wholly nugatory.
Same would be the position in the case of application of section 12(3) (b) of the Act because that clause precludes the passing of the decree if the tenant satisfies the requirements of that provision.
It must be remembered that after the enactment of the Act the landlord 's right to reenter on expiry of the lease is curtailed by the provisions of the Act which has made special provisions granting protection from eviction if the tenant abides by his obligations under the Act.
Under the Act a tenant is allowed to continue in possession notwithstanding the termination of the contractual tenancy if he abides by the provisions of the Act.
If he fails to abide by the requirement of section 12(3) of the Act, he must take the consequences flowing therefrom.
There is no question of granting him double protection.
That is what this Court clarified in Pradesh Kumar Bajpai vs Binod Behari Sharkar, ; That was a case arising under the provisions of the U.P. (Temporary) Control of Rent and Eviction Act, 1947.
The question which was seriously debated at the Bar before this Court was whether in addition to the safeguards provided to the tenant under the said Act, the tenant was also entitled to the benefit of section 1 14, T.P.Act.
The right of the landlord to have the tenant evicted was restricted under the said rent restriction legislation.
As that law had restricted the power of the landlord to evict the tenant except in accordance with the provisions therein contained, the terms of the contract and the provisions of the T.P.Act, it was urged, were no longer attracted.
Clause (a) of section 3(1) inter alia provided that the suit may be filed with the permission of the District magistrate when the tenant is in arrears of rent for more than three months and has failed to pay the same to the landlord within one month of the service upon him of the notice of demand.
Dealing with this contention this Court held that once the requirements of the rent legislation are satisfied, the tenant cannot claim the double protection of invoking the provisions of the T.P.Act or the terms of the contract and the provision of 741 section 114, T.P.Act, cannot be read into the rent legislation.
This Court concluded thus : "In the case before us, it is not indispute that after the Rent Act came into force, the landlord cannot avail himself of clause 12 which provides for forfeiture, even if the tenant neglected to pay the rent for over two months.
The landlord cannot enter into possession forthwith without notice.
The only remedy for him is to seek eviction under the provisions of the Rent Act.
In such circumstances the tenant cannot rely on section 114of the and claim that he should be given an opportunity to pay the arrears of rent, even though the requirements of section 3(1) had been fulfilled.
" It is, therefore, obvious that the tenant cannot avail of the benefit of section 114, T.P.Act since his case was governed by the provisions of section 12(3) (b) of the Act.
For the foregoing reasons, we are of the opinion that the executing court was right in issuing a warrant for possession under order 21 Rule 35 of the Code against the tenant since the tenant had failed to take advantage of the concession clause by clearing the arrears of rent, mesne profits, etc.
by 10th October, 1970.
The First Appellate Court as well as the High Court were in error in holding that the decree was not executable as clause (3) thereof was in the nature of a penalty.
We set aside the order of the First Appellate Court as well as the High Court and remit the matter to the executing court to proceed further in accordance with law.
We may, however, make it clear that if there have been subsequent developments between, the parties creating any de novo relationship that will not be affected by this order.
In the facts and circumstances of the case, we make no order as to costs.
U.R. Appeal allowed.
| The appellant, appointed Principal of Dr. Hari Ram (Co education) Higher Secondary School, was placed under suspension and a charge sheet containing 12 charges issued to him.
Charge No. 12 accused him of use of an unaccounted sum of Rs. 129.37, given to him by Maru Ram, teacher in charge of amalgamated fund.
The enquiry committee constituted comprised 3 members, of which the said Maru Ram was a member.
Maru Ram deposed as a witness for the administration in support of charge No. 12.
The appellant 's objection to the inclusion of Maru Ram on the enquiry committee was overruled, and he was found guilty of some of the charges including the said charge and the Managing Committee proposed to dismiss him from service.
The appellant 's application for inspection of documents to enable him to make his representation before the Deputy Commissioner the confirming authority under S.3(2) of the Punjab Aided Schools (Security of Service) Act, 1969 was rejected by the Managing Committee, the Deputy Commissioner and the Commissioner.
The appellant then filed a writ petition in the High Court for quashing the enquiry report and the orders passed by the Managing Committee, the Deputy Commissioner and the Commissioner.
The Managing Committee, opposing the petition, contended that the enquiry committee was not partial or inimical towards the appellant.
It was 864 contended that maru Ram was the only teacher member of the Managing Committee other than the appellant himself , therefore only Maru Ram could be taken in the enquiry committee as a representative of the teachers ' union.
It was further contended that though the application for inspection had been made after his dismissal, he had not been refused permission for inspection; he had been asked to indicate the rules under which he could see the file.
A Single Judge of the Punjab and Haryana High Court allowed the petition on the ground that the departmental proceeding was vitiated by the flagrant violation of natural justice.
Since one of the members of the Managing Committee acted both as a Judge and as a witness to prove one of the charges against the appellant despite the objections made by the appellant against the inclusion of such member in the committee, the entire enquiry proceeding was vitiated.
He held that the bias continued and percolated to the entire proceeding and should not be restricted to charge no. 12.
Since the enquiry report was required to be considered by the Deputy Commissioner for the purpose of affirming the proposed order of dismissal, the fact of bias and prejudice was required to be considered and the appellant was not debarred from raising such vital plea of bias in the writ proceeding.
The decision arrived at on the basis of an illegal and biased enquiry could not be sustained.
On appeal, the Division Bench reserved the order of the Single Judge.
It held that the plea of bias was vague; that the appellant had waived it by not raising it specifically before the Deputy Commissioner and Commissioner, and that as the Deputy Commissioner was not influenced by charge no.12 only but was impressed with some other charge, no interference with the impugned order was called for.
Allowing the appeal, this Court, HELD: 1.
In Administrative Law, Rules of natural justice are foundational and fundamental concepts and the law is now well settled that the principles of natural justice are part of the legal and judicial procedures.
(871 E) Franklin vs Minister of Town and Country Planning ; Kishan Chand Arora vs Commissioner of Police, Calcutta ; ; Breen vs Amalgamated Engineering Union ; Maneka Gandhi vs Union of India [1978] 2 SCR 621; State of Orissa vs Bina pani Dei and A.K.Kraipak vs Union of India & Ors.[1970] 1 SCR 457, 865 referred to.
2.Since the rules of natural justice are not embodied rules, it is not possible and practicable to precisely define the parameters of natural justice.
(872 H) Russel vs
Duke of Norfolk [1949] ALL ER109; Union of India vs P.K. Roy ; ; A.K.Kraipak vs Union of India and Prof. Wade.
Administrative Law, edn 1988 p. 503 referred to.
3.One of the cardinal principles of natural justice is: Nemo debet esse judex in propria causa: No man shall be a judge in his own cause.
The deciding authority must be impartial and without bias.
(874 C) Secretary tit Government Transport Department vs Munuswamy ; and State of U.P. vs Mohd. Nooh ; , referred to.
(874 C) For appreciating a case of personal bias, the test is whether there was a real likelihood of a bias even though such bias has not in fact taken place.
De Smith, Judicial Review of Administrative Action [1980] p. 269 R Sunderlal Justices at 373; R. vs Sussex Justices at 259; Halsbury 's Laws of England (4th Edn.) Vol.2, para 551 and Manak Lal vs Dr. Prem Chand ; , referred to.
It is in this sense that it is often said that justice must not only be done but must also appear to be done.
(875 E) 4.In the facts of this case, there was not only a reasonable apprehension of bias (if one of the members of the enquiry committee, but such apprehension became real when Maru Ram appeared as a witness against the appellant, and.
thereafter proceeded with the enquiry proceeding as a member of the enquiry committee to uphold the correctness of his deposition as a Judge.
(875 F) 5.The Division Bench dismissed the writ petition improperly on a technical ground that the plea of bias could not be raised in a writ proceeding especially when it was not specifically taken before the Deputy Commissioner and the Commissioner; more so when this defence could be waived by the person suffering the prejudice.
(876 E) 866 Generally a point not raised before the tribunal or administrative authorities may not be allowed to be raised for the first time in writ proceedings.
Which is equitable and discretionary and interference is not a matter of course particularly when the plea sought to be raised for the first time in a writ proceedings requires investigation of facts.
(876 A) A.M. Allison vs State of Assam.
, ; , referred to.
But if the plea goes to the root of the question and is based on admitted and uncontroverted facts and does not require any further investigation into a question of fact, it is only desirable that a litigant should not he shut out from raising such plea.
(pp. 19 20) (876 C) A.S. Arunachalam Pillai vs M/s. Southern Roadways Ltd. ; and The Cantonment Board vs Pyarelal ; , referred to.
6.The bias of Shri Maru Ram, one of the members of the enquiry committee had percolated throughout the enquiry proceeding thereby vitiating the principles of natural justice and the findings made by the enquiry committee was the product of a biased and prejudiced mind.
The illegality committed in conducting the departmental proceedings has left an indelible stamp of infirmity on the decision of the Managing Committee since affirmed by the Deputy Commissioner and the Commissioner.
(876 G) State of U.P. vs Mohd. Nooh.
; , relied on.
|
s by special leave from the judgments and orders dated November 27, 1961 of the Gujarat High Court in Special Civil Applications Nos. 704 and 707 of 1961.
140 Arun Naginlal Surti, B. Datta and J. B. Dadachanji, for the appellants.
A. K. Sen, M. section K. Sastri and B. R. G. K. Achar, for the respondents.
The Judgment of the Court was delivered by Ramaswami, J.
These four consolidated appeals are brought, by special leave, against the order of the High Court of Gujarat dated November 27, 1961 summarily dismissing four Special Civil Applications Nos.
704 to 707 of 1961 which had been filed by the appellants under article 227 of the Constitution of India for quashing the order of the Gujarat Revenue Tribunal dated July 18, 1961.
The appellants had applied for compensation to the Jagir Abolition Officer, Baroda under section 13 of the Bombay Merged Territories & Areas (Jagirs Abolition) Act, 1953, hereinafter referred to as the 'Jagirs Abolition Act ', in respect of their proprietary jagirs.
Against the award of compensation made by the Jagir Abolition Officer the appellants preferred appeals under section 16 of the Jagirs Abolition Act.
Although these appeals were filed before the Revenue, Tribunal at Bombay, the appeals were transferred, on the bifurcation of Bombay State, to the Gujarat Revenue Tribunal at Ahmedabad, hereinafter called the 'Tribunal '.
All these appeals were ultimately dismissed by the Tribunal for non prosecution on account of non appearance of the advocate of the appellants.
Against the dismissal of the appeals for non prosecution the appellants filed applications for restoration before the Tribunal on May 6, 1961.
The appellants contended that since the orders passed dismissing the appeals were received by them on April 9 and April 20, 1961, the restitution applications filed on May 6, 1961 were within 30 days of the receipt of the order of dismissal and hence the applications for restoration were made in time under Regulation 21 of the Bombay Revenue Tribunal Regulations.
The appellants also prayed that the applications for restoration should be allowed as they were prevented for sufficient cause from appearing at the hearing of the appeals.
The Tribunal rejected the applications holding that they were barred under article 168 of the Limitation Act read with Regulation 55 and 0.41, rr. 17 and 19 of the Civil Procedure Code.
The view taken by the Tribunal was that the applications for restoration should have been made within 30 days from the date of the order of dismissal.
As the orders of dismissal was made on February 1, 2 and 3, 1961 and the applications for restoration were made only on May 6, 1961, the Tribunal held that they were time barred.
Aggrieved by the order of dismissal of the restoration applications the appellants moved the High Court of Gujarat under article 227 of the Constitution of India but their applications were dismissed in Iimine.
The first question for consideration is whether the orders of the Tribunal dated February 1, 2 and 3, 1961 are illegal and ultra 141 vires because the Tribunal dismissed the appeals for non prosecution and there was no decision of the appeals on merits.
It was contended that it was obligatory on the part of the Tribunal to decide the appeals on merits and record its decision in view of section 17 of the Jagirs Abolition Act which states as follows: "17.
(1) The Bombay Revenue Tribunal shall, after giving notice to the appellant and the State Government, decide the appeal and record its decision.
(2)In deciding an appeal under this Act the Bombay Revenue Tribunal shall exercise all the powers which a court has and shall follow the same procedure which a Court follows in deciding appeals from the decree or order of an original Court under the Code of Civil Procedure, 1908.
" in our opinion, the contention put forward by the appellants is well founded and must be accepted as correct.
Section 13 of the Jagirs Abolition Act provides that any jagirdar entitled to compensation under section 11 or 12 shall, on or before the 31st day of July 1958 apply in writing to the Collector for determining the amount of compensation payable to him under the said section.
Section 13(2) states that on receipt of an application under sub section
(1), the Collector shall, after making formal enquiry in the manner provided by the Code, make an award determining the amount of compensation.
Section 14 of the Jagirs Abolition Act states as follows: "14.
(1) If any person other than a jagirdar is aggrieved by the provisions of this Act as abolishing, extinguishing or modifying any of his rights to, or interest in property and if compensation for such abolition, extinguishment or modification has not been provided for in the provisions of this Act, such person may apply to the Collector for compensation.
(2) The application under sub section (1) shall be made to the Collector in the prescribed form on or before the 31st day of July 1958.
The Collector shall, after holding a formal inquiry in the manner provided by the Code, make an award determining the compen sation in the manner and according to the method provided for in sub section (1) of section 23 and section 24 of the Land Acquisition Act, 1894.
" Section 15 states that "every award made under section 13 or 14 shall be in the form prescribed in section 26 of the Land Acquisition Act, 1894 and the provisions of the said Act shall, so far as may be, apply to the making of such award".
Section 16 provides 142 for an appeal against the Collector 's award and is to the following effect: "16.
An appeal shall lie against an award of the Collector to the Bombay Revenue Tribunal constituted under the Bombay Revenue Tribunal Act, 1957 notwithstanding anything contained in the said Act.
" Section 20 provides for the finality of the award and of the decision of the Revenue Tribunal and reads as follows: "20.
The award made by the Collector subject to an appeal to the Bombay Revenue Tribunal and the decision of the Bombay Revenue Tribunal on the appeal shall be final and conclusive and shall not be questioned in any suit or proceeding in any Court.
" On a consideration of the language of section 17(1) of the Jagirs Abolition Act and in the context of section 20 of the Jagirs Abolition Act we are of the opinion that it is obligatory on the part of the Tribunal to decide an appeal on merits even though there is default in the appearance of the appellants and to record its decision regarding the merits of the appeal.
If an appeal is dismissed for want of prosecution it cannot be said that the Tribunal has 'decided the appeal ' and 'recorded its decision ' within the meaning of section 17 of the Jagirs Abolition Act.
It cannot be supposed that the legislature intended by the word 'decide ' in section 17(1) to mean 'dispose of the appeal or to put an end to the appeal '.
It is important to notice that section 20 of the Jagirs Abolition Act makes a decision of the Tribunal in appeal as final and conclusive and not to be questioned in any suit or proceeding in any Court.
In the context of section 20 and in view of the express language of section 17(1) of the Jagirs Abolition Act we are of opinion that the Tribunal has no power to dismiss an appeal for non prosecution but it is obligatory on its part to decide the appeal on merits and to record its decision even though there is default on the part of the appellant to appear in the appeal.
The second question of law for consideration in this case is whether, on a proper construction of Regulations 19, 20 and 21 of the Bombay Revenue Tribunal Regulations, 1958, the Tribunal was right in taking the view that the applications for restoration made by the appellants were barred by limitation.
Section 14 of the Bombay Revenue Tribunal Act (Bombay Act No. XXXI of 1958) deals with the practice and procedure to be followed by the Gujarat Revenue Tribunal.
Section 14 states: "14.
(1) Subject to the provisions of this Act and to the previous approval of the State Government, the President may make regulations for regulating the practice and procedure of the tribunal, including the award of costs by the Tribunal, the levy of any process fee, the right of audience before the Tribunal, the sittings of the members either singly, or in 143 benches constituted by the President or such member as is authorised by him from amongst the members of the Tribunal, the disposal by the Tribunal, or a bench thereof, of any proceedings before it notwithstanding that in the course thereof there has been a change in the persons sitting as members of the Tribunal or bench; and generally for the effective exercise of its powers and discharge of its functions under this Act.
Where any members sit singly or where any benches are constituted, such member or bench shall exercise and discharge all the powers and functions of the Tribunal.
(2) The regulations made under this section shall be published in the Official Gazette.
" Regulation 19 deals with procedure to be followed by the Tribunal in case of non appearance of parties.
Regulation 19 is to the following effect: "19.
(1) If on the date fixed for hearing or any other subsequent day to which the hearing may be adjourned, the appellant or applicant does not appear either in person or through his agent or lawyer when the appeal or application is called for hearing, the Tribu nal may dismiss the appeal or application or may decide it on merits, after hearing the respondent or his agent or lawyer, if present.
(2) If on the date fixed for hearing or on any other subsequent day to which the hearing may be adjourned, the respondent or opponent, as the case may be, does not appear in person or through his agent or lawyer when the appeal or application is called for hearing the Tribunal may decide the same on merits, after hearing the appellant or applicant or his agent or lawyer. . . . " Regulation 20 provides for restoration of an appeal or application and reads as follows: "20.
If any of the parties was absent on the date of the hearing, either preliminary or final, and the appeal or application was heard and declared ex parte, the party concerned may apply for restoration of the appeal or application, as the case may be, and if the party satisfies the Tribunal that he had no notice of the date of the bearing or that be was prevented by sufficient cause from appearing when the appeal or application was called for hearing, the Tribunal may restore the appeal or application to its file, provided that where the other party had appeared in the appeal or application such party shall be given notice and an opportunity of being heard before the order for resto ration of the appeal or application is made.
" 144 Regulation 21 is to the following effect: (1) An application for restoration of an appeal or application made under regulation 20 shall be filed within thirty days from the date of the receipt of the order or dismissal of the appeal or application and shall be accompanied by (a) a certified copy of the Tribunal 's order; (b) the decision or order (either in original or a certified copy thereof) in respect of which appeal or application sought to be restored is made; (c) if the decision or order referred to in clause (b) is itself made in appeal against any decision or order, then also such latter decision or order either in original or a certified copy thereof; and (d) as many copies of the restoration application as there are respondents or opponents.
. . . . . . . .".
Regulation 55 states that in any matter not provided for in the Regulations the Tribunal shall follow the procedure, as far as it is applicable, laid down in the Code of Civil Procedure, 1908.
From the scheme of the Regulations it is apparent that under Regulation 19(1) it is open to the Tribunal to dismiss an appeal for non prosecution in a case where the appellant does not appear either in person or through his agent or lawyer.
It is also open to the Tribunal in such a case to hear the respondent to the appeal and decide it on merits.
Regulation 19(2) contemplates a case where the respondent fails to appear and even so it is open to the Tribunal to hear the appellant and then decide the case on merits.
Regulation 20 which provides for restoration of the appeal is a, consequential regulation to Regulation 19.
One of the conditions for invoking the provisions of restoration under Regulation 20 is that "the appeal 'or application was heard and decided ex parte".
On behalf of the respondent it is contended by Mr. Asoke Sen that Regulation 20 only applies to cases contemplated by the latter part of Regulation 19(1) and 19(2) and not to cases of dismissal for want of prosecution under the first part of Regulation 19(1).
We are unable to accept this submission as correct.
In our opinion, the language of Regulation 20, on its true interpretation, applies not only to a case where the appeal has been decided on merits but also to a case where the appeal has been dismissed for want of prosecution under Regulation 19(1).
The reason is that in Regulation 19(1) and 19(2) the legislative authority uses the words "decide it on merits" but in Regulation 20 the expression used is "decided ex parte" and we see no reason, either in the language or context of Regulation 20, why it should not include in its scope and ambit an application for restoration of an appeal dismissed for non prosecution as also an application for restoration of appeal decided 145 on merits under Regulation 19(1).
If the view that we have taken as to the interpretation of Regulation 20 is correct, it follows that Regulation 21 applies to the present case and the period of limitation prescribed by that Regulation being 30 days from the date of receipt of the order of dismissal of the appeal, the applications of restoration made by the appellants in all the four cases were well within the period of limitation prescribed by Regulation 21.
It follows, therefore, that the Tribunal committed an error of law in dismissing the applications of restoration made by the appellants in all the four appeals.
For these reasons we allow these appeals, set aside the order of the Gujarat High Court dismissing Special Civil Applications 704 to 707 of 1961 and hold that the order of the Gujarat Revenue Tribunal dismissing the restoration applications Nos.
GRT.D. 10 to 13 of 1961 dated July 18, 1961 is defective in law and must be set aside.
We also hold that the orders of the Gujarat Revenue Tribunal dismissing Appeals Nos.
REV.A. 27.
28, 29 and 30 of 1960 are ultra vires and illegal and must be set aside and order that these four appeals should go back to the Gujarat Revenue Tribunal for being reheard and dealt with in accordance with law.
The parties will bear their own costs up to this stage.
Appeals allowed.
| The appellants had applied for compensation to the Jagir Abolition Officer under section 13 of the Bombay Merged Territories and Areas (Jagir Abolition) Act, 1953 in respect of their proprietary jagirs.
Against the orders of the said officer they preferred appeals to the Revenue Tribunal which were dismissed for non prosecution.
The appellants thereupon filed applications for restoration of the appeals within 30 days of the receipt of the orders of dismissal of the appeals.
These applications were dismissed as time barred, the Tribunal taking the view that time was to be calculated from the date of the order.
The appellants ' applications under article 227 of the Constitution to the High Court failed and they came by way of special leave, to this Court.
It was contended on behalf of the appellant that (i)the Tribunal even while deciding ex parte had to decide on merits and that (ii) the applications for restoration were filed within the time prescribed in Regulation 21 made under the Bombay Revenue Tribunal Act, 1958 which applied to the case.
HELD:(i) In the context of section 20 and ;in view of the express language of section 17(1) of the Jagirs Abolition Act the Tribunal had no power to dismiss the appeals in question for non prosecution, but it was obligatory on its part of decide the appeals on merits and to record is decision even though there was default on the part of the appellant to appear in the appeal.
[142 E F] (ii) The Tribunal also committed an error of law in dismissing as time barred the applications for restoration of the appeals made by the appellants.
In Regulation 21 made under Bombay Revenue Tribunal Act, 1958 the time prescribed for such applications is thirty days from the date of receipt of the Tribunal 's order dismissing the appeal, and the appellants had filed their applications within the said period.
[145 A, B] Regulation 21 lays down the procedure for dealing with applications for restoration made under Regulation 20 and the latter Regulation includes within its scope all appeals 'decided ex parte ' whether on merits or otherwise.
It could not therefore be said that Regulation 21 did not apply to the case.
[144 H]
|
Appeals Nos. 1845 and 1846 of 1968.
Appeals by special leave from the judgment and order dated January 10, 1968 and October 20, 1967 of the Mysore High Court in Writ PetitiOns Nos.
1519 of 1067 and 1216 of 1965 respectively.
Jagdish Swarup, Solicitor General of India and section P. Nayar, for the appellants (in all the appeals).
section section Javali and M. Veerappa, for respondent No. 1 (in C.As.
184 1 and 1946 of 1968 ).
section L. Bhatia for respondents Nos. 1 and 2 (in C.A. No. 50 of 1969.
994 section K. Mehta, K. L. Mehta and K. R. Nagaraja, for the Intervener (in C.A. No. 1845 of 1968).
The Judgment of the Court was delivered by Khanna, J.
Whether the criterion to determine the seniority of R avi Varma and Ganapathi Kini respondents should be length of service in accordance with the Office Memorandum dated June 22, 1949 issued by the Ministry of Home Affairs, as claimed by the said respondents, or whether it should be the date of confirmation, as claimed by the appellants, is the main question which arises for decision in civil appeals Nos. 1845 and 1846 of 1968 which have been filed by the Union of India and two others by special leave against the judgment of Mysore High Court.
Similar question arises in respect of the seniority of Suresh Kumar and Tara Chand Jain, respondents in civil appeal No. 50 of 1969 which has been filed by the Union of India and two others on a ,certificate granted by the Punjab and Haryana High Court against the judgment of that Court reversing in Letters Patent appeal the ,decision of the single judge and issuing a writ in favour of those respondents.
The High Court held in all the cases that the seniority of the concerned respondents should be determined on the basis of the length of service in accordance with the above ,mentioned Office Memorandum.
Before giving the facts of the three cases, it would be pertinent to refer to two Office Memoranda issued by the Ministry of Home Affairs.
One of the memoranda is dated June 22, 1949.
It was mentioned in this memorandum that the Government of India had under consideration the question of the fixation of seniority of ;displaced government servants and temporary employees in the various grades.
Employees of the Central Government who were displaced from their offices in Pakistan, according to the memorandum, had been absorbed in offices under the control of the same administrative ministry or on nomination by the Transfer Bureau of the Ministry of Home Affairs in other offices.
All those persons had been appointed, with a few exceptions, on tem porary basis.
The Ministry of 'Home Affairs accordingly conveyed the following decision : "It has now been decided in consultation with the Federal Public Service Commission that the question of seniority in each grade should also be examined in the same context and specific rules suitable for each service prescribed in framing those instructions.
The question of seniority of Assistants in the Secretariat was recently examined very carefully in consultation with all the Ministries and Federal Public Service Commis 995 sion and the decisions reached are incorporated in para 8 of the 'Instructions for the initial constitution of the grade of Assistants ' an extract of which is attached.
It has been decided that this rule should generally be taken as the model in traming the rules of seniority for other services and in respect of persons employed in any particular grade seniority should, as a general rule, be determined on the basis of the length of service in that Grade irrespective of whether the latter was under the Central or Provincial Government of India or Pakistan.
It has been found difficult to work on the basis of 'comparable ' posts or grades and it has there fore been decided that 'Service in an equivalent Grade ', should, generally be defined as service on a rate of pay higher than the minimum of the time scale of the grade concerned.
The seniority of persons appoi nted on permanent or quasi permanent basis before the 1st January, 1944 should, however not be disturbed.
" Direction was accordingly issued by the Ministry of Home Affairs that the principles given in the Memorandum be borne in mind in determining the seniority of 'Government servants of various categories employed under the Ministry of Finance, etc. ' On December 22, 1959 another Office Memorandum was issued by the Ministry of Home Affairs on the subject of the general principles for determining seniority of various categories of persons employed in Central services.
Material part of this memorandum was as under: "The instructions contained in this Ministry 's Office Memorandum No. 30/44/48 Apptts, dated the 22nd June, 1949, were issued in order to safeguard the interests of displaced Government servants appointed to the Central Services after partition.
As it was not possible to regulate the seniority of only displaced Government servants by giving them credit for previous service, the instructions were made applicable to all categories of persons appointed to Central Services.
The principles contained in the 22nd June, 1949, orders were extended to (i) ex Government servants of Burma appointed to Central Services; and (ii) the employees of former part 'B ' States taken over to the Centre as a result of Federal Financial_ Integration.
996 The instructions contained in this Ministry 's Office Memorandum No. 32/10/49 CS dated the 31st March , 1950 and No. 32/49 CS(C), dated the 20.h September, 1952 similarly regulate the seniority of candidates with war service appointed to the Central Services.
The question has been raised whether it is necessary to continue to apply the in structions contained in the Office Memoranda cited above.
Displaced Government servants have by and large been absorbed in the various Central Services and their seniority has been fixed with reference to the previous service rend red by them.
Similarly, the seniority of ex employees of the Government of Burma and of Part 'B ' States as we I as of candidates with war service has already been determined in accordance with the instructions cited above.
As the specific objects underlying the instruction is cited above have been achieved, there is no longer any reason to apply those instructions in preference to the normal principles for determination of seniority.
It has, therefore, been decided in consultation with the Union Public Se vice Commission, that hereafter the seniority of all persons appointed to the various Central Services after the date of these instructions should be determined in accordance with the General principles annexed hereto.
The instructions contained in the various office memoranda cited in paragrah I above are hereby cancelled, except in regard to determination of seniority of persons appointed to the various Central Services prior to the date of this Office Memorandum.
The revised General principles embodied in the Annexure will not apply with retrospective effect, but will come into force with effect from the date of issue of these 'orders, unless a different date in respect of any particulate service/ grade from which these revised principles are to be adopted for purposes of determining seniority has already been or is hereafter agreed to by this Ministry. ', Relevant parts of paragraphs 2, 3 and 4 of the Annexure to this Memorandum were as under : "2 Subject to the Provision of para 3 below, persons appointed in a substantive or officiating capacity to a grade prior to the issue of these general principles shall retain the relative seniority already assigned to them or such seniority as may hereafter be assigned to them under the existing orders applicable to their cases 997 and shall en bloc be senior to all others in that grade.
Subject to the provisions of para 4 below, permanent officers of each grade shall be ranked senior to persons who are officiating in that grade.
Direct Recruits : Notwithstanding the provisions of para 3 above, the relative seniority of all direct recruits shall be determined by the order of merit in which they are selected for such appointment, on the recomendations of the U.P.S.C. or other selecting authority, persons appointed as a result of an earlier selection being senior to those appointed as a result of a subsequent selection.
Ravi Varma, respondent No. 1 in civil appeal No. 1845 of 1968.
was appointed as an Inspector in the Central Excise Collectors in Madras on 27 5 47 and was confirmed on 7 4 56.
Ganapathi Kini respondent No. 1 in civil appeal No. 1846, was appointed as an inspector in the Central Excise Collectorate in Madras on 28 5 47.
In view of the war service rendered by Ganapathi Kini, his service for purposes of seniority was computed with effect from 10 10 46 and he was confirmed on 7 4 56.
Ganapathi Kini and Ravi Varma were shown at serial Nos. 115 and 141 in accordance with the length of service in seniority list of inspectors prepared in 1959.
Subsequently on the directions of the Central Board of Revenue contained in letter dated October 19, 1962, a revised seniority list was prepared in 1963 by computing seniority from the date, of conifirmation.
In the revised list Ganapathi Kini and Ravi Varma were shown at serial, Nos. 149 and 150, junior to persons to whom they had been shown senior in the earlier seniority list.
Ganapathi Kini and Ravi Varma thereupon filed petitions under article 226 of the Constitution of India praying for quashing the revised seniority list prepared in 1963.
The main ground taken in the writ petitions was that the seniority should be determined according to length of service in terms of Office Memorandum dated June 22, 1949 of the Ministry of Home Affairs.
Impleaded in the writ petitions as respondents were the Union of India, the Central Board of Revenue and the Collector of Central Excise as also those inspectors of Central Excise who, according to the petitioners, were junior to them but who on account of being shown senior to the petitioners in the revised seniority list, had been appointed as Senior Grade Inspectors of Central Excise.
The above mentioned writ petitions were resisted by the appellants.
The learned judges of the Mysore High Court referred to the memoranda dated June 22, 1949 and December 22, 1959 L736SupCI/72 998 and held that the altered rule embodied in the Memorandum dated December 22, 1959 for the determination of seniority would be inapplicable to persons appointed before June 22, 1949 like Ganapathi Kini.
Argument was advanced on behalf of the appellants that on July 3, 1957 the Central Board of Revenue had again adopted the rule that the date of the confirmation should form the basis for determination of seniority.
This argument did not find favour with the learned judges,and it was observed "But what is however clear is that in the case of a person like the petitioner who was appointed before June 22, 1949 the rule made by the Ministry of Home Affairs on that date was what constituted the basis for the determination of seniority and not the rule which was revived by the Central Board of Revenue on July 3, 1957.
" Direction was accordingly issued that Ganapathi Kini 's seniority should be determined on on basis of the formula contained in the Office Memorandum dated June 22, 1949 and the revised seniority list be rectified accordingly.
In the petition filed Ravi Varma the High Court made a short order when, after 'referring the decision in the case of Ganapathi Kini, the learned judges granted similar relief to Ravi Varma.
Suresh Kumar, respondent No. 1 and Tara Chand Jain, res pondent No ' 2 in civil appeal No. 50 of 1969 were appointed as Lower Division Clerks in the Medical Stores Depot, Karnal under the Directorate General of High Services on October 9, 1950 and November 26 1951 respectively.
Both of them were con firmed on March 31, 1960.
In the Seniority list which was Prepared in accordance with Office Memorandum dated June 22, 1949 Suresh Kumar and Tara Chand Jain, respondents, were shown at serial Nos. 32 and 34 in accordance with their length of Service.
Subsequently Memorandum dated June 19, 1963 Was received from the Directorate General of Health Services in which there was a reference to the Ministry of Home Affairs office Memorandum date December 22, 1959.
It was stated in the Memorandum from the Directorate General of Health Services that scheduled castes ' and scheduled tribes candidates who were confirmed in reserved vacancies would rank senior to temporary, including quasi permanent persons irrespective of their position in the seniority list.
A revised seniority list was thereafter prepared and a number of scheduled castes candidates who had been recruited later but had been confirmed earlier than Suresh Kumar and Tara Chand Jain were shown senior.
Suresh Kumar and 999 Tara Chand Jain were thus shown at serial Nos. 40 and 42 in the revised seniority list Suresh Kumar and Tara Chand Jain thereafter filed petition tinder article 226 and 227 of the Constitution of India for quashing the instructions contained in the Memorandum dated June 19, 1963 issued by the Directorate General of Health Services is well its the revised seniority list and other consequential reliefs.
Impleaded is respondents in the petition were the Union or India, the Director General of Health Services, the Deputy Assistant Director General Medical Stores, as well astoother schedule castes employees of the Medical Stores Depot Karnal who had been shown senior to the petitioners in the revised seniority list.
The above petitions were resisted by the appellants and were dismissed by the learned single judge.
On Letters Patent appeal the judgment of the single judge was reversed and it was held thatSuresh Kumar and Tara Chand Jain having been appointed prior to December 22, 1959 were Governed by the rule of seniority contained in the Office Memorandum dated June 22, 1949 issued by the Ministry of Home Affairs.
This position, in the opinionof the learned judges, was not affected by the subsequent OfficeMemorandum issued by the Ministry of Home Affairs.
So far asthe Memorandum dated June 19, 1963 issued by the Directorate General of Health Services was concerned, it was found to be not in consonance with the Office Memoranda issued by the Ministry of Home Affairs on June 22, 1949 and December 22, 1959.
Assuch the Memorandum issued by the Directorate General of Health Services, according to the learned judges, could not affect the seniority of Suresh Kumar and Tara Chalid Jain.
In the result the revised seniority list was held to be invalid and theUnion of India and two other appellants were directed to prepare a revised seniority list in accordance with the original seniority of Suresh Kumar and Tara Chand Jain.
The learned Solicitor General on behalf of the appellants has at the outset referred to Memoranda dated June 22, 1949 and December 22, 1959 issued by the Ministry of Home Affairs and has argued that after the issue of the latter Memorandum the seniority of all Central Government employees should be determined by the date of their confirmation and not oil the basis of the length of service.
let this connection, we find, that the of a large number of Government employees After the partition of the country from areas now forming part of Pakisthan resulted in a situation wherein the Government had to review the Jules relating to seniority, As most of those displaced Government servants had been employed on temporary, basis and as it was felt that they should be given some weigh@age in the matter of seniority on compassionate grounds, the rule was evolved that the seniority 1000 should be determined on the basis of the length of service in equivalent grades.
The seniority of persons appointed on permanent basis or quasi permanent basis before January 1, 1944 was, however, left undisturbed.
Further, as it was not possible to regulate the seniority of only displaced Government servants by giving them credit for previous service, the instructions were made applicable to all categories of persons appointed to Central services.
Office Memorandum dated June 22, 1949 was consequently issued.
The above principles were also extended to other category of Government employees, including those with war service.
The matter was reviewed thereafter in 1959.
The Government then found that displaced Government servants had by and large been absorbed in the various Central services and their seniority had been fixed with reference to the previous service rendered by them.
Same was found to be the position of other Government servants who had been given the benefit of the principles contained in Memorandum dated June 22,.1949.
As the objects underlying the instructions of June 22, 1949 had been achieved and it was no longer considered necessary to apply those instructions in preference to the normal principle for determination of seniority, it was decided that the seniority of Central Government employees would henceforth be determined in accordance with the general principles contained in Annexure to the Office Memorandum issued by the Ministry of Home Affairs on December 22, 1959.
One ,of those principles was that permanent officiating of each grade would I ranked senior to persons who were, officiating in that grade.
The effect of that, as submitted by the learned Solicitor General, was that the seniority was to be determined by the date of confirmation and not on the basis of length of service as was the rule contained in the Office Memorandum dated June 22, 1949.
The Office Memorandum dated December 22, 1959, however, expressly made it clear that the general principles embodied in the Annexure thereto were not to have retrospective, effect.
In ,order to put the matter beyond any Pale of controversy, it was mentioned that 'hereafter the seniority of all persons appointed to the various Central Services after the date of these instructions should be determined in accor dance with the General principles annexed hereto '.
It is, therefore, manifest that except in certain cases with which we are not concerned, the Office Memorandum dated December 22, 1959 and the provisions laid down in the Annexure thereto could not apply to persons appointed to the various Central services before the date of that Memorandum.
It may also be mentioned that while dealing with the above Memorandum, this Court in the case of Mervyn Coutindo & Ors.
1001 vs Collector of Customs, Bombay & Ors.
(1) observed that these principles were not to apply retrospectively but were given effect to form the date of their issue, subject to certain reservations with which we are not concerned.
It has next been argued by the learned Solicitor General that whatever might be the positioned in respect of the employees in other Central services, so far as the clerks, supervisors and inspectors under the Central Board of Revenue were concerned, a decision was taken that for purposes of promotion, the permanent employees should have precedence before nonpermanent employees.
Our attention in this connection has been invited to letter dated March 15, 1958 sent by the Central Board of Revenue to all Collectors of Central Excise.
In this letter there was a reference to an earlier letter dated July 3, 1957 from the Board and it was mentioned that the instructions contained in the earlier letter that for purposes of promotion from ministerial grade to inspectors grade, permanent clerks would first be considered before considering persons who were non permanent, should be followed in respect of promotions to other grades also.
The Solicitor General accordingly contends that the direction contained in the Memorandum dated December 22, 1959 that it could not apply to employees appointed before that date would not hold good in the case of clerks, supervisors and inspectors functioning under the Central Board of Revenue.
It is, in our opinion, not necessary to go into this aspect of the matter because we find that the Central Board of Revenue as per letter dated August 27, 1971 addressed to all Collectors of Central Excise, gave fresh instructions regarding the principles of seniority.
In this letter there was a reference to the Office Memorandum dated December 22, 1959 issued by the Ministry of Home Affairs and it was stated : "In supersession of all previous orders on the subject, it has now been decided that in so far as the nongazetted staff in the Central Excise, Customs and Narcotics Departments and other subordinate offices are conceded, the seniority of persons appointed to various posts and services after receipt of these orders should be regulated in accordance with the Ministry of Home Affairs O.Ms.
referred to above.
" It would follow from the above that so far as the non gazetted staff 1 in the Central Excise, Customs and Narcotics Departments and other subordinate offices of the Central Board of Revenue are (1) [1966]3 S.C.R. 600.
1002 concerned, the question of seniority would have to be decided in accordance with the Office Memorandum dated 19 10 1959.
As the said Office Memorandum has, except in certain cases with which we are not concerned, applied the rule of seniority contained in the Annexure thereto only to employees appointed after the date of that Memorandum, there is no escape from the conclusion that the seniority of Ganapathi Kini and Ravi Varma, respondents, who were appointed prior to December 22, 1959, would have to be determined on the basis of their length of service in accordance with Office Memorandum dated Julie 22, 1949 and not on the basis of the date of their confirmation.
In civil appeal No. 50 of 1969 the learned Solicitor General has referred to Office Memoranda dated January 28, 1952, April 20, 1961 and March 27, 1963 issued by the Ministry of Home Affairs to show a departure from the rule of seniority for the benefit of members of scheduled castes and scheduled tribes.
Office Memorandum dated January 28, 1952 makes provision for communal representation in services for candidates to scheduled castes and scheduled tribes as also the Anglo Indian community.
The Memorandum gives a model roster which should be applied in filling the vacancies.
Perusal of the Memorandum shows that it relates only to recruitment and has nothing to do with the rule of seniority.
Office Memorandum dated April 20, 1961 deals with the ques tion of seniority of direct recruits who were confirmed in an order different from the original order of merit.
According to the Memorandum, it often happens that a scheduled caste or scheduled tribe candidate occupying a lower position in the merit list is appointed permanently to a reserved vacancy, while candidates above him in the merit list are not appointed at that time.
If such candidates are appointed in the following year, they are note entitled to a higher seniority on the ground that in the previous year they had obtained a higher position in the merit list.
It is plain that the above Office Memorandum did not deal with the question of seniority on the basis of length of service as contained in Office Memorandum dated June 22, 1949 but with the question a, to what would be the effect if a direct recruit scheduled caste or scheduled tribe candidate though occupying a lower position in the merit list, is confirmed earlier in a reserved vacancy.
We are in the present case not concerned with any merit list nor with any question of seniority based on such a list.
As such, Office Memorandum dated April 20, 1961 is also of not any material help to the appellants.
It may be stated that the counsel for the appellants in the High Court conceded that the above Memorandum had no direct relevance in the present controversy.
1003 The third Office Memorandum dated March 27, 1963 referred to by the learned solicitor General deals with the subject of maintenance of roster for giving effect to the reservations provided for scheduled castes and scheduled tribes ' in Central Government services.
This Memorandum has a bearing only on the question of recruitment and provides no guidelines for determining seniority.
We, thus, find that none of the three Office Memoranda relied upon by the Solicitor General is of any material assistance to the appellants.
We may now advert to the Memorandum dated June 19, 1963 issued by the Directorate General of Health Services.
As? mentioned earlier, it was after the receipt of this Memorandum that the seniority list of class III employees of the Government Medical Stores Depot, Karnal was revised and the seniority was determined on the basis of the date of confirmation and not on the basis of length of service.
The above Memorandum from the Directorate General of Health Services expressly refers to the Office Memorandum dated December 22, 1959 issued by the Ministry of Home Affairs and seeks implementation of that.
It is no doubt true that a direction was given in the Memorandum of the Directorate General of Health Services that scheduled caste and scheduled tribe candidates confirmed in reserved vacancies should be ranked senior to temporary, including quasi permanent persons, irrespective of their position in the seniority list, but such a direction went beyond the rule of seniority contained in the, Office Memorandum dated December 22, 1959 issued by the Ministry of Home Affairs in respect of employees appointed before that date.
As mentioned earlier Office Memorandum dated December 22, 1959 did not disturb the, seniority of Central Government employees who had been appointed prior to the date of that Memorandum, except in certain cases with which we are not concerned.
It is not disputed that according to the Government of India Allocation of Business Rules, 1961 general questions relating to recruitment, promotion and seniority in Central services like the one with Which we are concerned, have to be dealt with by the Ministry of Home Affiars.
As Suresh Kumar and Tara Chand Jain, respondents, were appointed prior to December 22, 1959 their seniority was governed by the rule of length of service as contained in Office Memorandum 1004 dated June 22, 1949 and not by the rule based upon date of confirmation as contained in the Annexure to the Memorandum dated December 22, 1959.
Reference was made by the learned Solicitor General to the case of Roshan Lal Tandon vs Union of India(1) wherein it has been laid down that the service rules may be framed and altered unilaterly by the Government.
No occasion for invoking the above dictum arises in this case because the learned counsel for the contesting respondents have not questioned the right of the Government to frame and alter unilaterly the service rules.
In the result, all the three appeals fail, and are dismissed with costs.
One hearing fee.
G.C. Appeals dismissed.
| The accused was charged with murder by stabbing, and the evidence against him was circumstantial.
It consisted of : (a) evidence of ill will against the deceased furnishing a motive (b) evidence that he was last seen in the company of the deceased, (c) evidence furnished by finger prints, that he was present in the room of the deceased at or about the time of the murder, (d) evidence that he was subsequently found in Possession of articles which had incriminating blood strains, and (e) evidence that he had bidden a dagger with bloodstains thereon, and certain other articles.
which were discovered on information furnished by him.
The trial court convicted him but the High Court set aside the conviction on the ground that the witnesses were not independent or impartial.
Allowing the appeal to this Court, HELD : (1) In an appeal against acquittal by special leave under article 136, this Court has power to interfere with the findings of fact, no distinction being made between judgments of acquittal and conviction though in the case of acquittals, it will not ordinarily interfere with the appreciation of evidence or findings of fact unless the High Court acted perversely or otherwise improperly.
[772 B D] State of Madras vs Vaidyanatha Iyer, ; , 587, referred to.
(2) In the case of circumstantial evidence if the links in the chain are complete leading to the undoubted conclusion that the accused alone could have committed the offence then it can be accepted.
In appreciating such evidence the prime duty of a court is to ensure that the evidence is legally admissible, that the witnesses are credible and that they have no interest or motive in implicating the accused, Since it is difficult to expect a scientific or mathematical exactitude while dealing with such evidence corroboration is sought wherever possible.
If there is any reasonable doubt the accused is given the benefit of such doubt.
The doubt should be reasonable and not a remote possibility in favour of the accused.
That is, the greatest possible care should be taken by the court in convicting an accused,, who is presumed to be innocent till the contrary is clearly established, and the burden of so establishing is always on the prosecution.
[772 C E, G; 773 E H; 774 C] (3)(a) While considering the evidence relating to the recovery under section 27 of the Evidence Act the court will have to exercise that caution and care which is necessary to lend assurance that the information furnished by the accused lead in to the discovery of a fact is credible.
[776 D] 766 In the present case, the various panchnamas of seizure prepared by the Investigating Officer could not be assailed on the ground that the witnesses who witnessed the recoveries were connected with the deceased or with his business, and that therefore, they were not independent or impartial witnesses.
[775 H; 776 G] (b) The evidence relating to recoveries is not similar to that contemplated under section 103, Cr.
It cannot be laid down as a matter of law or practice that where recoveries had to be effected from different places on the information furnished by an accused different sets of persons should be called to witness them.
[777 B C] On the contrary, in the present case, the witnesses who worked with the deceased were proper persons to witness the recoveries as they could identify the things which were missing.
[777 C D] (4) The report of the Director of the Finger Print Bureau regarding the finger prints can be used as evidence under section 510 Cr.
P.C., without examining the person making the report, because identification of finger prints has developed into an exact science.
As long as the report shows that the opinion was based on relevant observations that opinion can be accepted.
[783 A E] In the present case, the report set out many points of similarity between the finger prints found in the room of the deceased and those of the accused.
[783 H] (5) The information given by the accused that he purchased a dagger from one of the prosecution witnesses followed his leading the police to that witness and pointing him out is inadmissible under section 27 of the Evidence Act.
The concealment of a fact which is not known to the police is what is discovered by the information given by an accused and lends assurance that the information was true.
What makes the information leading to the discovery of a witness admissible is the discovery from him of the thing sold to him or hidden or kept with him which the police did not know until information was furnished by the accused.
But a witness cannot be said to have been discovered if nothing was found with or recovered from him.
as a consequence of the information furnished by the accused.
[778 F 779 H; 780 A C] Emperor vs Ramanuya Ayangar, A.I.R. 1935 Mad. 528, over ruled.
Pulukiuri Kotayya & Ors.
vs King Emperor, 74 I.A. 65, Ramkrishan Mithaplal Sharma vs State of Bombay, [1955] I S.C.R. 9 '03, Sukhan vs Crown, I.L.R. X Lah. 283, Public Protector vs India China Lingiah & Ors., A.I.R. 1954 Mad.
435 and Re : Vellingiri, A.I.R. 1950 Mad.
referred to.
(6) But that the accused had taken some of the prosecution witnesses to the witness from whom he bought the dagger and pointed him out, would be admissible under section 8 of the Evidence Act as conduct of the accused.
[780 C D] (7) Even after excluding some recoveries on the ground that the evidence regarding them was not satisfactory, the evidence against the accused consisted of evidence of motive, recovery of a button in the room of the deceased which matched with the button on the cuff of the coat recovered from the accused, the finger prints in the room, recovery of a blood stained coat and other articles of dress, a blanket, and the dagger, and the 767 fact that the accused and deceased were last seen together.
The evidences cogent and conclusive and should not have been rejected by the High Court.
[781 C E; 786 C D]
|
Appeal No. 647 of 1963.
Appeal from the judgment and order dated September 21, 1962, of the Punjab High Court in Civil Writ No. 280 of 1962.
the appellant appeared in person.
S.V. Gupte, Additional Solicitor General, N.S. Bindra and R.H. Dhebar, for the respondent (Union of India).
S.M. Sikri, Advocate General, Punjab, N.S. Bindra and R.H. Dhebar, for the respondent (State of Punjab).
November 19, 1963.
The Judgment of P.B. Gajendragadkar, K. Subba Rao, K.N. Wanchoo and J.C. Shah, JJ. was delivered by Wanchoo, J. Raghubar Dyal, J. delivered a dissenting Opinion.
WANCHOO J. This is an appeal on a certificate granted by the Punjab High Court.
The appellant joined the Indian Civil Service in 1939 and was governed in matters relating to discipline by the Civil Services (Classification, Control and Appeal) Rules, (hereinafter referred to as the Appeal Rules) made by 435 the Secretary of State for India in Council.
He continued in service till the transfer of power under the Indian Independence Act, 1947.
Under s.10 of that Act he continued to serve under the Government of India and was entitled to receive from the Government of India or of the Province which he might from time to time be serving the same conditions of service as respects remuneration, leave and pension, and the same rights as respects disciplinary matters or, as the case may be, as respects the tenure of his office, or rights as similar thereto as changed cir cumstances may permit as he was entitled to immediately before the transfer of power, which took place on August 15, 1947.
The same guarantee was extended to the appellant and all members of what were the Secretary of State 's Services before August 15, 1947 by article 314 of the Constitution.
As the appellant 's case is based on 'that Article we may set it out: "Except as otherwise expressly provided by this Constitution, every person who having been appointed by the Secretary.
of State or Secretary of State in Council to a civil.
service of the Crown in India continues on and after the commencement of this Constitution to serve under the Government of India or of a State shall be entitled to receive from the Government of India and the Government of the State, which he is from time to time serving, the same conditions of service as respects remuneration, leave and pension, and the same rights as respects disciplinary matters or rights as similar thereto as changed circumstances may permit as that person was entitled to immediately before such commencement.
" We shall hereafter refer to such a person as a member of the (former) Secretary of State 's Services.
It appears that the appellant was in the Indian Civil Service cadre in the State of Madras at the time of transfer of power, though later he was transferred to the Punjab.
After the transfer of power the Indian 436 Civil Service as a Secretary of State 's Service came to an end and thereafter a new Service was constituted known as the Indian Administrative Service.
Formal legal shape was given to the new Service after the enactment of the All India Services Act, No. LXI of 1951, and the Indian Administrative Service (Recruitment) Rules, 1954, (hereinafter referred to as the Recruitment Rules) were framed under Act LXI of 1951.
By r. 3 of these Rules, the Indian Administrative Service was to consist of (a) members of the Indian Civil Service, not permanently allotted to the judiciary; (b) members of the Indian Civil Service per manently allotted to the judiciary who have been holding executive posts from the date of the commencement of the Constitution and who may be declared by the Central Government to be members of the Service in consultation with the State Government; (c) persons who, at the commencement of these rules, are holding substantively listed posts, other than posts in the judiciary, (d) persons recruited to the Service before the commencement of these rules: and (e) persons recruited to the Service in accordance with the provisions of these rules.
The appellant thus became a member of the new Indian Administrative Service by virtue of these rules and continued to serve in the Punjab.
In 1955, the Central Government framed the All India Services (Discipline and Appeal) Rules, 1955 (hereinafter referred to as the Discipline Rules) which were applicable to all members of the Indian Administrative Service and the Indian Police Service.
On July 18, 1959, the appellant was suspended with immediate effect by the Governor of the Punjab on the ground that a criminal case was pending against him.
The order also provided that for the period of suspension the appellant shall be paid subsistence 437 allowance which shall be equal to leave salary which he would have drawn under the leave rules applicable to him if he bad been on leave on half average pay with a further provision that in case the suspension lasted for more than twelve months a further order fixing the rate of subsistence allowance shall be passed.
This order appears to have been passed under r. 7(3) of the Discipline Rules and in consequence thereof the appellant remained under suspension.
The appellant filed a writ petition in the Punjab High Court on February 16, 1962, challenging this order of suspension.
His contention was that he was entitled to.
the guarantee contained in article 314 of the Constitution and the order of suspension passed against him violated that guarantee and was therefore ineffective and invalid.
He relied for this purpose on r. 49 of the Appeal Rules, which provided for suspension as a penalty.
He contended that the Appeal Rules which governed him and which must be held to have continued to govern him in view of the guarantee contained in article 314 provided for suspension as a penalty only and that there was no provision anywhere in any rule or statute immediately before January 26, 1950 on which date the Constitution came into force, providing for suspension otherwise than as a penalty.
Therefore it was not open to the Governor to suspend him in the manner in which he did so in the present case, though it was not denied that he could be suspended pending criminal proceedings provided the suspension was as a penalty under r. 49 of the Appeal Rules; on the other hand mere suspension pending a criminal case not inflicted as a penalty was not provided at all by the Rules or the statute governing the appellant immediately before January 26, 1950.
Therefore when the Governor proceeded to suspend him under r. 7(3) of the Discipline Rules, he violated the guarantee contained in article 314.
The appellant also contends that as it was not open to any authority to suspend him except as a punishment immediately before January 26, 1950, r.7 of the Discipline Rules 438 which provides for suspension during disciplinary proceedings or during the pendency of a criminal charge insofar as it applies to him was ultra vires article 314 of the Constitution.
He also attacked rr.3 and 10 of the Discipline Rules as violative of article 314 of the Constitution, r.3 being concerned with penalties to be imposed on members of the Indian Administrative Service and r.10 with the right of appeal.
The contention in this connection was that r.3 omitted the penalty of suspension which was to be found in r.49 of the Appeal Rules with the result that suspension under r.7 was not open to appeal under r.10 which provided for appeals against penalties mentioned in r.3.
Therefore the guarantee under Art.314 was violated inasmuch as previously whenever the penalty of suspension was inflicted on a member of the Secretary of State 's Services it was open to him to appeal under r. 5 6 of the Appeal Rules.
Therefore the scheme of the Discipline Rules was such as to take away the protection to a member of the Secretary of State 's Service which was available to him immediately before the Constitution came into force and in consequence rr.3 and 10 also violated the guarantee contained in article 314 and were ultra vires.
The appellant therefore prayed for an appropriate writ, order or direction in the nature of mandamus striking down rr.3,7 and 10 of the Discipline Rules being violative of article 314 of the Con stitution and also for an order striking down the order of the Governor dated July 18, 1959, by which he suspended the appellant and such other appropriate relief as was just and proper.
The petition was opposed by the State of Punjab and its main contention was that rr.
3,7 and 10 of the Discipline Rules were perfectly valid and did not violate the guarantee contained in Art.314.
It was urged that article 314 only gave restricted protection to the members of what were formerly the Secretary of State 's Services in respect of disciplinary matters and stress was laid on the words "or rights as similar thereto as changed circumstances may permit" appear 439 ing therein.
It was also urged that suspension pending departmental enquiry or pending a criminal case was not the same thing as suspension by way of punishment and that previous to January 26, 1950, there could be suspension pending departmental enquiry or pending a criminal case and that no appeal lay from such suspension even then.
It was also urged that suspension pending a departmental enquiry or pending a criminal case was not a disciplinary matter at all and was therefore not included within the sweep of article 314 and in any case the rule relating to suspension even if it is connected with disciplinary matters was liable to variation as changed circumstances might demand and r.7 was framed in view of the changeed circumstances.
It was also urged that removal of suspension as a penalty under r. 3 could not affect the guarantee contained in article 314, for the effect of such removal was that there could be in future no penalty of suspension.
against a member of the Indian Administrative Service.
Therefore as the penalty had gone r. 10 did not naturally provide for an appeal against a penalty which did not exist.
Rule 7 which provides for suspension does not provide for any penalty and therefore there was no necessity of providing for any appeal against it.
It was urged that a difference must be made between suspension as a penalty and suspension as an interim measure only pending a departmental enquiry or pending a criminal case and if that difference was borne in mind there was no reason for holding that rr.3 and 10 were ultra vires article 314.
The respondent State finally contended that the order of the Governor passed under r. 7(3) was perfectly valid and did not violate the guarantee contained in article 314.
The High Court dismissed the petition.
It was of the view that it was inconceivable that under the old rules prevailing 'before January 26, 1950, a civil servant could never be suspended while an enquiry into his conduct was pending.
It was further of the view that suspension during the pendency of an enquiry was a power inherent in an employer like the 440 Government and the power to suspend was always implied in the authority making the appointment.
The High Court therefore rejected the contention of the appellant that under the old rules no member of the Secretary of State 's Services could have been suspended except by way of punishment.
The High Court further held that even if the contention of the appellant be accepted that a member of the Secretary of State 's Services had a right of appeal even where he was suspended during a departmental enquiry there was a provision in the Discipline Rules for a memorial to the President (see r.20) and that in the opinion of the High Court gave a right as similar to the right existing before January 26, 1950, as the changed circumstances permitted.
The High Court therefore dismissed the petition.
The appellant then applied for a certificate which was granted; and that is how the matter has come up before us.
The only question that has been debated before us is with respect to suspension whether as a punishment or otherwise of a member of one of the Secretary of State 's Services, in this case the Indian Civil Service, members of which have become members of the Indian Administrative Service under the Recruitment Rules; and it is only this question that falls to be determined in the present appeal.
But the appellant has also challenged rr.3 and 10 of the Discipline Rules which do not deal with suspension at all.
In these circumstances we do not propose to consider the vires of rr. 3 and IO, for that does not fall for decision as the order which is challenged has not been made under r. 3 and relates only to suspension.
It is therefore unnecessary to decide whether rr. 3 and 10 can in the changed circumstances apply to those members of the Indian Administrative Service who were at one time members of the Indian Civil Service.
We shall therefore express no view one way or the other on the vires of r. 3 and r. 10 and consider only r. 7 which deals with suspension.
We should also like to make it clear that what we say during the course of ' this judgment 441 with respect to suspenion refers only to those members of the Indian Administrative Service who became members thereof under r. 3 (a) and (b) of the Recruitment Rules and not to other members of the Indian Administrative Service who were not members before 1947 of the Indian Civil Service, for it is only the former kind of members of the Indian Ad ministrative Service who are entitled to the protection of article 314 and the whole case of the appellant is based on that protection.
Let us therefore turn to article 314 which we have already set out above.
This Article came to be considered by this Court in the Accountant General Bihar vs N. Bakshi(1).
In that case, however, that part of it was considered which related to "conditions of service as respects remuneration, leave and pension", and it was held that r. 3 of the All India Services (Overseas Pay, passage and leave salary) Rules, 1957, was ultra vires having regard to the guarantee contained in article 314 of the Constitution.
That case is an authority for the proposition that where any rule is framed, which is inconsistent with the guarantee contained in article 314 with respect to remuneration, leave and pension, that rule would be bad.
In the present case we are concerned with another part of article 314, namely, "the same rights as respects disciplinary matters or rights as similar thereto as changed circumstances may permit as that person was entitled to immediately before such commencement".
The same principle will apply to this part of article 314 also and if any rule is framed which goes against the guarantee contained in this part of article 31.4 with respect to members of what were former Secretary of State 's Services, it will be bad.
What article 314 provides with respect to disciplinary matters is that the members of the former Secretary of State s Services who continue to serve under the Government of India or of a State would be entitled to the same rights as respects disciplinary matters or rights as similar thereto as changed circumstances (1) [1962] Supp. 1.
S.C.R. 505.
442 may permit.
Stress has been laid on behalf of the respondent on the words "rights as similar thereto as changed circumstances may permit", and it is urged that in view of these words it was open in the " changed circumstances" to frame rules in particular with respect to suspension pending departmental enquiry or pending criminal proceedings.
These words in our opinion cannot bear this interpretation.
What the words "changed circumstances" mean is the change in circumstances due to transfer of power in August, 1947, and the coming into force of the Constitution in January, 1950, and no more.
Therefore when article 314 speaks of "rights as similar thereto as changed circumstances may permit", it only means that a member of the former Secretary of State 's Services would have rights similar to his pre existing rights as the changed circumstances resulting from constitutional changes may allow.
As an illustration take a case where a member of a Secretary of State 's Service could before August, 1947, be dismissed only by the Secretary of State; but after the transfer of power and the coming into force of the Constitution, circumstances have changed and there is no Secretary of State, therefore we have to look to the changed circumstances and find out which would be the authority to dismiss such a member in the changed circumstances.
If we do so, we find that the Government of India can be the only authority which now in the changed circumstances will have the power to dismiss such a member in the absence of a specific provision of law in force before January 26 , 1950.
These words do not mean that as time passes circumstances change and therefore new rules may be framed to meet the new circumstances due to passage of time.
The words "changed circumstances" in article 314 only refer to the constitutional changes which occurred after the transfer of power in August, 1947, and the coming into force of the Constitution in January 1950.
Further, article 314 provides that the protection is limited only to those rights as to disciplinary matters which a member of the former Secretary of State 's 443 Services was entitled to immediately before the commencement of the Constitution i.e. on January 25, 1950.
It is only those rights which are protected and no more.
Another argument that is urged on behalf of the respondent is that suspension pending a departmental enquiry or pending a criminal proceeding cannot be said to be a disciplinary matter at all and therefore the protection of article 314 does not extend to such suspension.
We cannot accept this argu ment.
The words "disciplinary matters" with which we are concerned appear in a constitutional provision and must be given their widest meaning consistent with what disciplinary matters may reasonably include.
Suspension is of two kinds, namely, as a punishment, or as an interim measure pending a departmental enquiry or pending a criminal proceeding.
We shall deal with these aspect 's of suspension in detail later.
So far as suspension as a punishment is concerned, it is conceded that it is a disciplinary matter.
The dispute is only as to suspension pending a departmental enquiry or pending a criminal proceeding.
There can in our opinion be no doubt that suspension of this kind also must be comprised within the words "disciplinary matters" as used in article 314.
Take the case of suspension pending a departmental enquiry.
The purpose of such suspension is generally to facilitate a departmental enquiry and to ensure that while such enquiry is going on it may relate to serious lapses on the part of a public servant , he is not in a position to misuse his authority in the same way in which he might have been charged to have done so in the enquiry.
In such a case suspension pending a departmental enquiry cannot be but a matter intimately related to disciplinary matters.
Take again the case where suspension is pending criminal proceedings.
The usual ground for suspension pending a criminal proceeding is that the charge is connected with his position as a government servant or is likely to embarass him in the discharge of his duties or involves moral turpitude.
444 In such a case a public servant may be suspended pending investigation, enquiry or trial relating to a criminal charge.
Such suspension also in our opinion is clearly related to disciplinary matters.
If the trial of the criminal charge results in conviction, disciplinary proceedings are bound to follow against the public servant so convicted.
Even in case of acquittal proceedings may follow where the acquittal is other than honourable.
The usual practice is that where a public servant is being tried on a criminal charge, the Government postpones holding a departmental enquiry and awaits the result of the criminal trial and departmental proceedings follow on the result of the criminal trial.
Therefore, suspension during investigation, enquiry or trial relating to a criminal charge is also in our opinion intimately related to disciplinary matters.
We cannot therefore accept the argument on behalf of the respondent that suspension pending a departmental enquiry or pending investigation, enquiry or trial relating to a criminal charge is not a disciplinary matter within the meaning of those words in article 314.
Before we investigate what rights a member of the former Secretary of State 's Services had with respect to suspension, whether as a punishment or pending a departmental enquiry or pending criminal proceedings, we must consider what rights the Government has in the matter of suspension of one kind or the other.
The general law on the subject of suspension has been laid down by this Court in two cases, namely, The Management of Hotel Imperial New Delhi vs Hotel Workers ' Union(", and T. Cajee vs U. Jormanik Siem(2).
These two cases lay down that it is well settled that under the ordinary law of master and servant the power to suspend the servant without pay could not be implied as a term in an ordinary contract of service between the master and the servant but must arise either from an express term in the contract itself or a statutory provision governing such contract.
It was further held that an order (1) ; (2) ; 445 of interim suspension could be passed against an employee while inquiry was pending into his conduct even though there was no specific provision to that effect in his terms of appointment or in the rules.
But in such a case he would be entitled to his remuneration for the period of his interim suspension if there is no statute or rule existing under which it could be withheld.
The general principle therefore is that an employer can suspend an employee pending an enquiry into his conduct and the only question that can arise on such suspension will relate to the payment during the period of such suspension.
If there is no express term in the contract relating to suspension and payment during such suspension or if there is no statutory provision in any law or rule, the employee is entitled to his full remuneration for the period of his interim suspension; on the other hand if there is a term in this respect in the contract or there is a provision in the statute or the rules framed thereunder providing for the scale of payment during suspension, the payment would be in accordance therewith.
These general principles in our opinion apply with equal force in a case where the government is the employer and a public servant is the employee with this modification that in view of the peculiar structural hierarchy of government, the employer in the case of government, must be held to be the authority which has the power to appoint a public servant.
On general principles therefore the authority entitled to appoint a public servant would be entitled to suspend him pending a departmental enquiry into his conduct or pending a criminal proceeding, which may eventually result in a departmental enquiry against him.
This general principle is illustrated by the provision in section 16 of the General Clauses Act, No. X of 1897, which lays down that where any Central Act or Regulation gives power of appointment that includes the power to suspend or dismiss unless a different intention appears.
Though this provision does not directly apply in the present case, 446 it is in consonance with the general law of master and servant.
But what amount should be paid to the public servant during such suspension will depend upon the provisions of the statute or rule in that connection.
If there is such a provision the payment during suspension will be in accordance therewith.
But if there is no such provision, the public servant will be entitled to his full emoluments during the period of suspension.
This suspension must be distinguished from suspension as a punishment which is a different matter altogether depending upon the rules in that behalf.
On general principles therefore the govern ment, like any other employer, would have a right to suspend a public servant in one of two ways.
It may suspend any public servant pending departmental enquiry or pending criminal proceedings; this may be called interim suspension.
Or the Government may proceed to hold a departmental enquiry and after his being found guilty order suspension as a punishment if the rules so permit.
This will be suspension as a penalty.
These general principles will apply to all public servants but they will naturally be subject to the provisions of article 314 and this brings us to an in vestigation of what was the right of a member of the former Secretary of State 's Services in the matter of suspension, whether as a penalty or otherwise.
As article 314 only guarantees protection to those rights which were in existence immediately before the Constitution came into force, all that is necessary is to find out the position before August 14, 1947, when the transfer of power took place and on January 25, 1950, just before the Constitution came into force.
Members of the Secretary of State 's Services who are protected under article 314 were appointed either by the Secretary of State or by the Secretary of State in Council.
Therefore on general principles it would have been open to the Secretary of State or the Secretary of State in Council, as the case may be, to suspend a member of such Services as the appointing authority as an interim measure pending a departmental enquiry or pending a criminal proceeding if it thought fit to do so.
What 447 remuneration such a public servant would get during such interim suspension would depend upon the rules if any, and if there were no rules he would be entitled to his full emoluments during such interim suspension.
But it appears that as the Secretary of State or the Secretary of State in Council was in London it was thought proper for the sake of administrative convenience to provide for suspension by authorities other than the appointing authority.
Reference in this connection may be made to section 247 (2) of the Government of India Act.
1935, as in force upto August 13, 1947.
That subsection provided that "any order suspending any such person (meaning thereby a member of the former Secretary of State 's Services) from office shall, if he is serving in connection with the affairs of the Federation, be made by the Governor General exercising his individual judg ment and, if he is serving in connection with the affairs of a Province, be made by the Governor exercising his individual judgment".
This sub section therefore made a specific provision for suspension by authorities other than the appointing authority; this was in addition to the general right of the employer (namely, the Secretary of State who was the appointing authority) to suspend an employee (namely, a member of one of the former Secretary of State 's Services).
Suspension in section 247 (2) cannot in our opinion be confined only to suspension as a penalty.
The words are general and must be given their full meaning and would include any kind of suspension, whether as a penalty or otherwise; and this power vested firstly in the Secretary of State or the Secretary of State in Council, as the case may be, under the general law of master and servant and also in the Governor General and the Governor, as the case may be, by virtue of this provision of the statute.
Further section 247 (3) also provided for remuneration of a suspended member of one of the former Secretary of State 's Services and laid down that "if any such person as aforesaid is suspended from office, his remuneration shall not during the period of his suspension be reduced except to such extent, if any, as may be directed by the Governor General exercising his in 448 dividual judgment or, as the case may be, by the Governor exercising his individual judgment".
Besides this statutory provision relating to former Secretary of State 's Services, there was a general provision as to payment to a government servant under suspension in Fundamental Rule 53.
That general provision is that a suspended governmentservant is at least entitled to one fourth of his pay.
This general provision was subject ,to section 247 (3) andin the case of members of the former Secretary of State 's Services, the Governor General or the Governor as the case may be, had to specify the amount which could be even more than what was provided by F.R. 53.
Here again when F.R. 53 speaks of suspension, it speaks of it in general terms.
It applies to all kinds of suspension whether as a penalty or otherwise.
Further r. 49 of the Appeal Rules deals with penalties and provides suspension as a penalty.
It also provides for appeals in r. 56 etc.
where suspension is inflicted as a penalty for good and sufficient reasons.
Rule 49 applied to the former Secretary of State 's Services also and thus these members were subject to the penalty of suspension.
A review therefore of the general law of master and servant, the provisions of the Government of India Act, 1935, of the Appeal Rules and the Fundamental Rules discloses that the position on August 13, 1947 with respect to members of the former Secretary of State 's Services with respect to suspension whether as a punishment or otherwise was as follows.
Members of the former Secretary of State 's Services were liable to suspension either as an interim measure or as a punishment.
Where suspension was as an interim measure and not as a punishment, it could be imposed either by the Secretary of State or the Secretary of State in Council as the appointing authority or by the Governor General or the Governor as the case may be as the statutory authority.
Suspension could also be imposed by the proper authority as a punishment under the Appeal Rules and such orders of suspension were subject to appeals as provided by the Appeal Rules.
There 449 was also provision for payment during suspension in the shape of subsistence allowance which was governed generally by F.R. 53 and in the case of members of the former Secretary of State 's Services, F.R. 53 was subject to section 247 (3) of the Government of India Act, 1935.
Therefore, the contention of the appellant that there could be no suspension except by way of punishment under r. 49 of the Appeal Rules before 1947 is not correct.
It is equally clear that where suspension before 1947 was an interim measure and not as a punishment under r. 49, there was no question of any appeal from such an interim suspension pending a departmental enquiry or pending a criminal proceeding.
If the position on January 25, 1950, stood as it was on August 13,1947, the appellant could not susbstantially challenge the order of the Governor passed on July 18, 1959, for it would have been covered by section 247(3) of the Govemment of India Act, 1935, and the appellant could not claim anything more under article 314 of the Constitution.
But article 314 does not speak of the protection which members of the All India Services had on August 13, 1947; it speaks of protection which they had immediately before the commencement of the Constitution i.e. on January 25, 1950, and that brings us to a consideration of the changes that took place between 1947 and 1950 after the transfer of power on August 15, 1947.
The effect of the transfer of power on the Secretary of State 's Services in particular came up for consideration be fore this Court in State of Madras vs
K.M. Rajagopalan(1) and it was held that "the conferral of Independence on India brought about an automatic and legal termination of service on the date of Independence.
But all persons previously holding civil posts in India are deemed to have been appointed and hence to continue in service, except those governed by 'general or special orders or arrangements ' affecting their respective cases, The guarantee about prior conditions of service and the previous statutory safeguards relating to disciplinary (1) ; 1 SCI/64 29 450 action continue to apply to those who are thus deemed to continue in service but not to others".
Section 10 of the Indian Independence Act provides or the Secretary of State 's Services and lays down that every person who having been appointed by the Secretary of State, or Secretary of State in Council, to a civil service of the Crown in India continues on and after the appointed day to serve under the Government of either of the new Dominions or of any Province or part thereof, shall be entitled to receive the same conditions of service as respects remuneration, leave and pension and the same rights as respects disciplinary matters or, as the case may be, as respects the tenure of his office, or rights as similar thereto as changed circumstances may permit as that person was entitled to immediately before the appointed day, i.e. August 15, 1947 By virtue of this provision those members of the Secretary of State 's Services who continued to serve the Government of India or the Government of any Province from August 15, 1947, were entitled to the protection of section 10.
What Rajagopalan 's case(" decided was that the Government of India was not bound to continue in service every member of the Secretary of State 's Services because of section 10 of the Indian independence Act; but that the protection of that section only applied to such members of the afore said services whose services the Government of India agreed to continue after August 14, 1947.
In Rajagopalan 's case(" the Government of India did not agree to continue Rajagopalan 's services and therefore, he could not claim the protection of section 10 of the Indian Independence Act.
In the appellant 's case his service continued after the transfer of power and therefore he was entitled to the protection of section 10 of the Indian Independence Act, which was almost in similar terms as article 314 of the Constitution so far as disciplinary matters were concerned.
On August 14, 1947, however, the India Provisional Constitution) Order, 1947, was promulgated as G.G.O. 14.
By that Order, section 247 of the Government of India was substituted by a new section and sub sections
(2) and (3) (1) ; 451 thereof to which we have already referred were repealed.
The substituted section 247 read as under: "Conditions of service of persons orginally recruited by Secretary of State The conditions of service of all persons who, having been appointed by the Secretary of State or the Secretary of State in Council to a civil service of the Crown in India, continue on and after the date of the establishment of the Dominion to serve under the Government of the Dominion or of any Province, shall (a) as respects persons serving in connection with the affairs of the Dominion, be such as may be prescribed by rules made by the Governor General; (b) as respects persons serving in connection with the affairs of a Province (i) in regard to their pay, leave, pensions, general rights as medical attendance and any other matter which immediately before the establishment of the Dominion was regulated by rules made by the Secretary of State, be such as may be prescribed by rules made by the Governor General; and (ii) in regard to any other matter, be such as may be prescribed by rules made by the Governor of Province.
" It will be clear from this that sub sections
(2) and (3) of section 247 disappeared on August 14, 1947.
No rules framed by the Governor General under the new section with respect to what we have called interim suspension have been brought to our notice.
Therefore no power was left in the Governor General or the Governor, as the case may be, to suspend a member of the former Secretary of State 's Services as an interim measure and only the appointing authority could suspend such a public servant, which in the changed circumstances would be the Government of India.
The explanation for this may be that as the Secretary of State disappeared and his place was taken by the Government of India, 452 it might not have been thought necessary to continue the further powers conferred by section 247 (2) in addition to the general power of the appointing authority to suspend.
Be that as it may, the fact remains that on August 14, 1947, section 247 (2) disappeared and therefore the Governor General and the Governor lost the power to suspend as an interim measure a member of the former Secretary of State 's Services and such power could only be exercised by the appointing authority which in the changed circumstances must be deemed to be the Government of India.
As for suspension as a punishment that continued to be provided in the Appeal Rules and no change was made therein.
It has however been urged that as the conferral of Independence on India brought about an automatic and legal termination of service on the date of Independence, there must in law have been reappointment of all members of the former Secretary of State 's Services.
This reappointment in case of those serving in connection with the affairs of a Province must be deemed to have 'been made by the Governor of the Province concerned and consequently the Governor will have the power to suspend as the appointing authority.
We are of opinion that there is no force in this argument.
The antecedent circumstances with respect to such Services have been fully dealt with in Rajagopalan 's case (1) and those circumstances show that the question of the retention of officers serving in these Services was dealt with between the Government of India and His Majesty 's Government and it was the Government of India which decided ,that all such officers should continue except those whom the Government of India, was not prepared to invite to continue and in the case of this limited class the Government of India agreed to compensation.
It was in consequence of this agreement between the Government of India and His Majesty 's Government that section 10 of the Independence Act provided that those officers who continued would have the same conditions of service etc.
as they were entitled to immediately before August 14, 1947.
The Governors of Provinces were nowhere in the picture in this matter and we can see (1) ; 453 no warrant for holding that the appointment must be deemed to be by the Governors of Provinces where such officers were serving in connection with the affairs of a Province.
It is true that the Indian Administrative Service as an all India Service was legally and formally constituted in 1951.
It is also true that under section 10 of the Indian Independence Act members of the former Secretary of State 's Services continued on and after August 14, 1947, to serve under the Government of either of the new Dominions or of any Province or part thereof It is also true that there are some passages in the correspondence between His Majesty 's Government and the Government of India which suggest that His Majesty 's Government was thinking on the lines that members of the former Secretary of State 's Services will become members of the Provincial Services.
These however are not conclusive of the matter and we have to find out what actually took place after this exchange of correspondence between the Government of India and His Majesty 's Government in connection with the former Secretary of State 's Services.
We have already indicated that section 10 was incorporated in the Indian Independence Act in consequence of this correspondence between the Government of India and His Majesty 's Government.
Thereafter we find that the India (Provisional Constitution) Order, 1947 (i.e. G.G.O. 14) was passed on August 14,1947, under powers conferred on the GovernorGeneral by virtue of section 9 (1) (a) of the Indian Independence Act.
Article 7 (1) of that Order is in these terms: "(1) Subject to any general or special orders or arrangements affecting his case, any person who immediately before the appointed day is holding any civil post under the Crown in connection with the affairs of the Governor General or Governor General in Council or of a Province other than Bengal or the Punjab shall, as from that day, be deemed to have been duly appointed to the corresponding post under the,Crownin connec 454 tion with the affairs of the Dominion of India or, as the case may be, of the Province.
" Reading this provision along with the provision in section 10 of the Indian Independence Act, it would in our opinion be right to say that so far as the.
members of the former Secretary of State 's Services are concerned they must be deemed to have been appointed to the posts on which they were serving at the time of conferral of Independence, by the Govemmentof India.
The deemed appointment under article 7 (1) of G.G.O. 14 was "subject to any general or special orders or arrangements affecting his case", and these arrangements are clear from the correspondence which ensued between the Government of India and His Majesty 's Government.
That correspondence and the special orders or arrangements contemplated by article 7 (1) of G.G.O. 14 show that so far as the members of the former Secretary of State 's Services were concerned, it was the Government of India which took the final decision whether to continue such officers or not.
It is true that in so doing it consulted the various Provincial Governments and was to a large extent guided by the views of the Provincial Governments, particularly in connection with such officers who were serving in connection with the affairs of the Provinces; even so, as the facts in Rajagopalan 's case(1) show, the final decision whether to continue or not a member of the former Secretary of State 's Services was taken by the Government of India.
In these circumstances it would in our opinion be reasonable to hold that in the case of the members of the former Secretary of State 's Services it was the Government of India which must be deemed to have appointed them after the conferral of Independence on India to the respective posts which they were holding whether under the Government of India or under the Governments of Provinces.
This conclusion is reinfored by the fact that the system in force before 1947 was that all members of the Secretary of State 's Services were assigned to one Province or other and from them such members as were necessary used to be on deputation to the Government of India for serving it directly.
It would be very anomalous (1) [1955].2 S.C.R. 541.
indeed that the accident whether an officer was serving on August 13, 1947, on deputation under the Government of India directly or in the Province to which he was assigned should determine who the appointing authority must be deemed to be on the date of the transfer of power.
Such an anomaly could in our opinion never have been intended and we have no doubt therefore in view of the history dealt with in Rajagopalan 's case(1) that on the conferral of Independence, even if there was legal termination of the services of members of the former Secretary of State 's Services, the reappointment must be deemed to be by the Government of India and not by the Governors of Provinces even in the case of officers who were serving in connection with the affairs of Provinces.
In this connection our attention has been drawn to section 241 (1) of the Government of India Act 1935 as it then stood, which is in these terms: "(1) Except as expressly provided by this Act, appointments to the civil services of, and civil posts under, the Crown in India, shall be made (a) in the case of services of the Dominion, and posts in connection with the affairs of the Dominion, by the Governor General or such person as he may direct; (b) in the case of services of a Province, and posts in connection with the affairs of a Province, by the Governor or such person as he may direct." This provision in our opinion does not apply in the peculiar circumstances arising out of the transfer of power in August 1947.
It is a general provision relating to appointments to civil services and civil posts under the Dominion or under the Provinces.
It has in our opinion nothing to do with the case of members of the civil services and holders of civil posts who were deemed to have continued by virtue of article 7 of G.G.O. 14 of August 14, 1947.
Clause (b) of section 241 (1) therefore cannot in our opinion lead to the inference that in the case of those members of the former Secretary of State 's (1) 456 Services who were deemed to have been appointed in connection with the affairs of a Province under article 7 (1) of G.G.O. 14, the appointments must be deemed to have been made by the Governor.
Such deemed appointments in our opinion must depend for their validity on article 7 G.G.O 14 and not on section 241 of the Government of India Act which is not a deeming provision and therefore we have to look to article 7 (1) to find out by whom the appointments must be deemed to have been made in these of the members of the former Secretary of State 's Services.
As article 7 opens with the words "subject to any general or special orders or arrangements affecting his case " (i.e. each individual officer 's case), it must be held in view of the history which is elaborately set out in Rajagopalan 's case( ) that so far as members of the former Secretary of State 's Services were concerned, it was the Government of India who must be deemed to have made the appointments in view of the special orders and arrangements with respect to such officers.
Reliance in this connection was also placed on the amendment of section 240 (2) of the Government of India Act by the same G.G.O. Section 240 (2) as it originally stood provided that " no such person as aforesaid (meaning thereby a member of a civil service of the Crown in India or a person holding any civil post under the Crown in India) shall be dismissed from the service of His Majesty by any authority subordinate to that by which he was appointed".
Amendment of this sub section became necessary as the Secretary of State for India was disappearing and some authority had to be provided which could dismiss members of the former Secretary of State 's Services.
G.G.O. 14 therefore provided that no member of a Secretary of State 's Services who continued in service after August 14, 1947, shall be dismissed by any authority subordinate to the Governor General or the Governor according as that person was serving in connection with the affairs of the Dominion or of a Province.
This amendment gave power to the Governor to dismiss even members of the former Secretary of State 's Services and stress has been laid on behalf of (1) 457 the respondent on this amendment and it is urged that this shows that appointments of such members who were serving in connection with the affairs of the Provinces must be deemed to have been made by the Governor concerned.
It appears however that the amendment by which the Governor could dismiss a member of the former Secretary of State 's Services may have crept in by inadvertence, for it would prima facie be against the provisions of the guarantee contained in s.10 of the Indian Independence Act.
In any case this sub section was further amended by G.G.O. 34 and the power of dismissal was only vested in the Governor General and was taken away from the Governor.
We are therefore of opinion that no inference can be drawn from the fact that for a short time section 240 (2) provided that the Governor may dismiss a member of the former Secretary of State 's Services, that the appointments of such members who were serving in connection with the affairs of the Province was by the Governor, and not by the Government of India.
Such an inference is in our opinion against the conclusion which can be plainly drawn from the history relating to the continuance and appointment of the members of the former Secretary of State 's Services at the time of conferral of Independence and the provisions of article 7 (1) of G.G.O. 14 of August 14, 1947.
The final position therefore on January 25, 1950, with respect to suspension of a member of the former Secretary of State 's Services whether as a punishment or as an interim measure pending departmental enquiry or pending a criminal proceeding was this.
Such member could be suspended under the general law by the appointing authority, which in the changed circumstances was, the Government of India, as an interim measure pending a departmental enquiry or pending a criminal proceeding, but there was no power in any other authority to pass such an order of interim suspension, for as we have already indicated the power under section 247 (2) was repealed by G.G.O.14 of August 14.
Besides this power of interim suspension otherwise than as a punishment, the power to suspend 458 as punishment continued under r. 49 of the Appeal Rules and an order of suspension made in exercise of that power was subject to appeal under r. 56 etc.
, thereof So far as payment during the period of interim suspension or during the period of suspension as a penalty is concerned, section 247 (3) had disappeared and therefore the general provision contained in F.R. 53 applied.
That general provision has made some distinction between the members of the Indian Civil Service and others; but that is a matter of detail, in which it is unnecessary to go.
So the position immediately before the commencement of the Constitution was that members of the former Secretary of State 's Services could be suspended either as an interim measure pending departmental enquiry or pending criminal proceeding or as a punishment.
Where suspension was as an interim measure and not as a punishment such suspension could only be by the appointing authority, which in the changed circumstances should be deemed to be the Government of India.
Such interim suspension was not subject to any appeal.
So far as suspension as a punishment was concerned, r. 49 of the Appeal Rules applied and the authorities specified in these Rules could pass an order of suspension as a punishment and that order would be subject to appeal provided in r. 56 and other rules therein.
As to the payment during the period of suspension that was governed by F.R. 53.
It is this position which was protected by article 314 of the.
Constitution so far as suspension of members of the former Secretary of State 's Services was concerned whether as an interim measure or as a punishment.
Then we come to the Discipline Rules 1955.
Rule 3 of these Rules provides for penalties and omits suspension as a penalty.
Now if suspension had remained a penalty under r. 3 of the Discipline Rules, the appellant would have been entitled to the same rights as respects suspension as a punishment or rights as similar thereto as changed circumstances would permit in view of article 314.
But r. 3 of the Discipline Rules has altogether done away with the penalty of suspension for members of 459 the Indian Administrative Service, which includes the members of the lndian Civil Service under r. 3 (a) and (b) of the Recruitment Rules.
Further rules corresponding to the Discipline Rules was repealed by r. 23 of the Discipline Rules , so after the Discipline Rules came into force in 1955 suspension could no longer be inflicted as a penalty on a member of the Indian Administrative Service (including members of the Indian Civil Service who became members of the Indian Administrative Service).
It is therefore unnecessary for us to consider whether the order of July 18, 1959, can be justified as a punishment and if so whether the memorial provided by r. 20 of the Rules is a sufficient protection for the purpose of article 314 which speaks of "rights as similar thereto as changed circumstances may permit".
Nor is it the case of the respondent that the appellant was suspended by way of punishment by the order of July 18, 1959.
The respondent justifies the said order under r. 7 ( 3) of the Discipline Rules and thus the case of the respondent is that the appellant was suspended not as a punishment but that the order of suspension was passed by the Governor as an interim measure which he could do either pending a departmental enquiry or pending a criminal charge.
The appellant has thus been suspended by the order of July 18, 1959, not as a punishment but as an interim measure pending a criminal charge against him; and this is what practically in terms the order says, for it places the appellant immediately under suspension because a criminal case was pending against him.
But as we have already pointed out the power to pass an order of interim suspension in the case of a member of the former Secretary of State 's Services on January 25, 1950, was only in the appointing authority, (namely, the Government of India).
The power to suspend a member of the Indian Administrative Service which the appellant became by virtue of r. 3 of the Recruitment Rules as punishment has disappeared from r. 3 of the Discipline Rules 1955.
The appellant therefore could not be suspended by the Governor as an interim measure and such suspension could only be by the Government of India.
The proper procedure therefore in a case 460 where the State Government wants a member of the former Secretary of State 's Services to be suspended pending departmental enquiry or pending investigation, inquiry or trial of a criminal charge against him is to approach the Government of India and ask it as the appointing authority to suspend such officer as an interim measure.
It is not open to the Government of India by framing a rule like r. 7 of the Discipline Rules to take away the guarantee as to Disciplinary matters contained in article 314.
We have already said that the guarantee in the case of a member of the former Secretary of State 's Services is that in disciplinary matters his rights would be the same or as similar thereto as changed circumstances would permit as they were immediately before the commencement of the constitution.
The right in the matter of interim suspension As distinct from suspension as a punishment was that a member of the former Secretary of State 's Services could not be suspended by any authority other than the Government of India.
That was guaranteed by article 314 and could not be taken away by framing a, rule like r. 7 of the Discipline Rules.
We have already referred to Bakshi 's case(" in which it has been held that the rights guaranteed by article 314 of the Constitu tion could not be destroyed or taken away by the Central Government in exercise of its rule making power ' In the present case the right guaranteed to a member of the former Secretary of State 's Services with respect to interim suspension (as distinct from suspension as a punishment is that such a member cannot be so suspended except by the appointing authority which in the changed circumstances is the Government of India.
That right has in our opinion been violated by r. 7 of the Discipline Rules insofar as it permits any authority other than the Government of India to suspend pending a departmental enquiry or pending a criminal charge a public servant who was a member of the, former Secretary of State 's Services.
Rule 7 therefore insofar as it permits this violation of the guarantee contained in article 314 with respect to interim suspension (other than suspension (1) [1962] Supp.
I S.C.R. 505.
461 as a punishment) is to that extent ultra vires article 314 i.e. insofar as it applies to the members of the Indian Adminstrative Service who fall within cls.
(a) and (b) of r. 3 of the Recruitment Rules.
it follows therefore that the order of the Governor dated July 18, 1959, purporting to be passed under r. 7 (3) of the Discipline Rules is without authority and must be set aside.
This brings us to the question of relief to be granted to the appellant.
it appears that on September 11, 1963, the Governor passed an order by which he reinstated the appellant for the period from July 18, 1959, to April 4, 1963, and granted him his full emoluments for that period.
The writ petition in the present case was filed in February 1962.
So the appellant is apparently not entitled to any further relief in the matter of his emoluments besides what has been granted to him by the Governor.
The order of reinstatement contained therein is unnecessary in view of our decision and the order granting full emoluments may be taken to be in pursuance of our judgment.
We therefore allow the appeal and declare r. 7 of the Discipline Rules insofar as it applies to members of the Indian Administrative Service who are members thereof by virtue of r. 3 (a) and (b) of the Recruitment Rules to be bad to the extent to which it permits an authority other than the Government of India to suspend as an interim measure (and not as a punishment) such members of the Services.
In consequence we set aside the order of the Governor dated July 18, 1959.
As however the order of September, 1963, has granted all such monetary reliefs to the appellant as we could grant him on setting aside the order of July 18, 1959, no further relief can be granted to the appellant.
We order the respondent the State of Punjab to pay the costs of the appellant in this Court as well as in the High Court.
RAGHUBAR DAYAL J.
I am of opinion that this appeal should be dismissed.
The appellant a member of the Indian Civil Service, was serving under the Government of Madras immediately before the appointed day ', i.e. August 15 462 1947, as laid down in sub section
(2) of section I of the Indian Independence Act, 1947 (10 & 11 Geo. 6, Ch. 30) hereinafter referred to as the Independence Act.
He continued to serve under the Government of Madras on and after the appointed day.
Subsequently, he was transferred to the State of Punjab where he was serving on ,,July 18, 1959, when he was suspended by the Governor of Punjab as a criminal case was pending against him. 'the appellant was a member of the Indian Administrative Service in 1959 and the order of suspension appears to have been made by the Governor in exercise of the power conferred by r. 7 of the All India Services (Discipline and Appeal) Rules, 1955, hereinafter referred to as the Discipline Rules.
The appellant challenges the validity of this order on the ground that this rule violates the provisions of article 314 of the Constitution.
His contention is that prior to August 15, 1947, a member of the Indian Civil Service could be suspended by way of punishment in view of r. 49 of the Civil Services (Classification, Control and Appeal) Rules, hereinafter referred to as the Classification Rules and that there was no provision for his suspension otherwise than as a penalty and that his suspension, as a disciplinary measure, though permissible, would have been then treated as suspension by way of penalty and therefore as subject to an apeal under r. 56 of the Classification Rules.
No appeal is provided under the Discipline Rules against an order of suspension under r. 7 which therefore violates article 314 of the Constitution as, according to that article, he was entitled to receive from the Government the same rights as respects disciplinary matters or rights as similar thereto as changed circumstances, permitted as he was entitled to immediately before 'the commencement of the Constitution.
He further contends that sub section
(2) of section 10 of the Independence Act guaranteed to him the same rights as respects disciplinary matters or rights as similar thereto as changed circumstances permitted, as he was entitled to immediately before the appointed day.
It was further contended, during the course of the submissions in Court, that though prior to the appoin 463 ted day an order of suspension during the pendency of a departmental enquiry or of a criminal charge could have been made only by the Governor General or the Governor, such an order thereafter and till January 26, 1950 could be made only by the Governor General, and that therefore such a suspension order subsequent to the commencement of the Constitution could be made by the Union Government and not by the Government of Punjab and that for this reason too, r. 7 of the Discipline Rules empowering the State Government to make an order of such suspension violates article 314.
I need not discuss the various points on which I agree with my learned brother Wanchoo, J.
I agree that the expression 'changed circumstances ' in article 314 only refer to the constitutional changes which occurred after the transfer of power in August, 1947, and the coming into force of the Constitution in January, 1950, that suspension during the pendency of disciplinary proceedings or of a criminal charge is related to disciplinary matters within the meaning of those words in article 314, that from the appointed day there was no express provision in the Government of India Act or in the rules framed thereunder empowering the Governor General or the Governor to suspend, otherwise as penalty, officers appointed by the Secretary of State for India and that any order of suspension pending enquiry against a person appointed by the Secretary of State on a day immediately before the coming into force of the Constitution had to be made by the Government in the exercise of the general power of suspension which an employer has with respect to his employee, that this general power an employer has to suspend an employee pending an enquiry into his conduct vests in the appropriate authority where the Government is the employer and a public servant is the employee and that such an authority in the case of Government, in view of the peculiar structure of the hierarchy of Government, be taken to be the, authority which has the power to appoint the public servant concerned.
I am however.
further of opinion that the appropriate authority in this connection can also include officers superior to 464 the appointing authority and that in the case of members of All India Services serving under any state includes the Governor who, as the executive head of State, has administrative control cover all officers serving under the State Government.
It would be anomalous to hold that the Governor could not suspend a person, appointed by the Secretary of State, during the pendency of departmental proceedings or a criminal charge against him, though he could have imposed a penalty of suspension on such a person in view of rr. 49 and 62 of the Classification Rules which were in force between the appointed day and January 25, 1950, and continued in force subsequently, up to the coming into force of the Discipline rules.
1, however, do not rest my decision on this view as, in my view, the appellant is to lie deemed to have been appointed by the Governor of Madras, on the appointed day, to the post corresponding to ,the post he was holding immediately before the appointed day under the Madras Government.
I now deal with the question of the authority which should be taken to be the appointing authority for persons who had been appointed by the Secretary of State to the Civil Services or to any post under the Crown and who continued to serve the Government after the appointed day.
To determine this question it is necessary to consider the following matters: (1) Did the Service known as the Indian Civil Service, whose members were to be recruited by the Secretary of State for India in view of section 244 (1) of the Government of India Act, cease to exist on and from the appointed day and, if so, whether any other AR India Service took its place immediately after it had ceased to exist? (2) If it ceased to exist, were the services of the members of the Indian Civil Service terminated immediately before the appointed day? (3) Which members of the Service continued in service of the Government on or after the appointed day.
(4 ) Whether those who so continued did so on account of their becoming servants of the new Government under the provisions of any Act, or their continuance in service was on account of their fresh appointment.
(5) If it was due to fresh 465 appointment, which authority appointed them and to which post or service Before I deal with the above questions, I may set out the relevant provisions which have a bearing in this connection.
The Independence Act was enacted by the British Parliament on July 18, 1947, for setting up in India two independent Dominions and to provide for necessary consequential matters.
By sub section
(1) of section 1, two independent Dominions known as India and Pakistan were to be set up from August 15, 1947.
Subsection ( 2) of that section provided for their being referred to as the new Dominions and August 15, 1947, being referred to as the appointed day.
One of the consequences of the setting up of the new Dominions was stated in sub section
(1) of section 7 to be that His Majesty 's Government in the United Kingdom was to have no responsibility as respects the government of any of the territories which, immediately before the appointed day, were included in British India.
Section 9 empowered the Governor General to make such provisions by order as appeared to him to be necessary or expedient for certain purposes mentioned therein.
Subsections (1) and (2) of section 10 of the Act read: "(1) The provisions of this Act keeping in force provisions of the Government of India Act, 1935, shall not continue in force the provisions of that Act relating to appointments to the civil services of, and civil posts under, the Crown in India by the Secretary of State, or the provisions of that Act relating to the reservation of posts.
(2) Every person who (a) having been appointed by the Secretary of State, or Secretary of State in Council, to a civil service of the Crown in India continues on and after the appointed day to serve under the Government of either of the new Dominions or of any Province or part thereof; or (b) having been appointed by His Majesty before the appointed day to be a judge of the Federal SCI/64 30 466 Court or of any court which is a High Court within the meaning of the Government of India Act, 1935, continues on and after the appointed day to serve as a judge in either of the new Dominions, shall be entitled to receive from the Governments of the Dominions and Provinces or parts which he is from time to time serving or, as the case may be, which are served by the courts in which he is from time to time a judge, the same conditions of service as respects remuneration, leave and pension, and the same rights as respects disciplinary matters or, as the case may be, as respects the tenure of his office, or rights as similar thereto as changed circumstances may permit, as that person was entitled to immediately before the appointed day The Governor General, in the exercise of the powers conferred on him by section 9 made the India (Provisional Constitution) Order, 1947 (G.G.O. 14 of 1947), hereinafter called the Provisional Constitution Order.
Article 7(1) of this Order is: "Subject to any general or special orders or arrangements affecting his case, any person who immediately before the appointed day is holding any civil post under the Crown in connection with the affairs of the Governor General or GovernorGeneral in Council or of a province other than Bengal or the Punjab shall, as from that day, be deemed to have been duly appointed to the corresponding post under the Crown in connection with the affairs of the Dominion of India or, as the case may be, of the Province." Sub section (1) of section 241 of the Government of India Act, as modified by this Order, reads: "Except as expressly provided by this Act, appointments to the civil services of, and civil posts under, the Crown in India, shall be made (a) in the case of services of the Dominion, and posts in connection with the affairs of the 467 Dominion, by the Governor General or such person as he may direct; (b) in the case of services of a Province, and posts in connection with the affairs of a Province, by the Governor or such person as he may direct." Section 247 of the Government of India Act as modified reads: "The conditions of service of all persons who, having been appointed by the Secretary of State or the Secretary of State in Council to a civil service of the Crown in India, continue on and after the date of the establishment of the Dominion to serve under the Government of the Dominion or of any Province shall, (a) as respects persons serving in connection with the affairs of the Dominion be such as may be prescribed by rules made by the GovernorGeneral; (b) as respects persons serving in connection with the affairs of a Province (i) in regard to their pay, leave, pensions, general rights as to medical attendance and any other matter which immediately before the establishment of the Dominion was regulated by rules made by the Secretary of State, be such as may be prescribed by rules made by the GovernorGeneral; and (ii) in regard to any other matter be such as may be prescribed by rules made by the Governor of the Province.
" Sections 244 to 246 of the Government of India Act, 1935, which dealt with Services recruited by the Secretary of State was omitted from the Act by this Order.
Reference may also be made to the announcement by His Excellency the Viceroy on April 30, 1947.
It purported to relate to grant of compensation for premature termination of their service in India to members of the Civil Services appointed by the Secre 468 tary of State and to regular officers and British Warrant Officers of the Indian Naval and Military Forces.
Its first 7 paragraphs are set out at pp.
548 to 550 in State of Madras vs K.M. Rajagopalan(1).
Its para 8 stated inter alia: "In pursuance of their wish to give all possible help to the Government of India in building up the new services, His Majesty 's Government agree 'that their obligation covers the claim to ultimate compensation of those British members of the Services who are asked to serve on in India and decide to do so.
" It may also be mentioned that subsequent to June 3, 1947, the Government of India made enquiries through the Provincial Governments from the members of the Secretary of State 's Services, including the Indian Civil Service.
about their desire to continue in service of the Government after the transfer of power and also made enquiries from the Provincial Governments themselves about their readiness to retain those officers in service who expressed their desire to continue in service.
This Court had occasion to discuss the effect of the steps taken by the Government of India prior to the appointed day and of the provisions of the Independence Act and the Provisional Constitution Order in Rajagopalan 's case(1) Rajagopalan was a member of the Indian Civil Service and was serving in the Province of Madras till August 14, 1947, when his services were terminated, though he had expressed his willingness to continue in the service of the, Govern.ment of Madras on and after the appointed day.
What this Court directly held and observed in connection with the points urged before it in that case would be mentioned at appropriate places in discussing the five points I have formulated earlier.
This first two points were directly decided in that case.
This Court held that the Secretary of State and his Services disappeared as from the appoin (1) ; 469 ted day and that, section 10(2) of the Independence Act and article 7(1) of the Provisional Constitution Order proceeded on a clear and unequivocal recognition of the validity of the various special orders and the individual arrangements made and amounted to an implicit statutory recognition of the principle of automatic termination of the Services brought about by the political change.
It is clear therefore that the Indian Civil Service, one of the Secretary of State 's Services, ceased to exist from the appointed day and that the services of its members automatically terminated on August 14, 1947.
This Court had not to consider whether any All India Service was set up to take the place of the Indian Civil Service on and from the appointed day, as the termination of Rajagopalan 's services was held to be valid.
There is nothing on the record to show that any such new Service took the place of the Indian Civil Service at the changeover, though, subsequently, the Indian Administrative Service was set up as an All India Service.
When it was actually set up is not known.
Article 312 of the Constitution states in cl.
(2) that the Services known at the commencement of the Constitution as the Indian Administrative Service and the Indian Police Service shall be deemed to be services created by Parliament under that article.
The All India Services Act, 1951 (Act LXI of 1951) defined an All India Service to mean the service known as the Indian Administrative Service or the service known as the Indian Police Service.
The Indian Administrative Service Recruitment Rules, 1954, came into force in 1954 and its r. 3 dealing with the constitution of the service provides inter alia that the Service shall consist of (a) members of the Indian Civil Service, not permanently allotted to the judiciary; (b) members of the Indian Civil Service permanently allotted to the judiciary who have been holding executive posts from the date of commencement of the Constitution; (d) persons recruited to the Service before the commencement of those Rules.
It appears therefore that all the 470 members of the Indian Civil Service who continued to serve the Government on and after the appointed day were not made members of the Indian Administrative Service and that those who were made members of the Service became members of such Service in 1954.
If the Indian Administrative Service had been set up to replace the Indian Civil Service immediately on the appointed day and the erstwhile members of the Indian Civil Service had become its members, the provisions of r. 3 (a) and (b) would have been different from what they are.
This indicates that the Indian Administrative Service did not take the place of the Indian Civil Service automatically after the changeover on the appointed day and that therefore the members of the Indian Civil Service who continued in service did not continue so as members of any All India Service.
The Viceroy 's announcement dated April 30, 1947, makes no mention of any All India Service replacing the Indian Civil Service immediately on the transfer of power though it specifically mentioned in para 8 about the giving of all possible help to the Government of India in building up the new Services and to the members of the Secretary of State 's Services continuing to serve under the Government in India after the transfer of power.
The provisions of article 7(1) of the Provisional Constitution Order also do not refer to the persons in the Secretary of State 's Services to continue in service as members of any All India Service though it specifically deals with the appointment of such other employees of Government to the posts they had held on the day immediately preceding the appointed day.
I am therefore of opinion that the service of the appellant as a member of the Indian Civil Service came to an end on August 14, 1947, and that thereafter he did not automatically or otherwise become member of any All India Service on August 15, 1947.
In connection with point No. 3 formulated by me.
this Court said in Rajagopalan 's case(1) at P. 552 (1) ; 471 that the continuance of service was contemplated only in respect of such of the previous servants who intimated their desire for the continuance of their services and whose offer in that respect was accepted, and at p. 563 that sub section
(2) of section 10 of the Independence Act had nothing to say as to who were the persons who would continue in service and receive the benefit that being obviously left to be provided by delegated 'legislation in the shape of Orders of the Governor General and at p. 565 that in view of the provisions of article 7(1) of the Provisional Constitution Order, all persons who were previously holding civil posts were deemed to have been appointed and hence to continue in service excepting those whose case was governed by general or special orders or arrangements affecting their cases.
It is clear therefore that only those members of the Secretary of State 's Services continued in service who had been holding civil posts immediately before the appointed day and were deemed to have been appointed to the corresponding post in view of the provisions of article 7 (1) of the Provisional Constitution Order.
The persons who had been holding civil posts immediately before the appointed day did not automatically become servants of the new Government on the appointed day.
Article 7(1) of the Provisional Constitution Order contemplates 'deemed appointment ' of such persons to their respective posts on that day.
The language of this article is not consistent with any suggestion that they automatically, by the force of the Independence Act or the Provisional Constitution Order, became holders of the respective posts on the appointed day.
The language is very much different from the language used in articles 374, 376, 377 and 378 of the Constitution which provide for certain persons holding office immediately before the commencement of the Constitution becoming, on such commencement, holders of corresponding posts on such commencement.
The language is also different from that of article 375 of the Constitution which deals with the continuance of courts, authorities 472 and officers after the commencement of the Constitution and reads: "All courts of civil, criminal and revenue jurisdiction, all authorities and all officers, judicial, executive and ministerial, throughout the territory of India, shall continue to exercise their respective functions subject to the provisions of this Constitution.
" There is no such expression in this article which would indicate that any of these officers had to be freshly appointed or would be deemed to have been appointed to their respective posts on the commencement of the Constitution.
The language of article 7(1) of the Provisional Constitution Order correspond to some extent to that of section 58 of 21 & 22 Vic. Cap.
CVI, 1858, an Act for the better Government of India, which was passed when the .,Government of India was transferred to Her Majesty from the East India Company.
Section 58 reads: "All persons who at the time of the commence ment of this Act shall hold any offices, employments, or commissions whatever under the said Company in India shall thenceforth be deemed to hold such offices, employments, and commissions under Her Majesty as if they had been appointed under this Act. . . " The language of article 7(1) of the Provisional Constitution Order, for purposes of comparison, may be just noted, and is ". any person who immediately before the appointed day is holding any civil post under the Crown . shall, as from that day, be deemed to have been duly appointed to the corresponding post under the Crown. " The language of section 58 of the 1858 Act contemplated a fresh appointment, though deemed appointment, as is abundantly clear from the words 'shall. be deemed to hold such offices, employments, and corn 473 missions.
.as if they had been appointed under this Act. ' I am therefore of opinion that the Provisional Constitution Order, by its article 7(1), provided for deemed fresh appointment of the members of the Secretary of State 's Services whose services had terminated automatically on the day immediately preceding the appointed day.
I will now deal with the last point as to which authority would be deemed to have appointed the persons who had been in the Secretary of State 's Services, to their corresponding posts on the appointed day.
The Government of India Act, 1935, hereinafter called the Act, as modified by the Orders of the Governor General, was in force on that day and the authorities competent to make appointments on that day would be deemed to have made the appointments of the erstwhile servants in the Secretary of State 's Services.
No other authority could have made those appointments and therefore no other authorities could be deemed to have made those appointments which were deemed to be made in view of the provisions of article 7(1) of the Provisional Constitution Order.
Section 241 of the Act provided that the GovernorGeneral, or such person as he may direct, would make appointments to the civil services of the Dominion and civil posts in connection with the affairs of the Dominion and that the Governor would make appointments to the services of a Province and posts in connection with the affairs of a Province.
Such persons of the Secretary of State 's Services who were holding posts in connection with the affairs of a Province would therefore be appointed to the corresponding posts, on the appointed day, by the Governor of that Province, as only he could have made appointments to those posts.
It is to be noticed that article 7(1) of the Provisional Constitution Order refers to appointments to posts and not to appointments to Services and that even prior to the appointed day the appoint 474 ments, to the various posts in the Provinces, of members of All India Services allotted to the cadre of the Provinces were also made by the Governor and not by the Governor General.
In this respect, with regard to all appointments to posts in connection with the affairs of the Provinces there had been really no ,change.
It is contended for the appellant that his deemed appointment to the post corresponding to the post he had held on August 14, 1947, was by the GovernorGeneral or the Government of India.
Article 7(1) of the Provisional Constitution Order does not expressly provide so.
Section 241 of the Act did not authorize the Governor General to make appointments to posts in connection with the affairs of the Provinces.
The provisions of article 7(1) of the Provisional Constitution Order refer to all the persons employed in the civil services and holding civil posts under the Crown and are not restricted to those persons only who held posts and had been appointed by the Secretary of State.
The mere fact that the Provisional Constitution Order was made by the Governor General would not lead to the result that the deemed appointments of all the persons serving under the Crown, whether as members of civil services or as holders of posts, had been made by the Governor General.
That could not have been intended.
All such employees would be deemed to be appointed by the appropriate authority on the appointed day and the appropriate authority for the appointment of a particular employee is to be found in section 241 of the Act.
It is also true that the erstwhile members of the Secretary of State 's Services were not actually reappointed by the appropriate appointing authority and that they were merely deemed to be so appointed in view of the provisions of article 7(1) of the Provisional Constitution Order whose purpose was to validate the continuity of the service of such persons even though they had not been actually appointed.
I see no reason why the provisions of section 241 of the Act be not applicable to the deemed appoint 475 ments of such persons who had been in the Secretary of State 's Services.
Undoubtedly, it was not a special provision for the deemed appointments at the particular occasion, but was of general application to appointments on and after the appointed day.
Appointments, whether actual or deemed to be made by the new Governments immediately on the changeover of the Government, must be governed by its provisions.
This Court did not make any reference to section 241 of the Act in Rajagopalan 's Case.(1) This is not because that section did not govern all the erstwhile members of the Secretary of State 's Services, but because the Court was not concerned in that case with the question of such fresh deemed appointments as Rajagopalan did not continue in service as his services were held to be validly terminated on August 14, 1947.
It has been urged in support of the appellant 's case that the retention of persons of the Secretary of State 's Services was dealt with between the Government of India and His Majesty 's Government as would appear from the various documents in connection with the steps taken for the setting up of the two Dominions and that only those officers continued in service whom the Government of India invited to continue and that those who were not so invited were to be paid compensation.
It is not clear from the antecedent circumstances that it was the Government of India which decided about the continuance in service of such officers of the Secretary of State 's Services who had been prior to the changeover serving under the Government of a Province.
Even if it was the Government of India which was to decide and invite the officers to continue, such a decision and invitation cannot amount to its appointing those officers to the various posts in connection with the affairs of a Province, in view of section 241 of the Act.
of course, negotiations with respect to the services took place between the Government of India (1) ; 476 and His Majesty 's Government.
A Provincial Government could not have continued such negotiations.
I do not find any specific mention in any of the documents referred to in Rajagopalan 's Case ' ') to the effect that it was the Government of India which decided which officers were to continue in service.
The Viceroy 's announcement dated April 30, 1947, practically sums up the result of the negotiations between the Government of India and His Majesty 's Government.
It is clear from what was stated in paragraphs 3 and 6 of this announcement that the undertakings and assurances 'with respect to persons appointed by the Secretary of State and who were to continue in service were given by the Government of India with respect to those who were to continue under its service and by the Provincial Governments with respect to those who would join the Provincial Services.
It is said in para 3, which dealt with the terms of pay etc., that the Government of India would then propose to Provincial Governments that they should give similar assurances to members of the Secretary of State 's Services who agreed to join Provincial Services.
It was said in para 6 : "His Majesty 's Government have been reviewing the whole position.
They have noted the undertaking which the Government of India have given in regard, to officers whom they desire should continue to serve under the Government of India .
Many Indian members of the Secretary of State 's services will however become members of provincial services and in their cases His Majesty 's Government 's agreement that the need not be compensated is conditional upon the Provincial Governments guaranteeing the existing terms of service.
If they are not prepared to do so His, Majesty 's Government reserve the right to reconsider the matter.
It is therefore clear that the Provincial Governments were also concerned in the negotiations though they Were actually made by the Government (1) ; 477 of India and had to agree to guarantee the existing terms of service and safeguards in matters of discipline And had also to agree to pay compensation.
It may look anomalous that some persons who had been members of the Secretary of State 's Services may be deemed to have been appointed to their respective posts, on the appointed day, by the Governor of a Province if they had been holding Posts under the Provincial Government and others be deemed to have been appointed by the Governor General if they happened to be then serving posts in connection with the affairs of the Government of India or the Dominion.
Such an anomaly was bound to come into existence and had been contemplated during the negotiations between the Government of India and His Majesty 's Government.
There was no other choice open to the members of the Secretary of State 's Services who were serving under the Government of a: Province when their services automatically came to an end and when they desired to continue ' in Government service.
Their wishes were ascertained in the context of what was taking place.
They knew of the; announcement by the Viceroy dated April 30, 1947.
It was only with their consent that their services were continued after the changeover.
They can therefore have no grievance for being appointed to provincial services or posts under the Provincial Governments and naturally, under its administrative control.
In fact, even prior to the changeover, such persons had been under the administrative control of the Provincial Government.
This Court, in Rajagopalan 's Case(1), refers at p. 551 to the Government of India asking the Provincial Govemments, by its letter dated June 18, 1947, to state, when forwarding the replies from the individual officers, about their willingness or otherwise to continue in service, whether for any reason they Would prefer such officer not to continue in service notwithstanding his desire to remain in service, and pointing out to the Provincial Government that in case it did not (1) ; 478 desire to retain the services of such persons, the Pro vincial Government would be incurring the liability to pay compensation.
Such an enquiry indicates, to my mind, that the decision to continue such persons in service after the changeover rested with the Provincial Government and It was on this account that .it had to bear the liability to the compensation payable to such persons.
Such a decision had to be taken by the Provincial Government because it was contemplated that officers serving under the Provincial Government would be appointed to their respective posts after the changeover by that Government itself and that the Government of India will have nothing to do with their appointments.
In the circumstances, it follows that it was the Provincial Government which invited such officers to continue in service and not the Government of India.
It is true that the Madras Government informed Rajagopalan of the Government 's decision not to retain him in service after August 15, 1947, and stated that a formal communication in that respect would issue from the Government of India.
The Government of India in a way approved of the decision of the Madras Government not to continue Rajagopalan in service.
But it does not follow that the Government of India 's approval was necessary for the Government of Madras to continue under its service officers whom it was prepared to keep in service.
The ter mination of service of such officers was prior to the coming into force of the Act as modified by the Provisional Constitution Order and therefore the termination order had to be formally made by the Government of India.
The order had to be passed prior to the changeover and at that time it was proper that any order about the termination of the services be with the approval of the Government of India.
The fresh deemed appointment was to be made on August 15, 1947, immediately after the changeover and, in view of the practical difficulties, such a fresh appointment was not actually made but was deemed to have been made, as provided by article 7(1) of the Provisional 479 Constitution Order.
When the appointment was to be made of persons serving under the Provincial Governments, there was no necessity of obtaining prior approval of the Government of India to retain such officers in service.
I am therefore of opinion that such members of the Secretary of State 's Services who were holdingposts under a Provincial Government immediately before the appointed day and continued in service on and after the appointed day are to be deemed to be appointed to the corresponding posts by the Governor of the Province, in view of the provisions of section 241 of the Act.
The appellant was serving under the Madras Government immediately before the appointed day.
He will therefore be deemed to be appointed by the Governor of the Province of Madras to the post he was holding on the appointed day.
The Governor of the Province was his appointing authority and therefore he could be suspended on the day immediately before the commencement of the Dominion by the Governor of the Province where he might have been then serving.
He can at best claim protection of his right of not being suspended pending departmental enquiry or of a criminal charge by any authority of a lower rank.
Rule 7 of the Discipline Rules does not provide for such suspension of a person who had been a member of the Secretary of State 's Services by an authority lower than the Governor.
The appellant was suspended by the Governor of Punjab on July 18, 1959.
He had no right of appeal against such an order of suspension.
The Discipline Rules did not provide for an appeal against such an order of suspension and, in not so providing, cannot be said to violate the provisions of article 314 of the Constitution as the appellant had no right of appeal against such an order before the commencement of the Constitution.
It follows that r. 7 of the Discipline Rules does not violate the provisions of that Article and that the impugned order of suspension was therefore valid.
480 1 would therefore dismiss the appeal.
ORDER in accordance with the opinion of the majority the appeal is allowed with costs in this Court and in the ' High Court.
| Suits were filed against the Union of India representing the Western Railway for the refund of amounts collected by the Western Railway as wharfage and demurrage charges from the appellants.
It was alleged in the plaint that Railway notifications and rules under which the Railway had charged the wharfage at two annas to four annas per maund per day were illegal and ultra rites and that in any view the railway had no power under the rules to collect charges from appellant firm for the "free time" under the head of wharfage charges.
The respondent pleaded that Civil Court had no jurisdiction to entertain the suits and that rules were not ultra rites and money was not collected against the rules.
Suits were dismissed by the trial court on the ground that they were barred under section 26 of the Indian Railways Act.
Revisions were also dismissed by the High Court.
The appellants came to this Court by Special Leave.
Accepting the appeals, Held, that section 26 of the Indian Railways Act is not a bar to the maintainability of a suit for the refund of what fage or demurrage charged in excess.
The bar under section 26 is not comprehensive.
It is limited by the opening words "Except as provided in the Act" in the section.
Two conditions must be complied with before applying section 26.
The railway administration should have done an act or omitted to do an act in contravention of the provisions of Chapter V of the Indian Railways Act and the Act should provide a remedy in respect of that act or omission.
In the present case, the Act does not provide for any remedy for an aggrieved party to approach the Tribunal appointed under section 34 of the Act for the refund of the amount collected in excess by the Railway Administration by way of wharfage or demurrage.
The Tribunal has no jurisdiction to decide whether the rules empowering the administration to collect wharfage or demurrage charges are ultra vires or the amounts collected are in excess of what is leviable under the rules.
Wharfage and demurrage are charges in respect of goods unloaded from wagons and kept at the station and also in respect of the goods kept on a platform of the station, beyond the free time allowed for clearance under the rules.
The said charges 149 can certainly be described as charges in respect of the station and are terminals within the meaning of the definition of the term in the Act.
|
Civil Appeal No. 1389 of 1988.
From the Judgment and order dated 6.7.1987 of the Orissa High Court in C.M.C. No. 375 of 1984.
R.K. Mehta and Miss Mona Mehta for the Appellant.
G.L. Sanghi and Vinoo Bhagat for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is an appeal by special leave from the judgment and order of the High Court of orissa, dated 6th July, 1987.
It arises out of a contract entered into between the State and the respondent for the construction of certain projects for irrigation.
During 1973 74 the respondent was entrusted with the job of 'Construction of Ramaguda Minor Irrigation project in Kukudakhandi Block ' vide agreement No. 4 F 2.
The value of the work was Rs.9,99,510.
The work pursuant to the contract commenced on 4th May, 1973 and 4th November, 1974 was the stipulated date of com 566 pletion of the work.
However, on 30th December, 1975 the work was actually completed.
It is asserted by the appellant that the respondent contractor accepted the final payment and was duly paid a sum of Rs.23,74,001 for the work done by him including the extra work.
Thereafter, no amount was due to the respondent, according to the appellant, and he did not raise any claim whatsoever before the Department.
On 28th September, 1976 the last payment was alleged to have been made by the respondent.
On 30th October, 1976 the last bill was prepared which was nil one.
The respondent, thereafter, raised a claim and gave notice for appointment of an arbitrator.
Consequently, the Chief Engineer appointed one Shri A.N. Nanda as the arbitrator in terms of the arbitration clause.
However, on the application of the respondent the learned Subordinate Judge removed Shri A.N Nanda and appointed one Shri B. Patnaik as the arbitrator.
It may be mentioned that the application was made for removal of the arbitrator Shri B. Patnaik but the same was ultimately dismissed.
Before the arbitrator, the respondent filed the claim raising some claims which, according to the appellant, were fictitious and baseless.
These claims were for the alleged extra work in respect of which the decision of the Superintending Engineer under clause 11 of the contract was final and the same was excluded from the purview of the arbitration clause.
It was contended on behalf of the appellant that the arbitrator had no jurisdiction to deal with such claims.
The appellant filed a counter claim for Rs.2,11,400, denying all the claims of the respondent.
All the documents and relevant papers were produced before the arbitrator.
It is stated that as the application for removal of Shri B. Patnaik as arbitrator was pending, an application had been made before Shri section Patnaik to adjourn the proceeding which was refused and the award was made.
This award was claimed to have been made virtually ex parte.
This, however, was not so and it appeared that the arbitrator on hearing the parties and considering the evidence produced before him made the award.
The arbitrator made the said award on 18th March, 1983 but the same was a non speaking and nonreasoned award for a lump sum of Rs.15,23,657 plus interest @ 10% from 9.9.1975 till the date of payment or decree.
Objections to the said award were filed in the Court.
The learned Subordinate Judge upheld the objection to the award and set aside the award on 15th September, 1984.
There was an appeal to the High Court and the High Court set aside the judgment of the learned Subordinate Judge and made the award of the arbitrator, rule of the Court.
It also directed payment of further interest at 6%.
567 Being aggrieved thereby the State of Orissa has preferred this appeal.
In support of this appeal, it was submitted that the award in question was a lump sum af money and it was without any reason, in favour of the respondent.
It was also submitted that the validity of the non reasoned award is awaiting determination by a larger Bench of this Court.
Hence, it was urged that this question should await decision of the larger Bench.
In the facts and circumstances of the case, we are of the opinion that we would not be justified in acceding to this request on the part of the appellant.
In this case the submission that the award was bad being an unreasoned one, was neither mooted before the learned Subordinate Judge nor before the High Court.
This contention was also not raised in the objection to the award, filed originally.
It is only in the special leave petition that such a plea has been raised for the first time.
Arbitration is resorted to as a speedy method of adjudication of disputes.
Stale and old adjudication should not be set at naught or examination of that question kept at bay on the plea that the point is pending determination by a larger Bench of this Court.
Even if it is held ultimately that the unreasoned award per se is bad, it is not sure whether such a decision would upset all the awards in this country which have not been challenged so far.
Certainly, in the exercise of our discretion under Article 136 of the Constitution and in view of the facts and circumstances of this case, we would not be justified in allowing the party to further prolong or upset adjudication of old and stale disputes.
In that view of the matter, we think that the pendency of this point before the larger Bench should not postpone the adjudication and disposal of this appeal in the facts of this case.
The law as it stands today is that award without reasons are not bad per se.
Indeed, an award can be set aside only on the ground of misconduct or on an error of law apparent on the face of the award.
This is the state of law as it is today and in that context the contention that the award being an unreasoned one is per se bad, has no place on this aspect as the law is now.
This contention is rejected.
It was next contended that in view of clause 11 of the contract the matters upon which the arbitrator has adjudicated were excluded and these were not arbitrable.
It was submitted that clause 11 of the contract between the parties made on these matters the decision of the Engineer Incharge final and binding.
Hence, inasmuch as the arbitrator has purported to act upon this field which was only to be decided by the Engineer in charge, the award was bad.
The disputes over which the arbitrator has purported to make an award, were regarding 568 works covered by the agreement.
lt was submitted that the provision to clause 11 af the agreement categorically provided that in the event of dispute over a claim for additional work, the decision of the Superintending Engineer of the Circle would be final and, hence, the arbitrator by entertaining the additional claim of the contractor had exercised a jurisdiction not vested in him and, as such, misconducted himself.
In order to judge this contention, therefore, it is Imperative first to refer to clause 11 of the agreement.
It provides as follows: "Clause 11 The Engineer in charge shall have the power to make any alteration in or additions to the original specifications, drawings designs, and instructions that may appear to him necessary or advisable during the progress of work and the contractor shall be bound to carry out the work in accordance with any instructions which may be given to him in writing signed by the Engineer in charge and such alteration shall not invalidate the contract.
Any additional work which the contractor may be directed to do in the matter above specified as part of the work, shall be carried out by the contractor on the same conditions in all respects on which he agreed to do the main work and at the same rates as are specified in the tender for the main work.
The time for the completion of the work shall be extended in the proportion that the additional work bears to the original contract work and the certificates of the Engineer in charge shall be conclusive as to such proportion and if the additional work includes any class of work shall be carried out at the rates entered in the sanctioned schedule of rates of the locality during the period when the work being carried on and if such last mentioned class of work is not entered in the schedule of the rate of the district, then the contractor shall within 7 days intimate the rate which it is his intention to charge for such class of work and if the Engineer in charge does not agree to this rate he shall by notice in writing be at liberty to cancel his order to carry out such class of work and arrange to carry such class of work and arrange to carry out in such manner as he may consider advisable.
No deviation from the specification stipulated in the contract or additional items of work shall ordinarily be carried by the contractor and should any altered, additional or substituted work be carried out by him unless the rates of the substituted, altered or additional 569 items have been approved as fixed in writing by the Engineer in charge.
The contractor shall be bound to submit his claim for any additional work done during any month or before the 15th day of the following months accompanied by the copy of the order in writing of the Engineer in Charge for the additional work and that the contractor shall not be entitled to any payment in respect of such additional work if he fails to submit his claim within the aforesaid period.
Provided it always that if the contractor shall commence work or incur any expenditure in regard thereof before the rates will have been determined as lastly herein before mentioned, then in such case he shall only be entitled to be paid in respect of the determination of the rates as aforesaid accordingly to such rate of rates as shall be fixed by the Engineer in Charge.
In the event of a dispute the decision of the Superintending Engineer of the Circle will be final. " This clause has to be read in conjunction with the arbitration clause i.e. clause 23, which provides as follows: "Clause 23: Except where otherwise provided in the contract all questions and disputes relating to the meaning of the specifications, designs and instructions hereinbefore mentioned and as to the quality of workmanship or materials used on the work or as to any other question, claim, right matter, or thing whatsoever in any way arising out of, or relating to the contract, designs, drawing specifications, estimates, instructions, orders or these conditions or otherwise concerning the works or the execution or failure to execute the same whether arising during the progress of work, or after the completion or abandonment thereof shall be referred to the sole arbitration of a Superintending Engineer of the Circle.
It will be no objection to any such appointment that the arbitrator so appointed is a Government servant.
The award of the arbitrator so appointed shall be final.
conclusive and binding on all parties to this contract.
The learned Subordinate Judge was inclined to hold that the 570 arbitrator had no jurisdiction to arbitrate on disputes which he has purported to do but in view of the Bench decision of the High Court of Orissa in State of orissa vs Gokulchandra Kanungo, , he held that he was not free to decide that the dispute was not arbitrable and rejected this plea.
The High Court also did not entertain this objection.
It was canvassed before us and submitted that in view of clause 11, the matters in dispute and the amount due for the alleged additional work, were not arbitrable at all.
We have noticed clause 11 which makes the decision of the Engineer in Charge final in respect of some issues.
In this connection, it is important to refer to the proviso of Clause 11 which states that in case of dispute about the rates and time for completion of the work and any dispute as to proportion that the additional work bears to the original contract work, the decision of the Superintending Engineer of the Circle would be final.
The points upon which the arbitrator in the instant case has adjudicated are not those which are excepted or covered by Clause 11 of the agreement.
In that view of the matter, this clause has no application in the instant controversy.
Our attention was drawn to certain observations of this Court in Bombay Housing Board (Now the Maharashtra Housing Board) vs Karbhase Naik & Co., Sholapur, s ; There in view of clause 14 of the said contract, it was open to the respondent to make claim on the basis of the rates quoted.
There, Clause 14 was more or less identical to Clause 11 in the present case.
This particular contention, however, did not arise in that case.
The Court held that the respondent there being contractor, was not bound to carry out additional or altered work and there was no reply to the notice stating the rates intended to be charged and the respondent there was not free to commence and complete the work on the basis that since the rates quoted were not accepted, it would be paid at such rates to be fixed by the Engineer in charge and that if it was dissatisfied with the rate or rates fixed by the Engineer in charge, it could raise a dispute before the Superintending Engineer and that the time limit for completion would be extended in all cases.
This Court observed that only the rates were settled by the agreement.
The respondents were under no obligation to carry out the additional or altered work but that is not the dispute before us in the present case.
On the construction of Clause 11 of the contract, we are unable to accept the contention but on the points that the arbitrator has awarded in this case, were excluded by Clause 11 of the contract herein.
Shri Mehta, however, strongly relied on certain observations of a Bench decision of Madhya Pradesh High Court in case of the Chief Administrator, Dandakaranya Project, 571 Koraput, Orissa & Anr.
vs M/s. Prabartak Commercial Corpn.
Ltd. Calcutta, , wherein while considering Clause 13A of the agreement there the High Court held that the dispute whether charges for stone chips could be adjudicated, was not arbitrable.
That was a case of rates which was within the jurisdiction of the Engineer in charge by Clause 13A of the bargain between the parties.
In the instant case it is not the rate which is in dispute.
The Madhya Pradesh High Court referred to several decisions of this type and came to the conclusion on the construction of Clause 13A in that case that the dispute that had arisen between the parties in arbitration, was excluded by Clause 13A of the agreement.
In view of the Clause in the instant case and the nature of the dispute which had arisen, we are of the opinion that such decisions also cannot give much assistance to the appellant.
Reliance was also placed on certain observations of the Delhi High Court in the case of Food Corporation of India vs P.L. Juneja, AIR 1981 Delhi 43.
There the Division Bench of the High Court was concerned with the questions which were to be decided by the Court and not by the arbitration.
There also the Clause was very much dissimilar to the present one which is set out hereinbefore.
Clause 15(c) provided that the question whether a particular service is or is not to be covered by any of the services specifically described and provided for the contract, or is or is not material to any such services shall be decided by the Regional Manager whose decision shall be final and binding.
It was not the case whether any additional work was done and if so, the extent of such work.
In the aforesaid view of the matter it is not possible to hold that in view of nature of instant dispute, the matters at issue were not excluded and the arbitrator did not commit any wrong in proceeding with the arbitration.
It was next contended that an amount of Rs.15,23,657 has been granted for additional work over and above the payment of Rs.23,74,001 and this was disproportionately high and the award for this amount was per se bad.
It is well settled that when the parties choose their own arbitrator to be the judge in dispute between them, they cannot, when the award is good on the face of it, object to the decision either upon law or on facts.
Therefore, when arbitrator commits a mistake either in law or in fact in determining the matters referred to him, where such mistake does not appear on the face of the award and the documents appended to or incorporated so as to form part of it, the award will neither be remitted nor set aside.
The law on this point is well settled.
See in this connection the observations of this Court in Union of lndia vs Bungo Steel Furniture P. Ltd.; , and Allen Berry & Co. (P) Ltd. vs Union of India, 282.
It was, however, contended that the amount of the award was shockingly high that it shocked the conscience of the Court and the award must be set aside.
The fact that merely the award amount is quite high as commented by the High Court or that a large amount has been awarded, does not vitiate the award as such.
In the instant case the original award was for Rs.9,99,510.
Admittedly, additional work was done and payment for such work was determined at Rs.23,74,001 and claim for further additional work was made for Rs. 15,23,657.
One has to judge whether the amount of the award was so disproportionately high to make it per se bad in the facts and circumstances of a particular case.
It is clear from the facts that the arbitrator is a highly qualified person having several Indian and foreign Degrees and at the relevant time was acting as Chief Engineer in charge of the State Government.
Having regard to the nature of claims involved and the fact that the additional work has been done for which large amounts have been paid and in this case it is evident that all due opportunities were given to the parties to adduce all evidence, we are unable to accept the submission that the award was so disproportionate as to shock the conscience of the Court and, as such, it cannot be held that the award was bad per se.
In our opinion, the High Court was right in dismissing the challenge to the award on this ground.
In support of the submission that the award must be held to be bad in this case, Mr. Mehta drew our attention to certain observations of Orissa High Court in State of Orissa & Ors.
vs Gangaram Chhapolia & Anr., , where at page 279 the learned Judge observed the malady of the racket of arbitration was rampant in Orissa.
Though the learned Judge was apparently heeding to the observations of Justice Holmes of America observed that the Court should take note of "the felt necessities of the time".
In our opinion, the evidence of such state of affairs should make this Court scrutinise the award carefully in each particular case but that does not make the Court declare that all high amounts of award would be bad per se.
As mentioned hereinbefore, it cannot be said that the amount of award was disproportionately high to hurt the conscience of the Court in this case.
It is now well settled that the interest pendente lite is not a matter within the jurisdiction of the arbitrator.
In this connection reference may be made to the observations of this Court in Executive Engineer (Irrigation), Balimela & Ors., vs Abhaduta Jena & Ors., [1988] 1 SCC 418 where this Court held that the arbitrator could not 573 grant interest pendente lite.
In the aforesaid view of the matter this A direction in the award for the payment of such interest must be deleted from the award.
The order of the High Court is modified to the extent that the award is confirmed subject to deletion of the interest pendente lite.
We make it clear that in the facts of this case interest for the period from 26.9.81 to 18.3.83, the date of the award be deleted.
The High Court has, however, granted interest from the date of the decree.
That is sustained.
The appeal is, therefore, dismissed except to the extent indicated above.
In the facts and circumstances of the case the parties will pay and bear their own costs.
G.N. Appeal dismissed.
| The respondent landlord had filed a petition against the appellant tenant under section 14(1)(a) and 14(1)(b) of the Delhi Rent Control Act, 1958 for eviction from a residential cum commercial premises, inter alia, on the ground that the appellant had sublet, assigned or otherwise parted with possession of the premises to his sons who were running their partnership business in the name of Bindra Tent House with which the tenant had no concern.
The tenant contested the petition on the ground that he was in exclusive possession of the premises and was carrying on his business therein with the help of his sons who were members of his Joint Hindu Family.
In support of his plea that the tenant had parted with possession, the landlord had produced documentary evidence which included copy of a statement made by the tenant before the Income Tax officer, which indicated that the tenant had sold his proprietary business to his sons.
The Additional Rent Controller held that there was no subletting by the tenant, but he had unlawfully parted with the possession of the premises in favour of his sons and as such was liable to be evicted.
During the pendency of the appeal the tenant sought permission under order 6 Rule 17 of the Code of Civil Procedure to amend his written statement to state that the property was taken on rent by M/s Bindra Tent House.
The Tribunal did not permit this belated amendment as this would have introduced an entirely new case.
On merits, the Tribunal dismissed the appeal of the tenant.
The High Court did not find any substantial question of law in the tenant 's second appeal and dismissed the same.
Allowing the appeal, it was, 326 ^ HELD: (1) The only ground perhaps upon which the landlord A was seeking eviction was parting with possession.
It is well settled that parting with possession meant giving possession to persons other than those to whom possession had been given by the lease and the parting with possession must have been by the tenant.
User by other person is not parting with possession so long as the tenant retains the legal possession himself, or in other words, there must be vesting of possession by the tenant in another person by divesting himself not only of physical possession but also of the right of possession.
So long as the tenant retains the right to possession there is no parting with possession in terms of clause (b) of section 14(1) of the Act.
[329G H; 330A] (2) Even though the father had retired from business and the sons had been looking after the business in the facts of this case, it cannot be said that the father had divested himself of the legal right to be in possession.
[330B] (3) In the instant case, if the father was carrying on the business with his sons and the family was a joint family, it is difficult to presume that the father had parted with possession legally to attract the mischief of section 14(1)(b) of the Act.
[330D E] (4) In these days of acute shortage of accommodation both for living and for vocation, one has to take the reality with a pinch of salt and the manner in which the original tenant has conducted himself in shifting his defence would not disentitle him to the benefit of the law.
[330Gl Subashini Mojumdar vs Krishna Prasad Mahatoo, A.I.R. ; M/s Modi Spinning and Weaving Mills Co. Ltd. vs M/s Ladha Ram and Co., ; and Smt.
Krishnawati vs Shri Hans Rai, , referred to.
|
Civil Appeal No. 1487 of 1984.
Appeal by Special leave from the Judgment and Order dated the 21st August, 1981 of the Allahabad High Court in Civil Misc, Writ Petition No. 9820 of 1981 Harbans Singh for the appellant.
Abdul Kader and G.S. Narayanan for the Respondent.
The Judgment of the Court was delivered by BHAGWATI, J.
This is an appeal by Special Leave directed against an order of the High Court of Allahabad dismissing a writ petition filed by the appellants claiming refund of a sum of Rs. 22681.88 from the Levy Sugar Price Equalisation Fund under Section 6, sub section (1) of the (hereinafter referred to as the Equalisation Fund Act).
The facts of the case are few and may be briefly stated as follows: The appellants carry on business of manufacture of syrups, squashes, jams and jellies, preservation of vegetables and other food products.
One of the essential raw materials for these products manufactured by the appellants is sugar.
There was at the material time Sugar Control Order 1966 issued under section 3 of the , clause 4 of which provided that no purchaser shall sell or agree to sell or otherwise dispose of sugar or deliver or agree to deliver sugar or remove any sugar from the bonded godown of the factory in which it is stored, except under and in 209 accordance with the directions issued in writing by the Central Government or the Chief Director.
Pursuant to this Order the Central Government introduced the policy of partial decontrol of sugar in August, 1967 and under this policy, the Central Government adopted a scheme of acquiring levy sugar from the factory.
The price of levy sugar acquired by the Central Govt.
was fixed every year in accordance with the principles set out in Section 3 (3c) of the and during the period in question the price of levy sugar was determined under the sugar (Price Determination) Order 1972.
This order was however challenged by factories manufacturing sugar and an interim order was passed by the High Court of Allahabad permitting them to charge a price higher than that fixed under the order, on condition that they furnished bank guarantee for the difference in price in favour of the Registrar of the High Court.
Now, different prices were fixed under the sugar (Price Determination) order, 1972 for different zones and so far as the East U.P. Zone was concerned, the price fixed was Rs. 175 per quintal exclusive of excise duty, sales tax etc.
with the result that the price inclusive of these taxes and duties amounted to Rs. 190 per quintal.
The appellants purchased from K.M. Sugar Mills Limited, Motinagar, Faizabad a certain quantity of sugar under a release order issued by the Central Government under the Levy Sugar Supply (Control) order 1972 and they lifted an aggregate quantity of 400 quintals of sugar on 12 8 1972 and 16 8 1972.
Now, under the sugar (Price Determination) order, 1972 K.M. Sugar Mills Limited were not entitled to recover from the appellants price at a rate exceeding Rs. 190 per quintal but by virtue of the stay order granted by the High Court of Allahabad they recovered from the appellants price at the rate of Rs. 234.89 per quintal and the total excess amount charged by K.M. Sugar Mills Limited from the appellants thus came to Rs 22681.88 for which bank guarantee was given by K.M. Sugar Mills Limited in favour of the Registrar of the High Court.
The writ petition filed by K.M. Sugar Mills Limited against the Sugar (Price Determination) Order, 1972 along with other similar writ petitions filed by other manufacturers of sugar was however, ultimately dismissed by the Allahbad High Court in November, 1974 with the result that the Registrar of the High Court became entitled to encash the bank guarantee given by K.M. Sugar Mills Limited and a sun of Rs. 22,681.88 was accordingly recovered by the Registrar under the bank guarantee.
Since the excess amount recovered by the various manufactu 210 rers of sugar, including K.M. Sugar Mills Limited really belonged to the consumers to whom sugar had been sold by these manufacturers, Parliament enacted with effect from 1 4 1976 for the purpose of ensuring that the excess amount so recovered should not remain in the hands of manufacturers of sugar so as to unjustly enrich them but should be paid to the consumers of sugar from whom it had been unlawfully recovered by the manufacturers.
Section 3(1) of the Equalisation Fund Act established a Fund known as the Levy Sugar Price Equlisation Fund.
Sub Section (2) of Section 3 provided that there shall be credited to the Fund amounts representing all excess realisations made by the manufacturers, irrespective of whether such realisations were made before or after the commencement of the Equalisation Fund Act.
Pursuant to this provision, the Registrar of the High Court deposited a sum of Rs. 22681.88 to the Credit of the Fund.
Section 6 of the Equalisation Fund Act then proceeded to enact that where any amount of excess realisation is credited to the Fund, the buyer of Levy sugar from whom such excess realisation was made by the manufacturer shall be entitled to the refund of such excess realisation from the Fund.
This Section is material for the purpose of determination of the controversy arising in the present appeal and we would, therefore, reproduce it as follows: (1) Where any amount is credited to the Fund a refund shall be made from the Fund to the buyer of Levy Sugar from whom any excess realisation was made by the producer or dealer, Provided that no buyer shall be entitled to claim as refund under this sub section if he (a) being the wholesale dealer, had passed on the incidence of such excess over the controlled or fair price of levy sugar to the retail dealer by whom the price of such sugar was paid or (b) being a retail dealer, had passed on the incidence of such excess over the controlled or fair price of levy sugar to the consumer by whom the price of such sugar was paid.
" Since a sum of Rs. 22681.88 represented excess realisation 211 made by K.M. Sugar Mills Limited from the appellants and this amount was credited to the Fund by the Registrar of the High Court, the appellants filed an application in form IV making a claim for refund of this amount from the Fund.
This application was filed by the appellants, on 30th April, 1979, admittedly within the prescribed period of six months.
The Central Government, however, rejected the claim made by the appellants on the ground that they had not been able to establish fully and clearly that the incidence of higher sugar price was not passed on by them to the consumers of the end products.
The appellants thereupon preferred a Writ Petition in the High Court but the High Court also rejected the Writ Petition on the same ground, namely, that according to the finding recorded by the Central Government the appellants had not been able to establish fully and clearly that the incidence of higher sugar price was not passed on to the consumers of the end products and since this was a finding of fact base on evaluation of the material and evidence produced by the appellants before the competent authority, the High Court would not be justified in interfering with the order of the Central Government.
The appellants thereupon preferred the present appeal with special leave obtained from this Court.
The main point of controversy between the parties centres round the true interpretation of section 6 Sub section (1) of the Equalisation Fund Act.
This provision lays down as a condition precedent to its applicability that the excess realisation made by the manufacturer of sugar should have been credited to the Fund.
Now, the application made by the appellants in from IV stated in so many terms that the amount in question had been deposited by the Registrar of the High Court in terms of the Levy Sugar Price Equalisation Fund Rules, 1972, through the Chief Pay & Accounts Officer, Govt.
Of India, Ministry of Agriculture & Irrigation, Department of Food, New Delhi.
This statement was not at any time disputed on behalf of the Central Government either in the order made by the Central Government rejecting the claim of the appellants or in the proceedings before the High Court.
It is indisputable that a sum of Rs. 22681.88 representing the excess realisation made from the appellants by K.M. Sugar Mills Limited was credited to the Fund by the Registrar of the High Court.
And in any event, this must be 212 presumed to have been done because the Equalisation Fund Act having been enacted for this purpose, the Registrar of the High Court would naturally be expected to carry out his obligation under the statute by depositing the amount of excess realisation recovered by him under the bank guarantee given by K.M. Sugar Mills Limited.
There can, therefore, be no doubt that in terms of Section 6, Sub section (1) the appellants were entitled to claim refund of the sum of Rs. 22681.88 from the Fund.
The only question is whether the proviso to section 6, Sub section (1) precluded the appellants from claiming refund of that amount.
The proviso on its plain terms applied only where the party claiming refund of the amount of excess realisation is a wholesale or a retail dealer who has passed on the incidence of the excess over the controlled price of levy sugar to the retail dealer or to the consumer, as the case may be.
The proviso obviously cannot apply to a case where a claim for refund has been made by a consumer of sugar from whom excess realisation has been made by the manufacturer of sugar.
The appellants were admittedly consumers of sugar and not dealers in sugar and since they were not dealers in sugar, there could be no question of any incidence of excess being passed by them to the retail dealer or to the consumer.
The learned counsel appearing on behalf of the respondent contended that the excess over the controlled or fair price of levy sugar must have been passed on by the appellants to the consumer when they sold the manufactured products to them, because the higher price paid by them for the sugar purchased from K.M. Sugar Mills Limited must have been taken into account by them in fixing the price of the manufactured products.
This may be so or may not be so.
It is not necessary for us to examine this question because it is irrelevant on the terms of the proviso to Section 6, Sub section (1).
That proviso deals with a situation where a wholesale or retail dealer passes on the incidence of excess over the controlled or fair price of levy sugar to a retail dealer or consumer, who purchases such sugar.
It contemplates a case where a dealer whether whole sale or retail sells sugar to a retail dealer or consumer as the case may be and not where a person sells a manufactured product containing sugar as one of its ingredients, we have, therefore, no doubt that the proviso to Section 6, Sub section (1) was not attracted in the case of the appellants and, consequently, the appellants were entitled to claim refund of the sum of the Rs. 22681.88 from the sum of Fund.
213 We accordingly allow the appeal, set aside the judgment of the High Court and issue a Writ directing the respondent to pay to the appellants a sum of Rs. 22681.88 together with interest thereon at the rate of 6 per cent per annum from today until payment.
The respondent will pay the costs of the appeal to the appellants.
H.S.K. Appeal allowed.
| The two petitioners in the Special Leave Petition were committed to the civil jail for a period of one month by Single Judge of the High Court under the , as they had acted in breach of an undertaking given by them in a suit pending in the High Court.
The appeal preferred by the petitioners under Section 19(1) of the Act to a Division Bench was dismissed.
In the Special Leave Petition it was contended on behalf of the petitioners that : though the petition had been filed under Article 136 the petitioners have, in law, an appeal as of right under Section 19(1), and (2) the Single Judge was not justified in giving directions in addition to punishing the petitioners for contempt of court.
Dismissing the Special Leave Petition, ^ HELD:1.
If the order of committal for contempt of court is made by a Single Judge of the High Court, there is one statutory right of appeal to a Division Bench of not less than two Judges.
If the order of committal of contempt of court is made by a Bench, an appeal lies as of right to the Supreme Court.
Where an appeal is filed against the order of the Single Judge to a Division Bench, the statutory right of appeal gets exhausted and there is no further right of appeal to the Supreme Court.[600B.C] 2.
As there was a clear breach of the undertaking given by the petitioners, the Single Judge was quite right in giving appropriate directions to close the breach.
[600E]
|
minal Appeal No. 248 of 1964.
87 Appeal from the judgment and order dated September 16, 1964 of the Allahabad High Court in Criminal Appeal No. 348 of 1964 and capital sentence No. 26 of 1964.
P.C. Khanna, for the appellant.
O.P. Rana, for the respondent.
The Judgment of the Court was delivered by Subba Rao, J.
Sahoo, the appellant, is a resident of Pachperwa in the District of Gonda.
He has two sons, Badri and Kirpa Shanker.
He lost his wife years ago.
His eldest son, Badri, married one Sunderpatti.
Badri was employed in Lucknow, and his wife was residing with his father.
It is said that Sunderpatti developed illicit intimacy with Sahoo; but there were incessant quarrels between them.
On August 12, 1963, during one of those quarrels,Sunderpatti ran away to the house of one Mohammed Abdullah ,a neighbour of theirs.
The appellant brought her buck, and after some wordy altercation between them they slept in the only room of their house.
The only other inmate of the house was the appellant 's second son, Kirpa Shanker, a lad of about 8 years.
On the morning of August 13, 1963, Sunderpatti was found with serious injuries in the room of the house where she was sleeping and the appellant was not in the house.
Sunderpatti was admitted in the Sadar Hospital Gonda, at 5.25 p.m. on that day and she died on August 26, 1963 at 3 p.m. Sahoo was sent up for trial before the Court of Sessions, Gonda, on a charge under section 302 of the Indian Penal Code.
The learned Sessions Judge, on a consideration of the entire evidence came to the conclusion that Sahoo killed Sunderpatti.
On that finding, he convicted the accused under section 302 of the Indian Penal Code and sentenced him to death.
On appeal, a Division Bench of the High Court at Allahabad confirmed both the conviction and the sentence.
Hence the appeal.
Except for an extra judicial confession, the entire evidence in the case is circumstantial.
Before we advert to the arguments advanced in the appeal it will be convenient to narrate the circumstances found by the High Court, which are as follows: (1) The accused had illicit connections with the deceased; (2) the deceased and the accused had some quarrel on the Janmashtami day in the evening and the deceased had to be persuaded through the influence of their neighbors, Mohammed Abdullah and his womenfolk, to go back to the house of the accused; (3) the deceased was seen in the company of the accused for the fast time when she was alive; (4) during the fateful night 3 persons, namely.
the accused.
the deceased and the accused 's second son, Kirpa Shanker (P.W. 17), slept in the room inside the house; (5) on the early morning of next day, P.W. 17 was asked by his father to go out to attend to calls of nature, and when he came back to the verandah of the house he heard some gurgling sound and he saw his father going out of the house murmuring something; and (6) P. Ws. 9, 11, 13 88 and 15 saw the accused going out of the house at about 6 a.m. on that day soliloquying that he had finished Sunderpatti and thereby finished the daily quarrels.
This Court in a series of decisions has reaffirmed the following well settled rule of "circumstantial evidence".
The circumstances from which the conclusion of guilt is to be drawn should be in the first instance fully established.
"All the facts so established should be consistent only with the hypothesis of the guilt of the accused and the circumstances should be of a conclusive nature and tendency that they should be such as to exclude other hypotheses but the one proposed to be proved.
" Before we consider whether the circumstances narrated above would stand the said rigorous test, we will at the outset deal with the contention that the soliloquy of the accused admitting his guilt was not an extra judicial confession as the Courts below held it to be.
If it was an extra judicial confession, it would really partake the character of direct evidence rather than that of circumstantial evidence.
It is argued that it is implicit in the concept of confession, whether it is extra judicial or judicial, that it shall be communicated to another.
It is said that one cannot confess to himself: he can only confess to another.
This raises an interesting point, which fails to be decided on a consideration of the relevant provisions of the Evidence Act.
Sections 24 to 30 of the Evidence Act deal with the admissibility of confessions by accused persons in criminal cases.
But the expression "confession" is not defined.
The Judicial Committee in Pakala Narayana vs R.(1) has defined the said expression thus: "A confession is a statement made by an accused ' which must either admit in terms the offence.
or at any rate substantially all the facts which constitute the offence.
" A scrutiny of the provisions of sections 17 to 30 of the Evidence Act discloses, as one learned author puts it, that statement is a genus.
admission is the species and confession is the sub species.
Shortly stated, a confession is a statement made by an accused admitting his guilt.
What does the expression "statement" mean? The dictionary meaning of the word "statement" is "the act of stating, reciting or presenting verbally or on paper." The term "statement" therefore, includes both oral and written statements.
Is it also a necessary ingredient of the term that it shall be communicated to another? The dictionary meaning of the term does not warrant any such extension; nor the reason of the rule underlying the doctrine of admission or confession demands it.
Admissions and confessions are exceptions to the hearsay rule.
The Evidence Act places them in the category of relevant evidence, presumably on the ground that, as they are declarations against the interest of the person making them, they are probably true.
The probative value of 89 an admission or a confession does not depend upon its communication to another, though, just like any other piece of evidence, it can be admitted in evidence only on proof.
This proof in the case of oral admission or confession can be offered only by witnesses who heard the admission or confession, as the case may be.
The following illustration pertaining to a written confession brings out the said idea: A kills B; enters in his diary that he had killed him, puts it in his drawer and absconds.
When he places his act on record, he does not communicate to another; indeed, he does not have any intention of communicating it to a third party.
Even so, at the trial the said statement of the accused can certainly be proved as a confession made by him.
If that be so in the case of a statement in writing, there cannot be any difference in principle in the case of an oral statement.
Both must stand on the same footing.
This aspect of the doctrine of confession received some treatment from wellknown authors on evidence, like Taylor, Best and Phipson.
In "A Treatise on the Law of Evidence" by Taylor, 11th Edn., Vol.
I, the following statement appears at p. 596: "What the accused has been overheard muttering to himself, or saying to his wife or to any other person in confidence, will be receivable in evidence.
" In "The Principles of the Law of Evidence" by W.M. Best, 12th Edn., at p. 454, it is stated much to the same effect thus: "Words addressed to others, and writing, are no doubt the most usual forms; but words uttered in soliloquy seem equally receivable.
" We also find the following passage in "Phipson on Evidence", 7th Edn., at p. 262: "A statement which the prisoner had been overheard muttering to himself,f, if otherwise than in his sleep, is admissible against him, if independently proved." These passages establish that communication to another is not a necessary ingredient of the concept of "confession".
In this context a decision of this Court in Bhogilal Chunilal Pandya v The State of Bombay(1) may usefully be referred to.
There the question was whether a former statement made by a witness within the meaning of $. 157 of the Evidence Act should have been communicated to another before it could be used to corroborate the testimony of another witness.
This Court, after considering the relevant provisions of the Evidence Act and the case law on the subject came to the conclusion that the word "statement" used in section 157 meant only "something that is stated" and the element of communication was not necessary before "something that is stated" became a statement under that section.
If, as we have said, statement is the genus and confession is only a sub species of that genus, we do not see any reason why the statement implied in the confession should be given (1) [1959] Supp. 1 S.C.R. 310. 90 a different meaning.
We, therefore, hold that a statement, whether communicated or not, admitting guilt is a confession of guilt.
But, there is a clear distinction between the admissibility of an evidence and the weight to be attached to it.
A confessional soliloquy is a direct piece of evidence.
It may be an expression of conflict of emotion; a conscious effort to stifle the pricked conscience; an argument to find excuse or justification for his act; or a penitent or remorseful act of exaggeration of his part in the crime.
The tone may be soft and low; the words may be confused; they may be capable of conflicting interpretations depending on witnesses, whether they are biased or honest, intelligent or ignorant, imaginative or prosaic, as the case may be.
Generally they are mutterings of a confused mind.
Before such evidence can be accepted, it must be established by cogent evidence what were the exact words used by the accused.
Even if so much was established, prudence and justice demand that such evidence cannot be made the sole ground of conviction.
It may be used only as a corroborative piece of evidence.
The circumstances found by the High Court, which we have stated earlier, lead to the only conclusion that the accused must have committed the murder.
No other reasonable hypothesis was or could be suggested.
Further, in this case, as we have noticed earlier, P.W.s 11, 13 and 15 deposed that they clearly heard the accused say when he opened the door of the house and came out at 60 'clock in the morning of the fateful day that he had "finished Sunderpatti, his daughter in law, and thereby finished the daily quarrels".
We hold that this extra judicial confession is relevant evidence: it certainly corroborates the circumstantial evidence adduced in the .case.
In the result, we agree with the conclusion arrived at by the High Court both in regard to the conviction and the sentence.
The appeal fails and is dismissed.
Appeal dismissed.
| The respondent who was assessed to agricultural income tax made an application to the Assessing Officer depositing compensation Bonds and prayed that the Bonds be accepted in payment of tax dues.
This was rejected stating that there was no rule for acceptance of these bonds.
Another attempt by the respondent was also turned down by the Collector.
Thereafter the respondent presented a writ petition in the High Court for directing them to accept the Bonds in lieu off the tax dues.
The High Court was of the opinion that the two officers completely ignored the provisions of section 6(d) of the Act and r. 8A, and directed the Collector to decide the respondent 's application in accordance with law.
In appeal by special leave: HELD: (i) Neither section 6(d) nor r. 8A provide that the Bonds must or can be accepted in payment of tax on agriculture income.
[133 E] Collector of Sultanpur vs Raja Jagdish Prasad Sahi. , referred to.
(ii) When the compensation payable to an intermediary has been paid in the form of cash or Bonds.
that compensation ceased to be payable.
The fact that the Bonds are negotiable does not make them legal tender and does not make it obligatory on anyone including Government to accept them in payment of any dues.
The only result of their being treated as negotiable instruments is that the owner of the Bonds can transfer them to any person who is agreeable to purchase them.
[134 D F]
|
Civil Appeal No. 2223 of 1987.
From the Judgment and order dated 21.8.1986 of the Andhra Pradesh High Court in C.R.P. No. 1518 of 1985.
A.K. Ganguli and A. Mariarputham for the Appellant.
G. Narasimhulu for the Respondent.
The Judgment of the Court was delivered by SEN, J.
This appeal by special leave brought from the judgment and order of the High Court of Andhra Pradesh dated August 21, 1986 raises a question of general importance.
The High Court has upheld the judgment of the Chief Judge, City Small Causes Court dated April 29, 1985 directing the eviction of the appellant from the demised premises under section 10(2)(vi) of the Andhra Pradesh Buildings (Lease, Rent 148 & Eviction) Control Act, 1960.
The question is whether the appellant was estopped from denying the title of the lessor under section 116 of the Evidence Act, 1872 despite the fact that there was threat of eviction by the owner of the demised premises one Krishnamurthy i.e. the person having title paramount.
There is no material point of fact which is now in dispute.
The demised premises which is a removable wooden cabin or kiosk located at one corner of a building belonging to one Krishnamurthy was let out on a rent of Rs. 6 per day which later was increased to Rs. 10, by the respondent P. Jagadish, son of the original tenant P.R.N. Upadhyaya on March 9, 1977.
Admittedly, the main premises i.e. the building was demised by Krishnamurthy to the said P.R.N. Upadhyaya in the year 1972 and in course of time he had sublet different portions of the premises to different persons.
By a notice dated November 8, 1980 the head lessor Krishnamurthy served a notice of eviction on the appellant and other sub tenants alleging that there was unlawful subletting by the lessee and that he had decided to terminate the tenancy of the tenant Upadhyaya with the expiry of that month i.e. by the end of December 1980.
Thereupon, the appellant on December 4, 1980 was constrained to attorn in favour of the original lessor Krishnamurthy agreeing to pay him a rent of Rs.300 per month.
Evidently, the appellant had paid rent to the respondent upto March 31, 1980.
After becoming a direct tenant under the head lessor Krishnamurthy, the appellant stopped paying rent to the respondent w.e.f. April 1, 1980.
On March 13, 1981 the respondent asserting to be the lessor commenced proceedings for eviction of the appellant from the demised premises under section 10(2)(i) and (vi) and 10(3)(b)(iii) of the Act i.e. On the ground that the appellant was in wilful default in payment of rent, that there was denial of title on his part and for his bona fide requirement.
The First Additional Rent Controller, Hyderabad by order dated November 3, 1982 disallowed the application on the ground that the respondent not being the lessor had no locus standi to initiate the proceedings for eviction.
On appeal, the Chief Judge, City Small Causes Court, Hyderabad by judgment dated April 29, 1985 reversed the order of the learned Rent Controller and directed the eviction of the appellant under section 10(2)(i) and (vi) holding that the premises in question was a building within section 2(iii) of the Act and that in view of the denial of his title as well as admitted non payment of rent, the appellant was estopped from denying the title.
That decision of his has been upheld by a learned Single Judge of the High Court by the judgment under appeal.
The judgment of the High Court mainly rests on the rule of estoppel.
149 The appeal must be allowed on the short ground that there being a threat of eviction by a person claiming title paramount i.e. head lessor Krishnamurthy, the appellant was not estopped under section 116 of the Evidence Act from challenging the title and his right to maintain the eviction proceedings of the respondent P. Jagadish as the lessor.
section 116 of the Evidence Act provides that no tenant of immovable property shall, during the continuance of the tenancy, be permitted to deny that the landlord of such tenant had, at the beginning of the tenancy, a title to such immovable property.
Possession and permission being established, estoppel would bind the tenant during the continuance of the tenancy and until he surrenders his possession.
The words "during the continuance of the tenancy" have been interpreted to mean during the continuance of the possession that was received under the tenancy in question, and the Courts have repeatedly laid down that estoppel operates even after the termination of the tenancy so that a tenant who had been let into possession, however, defective it may be, so long as he has not openly surrendered possession, cannot dispute the title of the landlord at the commencement of the tenancy.
The rule of estoppel is thus restricted not only in extent but also in time i.e. restricted to the title of the landlord and during the continuance of the tenancy; and by necessary implication, it follows that a tenant is not estopped, when he is under threat of eviction by the title paramount, from contending that the landlord had no title before the tenancy commenced or that the title of the landlord has since come to an end.
The rule of estoppel embodied under section 116 of the Evidence Act is that, a tenant who has been let into possession cannot deny his landlord 's title, however defective it may be, so long as he has not openly restored possession by surrender to his landlord.
During the continuance of the tenancy, the tenant cannot acquire by prescription a permanent right of occupancy in derogation of the landlord 's title by mere assertion of such a right to the knowledge of the landlord.
See: Bilas Kumar vs Desraj Ranjit Singh ILR (1915) 37 All 557 (PC) and Atyam Veerraju & Ors.
vs Pechetti Venkanna & ors., [19661 1 SCR 83 1.
The general rule is however subject to certain exceptions.
Thus a tenant is not precluded from denying the derivative title of the persons claiming through the landlord.
See: Kumar Krishna Prosad Lal Singha Deo vs Baraboni Coal Concern Limited & orS., Similarly, the estoppel under section 116 of the Evidence Act is restricted to the denial of the title at the commencement of the tenancy.
From this, the exception follows, that it is open to the tenant even without surrendering possession to show that since the date of the tenancy, the 150 title of the landlord came to an end or that he was evicted by a A paramount title holder or that even though there was no actual eviction or dispossession from the property, under a threat of eviction he had attorned to the paramount title holder.
In order to constitute eviction by title paramount, it has been established by decisions in England and in India, that it is not necessary that the tenant should be dispossessed or even that there should be a suit in ejectment against him.
It will be sufficient if there was threat of eviction and if the tenant as a result of such threat attorns to the real owner, he can set up such eviction by way of defence either to an action for rent or to a suit in ejecment.
If the tenant however gives up possession voluntarily to the title holder, he cannot claim the benefit of this rule.
When the tenancy has been determined by eviction by title paramount, no question of estoppel arises under section 116 of the Evidence Act.
See: Adyanath Chatak vs Krishna Prasad Singh & Anr., AIR (1949) PC 124.
The principle must equally apply when the tenant has attorned under a threat of eviction by the title paramount and there comes into existence a new jural relationship of landlord and tenant as between them.
The law is stated in 27 Halsbury 's Laws of England, 4th edn., para 238: "238.
Eviction under title paramount.
In order to constitute an eviction by a person claiming under title para mount, it is not necessary that the tenant should be put out of possession, or that proceedings should be brought.
A threat of eviction is sufficient, and if the tenant, in consequence of that threat, attorns to the claimant, he may set this up as an eviction by way of defence to an action for rent, subject to his proving the evictor 's title.
There is no eviction, however, if the tenant gives up possession voluntarily. " Quite recently, this Court in Mangat Ram & Anr.
vs Sardar Meharban Singh & ors.
, , to which one of us was a party, observed: "The estoppel contemplated by section 116 is restricted to the denial of title at the commencement of the tenancy and by implication it follows that a tenant is not estopped from contending that the title of the lessor has since come to an end.
See also: Fida Hussain vs Fazal Hussain & Ors., AIR (1963) MP 232, K.S.M. Guruswamy Nadar vs N.G. Ranganathan, AIR (1954) Mad.
151 402, S.A.A. Annamalai Chettiar vs Molaiyan & Ors., AIR (1970) Mad.
396 and Chidambara Vinayagar Devasthanam vs Duraiswamy, ILR In the premises, the High Court as well as the learned Chief Judge of the City Small Causes Court were clearly in error in allowing the proceedings brought by the respondent under section 10(2)(i) and (vi) of the Act by relying on the rule of estoppel embodied in section 116 of the Evidence Act.
The judgment of the High Court cannot be sustained for the reason that there is no finding that the dispute as to title was not bona fide in terms of section 10(2)(i) and further inasmuch as the appellant could not be treated to be in arrears of rent since he has been paying rent to the head lessor Krishnamurthy after the attornment of the tenancy to him.
The terms of section 10(2)(i) and (vi) of the Act are set out below: " 10.
Eviction of tenant (2) A landlord who seeks to evict his tenant shall apply to the Controller for a direction in that behalf.
If the Controller, after giving the tenant a reasonable opportunity of showing cause against the application, is satisfied (i) that the tenant has not paid or tendered the rent due by him in respect of the building 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, or (vi) that the tenant has denied the title of the landlord or claimed a right of permanent tenancy and that such denial or claim was not bona fide.
the Controller shall make an order directing the tenant to put the landlord in possession of the building and if the Controller is not so satisfied, he shall make an order rejecting the application.
" The High Court failed to appreciate that there could be no order of termination in terms of section 10(2)(i) unless it could be said that in the facts and circumstances of the case the dispute as to title was not bona fide.
It cannot be said having regard to the fact that the appellant was under threat of eviction by the title paramount, that the rule of estop 152 pel under section 116 of the Evidence Act applied and therefore he was not entitled to dispute the title of the respondent.
Furthermore, the appellant having on December 4, 1980 after being served with the notice of eviction attorned to the head lessor, there came into existence a direct tenancy.
It has been brought to our notice that the appellant has since that date been paying rent to his present lessor Krishnamurthy and is not in arrears of rent.
The order of eviction passed by the learned Chief Judge as well as the High Court against the appellant under section 10(2)(i) and (vi) of the Act is not sustainable in law.
In the result, the appeal succeeds and is allowed.
The proceedings for eviction of the appellant from the demised premises under section 10(2)(i) and (vi) and 10(3)(b)(iii) of the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960 are quashed.
No costs.
P.S.S. Appeal allowed.
| The Orissa Forest Produce (Control of Trade) Act, 1981 was enacted to prevent smuggling forest produce and also to provide State monopoly in such forest produce.
The State was empowered under section 1(3) of the Act, from time to time to issue a notification specifying the area or areas, the forest produce in relation to which and the date from which the Act shall come into force.
The State Government issued a notification dated December 9, 1982 directing that the Act shall come into force at once in the whole of the State of Orrisa in relation to sal seeds The petitioners were holders of long term license from the Government for collection of sal seeds from certain specified forest 315 divisions on payment of royalty.
Consequent upon the issue of the above notification, the Government refused to accept royalty from the petitioners in respect of certain forest divisions on the ground that the notification had the effect of rescinding the existing contracts between the Government and the petitioners.
The petitioners thereupon filed writ petitions before the High Court for a declaration that the above notification was void, and did not have the effect of rescinding their contracts in relation to sal seeds.
The High Court dismissed the writ petitions.
The Supreme Court, allowing the appeals of the petitioners, held that the Act and the notification issued thereunder did not apply to forest produce grown in Government forests and that it was not, therefore, open to the Government to treat the contract dated May 25,1979.
as rescinded.
On May 29, 1987, the Governor of Orissa promulgated orissa Forest Produce (Control of Trade) (Amendment and Validation) ordinance 1987 deeming it to have come into force with effect from September 5,1981, when the principal Act was notified in the Gazette, rendering the aforesaid decision ineffective.
The petitioners challenged the validity of this ordinance in this Court.
Dismissing the writ petitions, this Court, ^ HELD: 1.1.
The impugned ordinance is valid and cannot be challenged on any ground.
[327B] 1.2 The object to the Act was to prevent smuggling and to provide for State monopoly in the specified forest produce and not to provide State monopoly only to prevent smuggling.
The validity of the statutory notification cannot be judged merely on the basis of statement of objects and reasons accompanying the Bill.
Nor could it be tested by the Government policy from time to time.
[318B] The executive policy of the Government or the statement of objects and reasons of the Act or ordinances cannot control the words used in the legislation.
[323F] Central Bank of India vs Their Workmen, ; and State of West Bengal vs Union of India, [1964] 1 SCR 371 at p. 382, relied on.
316 1.3 It is open to the State to make laws for creating State monopolies either partially or complete in respect of any trade or business or industry or service.
The State may enter into trade like any other person either for administrative reasons or with the object of mitigating the evils in the trade, or even for the purpose of making profits in order to enrich the State exchequer.
The law relating to such trading activities must be presumed to be reasonable and in the interest of general public.
[324D E] Akadasi Padhan vs State of Orissa, [19631 2 Supp.
SCR 691, relied on.
1.4 The legislature may, at any time, in exercise of the plenary power conferred on it by Articles 245 and 246 of the Constitution render a judicial decision ineffective by enacting a valid law.
There is no prohibition against retrospective legislation.
The power of the legislature to pass a law postulates the power to pass it prospectively as well as retrospectively, subject, of course, to the legislative competence and other constitutional limitation.
[325E F] 1.5 The rendering ineffective of judgments or orders of competent Courts by changing their basis by legislative enactment is a wellknown pattern of all validating acts.
Such validating legislation which removes the cause of ineffectiveness or invalidity of action or proceedings cannot be considered as encroachment on judicial power.
The legislature, however, cannot by a bare declaration, without more, directly overrule, reverse or set aside any judicial decision.
[325F G] In the instant case, having regard to the then existing provisions of the Act, this Court declared that the Act and notification issued thereunder in relation to sal seeds did not apply to sal seeds grown in Government forests.
The Act has been suitably amended by the impugned ordinance by removing the cause of ineffectiveness pointed out by this Court.
The definition of "forest produce" under section 2(c) has been enlarged to include, among others, sal seeds, grown or found on Government lands or in Government forests.
Clause (a) of subsection (1) of section 5 has been substituted covering all contracts for the purchase, sale, gathering or collection of 'specified forest produce ' grown or found in the area specified in the notification issued under section 1(3) of the Act.
Such contracts shall stand rescinded when a notification under section 1(3) of the Act is issued.
Both these provisions shall be deemed to have come into force with effect from September 5, 1981, the date on which the Act had come into force.
[326A B, E F] 317 The notification dated December 9, 1982 has been validated under A section 5 of the ordinance notwithstanding any judgment, decree or order of any Court to the contrary.
It shall be deemed to have been issued in respect of sal seeds also grown or found in Government forests.
lt shall be valid and effectual as if it were issued under section 1(3) of the Act as amended by the ordinance.
This validation is more than sufficient to make it operative to cover the contracts of the petitioners.
It does not suffer from any infirmity.
[326H; 327A B] 1.6 It would be impermissible for the State to enter into such contracts in future.
The parties or Agents employed by the State cannot work for their own benefits.
They must work on behalf of the State.
[324F G ] Utkal Contractors & Joinery Pvt. Ltd. and Ors.
vs State of Orrisa & ors.
, AIR 1987 SC 1455 [1987] 3 SCC 279; Hari Singh & ors.
vs The Military Estate officer & Anr., [19731 1 SCR 515;Government of Andhra Pradesh & Anr.
vs Hindustan Tools Ltd., 119751 Supp.
SCR 394; V.N. Saxena vs State of M.P., ; and Misri Lal Jain Etc.
vs State of Orissa & Anr.
, ; , referred to.
|
Appeal No. 661 of 1963.
Appeal by special leave from the judgment and order dated August 17, 1959 of the Calcutta High Court in Civil Rule No. 274 of 1958.
N. C. Chatterjee and Sukumar Ghose, for the appellant.
Sarjoo Prasad and section C. Mazumdar, for the respondent.
delivered by Sikri J.
This appeal by special leave is directed against the judgment of the High Court of Calcutta in an application under section 115 of the Code of Civil Procedure and under article 227 of the Constitution filed by the tenant, Shri Surendra Nath Bibra, now appellant before us.
Stephen Court Limited, respondent before us, hereinafter referred to as the plaintiff, filed a suit in the Court of Small Causes, Calcutta, for the recovery of rent from September 1956 to November,1956, at the rate of Rs. 350/ per mensem, and interest, against the appellant, hereinafter referred to as the defendant, alleging that the defendant was a monthly tenant by virtue of a lease dated 459 April 30, 1956, under the plaintiff, in respect of flat No. 17 at promises No. 18A, Park Street, known as Stephen Court in the town of Calcutta, and that the defendant had not paid the rent from September to November, 1956.
The defendant, inter alia, Pleaded that relying on the representation and assurance of the plaintiff that three bed rooms, two bath rooms etc. would be available to the defendant in flat No. 17 he executed a lease on April 30, 1956, for a period of 21 years, but the plaintiff put him in possession only of two bed rooms and not three, and according to him, in the circumstances he was entitled to suspend the rent altogether.
The Small Cause Court Judge, Mr. Mandal, found that the defendant had not been put into possession of one of the three bed rooms.
Purporting to follow Katyayani Debi vs Udoy Kumar Das (1) and Abhoya Charan Sen vs Hem Chandra Pal (2) he held that the defendant was entitled to suspend payment of rent to the plaintiff.
The plaintiff then preferred an application under section 38 of the Presidency Small Cause Courts Act against the dismissal of its suit.
The Full Bench of the Small Causes Court, following Ram Lal Dutt Sarkar vs Dhirendra Nath.
Roy,(3) held that the plaintiff 's claim for arrears of rent must succeed in spite of the fact that the landlord had failed to give possession of one out of the three bed rooms of the demised premises.
The Bench, however, made it clear that the "non applicability of the principle of suspension of rent in the present suit for recovery of arrears of rent for a parti cular period will not necessarily debar the tenant from claiming other appropriate reliefs against the failure of the landlord to put him In possession of the entire demised premises by way of apportionment of rent or damages. ' Accordingly, it decreed the suit.
The defendant then filed an application under section 115, Civil Procedure Code, and article 227 of the Constitution.
In the application the defendant prayed that the suit be dismissed.
In the alternative, the defendant alleged that the plaintiff was at best entitled only to a proportionate rent.
The High Court dismissed the application and the defendant having obtained special leave, the matter is now before us.
Mr. N. C. Chatterjee, the learned counsel for the defendant,.
contends that the decision in Ram Lal Dutt 's (4) case which the High Court and the Full Bench of the Small Causes Court had followed was distinguishable because in that case the tenancy was.
an agricultural tenancy and the tenant in that case had raised the point after the lapse of a number of years.
He says that the doctrine of suspension of rent should be applied to the facts of this case because the plaintiff had deliberately not given possession (1) 30 C.W.N. (P.C.) 1 (2) (3) 70 I.A. 18.
460 of one bed room.
In the alternative he contends that the Fun Bench of the Small Causes Court and the High Court should have made an order for apportionment of rent.
We are unable to agree with Mr. Chatterjee that the decision of the Privy Council in Ram Lal Dutt 's (1) case can be distinguished on the ground urged by him.
It is no doubt true that the Privy Council was concerned with an agricultural tenancy but the Privy Council decided the appeal on a matter of principle, the principle being that the doctrine enunciated, in Neak vs Mackenzie (2 ) should not be regarded as a rule of justice, equity and good conscience in India in all circumstances.
It is interesting to note that the subject matter of the lease in Neak vs Mackenzie (2) was a dwelling house and land attached to it, and it was eight acres of the land which was attached to the house that the tenant had been kept out ,of possession.
Be that as it may, in our opinion, the doctrine laid down in Neale vs Mackengie (2) is too inflexible and cannot be applied to all cases.
As observed by Sir George Rankin, the ,doctrine cannot be justified as a dependable rule to be adhered to notwithstanding hard cases.
On the one hand it does not seem ,equitable that when a tenant enjoys a substantial portion of the property of the landlord, leased to him, without much inconvenience, he should not pay any compensation for the use of the property , in other words, to borrow the language of Sir George Ranking that he should enjoy a windfall.
On the other hand it is unfair that if a tenant is not given possession of a substantial portion of the property, he should be asked to pay any compensation for the use of the property while he is taking appropriate measures for specific performance of the contract.
It seems to us that it will depend on the circumstances of each case, whether a tenant would be entitled to suspend payment of the rent or whether he should be held liable to pay proportionate part of the rent.
On the facts of this case we are of the opinion that the tenant is not entitled to suspend the payment of rent but he must pay a proportionate part of the rent.
We may make it clear that like the Privy Council in Ram Lal Dutt 's (1) case we are not deciding that the doctrine of suspension ,of rent should or should not "be applied at all to cases of eviction ,of the lessee by the lessor from a part of the land, and if so, whether it is limited to rents reserved as a lump sum, and whether it is a rigid or discretionary rule these questions will call for careful review when they are presented by the facts of a particular case.
" In view of this we need not consider cases like Hakim Sardar Bahadur vs Parkash Singh (3); Jatindra Kumar Seal vs Raimohan Bai (4); and Nilkantha Pati vs Kshitish Chandra Satati.(5) (1) 70 I.A. 18.
(2) ; (3) A.I.R. (1962) Pun.
(4) A.I.R. [1961] An. 52.
(5) 1. 461 The High Court rejected the plea of apportionment of rent on the ground that the defendant had not taken a specific plea to this effect in the written statement.
The second ground given by the High Court was that it would be unreasonable to thrust a relief on the defendant unless he himself chooses one or more of the alternative reliefs available to him.
Further, no prayer was 3 made before the High Court to amend the written statement to include this relief.
In our opinion, the Full Bench of the Small Causes Court should have remanded the case for calculation of the proportionate rent for the portion of the premises taken possession of by the defendant.
In our view, the High Court has taken too technical a view.
It would be inequitable to allow the plaintiff to recover the full rent when he has not delivered possession of the whole of the premises in question.
Mr. Sarjoo Prasad, the learned counsel for the plaintiff, urges that the defendant had paid rent voluntarily for four months this fact also is relied on by the High Court and therefore we should not remand the case.
But we find that three months ' rent was paid in advance as security deposit, and hence there is no force in the contention.
Mr. Sarjoo Prasad finally contends that as this appeal arises from an application under section 115 of Civil Procedure Code and article 227 of the Constitution, we should not interfere with the decision of the Full Bench of the Small Causes Court even though it be erroneous.
A similar point was raised before the High Court and although the High Court found some substance in the point it chose to go into the merits of the case and not dismiss the application on this ground.
It must be remembered that the application was also under article 227 of the Constitution, and although ordinarily article 227 should be used sparingly, on the facts of this case we are satisfied that the High Court was right in not throwing out the application on this ground.
In the result the appeal succeeds.
We set aside the orders of the High Court and of the Full Bench of the Small Causes Court and of the Judge Small Causes Court, and remand the case to the Court of Small Causes, Calcutta, with ' the direction that it will dispose of the suit in the light of this judgment.
The parties would be at liberty to lead evidence before the Court of Small Causes on the question of apportionment of rent.
In the circumstances of the case there would be no order as to costs.
Appeal allowed.
| A dispute regarding amendment of rules relating to privilege leave etc.
arose between the Ahmedabad Millowners ' Association and the union of workmen employed in the textile industry.
After conceliation proceedings were declared by the Conciliator to have failed, the union referred the dispute to the Industrial Court under section 73A of the Bombay Industrial Relations Act, 1946.
The Industrial Court decided against the Millowners who filed a writ petition in the ' High Court and thereafter appealed to this Court.
It was urged on behalf of the appellants that (i) section 73A was violative of article 14 of the Constitution since it gave a right to the workers union to make a reference but not to the employer (ii) the Act had not been made applicable to the cotton industry at Ahmedabad under section 2(4) and it was not applicable under section 2(3) because the Bombay Industrial Disputes Act, 1938 was repugnant to Central) and must be deemed to have been repealed.
HELD:(i) Section 73A was not violative of article 14.
Whenever any industrial dispute arises the employer can always ensure arbitration of that dispute by making an offer to the union under section 66 of the Act whereupon a registered and approved union is compelled to agree to submission of the dispute to arbitration.
Clearly therefore there was no need to make any Provision empowering the employer to make a reference of the dispute for arbitration to the Industrial Court.
On the other hand if a Union wants a dispute to be settled and even offers that the dispute be submitted to arbitration under section 66 of the Act, the employer can refuse, whereupon the union would be left without any remedy.
It is obvious that section 73A was enacted to fill this gap and place the union on with the employer so as to enable the union to have any dispute = by arbitration even when the employer does not agree to arbitration.
This section, in these circumstances did not at all require that the right granted to the union should also be granted to the employer.
[441 G H] There was no difference in the procedure to be followed by the Industrial Court in a reference under section 73A and that to be followed when the reference is under section 66.
In both the procedure under section 92 had to be followed.
[443 E F] (ii)Chapter V of the Bombay Industrial Disputes Act 1938 was not repugnant to the Central Act of 1947 and therefore continued to be in force, and consequently under section 2(3) of the Bombay Industrial Relations Act 1947 the latter Act became applicable to the industry of the appellants and did not require a notification under section 2(4) to make it applicable [446 G H; 447 A B] 438 Ex Parte McLean, ; Victoria and Others vs The Commonwealth of Australia and Others, ; , Zaverbhai Amaidas vs The State of Bombay, [1955] 1 S.C.R. 799, Ch.
Tika Ramji & Ors.
vs The State of Uttar Pradesh & Ors., and Deep Chand vs The State of Uttar Pradesh and Others, [1959] Supp. 2 S.C.R. 8.
|
ivil Appeal No. 575 (NT) of 1975.
From the Judgment and Order dated the 24.4.1973 of the Calcutta High Court in Income Tax Reference No. 202 of 1969.
B. Ahuja and Ms. A. Subhashini for the Appellant.
K.P. Bhatnagar, S.P. Mittal and B.P. Maheshwari for the Respondent.
The Judgment of the Court was delivered by PATHAK, CJ.
This appeal by special leave is directed against the judgment of the High Court at Calcutta answering the following question in favour of the assessee and against the Revenue: "Whether, on the facts and in the circum stances of the case, the share of profit of the assessee 's wife was includable in the total income of the assessee under section 64(1)(iii) of the Income Tax Act, 1961?" 739 The assessee was assessed in the status of an individual for the assessement year 1962 63 corresponding to the previ ous year 26 March, 1961 to 13 April, 1962.
At the material time the assessee was a partner in a firm, Messrs Ramesh and Co., with a share of eight annas therein.
The balance was shared by three other partners, the assessee 's father, Kunjilal Agarwala, the assessee 's brother, Hariram Agarwala and a stranger, Jagdish Prasad.
On 10 November, 1960 and on 28 November, 1960 the assessee made two gifts of Rs.21,000 and Rs.30,000 respectively to his wife, Kaushalya Devi, from his account in the firm.
On 28 November, 1960 he made anoth er gift of Rs. 11,000 to his mother Chili Bai from that account.
It may be observed that Chili Bai received another gift of Rs.20,000 from her husband, Kunjilal, effected by similarly drawing from his account with the firm.
The assessee 's wife, Kaushalya Devi, as well as his mother Chili Bai became partners with three other persons in a newly constituted firm, Messrs Kunjilal Hariram & Co. The three other partners were the assessee 's grand father, Moharilal Agarwala, the assessee 's brother, Hariram Agarwala and the stranger, Jagdish Prasad Gup.
The Partnership Deed dated 10 November, 1960 provided that the business was to commence from 12 November, 1960.
The preamble to the deed stated: "Whereas the partner of the Fifth Part who has extensive experience and outstanding talent of organisation in Jagree and Grains Trade but little finance requested the partners of the First four Parts to enter into co partnership with him on contributing the necessary finance to carry on business in Jagree and Grains and also act as Commission Agents in Jagree Grains and allied commodities to which request they acceded." Clause 4 of the Partnership Deed stipulated: "That the partners of the First Four Parts shall initially contribute Rs.25,000 each to be put in within six months from the commence ment of the partnership.
The said contribu tions augmented by further deposits and prof its or depleted by withdrawals and tosses shall carry interest at the rate of 6% per annum.
The amount if any, standing to the credit of the partner of the Fifth Part shall carry interest at the same rate." 740 On 12 November, 1960 Kaushalya Devi contributed Rs.21,000 as capital, which came out of the gift made by the assessee on 10 November, 1960.
She also contributed Rs.30,000 as capital, which amount came out of the gift made on 28 November, 1960.
In the course of assessment proceedings for the assess ment year 1962 63 in respect of the assessee the Income Tax Officer included the profits of the assessee 's wife from the firm, Messrs. Kunjilal Hariram & Co., under section 64(1)(iii) of the Income Tax Act, 1961.
An appeal by the assessee was dismissed by the Appellate Assistant Commissioner of Income Tax, who observed that the wife would not have become a partner of the firm unless she had contributed capital, and as the capital was provided by the husband the inclusion of the wife 's share of income in the assessment of the assessee was justified.
In second appeal, it was conceded by the assessee before the Income Tax Appellate Tribunal that the interest received by the assessee 's wife on her capital contribution to the firm was includible in the total income of the assessee, but it was contended that the balance of the share of profit was not so includable as the assessee 's wife had become a part ner in the firm in her own right, and it was immaterial that the capital invested by her had been provided as a gift by the assessee.
The Appellate Tribunal found that the admis sion of the assessee 's wife as partner in the firm was solely on account of her contribution of capital to the firm, that the assets in the form of cash were transferred directly by the assessee to his wife otherwise than for adequate consideration, and that the income must be said to have arisen indirectly from the assets transferred.
The second appeal was dismissed.
At the instance of the assessee the question of law set forth earlier was referred to the High Court at Calcutta for its opinion.
The High Court has taken the view that the share of profits arose to the assessee 's wife primarily because the partnership made a profit and although it had connection with the gift it did not arise as a result of the gift, that the income arose from the share of profits only because the other partners agreed to take the assessee 's wife as partner and was allowed to contribute to the partnership firm, that the admission of the assessee 's wife to the partnership was not in consequence of the gift, and that, therefore, upon all those circumstances, the connection between the income of the share of profits and the gifts by the assessee to his wife was too remote to be included within the provisions of section 64(1)(iii) of the Income Tax Act.
741 S.64(1)(iii) of the Income Tax Act, 1961, as it stood at the relevant time, provides: "64(1) In computing the total income of any individual, there shall be included all such income as arises directly or indirectly (i) xx xx xx (ii) xx xx xx (iii) subject to the provisions of cl.
(i) of section 27, to the spouse of such individual from assets transferred directly or indirectly to the spouse by such individual otherwise than for adequate consideration or in connec tion with an agreement to live apart.
" The income may arise directly or indirectly, but there must be a proximate connection between the accrual of the income and the assets transferred by the assessee.
In Commissioner of Income tax, West Bengal 111 vs Prem Bhai Parekh and Others, this Court held that the income of minor sons, who had invested capital in the firm out of moneys gifted to them by their father (the assessee) could not be included in the assessment of the assessee.
The Court observed: "Before any income of a minor child can be brought within the scope of section 16(3)(a) (iv), it must be established that the said income arose directly or indirectly from assets transferred directly or indirectly by his father.
There is no dispute that the assessee had transferred to each of his minor sons, a sum of Rs.75,000.
It may also be that the amount contributed by those minors as their share in the firm came from those amounts.
But the question still remains wheth er it can be said that the income with which we are concerned in this case arises directly or indirectly from the assets transferred by the assessee to those minors.
The connection between the gifts mentioned earlier and the income in question is a remote one.
The income of the minors arose as a result of their admission to the benefits of the partnership.
It is true that they were admitted to the 742 benefits of the partnership because of the contribution made by them.
But there is no nexus between the transfer of the assets and the income in question.
It cannot be said that income arose directly or indirectly from the transferor the assets referred to earlier.
Section 16(3) of the Act created an artificial income.
That section must receive strict construction as observed by this court in Commissioner of Income tax vs Keshavlal Lal lubhai Patel, In our judgment before an income can be held to come within the ambit of section 16(3), it must be proved to have arisen directly or indirectly from a transfer of assets made by the assessee in favour of his wife or minor children.
The connection between the transfer of assets and the income must be proximate.
The income in question must arise as a result of the transfer and not in some manner con nected with it.
" It seems to us that the observations of this Court in that case fully cover the case before us.
There is no doubt that the wife became a partner because of the capital contributed by her in the firm, but, as observed by the High Court, in the judgment under appeal, it was upon agreement by the remaining partners that she became a member of the partner ship.
The mere contribution of the capital by the wife into the firm would not automatically have entitled her to part nership in the firm.
The partnership was based on agreement, and it is the event of agreement between the partners that brought the assessee 's wife into the firm as partner.
Learned counsel for the Revenue relies on Commissioner of Income tax, Bangalore vs J.H. Gotla, ; Commissioner of Income tax, Assam Tripurn and Manipur vs Jwalaprasad Agarwala, ; V.D. Dhanwatey vs Commissioner of Income tax, Madhya Pradesh, Nagpur and Bhandara, and Smt.
Mohini Thapar vs Com missioner of ' Income tax (Central), Calcutta, and Others, but we are not satisfied that those cases are of assistance to the Revenue.
Reliance was placed on Potti Veerayya Sresty vs Commissioner of Income Tax, A.P., where the Andhra Pradesh High Court upheld the inclusion of the wife 's income from cloth business carried on by her, into which cloth business she had invest ed a portion of the assets transferred by the assessee.
It is sufficient to observe that the cloth business was her own business and, as the High Court pointed out, there was no necessity to depend upon the agreement of others.
It is on that basis that the High Court distinguished Prem Bhai Parekh 's case (supra).
743 We are of the view that the High Court is right in answering.
the . question referred to it in the negative, in favour of the assessee and against the Revenue.
In the result the appeal fails and is dismissed with costs.
R.S.S. Appeal dismissed.
| Accused Nos. 1 to 6, constituting an unlawful assembly the common intention of which Was to kill Baharan Mian, came to his house armed with deadly weapons.
Baharan Mian, appre hending trouble, ran inside Co arm himself but his wife prevented him from coming out again.
At that time, Baharan Mian 's two infant daughters, Sahana Khatoon aged about seven years and Chand Tara aged about seven months, were playing in the 'dalan ' of his house.
Failing in their object to kill Baharan Mlan, accused No. 1 gave farsa blows on the head, abdomen and left thumb of Sahana Khatoon causing serious injuries, and accused No. 2 gave one farsa blow on the head of infant Chand Tara.
As a result of these injuries, Sahana Khatoon died the same day while Chand Tara died after 28 days.
Accused Nos.1 and 2 were charged under sections 302, 452 and 148 I.P.C., whereas accused Nos.
3 to 6 were sought to be held vicariously liable under section 302/149 I.P.C. Accused Nos. 3 and 4 were further charged under sections 447 and 148, I.P.C. and accused Nos. 5 & 6 were charged under sections 447 and 147, I.P.C. The Trial Court convicted accused Nos. 1 and 2 on all the three counts and awarded the sentence of death to both of them for the commission of the offence punishable under section 302, I.P.C. Accused Nos. 3 and 4 were convicted under sections 302/149, 447 and 148, I.P.C. and for the offence under section 302/149, each of them was directed to suffer imprison 499 ment for life.
Accused Nos. 5 and 6 were convicted under sections 302/149, 447 and 147, I.P.C.
For the offence under sections 302/149, I.P.C., they were sentenced to undergo imprisonment for life.
The High Court dismissed the appeal of accused Nos. 1 and 2 and, while accepting the reference, confirmed the sentence of death awarded to them for the murder of the two infant girls.
The conviction of the remaining four accused under section 302/149 was, however, altered to sections 326/149 and the sentence of imprisonment for life given to each of them was substituted by a sentence of rigorous imprisonment for seven years.
Their convictions and sen tences on the other counts were, however, maintained: Before this Court it was contended on behalf of the appellants that (1) the evidence adduced by the prosecution was not reliable; (2) Even on the facts found proved by the courts below, accused Nos.
1 to 6 could not be held guilty of murder with the aid of section 149, I.P.C. as the kill ings of the two girls was outside the common object of the unlawful assembly; (3) the facts of the case did not warrant a death penalty in the case of accused Nos. 1 and 2, more so because the procedural requirement of section 235(2) of the Cr.
P.C. was not followed in letter and spirit; and (4) section 302, I.P.C., and section 354(3), Cr.
P.C., insofar as they permit the imposition of the death penalty were viola tive of Articles 14, 19 and 21 of the Constitution of India.
While partly allowing the appeals by converting the sentence of death in the case of accused nos.
1 and 2 to imprisonment for life under section 302, I.P.C., and setting aside the conviction of accused nos.
3 to 6 under section 326/149 I.P.C., the Court, HELD: (1) There is no substance in the contention that the prosecution evidence is unreliable and should not be acted upon for confirming the conviction of the accused persons.
[508B C] (2) If the prosecution did not examine some persons who were admittedly present at the scene of occurrence, on learning that they were won over, it cannot be said that the prosecution was unfair to the accused persons.
The non examination of these persons cannot affect the probative value of the evidence of other prosecution witnesses.
[508F] (3) Section 149.
I.P.C., creates a. specific offence.
Since this section imposes a constructive penal liability, it must be strictly construed.
[509G] 500 (4) It is not the intention of the legislature in enact ing section 149 to render every member of an unlawful assem bly liable to punishment for every offence committed by one or more of its members.
In order to invoke section 149 it must be shown that the incriminating act was done to accom plish the common object of the unlawful assembly.
Even if an act incidental to the common object is committed to accom plish the common object of the unlawful assembly, it must be within the knowledge of other members as one likely to be committed in prosecution of the common object.
If the mem bers of the assembly knew or were aware of the likelihood of a particular offence being committed in.
prosecution of the common object they would be liable for the same under sec tion 149.
I.P.C. [510F H] (5) What is important in each case is to find out if the offence was committed to accomplish the common object of the assembly or was one which the members knew to be likely to be committed.
There must be a nexus between the common object and the offence committed, and if it is found that the same was committed to accomplish the common object, every member of the assembly will become liable for the same.
[509H; 510A B] (6) In the instant case, the common object of the unlaw ful assembly, as alleged in the charge, was to kill Baharan Mian.
When accused Nos. 1 and 2 realised that Baharan Mian was beyond their reach.
frustrated at their failure to accomplish their mission, wielded their weapons on the innocent girls, which was no part of the common object of the unlawful assembly.
For accomplishing their common object it was not necessary to kill the two girls who were not a hinderance to accused Nos. 1 and 2 accomplishing their common object.
Accused Nos.
3 to 6 cannot, therefore, be convicted for the injuries caused to the two minor girls by accused Nos. 1 and 2, with the aid of section 149.
[511A B] (7) Section 302, I.P.C, casts a heavy duty on the Court to choose between death and imprisonment for life.
When the Court is called upon to choose between the convict 's cry 'I want to live ' and the prosecutor 's demand 'he deserves to die ', it goes without saying that the Court must show a high degree of concern and sensitiveness in the choice of sen tence.
[511D E] (8) In our justice delivery system several difficult decisions are left to the presiding officer, sometimes without providing the scales or the weights for the same.
In cases of murder, however, since the choice 501 is between capital punishment and life imprisonment, the legislature has provided a guideline in the form of sub section (3) of section 354 of the Code of Criminal Proce dure, 1973.
[511E F] (9) When the law casts a duty on the Judge to state reasons it follows that he is under a legal obligation to explain his choice of the sentence.
It may seem trite to say so but the existence of the 'special reason clause ' in the above provision implies that the Court can in fit cases impose the extreme penalty of death which negatives the contention that there never can be a valid reason to visit an offender with the death penalty, no matter how cruel, gruesome or shocking the crime may be.
[512A C] (10) Where a sentence of severity is imposed, it is imperative that the Judge should indicate the basis upon which he considers a sentence of that magnitude justified.
Unless there are special reasons, special to the facts of the particular case, which can be cataloged as justifying a severe punishment, the Judge would not award the death sentence.
If a Judge finds that he is unable to explain with reasonable accuracy the basis for selecting the higher of the two sentences, his choice should fail on the lower sentence.
[512D E] (11) The choice of the sentence has to be made after following the procedure set out in sub section (2) of sec tion 235 of the Code.
Since the provision is intended to give the accused an opportunity to place before the Court all the relevant material having a bearing on the question of sentence, there can be no doubt that the provision is salutary and must be strictly followed.
[513D, H; 514A] (12) The requirement of hearing the accused is intended to satisfy the rule of natural justice.
In the case of life or death, the presiding officer must show a high degree of concern for the statutory right of the accused and should not treat it as a mere formality to be crossed before making the choice of the sentence.
If the choice is made without giving the accused an effective and real opportunity to place his antecedents, social and economic background, mitigating and extenuating circumstances, etc.
before the Court, the Court 's decision on the sentence would be vulner able.
[514C] (13) A sentencing decision taken without following the requirements of sub section (2) of section 235 of the Code in letter and spirit may have to be replaced by an appropri ate order.
In the instant case, the Trial Court actually treated it as a mere formality as is evident from 502 the fact that it recorded the finding of guilt on 31st March, 1987, and on the same day before the accused could absorb and overcome the shock of conviction they were asked if they had anything to say on the question of sentence.
Immediately thereafter the decision imposing the death penalty on the two accused was pronounced.
[514B, E] (14) As a general rule, the Trial Courts should after recording the conviction adjourn the matter to a future date and call upon both the prosecution as well as the defence to place the relevant material bearing on the question of sentence before it and thereafter pronounce the sentence to be imposed on the offender.
[514F G] (15) In the instant case, the Trial Court did not attach sufficient importance to the mandatory requirement of sub section (2) of section 235 of the Code.
The High Court also had before it only the scanty material placed before the Sessions Judge when it confirmed the death penalty.
Absence of particulars of ancedents of accused, their socio economic conditions, the impact of their crime on the community, etc. makes the choice of punishment difficult.
[514G H] (16) It is necessary that the maximum sentence pre scribed by law should be reserved for 'the rarest of rare ' cases which are of an exceptional nature.
Sentences of severity are imposed t9 reflect the seriousness of the crime, to promote respect for the law, to provide just punishment for the offence, to afford adequate deterrent to criminal conduct and to protect the community from further similar conduct.
[515G] (17) In the instant case, unfortunately the material for choice of sentence is scanty.
The motive for the crime is obscure, the one stated.
namely, the quarrel between two infants of both sides, does not seem to be correct.
The killings were not for gain.
The change shows that the target was Baharan Mian, the father, and not the two infants.
The killing of the two infants was not in the contemplation of any of the accused.
Both the girls were the victims of the offenders ' ire resulting from frustration at the escape of their target.
There is nothing so uncommon about the crime as to make the case an exceptional one.
The mere fact that infants are killed, without more, is not sufficient to bring the case within the category of 'the rarest of rare ' cases.
[516C E] Bachan Singh vs State of Punjab, ; and Machhi Singh vs State of Punjab, , referred to.
|
N: Criminal Appeal No. 602 of 1981.
From the judgment and order dated 27th August, 1980 of the Gujarat High Court at Ahmedabad in Cr.
Revision Application No. 282 of 1979.
N.N. Keshwan and R.N. Keshwani for the Appellant.
Vimal Dave and Miss Kailash Mehta for Respondent No. 1.
S C. Patel and R.N. Poddar for Respondent No. 2 The Judgment of the Court has delivered by FAZAL ALI, J.
This appeal by special leave is directed against a judgment dated August 27, 1980 of the Gujarat High Court accepting the revision application of the Respondent and setting aside the order of the Metropolitan Magistrate, Ahmedabad.
The facts of the case lie within a very narrow compass, which may be detailed thus.
The respondent who is the wife of the appellant filed an application before the Magistrate under section 125 of the Code of Criminal Procedure, 1973 (hereinafter referred to as the 'Code of 1973 ') for grant of maintenance by the appellant on the ground that her husband appellant was guilty of wilful neglect and was unable to fulfil his primary responsibility of discharging his marital obligations.
The parties were married on May 27, 1978 according to Sunni Muslim rites.
After the marriage the respondent lived with her husband upto July 1978.
The respondent alleged that during this period she found her husband to be physically incapable of carrying on sexual relationship and that her husband frankly told her that he was impotent.
The respondent further alleged that she was maltreated and ultimately driven out of the house by her husband on July 11, 1978.
On November 17, 1978 the appellant sent a registered notice (Ext. 5) to the respondent informing her that he had no physical disability and was prepared to keep her with him and discharge his marital obligations.
On October 28, 1978 the respondent filed an application before the Magistrate for awarding maintenance against the appellant.
So far as the facts found are concerned, there is no dispute and the case will have to be decided on the point of law that arises 698 on the contentions raised by the parties before the courts below as also in this Court.
Both the High Court and the Metropolitan Magistrate clearly found that the appellant was physically incapable of having sexual relations with the respondent.
In other words, the concurrent finding of fact by the courts below is that the appellant was impotent and was, therefore, unable to discharge his marital obligations.
The respondent, however, refused to live with her husband on the ground that as he was impotent and unable to discharge his marital obligations, she could not persuade herself to live with him and thus inflict on herself a life of perpetual torture.
The Metropolitan Magistrate relying on a decision of the Allahabad High Court in Bundoo vs Smt.
Mahrul found that the mere ground that the husband was impotent was not a just cause for the refusal of the wife to live with her husband and accordingly dismissed the application filed by the respondent for maintenance.
Thereafter, the matter was taken up in revision before the High Court which differed from the view taken by the Magistrate and held that the husband having been found to be impotent, this should be a just ground for the wife to refuse to live with the husband and hence she was entitled to the grant of maintenance.
The High Court after having come to the aforesaid conclusion further held that having regard to the means of the husband he was in a position to pay Rs. 150/ per month by way of maintenance to the respondent.
Hence, this appeal by special leave by the appellant husband Mr. Keshwani, learned counsel for the appellant, vehemently contended before us that it is now well settled by a long course of decisions of various High Courts that impotency is no good ground or reason for the wife to refuse to live with her husband and hence the wife is not entitled to maintenance if she refused to live with the husband merely because her husband was impotent.
Mr. Keshwani cited a number of decisions in support of his contentions, on the other hand, Mr. Dave, appearing for the respondent, submitted that the various authorities of the High Courts seems to have overlooked the legal effect of the second proviso to sub section (3) of section 125 of the Code of 1973 under which a wife could refuse to live with her husband if there was a just ground for doing so.
The said proviso may be extracted thus: "Provided further that if such person offers to maintain his wife on condition of her living with him, and she 699 refused to live with him, such Magistrate may consider any grounds of refusal stated by her, and may make an order under this section notwithstanding such offer, if he is satisfied that there is just ground for so doing.
" We are of the opinion that if the husband was impotent and unable to discharge his marital obligations, how could he fulfil the main object of marriage, more particularly, under the Mahomedan law where marriage is a sacrosanct contract and not a purely religious ceremony as in the case of Hindu law.
This would certainly be a very just and reasonable ground on the part of the wife for refusing to live with her husband, as also in cases under the Hindu law or other Laws.
In Nanak Chand vs Shri Chandra Kishore Agarwala and Ors.
this Court held thus: "Section 488 provides a summary remedy and is applicable to all persons belonging to all religions and has no relationship with the personal law of the parties." After having heard counsel for the parties we are clearly of the opinion that the contention of the counsel ' for the respondent is sound and must prevail.
It is true that there are several decisions of the High Courts taking a contrary view but they seem to have proceeded on a totally wrong assumption and we are constrained to observe that in taking such a narrow view they have followed a most outmoded and antiquated approach.
The learned Magistrate mainly relied on a decision of the Allahabad High Court in Bundoo 's case (supra).
It is true that Bakshi, J. in that case seems to have been influenced more by the concept of neglect rather than by the reasonableness of the ground on which the refusal of the wife was based.
While dwelling on this aspect of the matter, the learned Judge observed as follows: "Assuming now for the purpose of argument that Bundoo was physically incapable of satisfying the sexual desire of his wife, it cannot be said this inability amounted intentionally to disregarding, slighting, disrespecting or carelessly and heedlessly treating his wife.
In this view of the matter, I am of the opinion that the element of neglect as envisaged under Section 488 Cr. P.C., old and under Section 125 Cr.
P.C. new, has not been established.
" 700 The attention of the learned Judge does not seem to have been drawn to the provisions of second proviso nor has the Judge come to any clear finding that the refusal of the wife could not fall within the ambit of "just ground" as contemplated by the aforesaid proviso.
Secondly, the learned Judge mainly relied on an earlier decision of Hidayatullah, J. (as he then was) in Emperor vs Daulat Raibhan and Anr.
in which it was held that a wife was not entitled to live apart from her husband and claim maintenance on the ground that her husband was impotent and unable to perform his marital obligations.
In fact, a number of decisions of the High Courts which were relied upon by the counsel for the appellant follow the decision of the Nagpur High Court as also the previous decisions of other High Courts replied upon by Hidayatullah, J. in the Nagpur case.
We shall consider the legal effect of this decision a little later.
So far as the decision of the Allahabad High Court, in which the Magistrate had relied, is concerned, the observations of Bakshi, J. were purely obiter.
It would appear that there was a clear finding cf fact by the Magistrate.
which had been accepted by the High Court, that the wife failed to prove by convincing evidence that her husband was impotent.
In view of this finding of fact, the question of law posed and decided by Bakshi, J. did not fall for decision at all because if the wife failed to prove that her husband was impotent, the question of her refusal to live with him for a just ground did not arise at all.
While adverting to this finding of fact, Bakshi, J. in the aforesaid case observed as follows: "I find from the perusal of judgment of the Magistrate that he has taken into consideration the entire evidence on the record led in connection with this question and he was of the opinion that Shrimati Mahrul Nisa failed to prove by convincing evidence that Bundoo was impotent." (Emphasis supplied) In the circumstances, we are not in a position to accept the observations of Bakshi J. which are in the nature of obiter dictum, in support of the argument of Mr. Keshwani.
This brings us now to the consideration of the authorities of other High Courts which seem to have taken ' the view that impotency is no ground for grant of maintenance to the wife.
We would first deal with the decision of Hidayatullah, J. in Daulat Raibhan 's case 701 (supra).
In the first place, the learned Judge thought that the point A raised before him was one of first impression and his decision was, therefore, greatly influenced by the fact that there was no direct decision on the point taking a contrary view.
In this connection, the learned Judge observed as follows: "No authority has been cited before me in support of the case of the wife that she is entitled to live separate from her husband on account of his impotence." Subsequently, the learned Judge mainly relied on the following observations made in Arunachala Anandayammal: "I cannot see that section 488, Criminal P.C. has anything to do with ordinary conjugal rights; it deals with maintenance only. " The learned Judge seems to have been under the impression that so far as the provisions of section 488 of the Code of 1898 were concerned they had no bearing on conjugal relations between the husband and the wife.
With great respect to the learned Judge we are unable to agree with this process of reasoning.
In fact, the fundamental basis of the ground of maintenance under section 488 is conjugal relationship and once conjugal relationship is divorced from the ambit of this special provision, then the very purpose and setting of the statutory provision vanishes.
In the matter of the Petition of Din Mohammed, Mahmood, J. very pithily and pointedly observed as follows: "The whole of Chapter XLI, Criminal Procedure Code, so far as it relates to the maintenance of wives, contemplates the existence of the conjugal relations as a condition precedent to an order of maintenance and, on general Principles, it follows that as soon as the conjugal relation ceases, the order of maintenance must also cease to have any enforceable effect." (Emphasis supplied) We find ourselves in complete agreement with the observations made by the eminent Jurist Mahmood, J. which lays down the correct law on the subject.
Thus, one of the fundamental premises on which rested the decision of Hidayatullah, J. appears to us to be 702 clearly wrong and directly opposed to the very object of the section (which at the relevant time was section 488).
In Arunchala 's case (supra) which was relied upon by Hidayatullah, J., Burn J. Observed thus: "I cannot see that section 488, Criminal P.C. has anything to do with ordinary conjugal rights; it deals with "maintenance" only and I see no reason why maintenance should be supposed to include anything more than appropriate food, clothing and lodging.
" It would be seen that here also the learned Judge proceeds on a legally wrong premise, viz., that section 481 had nothing to do with ordinary conjugal rights.
Moreover, the Madras decision as also the earlier decision seem to have followed the outmoded and antiquated view that the object of section 488 was to provide an effective and summary remedy to provide for appropriate food, clothing and lodging for a wife.
This concept has now become completely out dated and absolutely archaic.
After the International Year of Women when all the important countries of the world are trying to give the fair sex their rightful place in society and are working for the complete emancipation of women by breaking the old shackles and bondage in which they were involved, it is difficult to accept a contention that the salutary provisions of the Code are merely meant to provide a wife merely with food, clothing and lodging as if she is only a chattel and has to depend on the sweet will and mercy of the husband.
The same line of reasoning was adopted in an earlier decision of the Madras High Court in Jaggavarapu Basawama vs Jaggavarapu Seeta Reddi.
Here also, the Judge was of the opinion that food and clothing was sufficient for the maintenance of the wife and even if the husband refused to cohabit that would not provide any cause of action to the wife to claim separate maintenance.
In a recent decision in Velayudhan vs Sukmari a Single Judge observed as follows: "Learned magistrate seems to have concentrated solely on the last mentioned ground namely, failure of the husband to perform his marital duties, and has held that it is a sufficient ground entitling the wife to live away from the husband, and claim separate maintenance.
But I do not think, in the face of authorities cited before me that this 703 is a sufficient ground justifying the award of separate maintenance to the wife.
It was observed by Kumaraswami Sastri, J. in Basawamma vs Seetareddi (AIR 1922 Mad. 209) that there is nothing in the Code which compels the criminal court to award separate maintenance to a wife whom the husband agrees to protect and maintain in a manner suitable to her position in life; refusal to cohabit is no ground.
Here also, the Judge while noticing that the ground taken by the wife was that the husband has failed to perform his marital duties, found himself bound by the decisions of the Madras High Court in Jaggavarapu Basawamma 's case (supra).
Thus even in this decision though given in 1971 when the entire horizon of the position and status of women had changed, it is rather unfortunate that the Judge chose to stick to the old view.
There is however a very formidable circumstance which seems to have been completely overlooked by later decisions while following the previous decisions of the Nagpur or the Madras High Courts.
Although the second proviso to sub section (3) of section 125 of the Code of 1973, which was also a proviso to the old section 488, clearly provided that it is incumbent on the Magistrate to consider the grounds of refusal and to make an order of maintenance if he was satisfied that there was just ground for refusing to live with the husband, yet this salutary provision which was introduced with the clear object of arming the wife with a cause of action for refusing to live with the husband as the one which we have in the present case, no legal effect to the legislative will and intent appears to have been given by the aforesaid decisions.
Another important event which happened in 1949 also seems to have been completely ignored by the recent decisions while following the previous decisions of the High Courts.
It would appear that by the Code of Criminal Procedure (Amendment) Act No. 9 of 1949 an additional provision was added after the proviso which may be extracted thus: "If a husband has contracted marriage with another wife or keeps a mistress it shall be considered to be just ground for his wife 's refusal to live with him.
" The object of introducing this provision was clearly to widen the scope and ambit of the term 'just ground ' mentioned in the 704 proviso.
This provision is not exhaustive but purely illustrative and self explanatory and takes within its fold not only the two instances mentioned therein but other circumstances also of a like or similar nature which may be regarded by the Magistrate as a just ground by the wife for refusing to live with her husband.
Under the Code of 1973, this provision has been incorporated as Explanation to the second proviso to sub section (3) of section 125.
The decisions of the High Courts given prior to the Amendment of 1949 would no longer be good law after the introduction of the Amendment which gives, as it were, a completely new complexion to the intendment and colour of the second proviso to section 488 (now Explanation to the second proviso to sub section (3) of section 125) and widens its horizon.
It is, therefore, needless to refer to these decisions or to subsequent decisions which have followed the previous cases.
A clear perusal of this provision manifestly shows that it was meant to give a clear instance of circumstances which may be treated as a just ground for refusal of the wife to live with her husband.
As already indicated, by virtue of this provision, the proviso takes within its sweep all other circumstances similar to the contingencies contemplated in the Amending provision as also other instances of physical, mental or legal cruelty not excluding the impotence of the husband.
These, circumstances, therefore, clearly show that the grounds on which the wife refuses to live with her husband should be just and reasonable as contemplated by the proviso.
Similarly, where the wife has a reasonable apprehension arising from the conduct of the husband that she is likely to be physically harmed due to persistent demands of dowry from her husband 's parents or relations, such an apprehension also would be manifestly a reasonable justification for the wife 's refusal to live with her husband.
Instances of this nature may be multiplied but we have mentioned some of the circumstances to show the real scope and ambit of the proviso and the Amending provision which is, as already indicated, by no means exhaustive.
In other words, where a husband contracts a marriage with another woman or keeps a mistress this would be deemed to be a just ground within the meaning of the second proviso so as to make the refusal of the wife to live with her husband fully justified and entitled to maintenance.
If this is so, can it be said by any stretch of imagination that where a wife refuses to live with her husband if 705 he is impotent and unable to discharge his marital obligation, this would not be a just ground for refusing to live with her husband when it seems to us that the ground of impotence which had been held by a number of authorities under the civil law to be a good ground not only for restitution of conjugal rights but also for divorce.
Indeed, if this could be a ground for divorce or for an action for restitution of conjugal rights, could it be said with any show of force that it would not be a just ground for the wife to refuse to live with her husband.
The matter deserves serious attention from the point of view of the wife.
Here is a wife who is forced or compelled to live a life of celibacy while staying with her husband who is unable to have sexual relationship with her.
Such a life is one of the perpetual torture which is not only mentally or psychologically injurious but even from the medical point of view is detrimental to the health of the woman.
Surely, the concept of mental cruelty cannot be different in a civil case and in a criminal case when the attributes of such a cruelty are the same.
In Rita Nijhawan vs Balkrshaan Nijhawan (Sachar, J.) while dealing with a case of annulment of marriage under the Hindu Marriage Act on the ground of impotency very poignantly and pithily observed as follows: "Thus the law is well settled that if either of the parties to a marriage being a healthy physical capacity refuses to have sexual intercourse the same would amount to cruelty entitling the other party to a decree.
In our opinion it would not make any difference in law whether denial of sexual intercourse is the 'result of sexual weakness of the respondent disabling him from having a sexual union with the appellant, or it is because of any wilful refusal by the respondent. . .
Marriage without sex is an anathema.
Sex is the foundation of marriage and without a vigorous and harmonious sexual activity it would be impossible for any marriage to continue for long.
It cannot be denied that the sexual activity in marriage has an extremely favourable influence on a women 's mind and body.
The result being that if she does not get proper sexual satisfaction, it will lead to depression and frustration.
" 706 We find ourselves in complete agreement with the very practical and pragmatic view that the learned Judge has taken and the principles adumbrated by the Judge apply fully to proceedings for maintenances because as we have said the concept of cruelty is the same whether it is a criminal case or a civil case.
As far back as 1906, the Bombay High Court came out with the concept of cruelty which could be considered for exercising jurisdiction under section 488 of the Code of 1898.
In Bhikaji Maneekji vs Maneekji Mancherji a Division Bench of the Bombay High Court observed as follows: "Where it is proved that a husband has not refused or neglected to maintain his wife, a criminal Court, acting under the section, has no jurisdiction to make an order upon the husband for her maintenance on the ground that the husband has been guilty of cruelty to her.
But that is a very different thing from holding that no evidence of cruelty can be admitted in a proceeding under the section to prove, not indeed cruelty as a ground for separate maintenance, but the conduct and acts of the husband from which the Court may draw the inference of neglect or refusal to maintain the wife.
A neglect or refusal by the husband to maintain his wife may be by words or by conduct.
It may be express or implied.
If there is evidence of cruelty on the part of the husband towards the wife from which, with other evidence as to surrounding circumstances, the Court can presume neglect or refusal, we do not see why it should be excluded.
There is nothing in section 488 to warrant its exclusion, and such has been the practice of the Court.
But the section has been altered and now the Court can pass an order for maintenance where neglect or refusal is proved, even if the husband is willing to maintain the wife, provided the Court finds that there are "just grounds" passing such an order.
This alteration gives a wider discretion to the Court, which means that in passing such an order it is legitimate for it to take into account the relations between the husband and the wife, and the husband 's conduct towards her." This decision, given as far back as 1907, while construing the proviso appears to be both prophetic and pragmatic in its approach 707 and it is rather unfortunate that subsequent decisions have not noticed this important principle of law decided by the Bombay High Court.
We fully endorse this decision as laying down the correct law on the subject and as giving the correct interpretation of the proviso to section 488 particularly the concept of the words 'just ground '.
Another decision which had touched the question of 'cruelty ' is the case of Bai Appibai vs Khimji Cooverji where the following observations were made: "If, however, the husband by reason of his misconduct, or cruelty in the sense in which that term is used by the English Matrimonial Courts, or by his refusal to maintain her, or for any other justifying cause, makes it compulsory or necessary for her to live apart from him, he must be deemed to have deserted her, and she will be entitled to separate maintenance and residence.
" In Gunni vs Babu Lal Dixit, J. sounded a very pragmatic note on this aspect of the matter and in this connection pointing out the scope of the Amendment of 1949 observed thus: "There is nothing in the Criminal Procedure (Amendment) Act, 1949 to show that it would not be a just ground for the wife 's refusal to live with her husband if the husband has contracted marriage with another wife or taken a mistress before the amendment made in section 488.
The amendment is clearly intended to put an end to an unsatisfactory state of law, utterly inconsistent with the progressive ideas of the status and emancipation of women, in which women were subjected to a mental cruelty of living with a husband who had taken a second wife or a mistress on the pain of being deprived to any maintenance if they chose to live separately from such a husband.
If my view to hold that the amendment is intended to afford a just ground for the wife 's refusal to live with her husband only in those cases where he has after the amendment, taken a second wife or a mistress is to defeat in a large measure the very object of the amendment.
" 708 We find ourselves in complete agreement with the observations made by the learned Judge.
In Mst.
Biro vs Behari Lal, a decision to which one of us (Fazal Ali, J. as he then was a party, where the importance of the Amendment of 1949 also touched, the following observations were made: "Before the amendment, the fact of the husband 's marrying a second wife or keeping a mistress was not by some High Courts considered a just ground for the first wife 's refusal to live with him, although it was taken into account in considering whether the husband 's offer to maintain his first wife was really 'bona fide ' or not.
The amendment is clearly intended to put an end to an unsatisfactory state of law utterly inconsistent with the progressive ideas of the status and emancipation of women, in which women were subjected to a mental cruelty of living with a husband who had taken a second wife or a mistress on the pain of being deprived of any maintenance if they chose to live separately from such a husband." In Sm.
Pancho vs Ram Prasad, Roy, J. while dealing with the Hindu Married Women 's Right to Separate Residence and Maintenance Act (19 of 1946) expounded the concept of 'legal cruelty ' and observed thus: "In advancement of a remedial statute, everything is to be done that can be done consistently with a proper construction of it even though it may be necessary to extend enacting words beyond their natural import and effect. . .
Conception of legal cruelty undergoes changes according to the changes and advance of social concept and standards of living.
With the advancement our social conceptions, this feature has obtained legislative recognition that a second marriage is a sufficient ground for separate residence and separate maintenance.
Moreover, to establish legal cruelty, it is not necessary that physical violence should be used.
Continuous ill treatment, cessation of marital intercourse, studied neglect, indifference on the part of the 709 husband, and an assertion on the part of the husband that the wife is unchaste are all factors which may undermine the health of a wife.
The learned Judge has put his finger on the correct aspect and object of mental cruelty.
The fact that this case did not arise out of the proceedings under section 125 makes no difference because we have already observed that the concept of cruelty remains the same whether it is a civil case or a criminal case or a case under any other similar Act.
The general principles governing acts constituting cruelty legal or mental ill treatment or indifference cannot vary from case to case though the facts may be different.
Similarly, while dealing with a case under the , a Division Bench of the Karnataka High Court in Dr, Srikant Rangacharya Adya vs Smt.
Anuradha dwelling on the aspect of impotency and its impact on the wife observed as follows: "In these days it would be an unthinkable proposition to suggest that the wife is not an active participant in the sexual life and therefore, the sexual pleasure to the wife is of no consequence and therefore cannot amount to cruelty.
Marriage without sex is an anathema.
Sex is the foundation of marriage and without a vigorous and harmonious sexual activity it would be impossible for any marriage to continue for long.
It cannot be denied that the sexual activity in marriage has an extremely favourable influence on a woman 's mind and body.
The result being that if she does not get proper sexual satisfaction it will lead to depression and frustration.
It has been said that the sexual relations when happy and harmonious vivifies woman 's brain, develops her character and trebles her vitality.
It must be recognised that nothing is more fatal to marriage than disappointments in sexual intercourse.
" We find ourselves in entire agreement with the observations made by the learned Judges of the Karnataka High Court which seems to be the correct position in law.
Even the learned Judge who had delivered the judgment in the instant case had very rightly pointed out as follows: 710 "If the maintenance of a wife is supposed to include only food, shelter and clothing having regard to the conjugal rights and if the just cause on which wife can refuse to stay with the husband and yet claim maintenance, can have reference only to the comfort and safe of the wife then it might reduce the wife to the status of a domesticated animal.
In the context of the changing status of woman in society such a proposition would seem outdated and obsolete. .
In other words, the Courts cannot compel the wife to stay with husband on the ground that the husband though he is forcing her in a situation where her physical and mental well being might be adversely affected, as there is no intention on the part of the husband to inflict that cruelty, she should suffer that predicament without demur and be satisfied with a grab to bite and some rags to clothe her and a roof over her head.
" We fully endorse the observations made above.
Apart from the various decisions referred to above, there is a direct English decision on the point.
In Sheldon vs Sheldon, Lord Denning observed as follows: "I rest my judgment on the ground that he has persistently, without the least excuse, refused her sexual inter course for six years It has broken down her health.
I do not think that she was called on to endure it any longer.
It has been said that, if abstinence from intercourse causing ill health can be held to be cruelty, so should desertion simpliciter leading to the same result.
" Thus, from a conspectus of the various authorities discussed above and the setting, object and interpretation of the second proviso to sub section (3) of section 125 of the Code of 1973, we find ourselves in complete agreement with the view taken by the learned Judge of the High Court.
We hold that where it is proved to the satisfaction of the court that a husband is impotent and is unable to discharge his marital obligations, this would amount to both legal and mental cruelty which would undoubtedly be a just ground as contemplated by the aforesaid proviso for the wife 's refusal to live 711 with her husband and the wife would be entitled to maintenance from her husband according to his means.
In these circumstances, therefore, it would be pusillanimous to ignore such a valuable safeguard which has been provided by the legislature to a neglected wife.
For these reasons, therefore, we find no merit in the appeal which fails and we accordingly dismiss the same without any order as to costs.
In view of our decision in this case, it follows that the decisions referred to above in the judgment taking a contrary view must be held to be no longer good law and are hereby overruled.
P. B. R. Appeal dismissed.
| In exercise of its executive power the State Government of Madhya Pradesh made by its order dated 2nd April, 1980 the Rules for admission into the Medical, Dentistal and Ayurvedic Colleges in Madhya Pradesh.
By and under Rule 7 the State Government has reserved 15% of seats for each of the categories of Scheduled Castes and Scheduled Tribes candidates.
Rule 20 lays down that selection of candidates from amongst those who have qualified in the examination shall be made strictly on merit as disclosed by total number of marks obtained by candidates in the pre medical examination.
Rule 20 further provides that minimum qualifying marks for admission to Medical Colleges shall be 50% in the aggregate and 33% in each subject respectively; but for Scheduled Castes and Scheduled Tribes candidates the minimum qualifying marks shall be 40% in the aggregate and 30% in each subject.
Note (ii) below Rule 20 empowers the Government to grant in case of candidate belonging to the categories of Scheduled Castes and Scheduled Tribes special relaxation in the minimum qualifying marks to the extent considered necessary in the event of the required number of candidates in these two categories not being available.
Rule 9 contains a provision to the effect that in case seats reserved for categories of Scheduled Castes and Scheduled Tribes remain vacant, these seats will be filled up by candidates available on the combined merit list.
The total number of seats in all the Medical Colleges being 720 in number, 108 seats each for the Scheduled Castes and Scheduled Tribes became reserved under Rule 7. 760 For admission to The Medical Colleges for the academic year 1980 8., there were 9400 candidates in all of which 623 candidates were from Scheduled Castes and 145 candidates were from schedule Tribe.
On the result of the pre medical examination only 18 seats in the category of Schedule Casts and 2 seats in the Schedule Tribe could be filled up because the other candidates of these categories did not secure the qualifying marks prescribed by Rule 20.
The selection Board in exercise of the power under note (i) to Rule 20 made a relaxation of 5% in terms thereof and thereafter 7 more candidates in the category of Schedule Casts and one more in the category of Schedule Tribes got admitted leaving a balance of 83 seats under Schedule Casts quota, and 105 seats under the Schedule Tribes quota to be filled as provided for under Rule 9.
But the State Government, by its order dated 9th September 1980 removed the condition relating to minimum qualifying marks in favour of the candidates from amongst Schedule Castes and Schedule Tribes.
The respondent belonging to the general category who obtained the minimum qualifying marks but could not secure admission as other candidates for the general seats had obtained marks higher than she had obtained in the premedical examination for filling up the vacancies available in the general category, would have been in a position to secure admission to the Medical College but for the complete relaxation granted by the impugned order without complying with the provisions of Rule 9.
She, therefore, filed a writ petition in the High Court on the grounds, inter alia, (1) that the order of the Government contravenes Regulation II of the Medical Council of India and would hit Section 19 of the Indian medical council Act 1956 exposing the Medical colleges to the risk of being derecognised:(2) that the order of the Government will have the effect of allowing less qualified and less deserving candidates to fill up the seats and would, therefore, destroy equality and violate Articles 14 and 15 of the Constitution ; and (3) the order was violative of Ordinance 94 of the University of Jabal pur.
The High Court accepted the contentions of the writ petitioner and allowed the petition.
Hence the appeal by the State, after obtaining special leave.
Allowing the appeals, the Court, ^ HELD: 1.
The executive order dated 9th September, 1980 passed by the State cf Madhya Pradesh completely relaxing the conditions relating to the minimum qualifying marks for selection of students to Medical Colleges of the State in respect of candidates belonging to Schedule Castes and Scheduled Tribes is not violative of either Article 14, 15(1) or 15(2) or 15 (4).
[785 G, 788 C] 2.
The relaxation does not offend Article 14 of the Constitution.
There is no relaxation of the condition regarding eligibility for and admission into Medical Colleges.
The relaxation is only in the rule regarding selection of candidates belonging to Scheduled Castes and Scheduled Tribes who were otherwise qualified and eligible to seek admission into Medical Colleges only in relation to seats reserved for them.
Further the validity of the reservation of seats for candidates belonging to Schedule Castes and Scheduled Tribes have not been challenged and very properly in view of Article 15 (4) of the Constitution.
[786 E G] 3.
The relaxation cannot be said to be unreasonable and does not violate Articles 15(1), (2) and (4) of the Constitution.
The State must do everything 761 possible for the upliftment of the Schedule Castes and Scheduled Tribes and other backward communities and it is entitled to make reservations for them in the matter of admission to medical and other technical institutions.
In the absence of any law to the contrary, it must also been open to the Government to impose such conditions as would make the reservation effective and would benefit the candidates belonging to these categories for whose benefit and welfare the reservations have been made.
In any particular situation taking into consideration the realities and circumstances prevailing in the State it will be open to the State to vary and modify the condition; regarding, selection for admission if such modification or variation becomes necessary for achieving the purpose for which reservation has been made and if there be no law to the contrary.
Note (ii) of rule 20 of the Rules for admission framed by the State Government specifically empowers the Government to grant such relaxation in the minimum qualifying marks to the extent considered necessary.
The order can be supported under Article 15(4) of the Constitution.
[785 H, 786 A D] State of Kerala and Anr.
vs N.M. Thomas, ; ; Jagdish Saran and Ors.
vs Union of India and ors.
; , , followed.
Amalendu Kumar vs State of Bihar, AIR 1980 Patna 1 overruled.
Under Article 162 of the Constitution the executive power of a State, extends to the matter with regard to which the Legislature of a State has power to make laws.
As there is no legislation covering the field of selection of candidates for admission to Medical Colleges, the State Government would, undoubtedly, be competent to pass executive orders in this regard.
[785 D.E] State of Andhra Pradesh and Ors.
vs Lavu Narendranath and Ors.
; , , reiterated.
Regulation II of the Indian Medical Council is merely directory and in the nature of a recommendation and, therefore has no such statutory force as to render the executive order dated 9th September, 1980 which contravenes the said Regulation illegal, invalid and unconstitutional.
[785 B Cl Entry 66 in List I (Union List) of the Seventh Schedule to the Constitution relates to "co ordination and determination of standard in institutions for higher education or research and scientific and technical institutions".
This entry by itself does not have any bearing on the question of selection of candidates to the Medical Colleges from amongst candidates who are eligible for such admission.
On the other hand, entry 25 in List II (Concurrent List) of the same Schedule speaks of "education, including technical education, medical education in Universities, subject to entries 63, 64, 65 and 66 of List I. vocational and technical training of labour".
This entry is wide enough to include within its ambit the question of selection of candidates to Medical Colleges and there is nothing in the entries 63, 64 and 65 of List I to suggest to the contrary.
[784 G.H, 785 A C] 5:2.
Regulation I of the Medical Council prescribes the requisites which have to be satisfied to enable every student to become eligible or qualified to seek admission and the process of selection comes thereafter.
As this Regulation is 762 within the competence of the Council the Council, has framed this Regulation in a manner which leaves no doubt that this Regulation is mandatory.
[783 B C] 5:3.
Regulation II of the, Council is merely in the nature of a recommendation.
Regulation II begins with the words "selection of students in medical college should be based solely on merit".
Language used in Regulation II is deliberate and is intended to indicate the intention of the Council that it is only in the nature of a recommendation.
By way of solution to the problem of dearth of seats, the Council appears to have thought it fit to suggest the procedure which will have the effect of selecting such candidates on the basis of merit only.
The procedure suggested is intended to do away with nepotism and favoritism and any unfair practice in the matter of such admission, as the procedure recommends merit to be the criterion.
Regulation II recommending the process of selection is outside the authority of the Council under section 33 of the Act and the Council has advisedly and deliberately used such language in Regulation II as makes the position clear and places the matter beyond any doubt.
Further, apart from reservations of seats for Scheduled Castes and Scheduled Tribes and other reservations, reservation of seats is commonly made for being filled up by nomination.
In the instant case, it appears that seats not exceeding three per cent are reserved for the nominees of the Government of India apart from the other reservations.
These nominees of the Central Government do not have to sit for any premedical examination to qualify themselves for selection to the Medical Colleges, They must of course be eligible for admission in the sense that they must have the necessary qualification for admission in accordance with Regulation I.
The candidates eligible under Regulation I are selected by virtue of nomination and there is no question of any pre medical test for such candidates nominated by the Central Government.
If Regulation II could be considered to be mandatory, there could be no such nomination of candidates by the Central Government.
[783 G H, 784A C, E G] 6:1.
An analysis of the various sections of the indicates that the main purpose of the Act is to establish Medical Council of India, to provide for its constitution.
composition and functions and the main function of the Council is to maintain the medical register of India and to maintain a proper standard of medical education and medical ethics and professional conduct for medical practitioners.
The scheme of the Act appears to be that the Medical Council of India is to be set up in the manner provided in the Act and the Medical Council will maintain a proper medical register, will prescribe minimum standards of medical education required for granting recognised medical qualifications, will also prescribe standards of post graduate medical education and will further regulate the standard of professional conduct and etiquette and code of ethics for medical practitioners.
The Act further envisages that if it appears to the Council that the courses of study and examination to be undergone in, or the proficiency required from candidates at any examination held by any University or Medical Institution do not conform to the standard prescribed by the Council or that the staff, equipment, accommodation training and other facilities for instructions and training provided in such University or medical institution or in any college or other institutions affiliated to that University do not conform to the standards prescribed by the Council, the Council will make a representation to that effect to the Central Government and 763 on consideration of the representation made by the Council, the Central Government may take action in terms of the provisions contained in section 19 of the Act.
[776 G H, 777 A C] The Act also empowers the Council to take various measures to enable the Council to judge whether proper medical standard is being maintained in any particular institution or not.
[777 C D] 6:2.
The authority of the Council extends to the sphere of maintaining proper medical standard in Medical Colleges or institutions necessary for obtaining recognized medical qualifications.
By virtue of this authority it may be open to the Council to lay down the minimum educational qualifications required of a student who may seek admission into a Medical College.
In other words, the eligibility of a candidate who may seek to get admitted into a medical ( ' college for obtaining recognized medical qualifications may be prescribed by the Council.
All the candidates who are eligible for admission into Medical Colleges or institutions for getting themselves qualified as medical practitioners are entitled to seek admission into a Medical College or institution.
As to how the selection has to be made out of the eligible candidates for admission into the Medical College is a matter which has necessarily to depend on circumstances and conditions prevailing in particular States.
Though the question of eligibility for admission into the medical curriculum may come within the power and jurisdiction of the Council, the question of selection of candidates out of the candidates eligible to the medical course does not appear to come within The purview of the Council.
[777 E H, 778 A] 6:3.
The process of selection of candidates for admission to a Medical College out of the candidates eligible for admission for filling up the limited vacancies has no real bearing on the question of eligibility or qualification for admission or on the standard of medical education.
The standard of medical education really comes into the picture in the course of studies in the medical colleges or institutions after the selection and admission of candidates into Medical Colleges and institutions.
Students who satisfy the requirements of Regulation I become qualified or eligible to seek admission into the Medical Course.
Regulation I prescribes the requisites which have to be satisfied to enable every student to become eligible or qualified to seek admission and the process of selection comes thereafter.
[778 C E] Undoubtedly, under section 33 of the Act, The Council is empowered to make regulations with the previous sanction of the Central Government generally to carry out the purposes of the Act and such regulations may also provide for any of the matters mentioned in section 33 of the Act.
[778 E F] G State of Kerala vs Kumari T. P. Roshana and Ors ; Arti Sapru vs State of Jammu and Kashmir and Ors , explained and distinguished.
|
Appeal No. 1103 of 1955.
Appeal from the order dated August 9, 1963 of the Andhra Pradesh High Court in Writ Petition No. 431 of 1961.
D. Natsaralu, A. Subba Rao and K. Javaram, for the appellant.
B. Parthasarathy, for respondent No. 1.
625 T. Satyanarayana, for respondent No. 2.
The Judgment of the Court was delivered by Hegde, J.
A short, none the less interesting question of law arises for decision in this appeal by certificate, and that question is whether a tank can be considered as a charitable institution within the meaning of those words in section 2(E) of the Andhra Inams (Abolition & Conversion into Ryotwari Act) 1956 (Act No. 36 of 1956) (to be hereinafter referred to as the Act).
The Inam with which we are concerned in this case stands abolished under the Act.
The appellant wants the property comprised in that Inam to be registered in his name.
His contention is that prior to its abolition he was the/namdar of that Inam though he had the liability to repair the tank in his village from out of the income of that/nam.
The Authorities under the Act have rejected 'Iris claim that he was the Inamdar of the Inam in question.
They have come to the conclusion that the Inam was in favour of the tank and that he was in possession of the Inam property only as the Manager of the tank which according to them was a charitable institution.
This conclusion has been upheld by the High Court.
It is not known as to who granted the Inam in question.
The grant is lost in antiquity.
The only evidence we have relating to this/nam are the entries in the Inam register.
A copy of that register has been produced in this case.
Therein the Inam is shown to have been granted to the tank "uracheruvu".
Under column 8 it is mentioned that it was given for repairs of the pond called uracheruvu situated close to the village.
Under column 10 it is mentioned that it is to be in force so long as the repairs of the tank are performed.
The ancestor of the appellant was shown to be the Manager of the charitable institution viz., the tank.
Under the remarks column it is mentioned "The pond is of great use for the cattle and people of the village.
The Inam can be confirmed permanently so long as the repairs are performed.
The pond for which the Inam was originally granted was situated north to the village and is now out of use.
At the request of the villagers the late Collector Mr. Fraser issued an order in 1819 that the proceeds of this Inam can be applied to the present existing Kunta which is south to the village and so of use.
" From these entries it is clear that the Inam was granted in favour of the tank known as "uracheruvu".
It has been so considered at least ever since 1819.
Therefore we are unable to uphold the contention of the appellant that it was a grant in favour of his family subject to the liability to.
repair the tank.
It appears that the ancestors of the appellant and at present the appellant is looking after the management of the tank.
626 Mr. Narsaraju, learned Counsel for the appellant contended that even if we come to the conclusion that the Inam was granted for a charitable purpose, the object of the charity being a tank, the same cannot be considered as a charitable institution.
According to him a tank cannot be considered as an institution.
In support of that contention of his he relied on the dictionary meaning of the term 'institution '.
According to the dictionary meaning the term 'institution ' means "a body or organization of an association brought into being for the purpose of achieving some object".
Oxford Dictionary defines an 'institution ' as "an establishment organisation or association, instituted for the promotion of some object especially one of public or general utility, religions, charitable, educational, etc.
" Other Dictionaries define the same word as 'organised society established either by law or the authority of individuals, for promoting any object, public or social '.
In Minister of National Revenue V. Trusts a.nd Guarantee Co. Ltd. (1) the Privy Council observed: "It is by no means easy to give a definition of the _ word "institution" that will cover every use of it.
Its meaning must always depend upon the context in which it is found.
" In Masjid Shahid Ganj and Ors. V. Shiromani Gurdwara Prabandhak Committee, Amritsar and Anr.(2) the Privy Council considered a Madrasah as institution though it doubted whether the same can be considered as a "juristic personality".
This is what the Privy Council observed: "A gift can be made to a madrasah in like manner as to a masjid.
The right of suit by the mutwali or other manager or by any person entitled to a benefit (whether individually or as a member of the public or merely in common with certain other persons ) seems hitherto to have been found sufficient for the purpose of maintaining Mohomedan endowments.
At best the institution is but a caput mortuum, and some human agency is always required to take delivery of property and to apply it to the intended purposes.
Their Lordships, with all respect to the High Court of Lahore, must not be 'taken as deciding that a "juristic personality" may be extended for any purpose to Muslim institutions generally or to mosques in particular.
On this general question they reserve their opinion.
" We may at this stage state that the Act has not defined either the expression "charitable institution" or even "institution".
Therefore we have to find out the meaning of that term with reference to the context in which it is found.
We must remember that the (1) (2) 627 expression "charitable institution" is used in a statute which abolishes Inams.
The Inam in question must undoubtedly have been granted by a Hindu.
Most of the Inams abolished by the Act were those granted by Hindu Kings in the past.
According to Hindu conceptions a tank has always been considered as an object of charity.
In the Tagore Law Lectures delivered in 1892 by late Parelit Prannath Saraswati on "The Hindu Law of Endowments", "From very ancient times the sacred writings of the Hindus divided works productive of religions merit into two divisions named ishta and purta a classification which has come down to our times.
So much so that the entire objects of Hindu endowments will be found included within the enumeration of ishta and purta works.
In the Rig Veda ishtapurttam (sacrifices and charities ) are described as the means of going to heaven.
In commenting on the same passage Sayana explains ishtapurtta to denote "the gifts bestowed in srauta and smarka rites.
" In the Taittiriya Aranyaka, ishtapurtta occur in much the same sense and Sayana in commenting on the same explains ishta to denote "Vedic rites like Darsa, Purnamasa etc.
and purta "to denote Smarkta works like tanks, wells etc.
At page 26 he again quotes Vyasa in these words: "Tanks, wells with flights of steps, temples, the bestowing of food, and groves these are called purttam.
" At page 27, the learned lecturer enumerates the purtta works.
Amongst them is included the construction of works for the storage of water, as wells, baolis, tanks etc.
The learned lecturer devotes his tenth lecture to "purtta".
In the course of that lecture he again states that the construction of reservoirs of water is.
classed by Hindu sages amongst the "purtta" and charitable works.
In this connection he quotes from various treatises such as: (i) Ashwalayana Grihya Parishishta; (ii) Vishnu Dharmottara; (iii) Skanda Purana; (iv) Nandi Purana; (v) Aditya Purana; (vi) Yama; (vii) Mahabharata etc.
In Jamnabai vs Khimji Vullubdass and Ors.(1) Sir Charles Sargent Kt.
, C.J. while interpreting a will observed thus: (1) I.L.R. at p. 9. 13 Sup.
C1/68 9 628 "We come to the latter part of clause 6, which directs the building of a well and "avada", (cistern for animals to drink water from), out of the surplus of his fund after providing for the outley of the two sadavarats and repairing his property.
Mr. Justice Jardine considered he could not presume a charitable object in a well and "avada".
Such an object is so frequently the result of charitable intention in Oriental countries, and i.s so entirely in accordance with the notions of the people of this country that we think that, in the absence of anything to show that the testator intended the well and "avada" to be built for the benefit of the property and there is nothing in the presen 't will to show such intention they should be presumed to have intended by the testator for the use of the public." In V. Mariyappa and Ors.
B.K. Puttaramayya and Ors(x) a Division Bench of the Mysore High Court observed thus: "The maintenance of Sadavartas, tanks, seats of learning and homes for the disabled or the destitute and similar institutions is recognised by and well known to Hindu law, and when maintained as public institutions they must be taken to have a legal personality as a Matha or the diety in a temple has, and the persons in charge of the Management would occupy a position of trust.
" That decision proceeds on the basis that a tank can be a charitable institution under Hindu law.
That decision was quoted with approval by late Bijan Kumar Mukherjea who later became the Chief Justice of this Court, in his Tagore Law Lectures delivered in August 1951.
Therein he observed: "It has been held that though Mutts and temples are the most common forms of Hindu religious institutions, dedication for religious or charitable purposes need not necessarily take one of these forms and that the maintenance of sadabartas, tanks, seats of learning and homes for the disabled or the destitute and similar institutions are recognised by and well known to Hindu law and when maintained as public institutions, they must be taken to have a legal personality as a Matha or the deity in a temple has, and the persons in charge of the management would occupy a position of trust.
" From the above discussion it is seen ' that under Hindu law a tank can be an object of charity and when a dedication is made in (1) I.L.R. [1957] Mys.
629 favour of a tank, the same is considered as a charitable institution.
It is not necessary for our present purpose to decide whether that institution can also be considered as a juristic person.
Once we come to the conclusion that the Inam with which we are concerned in this case was an Inam in favour of the "uracheruvu" (tank) that tank must be considered as a charitable institution under the Act.
Consequently after the abolition of the Inam, the Inam property gets itself converted into Royatwari property, of the "uracheruvu", to be managed by its Manager.
Admittedly the appellant is its present Manager.
Hence the property in question has to be registered in the name of the tank but it will" continue to be managed by the appellant so long as he continues to be its Manager.
In the result subject to our observations as regards the management of the property, the appeal is dismissed.
No costs.
R.K.P.S. Appeal dismissed.
| There was a strike in the establishment of the appellant company betseen 18th and 30th March, 1964, and again a token strike on 10th April, 1964.
For the misconduct of going on the first strike some of the workmen were charged and given a warning.
The second strike was held to be illegal by an enquiry officer and six of the workmen who had been given a warning in respect of the first strike were dismissed for taking part in the second strike also.
The Labour Court held that in the compromise that had ended the first strike the company had given the undertaking that it would not take any action by way of punishment against the workmen, and therefore the warning in respect of the first strike which was given only after the enquiry report relating to the second strike had been already received, was not only not bona fide but illegal.
Because this warning was taken into account against the six workmen who were dismissed, the Labour Court set aside the order of dismissal, although holding that the second strike was ille.gal because of want of notice under subs.
4 of section 6 S of the U.P.
The company appealed to this Court.
HELD: (i) The Labour Court rightly held on the facts that the warning given to the workmen in respect of the.
first strike was not only not bona fide but also.
against the terms of the settlement by which the first strike was ended.
[548 G] (ii) The second strike was, as held by the Labour Court, illegal and therefore 'misconduct ' under sub cl.
(2) of cl. 21 of the Standing Orders of the company.
Any punishment imposed under el.
22 of the said Orders in respect of an illegal strike after a fair enquiry, being a managerial function would not normally be interfered with.
But in the present case the management was not entitled to take into.
account the warning given in respect of the first strike in view of the settlement it had entered into with the workers to end that strike.
The Labour Court was therefore again right in holding the punishment of dismissal of the six respondents as vindictive and unjustified.
[548 H 549E]
|
minal Appeal No.70 of 1968.
Appeal by special leave from the judgment and order dated October 6, 1967 of the Allahabad High Court, Lucknow Bench in Criminal Appeal No. 164 of 1966.
R.K. Garg, S.C. Agarwal and Uma Dutta, for the appellants.
O.P. Rana, for the respondent.
238 The Judgment of the Court was delivered by Jaganmohan Reddy, J.
This appeal by special leave is directed against the judgment of the Allahabad High Court setting aside the conviction of Hori Lal and Bisram under section 307 read with section 34 of the I.P.C. and instead convicting them under section 326 read with section 34 I.P.C. and sentencing each of them to rigorous imprisonment for 5 years.
The appellants.
who are the residents of Bhitwa Gadan Khera are friends belonging to the same party.
It was alleged that on June 14, 1964 Bisram 's cattle strayed into the field and damaged the crop of Deo Dutt who is the nephew of Sagar Singh and Jeer Bahadur.
In respect of this damage Deo Dutt and his partner Ram Bharose.
complained to Bisram who along with some other persons went to the house of Deo Dutt and threatened him and the members of his family including Jeet Bahadur and Sagar Singh.
Thereupon Deo Dutt lodged a complaint in the police station.
Because of this complaint relations between the parties became strained as a result of which the accused stopped working for Jeet Bahadur and Sagar Singh and even asked the other members of his beradari to follow suit.
On March 29, 1965 at about 5.30 p.m. Jeet Bahadur P.W. 2 along with his laborer Sri Pal deceased was reaping the harvest.
The field of Sagar Singh P.W. 1 is situate just adjacent to the field of Jeer Bahadur with only a chak road between their fields.
It is the prosecution case that on that day both the accused armed with kantas went to the field of Jeet BahAdur and challenged him.
Immediately thereafter they began to deal kanta blows on Jeet Bahadur.
Jeer Bahadur P.W. 2 cried out whereupon Sagar Singh P.W. 1 hearing the shouts rushed to his aid.
Maya Ram P.W. 3 and Himachal and Ram Pal who were nearby also rushed to the aid of Jeet Bahadur.
Accused Bisram is said to have fired a revolver at Sagar Singh but he did not receive any inquiry.
Thereafter the accused ran away towards the village.
As Jeet Bahadur was injured, Sagar Singh P.W. 1 took him to the police station and there lodged a report exhibit Ka 1 at about 9.55 p.m. on March 29, 1965.
The investigation officer Bhanu Prakash Sharma, P.W. 5 investigated the crime,.
prepared site plan, recorded statements of the witnesses and seized blood stained mud.
Jeet Bahadur was admitted to the District hospital at Unnao.
Dr. Srivastava examined him on March 30, 1965 at 8.30 a.m. and found as many as 10 injuries of which injuries 2 to 7 were incised wounds, injuries 1 and 9 contusions and injuries 8 and 10 abrasions.
All the incised injuries except No. 7 showed that the bones had been cut.
These injuries are as follows : "2.
Incised wound .13" X 1" X bone vertically on the right half forehead just above the right eye brow.
239 3.
Incised wound 1 1/4" ><1/2">( bone cutting the underlying bone lower p art left humerus just above the left elbow on the back of left arm.
Incised wound obliquely 5" X 2" X bone cutting the underlying radius and above left in the middle of the left forearm back.
Incised wound 5"X I"X bone on the back of the left forearm lower I/3rd.
Slightly obliquely cutting both the bones of left forearm.
Incised wound 4 1/2"X 1" bone on the left leg middle back and laterally cutting the underlying tibia bone shaft.
" The defence of the accused is that they had been falsely implicated.
The prosecution examined Sagar Singh P.W. 1, Jeet Bahadur P.W. 2 and Maya Ram P.W. 3 as eye witnesses and since Sri Pal one of the eye witnesses died after his evidence was recorded by the committing magistrate, his deposition was admitted and treated as evidence under section 33 of the Evidence Act (exhibit Ka 11).
The learned Sessions Judge.
believed the eye witnesses and relying upon exhibit Ka 3 convicted the accused under section 307 read with section 34.
The learned Judge however acquitted them of the second charge of attempting to murder P.W. 1 with pistol.
In this appeal Mr. S.C. Agarwala learned counsel for the appellants contends firstly, that the injuries as found by the doctor do not justify the conviction of the appellants of grievous hurt inasmuch as there is no evidence that any of the bones was fractured or that the injured person was disabled for 20 days or more; secondly, that the contusions found on P.W. 2 would clearly belie the evidence of the eye witnesses that the injuries were inflicted by a kanta, and thirdly, that the deposition of Sri Pal ought not to have been admitted in evidence under section 33 because the death of Sri Pal has not been strictly proved.
The main question which requires to be determined in this case is whether there is sufficient evidence to establish that ,he appellant had caused the injuries found on P.W. 2, and if so, having regard to the injuries what is the offence which the appellants have ' committed.
It appears to us that there is sufficient credible evidence of the eye witnesses to prove beyond doubt that the appellants had caused injuries to P.W. 2.
Even if the evidence of P.W. 1 and P.W. 2 who.
are brothers, of whom P.W. 2 is the victim, is for the moment not considered, there is no reason why the evidence of P.W. 3 Maya Ram ought not 240 to be relied upon.
According to Maya Ram, he was in the Kallian when he heard the cries of Jeet Bahadur and rushed.
He says, "it was the time of about 5 or 5.30 ' p.m.
I heard an .alarm raised in the field of Jeet Bahadur.
I and Himachal ran to that side.
Ram Pal was coming up running from the western side.
In the field of Jeet Bahadur, I saw Bisram and Hori Lal accused present in court beating Jeet Bahadur with kantas.
We raised alarm.
After assaulting Jeet Bahadur Hori Lal and Bisram accused went away towards the east.
Sagar Singh was coming up running from his chak.
Sagar Singh was raising alarm.
Bisram accused fired the pistol at Sagar Singh, but Sagar did not sustain any injury.
I saw injuries on the body of Jeet Bahadur.
After it we took Jeer Bahadur to Hasanganj on a cot.
" The witness was cross examined at length but now here has it been suggested that he is an interested witness or he is speaking untruth.
Both the Sessions Court as well as the High Court relied upon his evidence which according to them fully corroborated the evidence of P.Ws. 1 and 2.
The fact that some contusions and abrasions were found on P.W. 2 does not impair the evidence of these witnesses because the doctor was not asked whether the injuries were possible if kanta blows are given.
It is quite possible to find contusions where two persons are giving blows with kantas which have also blunt asides.
Unless definite suggestions are made and the impossibility of finding any such injuries with kanta blows is elicited, we will not be justified merely on a submission from the bar to accept it and discard the evidence of the eye witnesses.
We, therefore, find no valid reason in not accepting the concurrent findings of both the courts that the appellants had caused injuries to P.W. 2 as spoken to by the witnesses.
these circumstance.s, it is unnecessary for us to express any view on the question whether the evidence of the investigating officer Bhanu Prakash Sharma that 'it has been learnt that Sri Pal has died ' is sufficient to prove the death of Sri Pal in order to admit the deposition of Sri Pal in the Committal Court under section 33 of the Evidence Act.
It now remains to consider whether the conviction of the appellants under section 326 for grievous hurt is justified.
The answer to this question would depend on the nature of the injuries which have been found on P.W. 2, namely, whether they are simple or grievous.
In order to justify conviction under section 326.
injuries on P.W. 2 must satisfy the requirements of cl. 7 or cl. 8 of section 320 of the Indian Panel Code, otherwise they will be treated as simple injuries.
Clauses 7 and 8 of section 320 I.P.C. provide that an injury could only be designated as grievous if it is (l) a fracture or dislocation of a bone or tooth, or (2) any hurt which 241 endangers life or which causes the sufferer to.
be ,during the space of twenty days in severe bodily pain, or unable to follow his ordinary pursuits.
It is contended by the learned counsel for the appellant that none of the injuries 2 to 6 which were inflicted on P.W. 2 discloses that there is a fracture or dislocation of any bone.
These injuries, it is said, at the most show that the particular bones on which the injuries were inflicted were cut which however does not amount to a fracture.
It is true that fracture has not been defined in the penal code.
It is sometimes thought as in the case of Po Yi Maung vs Ma E Tin(1) that the meaning of the word fracture would imply that there should be a break in the bone and that in the case of a skull bone it is not merely sufficient that there is a crack but that the crack must extend from the.
outer surface of the skull to the inter surface.
In Mutukdhar Singh vs Emperor(2) it was observed that if the evidence is merely that a bone has been cut and there is nothing whatever to indicate the extent of the cut, whether a deep one or a mere scratch on the: surface of the bone, it will be difficult to infer that the injury is a grievous hurt within the meaning of section 320 of the Panel Code.
In our view, both these assumptions are misleading.
It is not necessary that a bone should be cut through and through or that the crack must extend from the.
outer to the inner surface or that there should be displacement of any fragment of the bone.
If there is a break by cutting or ,splintering of the bone or there is a rupture or fissure in it, would amount to.
a fracture within the meaning of el. 7 of section 320.
What we have to see is whether the.
cuts in the bones noticed in the injury report are only superficial or do they effect a break in them.
The nature of the injuries as spoken to by the doctor in his evidence, discloses the length, breadth and depth of each injury.
far as the depth of the injuries Nos. 3, 4, 5 and 6 is concerned, each one of the injuries shows that it is bone deep and they are described as cutting the underlying bone.
in injury 3 left humerus, in injury 4 radius, in injury 5 both the bones of the left forearm and in injury 6 the tibia bone shaft have been cut which would show that they are fractures.
Apart from this the doctor as noticed earlier has in his evidence said that these injuries are grievous.
It is contended that the doctor has not disclosed the reason why he thinks that the injuries were grievous.
But in our view the doctor would not be unaware of what injuries are grievous or what are simple.
At any rate, the nature of the injuries considered with the evidence of the doctor would undoubtedly establish that all the aforesaid" ' (1) A.I.R. (1937 ') Rang 253.
(2) A.I.R. (1942) Pat.
242 injuries were grievous.
these injuries were inflicted by kantas which are dangerous weapons and hence the conviction under section 326 is fully justified.
The appeal fails and it is dismissed.
Y.P. Appeal dismissed.
| The suit lands were patilkiwatan lands in the erstwhile State of Kolhapur.
Under the wat hukum No. 26 of Fasli 1323, the service was to be performed by persons in the eldest branch, but the properties need not necessarily be with the person doing the service.
Thus, though the respondent was registered 'as the Nawa wala and was doing service, the properties were in possession of another branch.
The widow of the last holder of the properties, in that branch, died in 1943 leaving a daughter.
The respondent, thereupon, filed a suit claiming the properties on the ground that, under the wat hukum, the other branch had become Nashtamsha, that is, extinct, because there was no direct male descendant, and that he was entitled to get possession of the properties from the appellants.
who were in possession.
The suit was decreed by the Subordinate courts and the High Court.
In appeal to this Court, HELD: In Kolhapur State succession to watan properties was governed by the war hukum and not by ordinary Hindu law.
In Dads Babaji Patil vs Kalgonda Babgonda Patil, (1945) Kol.
L.R. 541, a decision of the Supreme Court of Kolhapur, followed in S.A. No. 210 of 1947 by the High Court of Kolhapur, it was held that a branch became Nashtainsa when the deceased person left behind him no sons.
But, according to Shivgouda vs Champabai Bharatar Siaganda App.
No. 297/57 (dt. 7 12 1962) of the Bombay High Court, a branch cannot be said to be Nashtamsha if the last holder leaves a daughter.
But, whatever may be the correct interpretation, the appellants could not succeed, because, if the view of the Kolhapur courts is accepted, the respondent,as Nawa wala, was entitled to get possession, and if the Bombay view is according to Shivgonda vs Champabai Bharatar Siaganda App.
No. 297/57 who. would be entitled to inherit the watan properties.
[348 B E: 349 B. E G] Sambaji Ramachandra Kulkarni vs Gopal Govind Dattawad, , referred to.
|
Appeals Nos. 416 and 417 of 1947.
Appeals from the judgment and decree dated May 1, 1956, of the Punjab High Court in Regular First Appeal No. 45 of 1950.
276 A.V. Viswanatha Sastri, Gopal Singh and R. N Sachthey, for the appellants (in C.A. No. 416/1962), and respondent (in C.A. No. 417/62).
S.T. Desai, Hardayal Hardy and J. P. Agarwal, for the, respondent (in C.A. No. 416 of 1962) and appellants (in C.A. No. 417 of 1962).
May 8, 1964.
The following Judgments were delivered by the Court.
SARKAR J.I agree with the orders proposed by my brother Hidayatullah.
These appeals arise out of a suit brought by a firm called the Modern Cultivators against the State of Punjab to recover damages for loss suffered by flooding of its lands as a result of a breach in a canal belonging to the State of Punjab.
Both the Courts below have held in favour of the plaintiff but the High Court reduced the amount of the damages awarded by the trial Court.
Both parties have appealed to this Court.
The Modern Cultivators contend that the High Court is in error in reducing the amount of the damages.
The State of Punjab contends that it had no liability forthe loss caused by the flooding.
The breach and the floodingof the plaintiff 's lands are not now denied.
In regard to the appeal by the Modern Cultivators I have nothing to add to what has been said by Hidayatullah J.
For the reasons mentioned by him I agree that the damages had been correctly assessed by the trial Court.
In its appeal the State of Punjab first contended that the plaintiff could not succeed as it had failed to prove that the breach had been caused by the defendant 's negligence.
I am unable to accept this contention.
The trial Court inferred negligence against the defendant as it had failed to produce the relevant documents and with this view agree.
The defendant had produced no documents to show how the breach was caused.
It had been asked by the trial Court to do so by an order made on May 12, 1949 but failed to produce them.
The defendant bad a large number of canal officers and according to Mr. Malhotra, the,Executive Engineer in charge of the canal at the relevant time, 277 there was a regular office and various reports concerning the breach had been made.
None of these was produced at the hearing.
It is obvious that in an Organisation like the canal office, reports and other documents must have been kept to show how the breach occurred and what was done to stop it.
If such documents are not produced, an inference can be legitimately made that if produced, they would have gone against the case of the defendant, that is, they would have proved that the defendant had been negligent: Murugesan Pillai vs Manickavasaka Pandara(1).
It was suggested in this Court.
that the documents had been destroyed.
It may be that they are now destroyed.
One of the defendant 's officers called by the High Court in view of the unsatisfactory nature of the documentary evidence said that documents Were destroyed after three lo seven years.
The breach occurred in August 1947, the suit was filed in October 1948 and the trial was held about August 1949.
So it would appear that at the time ,of the trial the relevant documents had not been destroyed.
Nor was it said that they had then been destroyed.
Furthermore, in view of the pendency of the suit the documents must have be en preserved.
It is, clear that they bad not been produced deliberately.
An inference that the defendant was negligent in the management of the canal arises from the non production of the documents.
There is therefore, evidence that the defendant was negligent.
Furthermore it seems to me that the rule of res ipsa loquitur applies to this case.
The canal was admittedly in the management of the defendant and canal banks are not breached if those in management take proper care.
In such ,cases the rule would apply and the breach itself would be prima facie proof of negligence: see Scott vs London Dock Co.(1).
No doubt the defendant can show that the breach was due to act of God or to act of a third party or any ,other thing which would show that it had not been negligent, but it did not do so.
It may be that the rule of res ipsa loquitur may not apply where it is known how the thing which caused the damage happened as was held in Bankway vs South Wales Transport Co., Ltd.(1).
But that is not the (1) L.R. 44 I.A. 98.
(2) (3) 278 case here.
No reason has been advanced why the rule should not apply.
Therefore I think that the first contention of the defendant that there is no evidence of negligence must be rejected.
I do not think it necessary in the present case to consider whether the rule in Rylands vs Fletcher(1) applies to make the defendant liable for I have already held that it is liable as negligence has been proved.
The second point raised by the defendant was one of limitation.
It was contended on behalf of the defendant that the case was governed by article 2 of the first schedule of the Limitation Act.
It is not in dispute that if that article applies, the suit would be out of time.
That article relates to a suit "for compensation for doing or omitting to do an act alleged to be in pursuance of any enactment".
It was said that the imposed a duty on the defendant to take care of the canal banks and its failure to do so was the omission to do an act in pursuance of an enactment within the article.
I have very grave doubt if this interpretation of article 2 is correct.
There is authority against it: see Mohammad Saadat Ali Khan vs The Administrator, Corporation of City of Lahore(1).
But apart from that I find nothing in the Canal Act imposing any duty on the defendant to take care of the banks.
We were referred to sections 6 and 51 of that Act.
Both are enabling sections giving power to the State Government to do certain acts.
Under section 6 it has power to enter on any land and remove any obstruction and close any channels or do any other thing necessary for the application or use of the water to be taken into the canal.
This obviously does not impose any duty in connection with the canal bank.
Section 15.
gives the power to the canal autho rities in case of accident happening or being apprehended to a canal to enter upon lands of others and to do all things necessary to repair the accident or prevent it.
This section again has nothing to do with taking care of the canal banks.
Therefore, even assuming that the defendant 's interpretation of article 2 is correct, this is not a case to which it may apply.
I wish however to make it clear that nothing that I have said (1) ; (2) [1945] L.R 26 Lah.
523 279 here is to be read as in any way approving the defendant 's interpretation of article 2.
Therefore the defendant '& conten tion that the suit was barred by limitation also fails.
The defendant 's appeal must, therefore, be dismissed and the plaintiff 's appeal allowed.
Costs will naturally follow the result.
HIDAYATULLAH, J.On August 15, 1947 the Western Jamna Canal at R.D. No. 138000 near Sangipur and Jandhrea villages burst its western bank.
The canal water inundated the neighbouring fields where crops of sugar cane, maize, urud etc.
grown by the plaintiff firm were damaged.
The plaintiff brought this action alleging that the breach in the bank was caused by negligence on the part of the canal authorities who were guilty of further negligence in not closing the breach without delay.
The plaintiff estimated its loss at Rs. 60,000 in respect of the standing crop and a further loss of Rs. 10,000 in respect of the deterioration of the land for future cultivation.
It however, limited its claim to Rs. 20,000.
The State Government denied negligence on the part of the canal authorities.
Government admitted that a breach did occur in an old inlet channel of Chhalaundi Silting Tank on August 15, 1947 and some canal water escaped through the breach which, it was said, flowed back to the canal through the outlet of the silting tank lower down the canal.
Government claimed that the site was immediately inspected by the Executive Engineer and no damage to the crops was discovered and that the breach was promptly closed and the bank was strengthened.
Government stated that there were heavy rains on the 8th September and again from 23rd to 28th September, 1947 causing floods in the nullahas but as the canal was running full supply, water brought by the nullahas to the silting tank could not get to the canal and over flowed to the adjoining areas.
Shortly stated, plaintiff 's case was that there was a breach in the western bank of the canal owing to the negligence of the defendants and canal water escaped to the fields causing them to be flooded; while the case of the Government was that a breach did take place but it was promptly repaired 280 and the fields were flooded not by the canal water but by heavy rains in the month of September.
The trial judge passed a decree for Rs. 20,000 against Government, but it was reduced by the High Court to Rs. 14,130.
These two cross appeals have thus been filed by the rival parties by special leave of this Court.
The High Court and the court below have a, reed in holding that there was a break in the canal.
The size of the breach has been variously described, but it was certainly not less than 30 feet wide and the depth of the water at the breach was about 15 feet.
It is admitted that the canal was then running full supply 2, 5,000 Cusecs.
As the width of the canal was 400 feet, the out flow would be at the rate of 5,00OX30/400 Cusecs if the breach was 30 feet wide.
This would mean extensive flooding of the low lying areas unless the breach was immediately closed.
Some of the witnesses say that it was as much as 70 to 80 feet wide and that would make the out flow even greater.
The High Court held that the floods were not caused by the rains.
Prior to the break in the canal there was only I inch of rainfall.
The heavy rains took place much later.
The inundation of the fields was thus by water from the canal and not from the nullahas.
This much has already been held.
It ,is admitted that the breach occurred at a place where there was an old nullah through which silting operations were carried out in the past and this exit was closed in the previous years and the breach was at that very site.
The breach was noticed on the morning of the 16th.
No attempt was made by either side to establish the exact duration of time before the breach was repaired.
Mr. Malhotra (Executive Engineer) stated that it was repaired by the 18th but was re opened (one does not know why) on the 20th and again closed on the 21st.
Evidence on behalf of the plaintiff established that water continued pouring out as late as the month of October.
This was apparently an exaggeration.
There is no evidence to show that the flow of water in the canal was reduced from the headworks the breach occurred.
It apparently continued on full The High Court attempted to secure the documents from the canal Office which had not been produced earlier.
The 281 Executive Engineer, then in charge was summoned to bring all the papers in his office and he produced the telegrams received by and copies of telegrams issued from the head office between August 16, 1947 and September 5, 1947.
From these documents it is now established that the breach was not repaired at least upto August 27, 1947 and the evidence that it was repaired on the 18th was therefore not accurate.
It has also been established that the case of the plaintiff that water continued to flow right upto October was also false.
It may thus be assumed that repairs were completed by the 27th August but not earlier.
It is admitted that the area into which water flowed was used as a silting tank.
The silting operations comprise the opening of the bank of the canal at a selected place to let out turbid water which passing through the silting tank drops the sediment and flows back to the canal at a lower reach free of the silt, and closing of the bank.
It is now admitted that at the exact spot where the breach took place there was previously an opening for silting purposes which was recently closed.
There is no evidence to show negligence on the part of Government.
Curiously enough Government said that it had not preserved the papers connected with this mishap.
We can hardly believe this.
Government led evidence to establish that the banks of the canal were periodically inspected and claimed that the breach was an act of God without any negligence on the part of the canal authorities.
It is an admitted fact that crops of the plaintiff were destroyed if not wholly at least substantially.
The only question, therefore, is whether Government can be held responsible for the damage caused to the plaintiff and, if so what should be the compensation.
Two points were urged on behalf of Government: the first was that the suit filled by the plaintiff was out of time inasmuch as article 2 of the Indian Limitation Act which pres cribes a period of three months was applicable and not article 36 which prescribes a period of two years.
This wag held against Government by the High Court and the court below.
The second point urged on behalf of Government was that there was no proof of negligence whatever by the plaintiff and the plaintiff must therefore fail.
The High 282 Court in dealing with this point held that, in the circum stances res ipsa loquitur and that it was not necessary for the plaintiff to prove negligence and it must be so presumed.
The High Court differed from the court below in assessing damages.
In the appeal of the Government both these points are urged.
On behalf of the plaintiff, in the companion appeal, it is contended that the High Court omitted to give proper compensation for the loss of maize and urud crop.
It is submitted that the High Court adopted the formula that in respect of sugar cane crop which needs plenty of water the damages should be assessed at 1/3 of the value of the crop and in respect of maize and urud crops at 1/2 the value.
The plaintiff contends in its appeal (that the whole of the maize and urud crop was completely destroyed and the decree of the court of first instance allowing 3/4 of the value of the crop as compensation was unassailable.
It is pointed out that evidence disclosed that water in the fields was 4 to 5 feet deep and the maize and urud plants were less than 2 feet high.
In other words, the plants remained submerged during all the time the fields were mandated.
It is obvious that the crop must have been entirely destroyed and the allowance of 1/4 was because the destroyed crop had some value as chari.
On the facts, as found, there was hardly any justification for reducing the amount of the decree for damages passed by the court of first instance.
The High Court itself, in more than one place, stated in its judgment that the maize and urud crops were completely destroyed.
It is, therefore, clear that unless Government succeeds in its appeal the.
decree of the court of first instance must be restored in this case.
Mr. Vishwanatha Sastri on behalf of Government asked for a remit, but in view of the slight difference and the fact that the High Court itself remarked that the maize and urud crops were completely destroyed there would not be any necessity to order a remit in case the appeal of the Government fails.
I shall now turn to that appeal.
The facts as found in this case are that in 1946, the land which got flooded, was used for silting operations.
An opening in the western bank was made in that year and the 283 bank was restored in June 1946.
Till the month of August in the following year there was no complaint.
Evidence discloses that the banks were regularly inspected.
A special Engineer and a Special Sub Divisional Officer were in charge and there were watchmen also.
There is no evidence of wilful conduct.
The plaintiff has not led evidence to establish any particular act of negligence.
There is no evidence that the breach was caused by the act of a third party or even of God.
Sastri, therefore, contends that as there was no foreseable danger against which precautions could be taken beyond making periodical inspections, and this was done, there can be no liability.
He submits that in this view of the matter the plaintiff must fail in the absence of proof of negligence.
The High Court applied to the case the rule in Donoghue vs Stavenson(1) reinforcing it with what is often described as the doctrine of res ipsa loquitur.
This case is first of its kind in India and needs to be carefully considered.
Before us reliance was placed upon the rule in Rylands vs Fletcher(1).
That rule, shortly stated, is: that any occupier of land who brings or keeps upon it anything likely to do damage if it escapes is bound at his peril to prevent its escape, and is liable for all the direct consequences of its escape, even if he has been guilty of no negligence: Per Salmond, Law of Torts 13th Edu.
p. 574.
The rule in Rylands vs Fletcher was derivatively created from the rule of strict liability applicable to the acts of animals but, in my opinion, it is hardly applicable here.
Canal systems are essential to the life of the nation and land that is used as canals, is subjected to an ordinary use and not to an unnatural use on which the rule in Rylands vs Fletcher rests.
The words of Lord Cairns "non,natural use" of land and of Blackburn, J. "special use bringing with it increased danger to others" are sometimes missed.
There is difficulty in distinguishing non natural and natural user but perhaps the best test to apply is slated by Lord Moulton in Richards vs Lothian(1): (1) [1932] A.C. 562 (2) L.R 3 H.L. 300 (3) ; , 280 284 "Some special use bringing with it increased danger to others, and must not merely be the ordinary use of the land or such a use as is proper for the general benefit of the community.
" They formed the basis of observation of Viscount Maugham in Sedleigh Denfield vs V. O 'Callaghan and Ors.(1).
As was pointed out by Holmes in his Common Law (1963) at p. 93: "It may even be very much for the public good that dangerous accumulations should be made.
" Cases of breaks in canals resulting in danger to neigh bouring lands are rare but some are to be found in law reports from the United States of America.
I need not refer to them because the following passage from American Jurisprudence Vol.
9 page 340 para 38 gives an adequate summary of the principles on which they had been dealt with: "A canal company is also liable for flooding private property where it has not acquired the legal right to do so; it is answerable in damages for all loss occasioned by a neglect on its part to use reasonable care and precaution to prevent the waters of its canal from escaping therefrom to the injury and detriment of others.
A canal proprietor is not, however, liable for damages to adjoining lands resulting from a mere accidental break in his canal which human foresight and vigilance could not have anticipated, and against which proper prudence and judgment could not be expected to provide.
Although it has been held that a canal company is not liable for damages occasioned by the per colation of waters through the banks of its canal, in the absence of proof of negligence on its part in want of skill or care in the construction and maintenance of its canal, such holdings are maintenance of its canal.
such holdings (1) ; at 889 285 are opposed to the weight of reason and autho rity.
" Perhaps the liability is viewed strictly as an inducement to care Safety is best secured when.
it is made the responsi bility of the person who must not only take precautions to avoid accident but who alone decides what those precautions should be.
In this connection the rule that is most often quoted was stated by Erle C.J. in Scott vs London and St. Katherine Docks Co. (1) thus: "There must be reasonable evidence of negligence.
But where the thing is shown to be under the management of the defendant or his servants, and the accident is such as in the ordinary course of things does not happen if those who have the management use proper care, it affords reasonable evidence, in the absence of explanation by the defendants that the accident arose from want of care.
" In subsequent cases it has been customary to regard this as a statement of the principle of res loquitur.
But the principle, if it be one, cannot always be safely applied where the facts before the court are not the whole facts.
In a vast canal system constructed with great care and attention to detail it may be difficult to prove negligence but it may sometimes be equally difficult to explain how the defect arose.
The principle of res ipsa loquitur had its origin in the failing of a barrel of flour from a first floor window on a passerby but it has been extended to situations quite different.
It is not very much in favour and if applied it must be correctly understood.
It is not a principle which dispenses with proof of negligence.
Rather it shifts onus from one party to another.
It is rule of evidence and not of liability.
A too ready reliance on the maxim reinforces a fault liability and makes it into an absolute liability.
If absolute liability is to give way to fault liability, some fault must be established by evidence or must be capable of being reasonably inferred from the circumstances.
It is not (1) ; : 286 sufficient to say res ipsa loquitur because the danger is that facts may not always tell the whole story and if there is something withheld how can the thing be said to speak for itself ? The principle which I consider reasonable to apply where fault has to be inferred from circumstances was best stated by Lord Porter and I respectfully adopt it.
Speaking of res ipsa loquitur it was observed by Lord Porter in Barkway vs South Wales Transport Co. Ltd.(1) : "The doctrine is independent on the absence of explanation, and, although it is the duty of the defendants, if they desire to protect themselves, to give an adequate explanation of the cause of the accident, yet, if the facts are sufficiently known, the question ceases to be one where the facts speak for themselves, and the solution is to be found by determining whether, on the facts as established, negligence is to be inferred or not.
" I have made these observations so that the principle may not be applied too liberally.
It must also be remembered that what is said in relation to it in one case cannot indiscriminately be applied to another case.
It should not be applied as legal rule but only as an aid to an inference when it is reasonable to think that there are no further facts to consider.
I shall now consider the facts as they stand in this case to discover if the canal authorities can be said to be at fault.
The facts show that the water escaped into the Chillaundi Silting Tank through the nallah which had previously been used for silting operations and had been sealed in the previous year.
If the plug were sound it would have withstood the pressure of water as it did after it was repaired on the 27th August even though 28" of rainfall fell within 20 days.
There is nothing to show that the outflow was due to rainfall or a storm so exceptional that it could be regarded as an act of Good.
Nor was it due to any disturbance of the earth 's crust or interference by a stranger.
There is thus ,sufficient evidence, in the absence of reasonable explanation (1) at 394,395 287 (which there is not), to establish negligence.
Further, there was inordinate delay and negligence in sealing the breach.
Even the flow in the canal was not reduced for repairs to be carried out quickly.
In such circumstances, the facts prove negligence and government was rightly held responsible.
Whether the defect was patent or latent is not much to the purpose.
It was not an inevitable accident, and the Government must be held liable.
It remains to consider the question of limitation.
The high Court and the court below have applied article 36 of the indian Limitation Act.
Government claims that the proper Article to apply was article 2.
These Articles may be set down here: Description of Period of limitation Time from which suit.
period begins to run.
For compensation Ninety days When The act or for doing or for omission takes omitting to do an place.
act alleged to be in pursuance of any enactment in force for the time in India 36.
For compensation Two years (now When the malfeasance for any mal feas one year) misfeasance or non ance, misfeasance feasance takes place.
or nonfeasance independent of contract and not herein specially provided for.
It is not denied that if article 2 was not applicable, the proper Article would be article 36 and the suit would also be within time.
In contending that the second article applies reliance is placed on a decision of the Privy Council in Punjab Cotton Press Co. Ltd. vs Secretary of State(1).
But that case is clearly inapplicable.
There the canal authorities cut the bank of a canal at a selected point to let the water away with a view to protecting a railway track passing close by ,on a high embankment and in this way flooded and injured the plaintiff 's mills.
The Judicial Committee held that if the act was done, as was said, under section 15 of the (8 of 1873), article 2 was applicable and not article 36.
The case was thus remanded (1) I.L.R. to Lah.
171 P.C. 288 to find the fact necessary for the application of the.
right article.
In relying upon this case, Mr. Viswanatha Sastri claims that section 15 of the Canal Act covers the present facts.
Mr. Gopal Singh, who followed, also refers to section 6.
These, sections read: "6.
Powers of Canal Officer.
At any time after the day so named, any Canal Officer, acting under the orders of the State Government in this behalf, may enter on any land and remove any obstructions, and MaY close any channels, and do any other thing necessary for such application or use of thE said water." "15.
Power to enter for repairs and to prevent accidents.
In case of any accident happening or being apprehended to a canal, any Divisional Canal.
Officer or any person acting under his general or special orders in this behalf may enter, upon any lands adjacent to such canal, and may execute all works which may be necessary for the purpose of repairing or preventing such accidents.
Compensation for damage to land.
In every such case, such Canal Officer or person shall tender compensation to the proprietors or occupiers of the said lands for all damage done to the same.
If such tender is not accepted, the Canal Officer shall refer the matter to the Collector, who shall proceed to award compensation for the damage as though the State Government had directed the occupation of the lands under section 43 of the Land Acquisition Act, 1870.
" In regard to section 6 it is sufficient to say that it has no application here.
It refers to the day named in section 5 and 289 that section provides for a notification to be issued declaring that water would be applied after a particular date for purpose of any existing or projected canal or drainage work or for purposes of Government.
On such notification issuing any Canal Officer, acting under the orders of the State Government, may enter on any land and remove obstructions or close any channels so that water may be applied to those purposes.
This is an entirely different matter and it is no wonder that Mr. Viswanatha Sastri did not rely upon section 6.
Section 15 no doubt confers a power to enter lands and property of others to affect repairs or to prevent accidents.
One can hardly dispute that it is the normal duty of canal authorities to make repairs and execute works to prevent accidents.
But article 2 cannot apply to omissions in following the statutory duties because it cannot be suggested that they are 'in pursuance of any enactment '.
Cases of malfeasance, misfeasance or nonfeasance may or may not have statutory protection.
Act or omission which can claim statutory protection or is alleged to be in pursuance of a statutory command may attract article 2 but the act or (mission must be one which can be said to be in pursuance of an enactment.
Here the suit was for compensation for damage consequent on a break in the canal on August 15, 1947.
The only act or omission could be the opening and closing of the channel for silting operations.
That was before June 1946.
The third column of article 2 provides the start of the limitation of 90 days" when the act or omission takes place.
" The period of limitation in this case would be over even before the injury if that were the starting point.
This subject was elaborately discussed in Mohamad Sadaat Ali Khan vs Administrator Corporation of City of Lahore(1) where all rulings on the subject were noticed, Mahajan J. (as he then was) pointed out that "the act or omission must be those which are honestly believed to be justified by a statute".
The same opinion was expressed (1) I.L.R. F.B. 51 S.C. 19. 290 by Courtney Terrell C.J., in Secretary of State vs Lodna Colliery Co. Ltd. (1) in these words : "The object of the article is the protection of public officials, who, while bona fide purporting to act in the exercise of a statutory power, have exceeded that power and have committed a tortious act; it resembles in this respect the English Public Authorities Protection Act.
If the act complained of is within the terms of the statute, no protection is needed, for the plaintiff has suffered no legal wrong.
The protection is needed when an actionable wrong has been committed and to secure the protection there must be in the first place a bona fide belief by the official that the act compalined of was justified by the statute; secondly, the act must have been performed under colour of a statutory duty, and thirdly, the act must be in itself ,a tort in order to give rise to the cause of action.
It is against such actions for tort that the statute gives protection.
" These cases have rightly decided that Art.2 cannot apply to cases where the act or omission compalained of is not complained of is not alleged to be in pursuance of statutory authority.
It is true that in Commissioners for the Port of Calcutta vs Corporation of Calcutta(1) the Judicial Committee, while dealing with section 142 of the Calcutta Port Act (3 of 1890) which reads: No suit shall be brought against any person for any done or purporting or professing to be done in pursuance of this Act, after the expiration of three months from the day on which the cause of action in such suit shall have arisen", pointed to the presence of the words "purporting or profess ing to be done in pursuance of this Act" and observed that (1) I.L.R. 1 5 Pat.
510 (2) 64 I.A. 36 291 they regarded the words as of 'pivotal importance ' and that their presence postulated "that work which is not done in pursuance of the statute may nevertheless be accorded its protection if the work professes or purports to be done in pursuance of the statute".
But they were giving protection to an act which could legitimately claim to be in pursuance of the Port Amt.
Here the break in the bank was not that kind of act or omission.
It could not claim to be in pursu ance of the Canal Act.
Nor could the opening or closing of the channel for silting operations, though in pursuance of the Canal Act, be the relevant act or omission because they were more than a year before the cause of action and to apply a limitation of 90 days to that cause of action is not only impossible but also absurd.
article 2, therefore, does not apply here.
It was not contended before us that the suit was otherwise time barred and we accordingly confirm the finding that the suit was within time.
The result thus is that the appeal filed by the State Government fails and I would dismiss it with costs and allow the appeal filed by the plaintiff with costs.
I would modify the judgment and decree of the High Court by altering the amount of Rs. 14,130 to Rs. 20,000 as ordered by the trial judge.
MUDHOLKAR, J.I agree with my brethren Sarkar and Hidayatullah that the appeal preferred by the defendant, the Stale of Punjab, be dismissed and the appeal preferred by the plaintiff, the Modern Cultivators, be allowed and the decree for damages be restored to the sum awarded by the trial court.
I also agree with the order for costs as proposed.
I wish to add nothing with regard to the plaintiff 's appeal to what has been said by my brother Hidayatullah nor to what he or my brother Sarkar has said regarding the question of limitation raised on behalf of the defendant.
They have both held that article 2 of the Limitation Act is not attracted to a case like the present where the damages sustained by the plaintiff are not the result of anything done by the State 292 in pursuance of a statutory power exercised by it or by reason of an act which could properly be said to have been performed in the purported exercise of a statutory power.
If article 2 is out of the way, it is not disputed on behalf of the State that the suit will be within time.
My learned brother Hidayatullah has referred to the rule of common law as to strict liability with respect to damages resulting from the escape of deleterious substances or cattle from the land which have been accumulated or brought on the land by its owner for his use and which were not natural there.
The rule was stated thus in Rylands vs Fletcher(1) by Blackburn, J. "We think that the true rule of law is that the person who for his own purposes brings on his lands and collects and keeps there anything likely to do mischief if it escapes, must keep it in at his peril, and if he does not do so is prima facie answerable for all the damage which is the natural consequence of its escape.
" It was approved by the House of Lords, but Lord Cairns laid down a new principle distinguishing the natural from the non natural user of land and holding that in the latter case only was the liability absolute.
(see Salmond on Torts, 13th ed.
p. 579).
This rule has been adopted in this country in several cases (see Gooroo Churn vs Ram Dutt(2); Dhanusao vs Sitabai(3) and several other cases) and can, therefore, be regarded as a part of the common law of the land.
In the country of its origin, this rule has been subjected to certain exceptions.
The present case falls in one of the exceptions recognised in some, though not, all cases.
It has been held in some cases that where the owner or occupier of land accumulate,,, a deleterious substance thereon by virtue of an obligation imposed upon him by a statute or in exercise of statutory authority he will not be rendered liable for damages resulting therefrom to other persons unless it is established that he was guilty (1) 18681 ; (2) 293 of negligence in allowing the deleterious substance to escape.
In a recent decision Dunne vs Horth Western Gas Board(1) the Court of Appeal has recognised this exception and the controversy may be said to have been set at rest subject, of course, to what the House of Lords may have to say hereafter.
Indeed, the liability to pay damages to another resulting from an act of a person is laid upon him by the law of torts upon the basis that his act was wrongful and that he was a wrong doer.
Where, therefore, the act consists of something which the law enjoins upon that person to do or which the law permits him to do, it cannot possibly be said that his mere act in doing that something was in itself wrongful and that he was a wrong doer.
He will, however, be liable if he performed the act in a negligent manner or if the escape of the deleterious substance subsequent to accumulation of that substance in exercise of a statutory authority was the result of his negligence.
There is nothing here to show that in constructing the canal under the powers conferred by the State did anything other than what the law permitted.
Therefore, by constructing the canals and allowing water to flow along it the State merely exercised its statutory authority.
Further, there is nothing to show that there was any want of care in constructing the canal and so no question of negligence will arise in constructing the canal and allowing water to flow along the canal in question.
Here, what has happened is that at the point where prior to 1946 the water from the canal was allowed to flow into the silting tank through a nallah, there was an opening which was plugged in that year.
Here, it is established that over a year after that opening was plugged by the State a breach of about 30 or 40 feet was caused.
This occurred on August 15, 1947.
It has not been shown that the breach could have been caused by an act of God or an act of third party.
The contention of the State that it was caused by heavy rains in the catchment area has not been found to be true If, therefore, there is material from which it could be inferred that the breach was caused by reason of negligence on the part of the State in inspecting the banks of the canal and in (1) 294 particular that portion of it where the breach had been caused the State would be liable in damages.
This would be, so not by the operation of the rule in Rylands vs Fletcher(1) but by reason of negligence.
The sole ground upon which the liability of the State could be established in this case would be negligence of the State in properly maintaining the banks of the canal.
For this purpose it would be relevant to consider whether there were periodical inspections, whether any breaches or the development of cracks were noticed along the banks of the canal and in particular at the place where the breach ulti mately occurred or whether any erosion of the banks parti cularly at the place where one of the banks had been plugged had been noticed and no action or timely action had been taken thereon.
There is evidence to show that the canals were being regularly inspected.
That, however, is not the end of the matter.
Immediately after the breach occurred some reports were made and as pointed out by my brethren in their judgments they were not placed before the court despite its order requiring their production.
When the matter went up before the High Court it was said that the records had been destroyed in the year 1958 or so and therefore they could not be furnished.
This action on the part of the State is manifestly unreasonable and the legiti mate inference that could be drawn from it is that if the documents had been produced they would have gone against the State and would establish its negligence.
In it could legitimately be presumed that the State was negligent inasmuch as it had deliberately suppressed evidence in its possession which could have established negligence.
In the circumstances of this case I do not think it appropriate to refer to the rule of evidence res ipsa loquitur.
| Under Section 7 of the , the appropriate Government has ample power to constitute an industrial tribunal for a fixed period of time and to constitute a new tribunal on the expiry of that period, to hear and dispose of all references made to the previous.
tribunal which had not been disposed of by that tribunal.
|
Appeals Nos. 307 to 309 of 1958.
Appeals from the judgment and order dated August 1, 1956, of the Orissa High Court in O. J. C. Nos. 16, 19, 137 and 61 of 1954.
C.B. Aggarwala and P. C. Aggarwala, for the appellant (In C. As.
307 to 309 of 58).
N.C. Chatterjee, J. H. Umrigar and T. M. Sen, for the respondents (In all the appeals).
September 21.
The Judgment of the Court was delivered by SHAH J.
This is a group of three appeals filed with certificate of fitness under article 132 of the Constitution issued by the High Court of Judicature, Orissa.
The Legislature of the Province of Orissa enacted the Orissa Agricultural Income tax Act XXIV of 1947 hereinafter referred to as the Act providing for the levy of income tax on agricultural income derived from lands situated in the Province of Orissa.
This Act was brought into operation from July 10, 1947.
By section 3, agricultural income tax at the rate or rates specified in the schedule was made payable for each financial year on the total income of the previous year of every person.
By the proviso to that section, agricultural income of the Central Government or of the State Government or of any local authority was exempt from 'taxation.
Section 2, cl.
(1), defined a " person " as inclusive of a Ruler of an Indian State.
The appellant in these three appeals is the former Ruler of the State of Sonepur.
After 781 the establishment of the Dominion of India on August 15, 1947, the appellant as the Ruler of the State of Sonepur executed an instrument of accession to the., Dominion restricted to three subjects Defence, External Affairs and Communications.
On December 15, 1947, he executed a merger agreement whereby the territory of the State of Sonepur became merged with the territory of the Dominion of India.
By virtue of the merger agreement, the Government of India acquired full sovereign rights over the territory of the State, but ownership of private properties belonging to the appellant and full enjoyment thereof were under the agreement guaranteed to him under article 3.
In exercise of the powers conferred by the Extra Provincial Jurisdiction Act 47 of 1947, the Government of India by notification dated March 23, 1948, delegated to the Provincial Government of Orissa full powers to administer the merged States of Orissa including the State of Sonepur.
The Government of the Province of Orissa applied to the merged States section 1 of the Act as from January 19, 1949, and by notification dated April 1, 1949, the remaining provisions of the Act.
In the meantime, by amendment, two new sections, section 290(A) and section 290(B) were incorporated in the Government of India Act, 1935.
The Governor General of India was thereby given power to direct by order that a merged State shall be administered in all respects as if it formed part of the Governor 's Province specified in the order.
The Governor General of India exercising authority under sections 290(A) and 290(B) issued on July 27, 1949, an order providing that the merged Orissa States including the State of Sonepur shall be administered in all respects as if they formed part of the Province of Orissa with effect from August 1, 1949.
On December 30, 1949, the Governor of Orissa promulgated Ordinance No. IV of 1949 providing inter alia that the Agricultural Income tax Act, 1947, be applied to the merged Orissa States.
This Ordinance was later replaced by the Orissa Merged States (Laws) Act, XVI of 1950.
The appellant was then called upon by the Agricultural 782 Income tax Officer to furnish a return of his agricultural income.
The appellant disputed his liability to pay the agricultural income tax and declined to furnish the return.
The Agricultural Income tax Officer then proceeded to make enquiries about the income received from the lands held by the appellant and assessed him to pay tax for the years 1949 50 to 1953 54.
He also imposed a penalty upon the appellant for failure to submit his returns for the years 1949 50 and 1950 51.
Against the order assessing him to tax and directing him to pay penalty, the appellant preferred appeals to the Assistant Collector of Agricultural Income tax, Sambalpur.
The appeals were dismissed by that officer.
Revision applications to the Collector of Commercial Taxes, Cuttack and to the Board of Revenue were unsuccessful.
The appellant filed four petitions in the High Court of Orissa, being petitions Nos. 17, 16, 19 and 137 of 1954 challenging the assessments made by the taxing authorities for the years 1949 50, 1950 51, 1951 52 and 1952 53 respectively, and two more petitions being petitions Nos. 18 and 138 of 1954 against orders imposing penalty for the years 1949 50 and 1950 51 respectively.
These six petitions and certain other petitions were heard by a Division Bench of the Orissa High Court.
The High Court held that by the guarantee of full ownership, use and enjoyment of the private properties under the merger agreement the Properties of the appellant were not rendered immune from liability to pay tax imposed by the Act and that in the absence of an express provision, his income from lands was liable to pay agricultural income tax.
The High Court also held that even though the appellant was the Ruler of a former Orissa State, he was a " person " within the meaning of the Act and was liable to pay agricultural income tax.
The learned Judges therefore dismissed the petitions challenging the liability of the appellant for the assessment years 1950 51, 1951 52 and 1952 53 to pay agricultural income tax, and they cancelled the order of assessment in respect of the year 1949 50 and the orders imposing penalty in respect of years 1949 50 and 783 1950 51.
Against the orders dismissing the applications for setting aside the assessments in respect of years 1950 51, 1951 52 and 1952 53, these appeals have been preferred with certificate granted by the High Court under article 132 of the Constitution.
The appellant was undoubtedly the Ruler of an Indian State before August 15.
1947, but by reason of the merger agreement executed by him on December 15, 1947, his sovereignty was extinguished.
By article 1 of the terms of the merger agreement, the appellant ceded to the Dominion of India full and exclusive authority, jurisdiction and power for and in relation to the governance of the State and agreed to transfer the administration of the State on the appointed day and as from the said day, the Dominion Government became competent to exercise the power, authority and jurisdiction in relation to the governance of the State in such matters and through such agency as the Government thought fit.
By article 3, the appellant remained entitled to full ownership, use and enjoyment of all private properties (but not of the State properties) belonging to him on the date of the merger.
By article 5, the Dominion Government gua ranteed the succession according to law and customs, to the gadi of the State and to the personal rights, privileges, dignities and titles of the appellant.
It was provided by article 4 that " the Raja, the Rani, the Rajmata, the Yuvraja and the Yuvrani shall be entitled to all personal privileges enjoyed by them whether within or outside the territories of the State, immediately before the 15th day of August, 1947 ".
The appellant contends that as a Ruler of the State of Sonepur, he was, before merger of his State, immune from liability to taxation in respect of his private property both within his territory and outside.
He claims that he was so immune in respect of his property within his State as a Ruler and in respect of his property outside the State by the rules of International Law which, he submits, protect from taxation the properties of a Ruler of a State, situate in a foreign State.
The appellant says that by articles 4 and 5, the Dominion Government guaranteed to him all 784 his personal rights, privileges, dignities and titles enjoyed within or without the territory immediately before the 15th August, 1947, and that any attempt to tax his private property by the State of Orissa or by the Union Government violates that guarantee.
The appellant submits that to give effect to this guarantee, all legislation must be interpreted in the light of the merger agreement which he claims is incorporated in article 362 of the Constitution and he must be held exempt from liability to pay tax even though no express provision in that behalf has been made by the Legislature.
In our view, there is no force in the contentions raised by the appellant.
The privileges guaranteed by articles 4 and 5 are personal privileges of the appellant as an ex Ruler and those privileges do not extend to his personal property.
In dealing with a similar contention raised on the interpretation of article 4 of the merger agreement entered into by the Ruler of Khairagarh (which was in material terms identical with the terms of article 4 of the agreement executed by the appellant), section R. Das, J., (as he then was), observed in Visweshwar Rao vs The State of Madhya Pradesh(1): " The guarantee or assurance to which due regard is to be had is limited to personal rights, privileges and dignities of the Ruler qua a Ruler.
It does not extend to personal property which is different from personal rights ".
The Act imposes on the agricultural income of "every person " liability to pay agricultural income tax.
By the proviso to section 3, agricultural income of the Central Government, State Government and of local authorities is exempt from tax, but this exemption is not extended to any other body or person.
It is true that in the definition of the expression " person " as originally enacted in section 2, cl.
(1), a Ruler of an Indian State was expressly included and by the Adaptation of Laws Order, 1950, reference to Rulers of Indian States was deleted as from January 26, 1950.
But by that amendment, an intention to exclude the Rulers of Indian States from liability to pay (1) , 1054.
785 agricultural income tax was, in our judgment, not evinced.
Between the dates on which the Act wag enacted and the Adaptation of Laws Order, 1950.
several political events of far reaching effect had taken place, in consequence of which the appellant bad ceased to be a Ruler of an Indian State.
On January 26, 1950, the date on which the Adaptation of Laws Order, 1950, became operative, there were in, existence no Indian States.
The sovereign rights of the erstwhile Rulers of the Indian States were extinguished, and their territories were merged in the, Indian Union.
The amendment in the definition of "person " in section 2, cl.
(i), of the Act was made not with) the object of excluding the Rulers of former Indian States from liability to pay tax: it was only made to; delete a clause which, in view of political changes, had no practical significance.
Liability to pay tax is imposed by the Act and there is in the Act no express exemption in favour of the appellant.
The claim of the appellant to exemption on the ground that he is not a " person " cannot therefore be sustained.
Article 362 of the Constitution provides: "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 bad to the guarantee or assurance given tinder any such covenant or agreement as is referred to in article 291 with respect to the personal rights, privileges and dignities of the Ruler of an Indian State ".
Article 291 of the Constitution deals with the privy purse of the Rulers under any covenant or agreement entered into by the Ruler of any Indian State before the commencement of the Constitution payment whereof is free from tax as has been granted or assured by the Government of the Dominion of India.
Article 362 recommends to the Parliament and the State Legislatures in making laws after the Constitution " to have due regard to the guarantee or assurance given under any covenant or agreement ".
Even though article 362 is not restricted in its recommendation to agreements relating to the privy purse and 786 covers all agreements and covenants entered into by the Rulers of Indian States before the commencement of the Constitution whereby the personal rights, privileges and dignities of the Ruler of an Indian State were guaranteed, it does not import any legal obligation enforceable at the instance of the erstwhile Ruler of a former Indian State.
If, despite the recommendation that due regard shall be had to the guarantee or assurance given under the covenant or agreement, the Parliament or the Legislature of a State makes laws inconsistent with the personal rights, privileges and dignities of the Ruler of an Indian State, the exercise of the legislative authority cannot, relying upon the agreement or covenant, be questioned in any court, and that is so expressly provided by article 363 of the Constitution.
The plea of the appellant that he was not seeking to enforce the terms of the merger agreement and that be was merely resisting the claim made by the authority appointed by the State of Orissa to levy a tax inconsistently with the terms of the merger agreement, has no substance.
In truth, the appellant sought by his petitions under article 226 of the Constitution to enforce the terms of article 4 of the merger agreement.
By his petitions, the appellant contended that in enacting the Agricultural Income tax Act and in seeking to enforce it against him, the State of Orissa acted contrary to the terms of the merger agreement and he asked the High Court to enforce the terms of the merger agreement.
On the grounds therefore that liability to pay agricultural income tax in respect of his private property is imposed upon the appellant by section 3 of the Act, and the immunity claimed by the appellant is not one of the personal rights or privileges within the meaning of the merger agreement and that the claim made by the appellant is not justiciable, the objection raised by the appellant to liability to pay agricultural income tax assessed under the Act cannot be sustained.
Two subsidiary contentions which were sought to be raised before us may be briefly referred to.
It was urged that of the forty two villages of which the 787 appellant is held by the assessing authority to be the holder, two were in the year 1945 transferred by him to the Yuvrani (the appellant 's son 's wife) and on that,, account, the income of those villages was not liable to be taxed in his hands.
It appears from the assessment order that this contention was raised before the Agricultural Income tax Officer and that officer rejected the contention relying upon section 14, cl.
(1), of the Act.
It is unnecessary for the purpose of these appeals to decide whether the assessing officer was right in the view which he took.
In the petitions filed by the appellant in the High Court, this plea was not raised and no relief was claimed by him in respect of the income of the two villages.
The question was never mooted before the High Court and the State of Orissa had no opportunity of meeting the claim now sought to be made by the appellant.
On the ground that the question was never raised in the High Court, we reject this contention.
It was also urged that whereas the assessing officer has found that the appellant had lands in forty two villages, in the inventory of properties submitted by the appellant to the Government, only eighteen villages were set out and this inventory was accepted by the Government of India.
Relying upon this premise, the appellant contends that he is liable to pay tax in respect of his income from these eighteen villages and no more.
But even this plea was never raised in the High Court and we cannot, in dealing with these appeals, enter upon an enquiry into a question which was never raised on which no evidence was led, and on which no finding was given by the High Court.
On the view taken by us, appeals Nos. 307, 308 and 309 of 1958 fail and are dismissed with costs.
There will be one hearing fee.
Appeals dismissed.
| The respondent sued the State of Bihar for a declaration that the Bihar Land Reforms Act, 1950, was ultra vires, void and unconstitutional and for a permanent injunction restraining the State and its officers or agents from issuing any notification thereunder in respect of her estate or taking possession thereof and on a petition filed along with the plaint obtained an order of temporary injunction against the State in terms of her prayer, pending the hearing of the suit.
More than a year thereafter, the State made an application under 0. 39, r. 4 of the Code for a discharge of the order of temporary injunction on the ground that the impugned Act had in another case been declarer valid by the Supreme Court.
Before that application could, however, be heard, the State of Bihar, on May 19, 1952 issued a notification under section 3(1) of the Act, authenticated by the Additional Secretary to the Government, declaring that, amongst others, the respondent 's estate had vested in the State of Bihar under the provisions of the Act.
Thereupon the respondent moved the trial Court for taking action against the State under 0. 39, r. 2(3) of the Code.
The contention on behalf of the State was that in view of article 31 B of the Constitution the issue of the notification was lawful and could not constitute contempt of Court.
The Subordinate judge held that this was no defence to the application by the respondent and directed attachment of the appellant 's property to the value of Rs. 5,000 and the High Court on appeal affirmed that decision.
Held, that the courts below took the correct view of the matter and that the appeal must be dismissed.
The procedure laid down by 0. 39, r. 2(3) of the Code of Civil Procedure is remedial and essentially one for the enforcement or execution of an order of temporary injunction passed under 0. 39, r. 2(1) and is available against the State although the provision for detention may not apply to it.
It is wrong to say that it is either contrary to article 300 of the Constitution or hit by the rule that no action lies against the State in tort or for a wrong doing entailing punishment or compensation.
District Board of Bhagalpur vs Province of Bihar, A.I.R. 1954 729 Pat.
529 and Tarafatullah vs section N. Maitra, A.I.R. 1952 Cal.
gig, distinguished.
There is also no basis for the contention that the State is not expressly or by necessary implication mentioned in 0. 39, r. 2(3).
The word 'person ' used by it, properly construed, includes the defendant against whom the order of injunction is primarily issued as also the defendant 's agents, servants and workmen.
Since the court 's power to issue an order of temporary injunction against the State under 0. 39, r. 2(1) cannot be in doubt, disobedience of such an order when issued necessarily attracts 0. 39, r. 2(3) of the Code.
Director of Rationing & Distribution vs Corporation of Calcutta, ; , held inapplicable.
Held, further, that when once an order is passed which the Court has jurisdiction to pass, it is the duty of the State no less than any private party to obey it so long as it stands, and the conduct of the State Government in the instant case in issuing the notification at a time when its application for vacating the injunction was still pending and the attitude taken up by it after the application under 0. 39, r. 2(3) was made and persisted in till the end must be disapproved.
|
Appeal No. 1249 of 1967.
Appeal from the judgment and decree dated July 21, 1967 of the Delhi High Court in Regular First Appeal No. 166 D of 1965.
A.K. Sen, Rameshwar Nath, P. L. Vohra and Mahinder Narain, for the appellant.
Bishan Narain, Radhey Mohan Lal and Harbans Singh, for the respondent.
The Judgment of the Court was delivered by Bachawat, J.
This appeal arises out of a suit for ejectment instituted by a landlord against a tenant.
It is common case that the suit is governed by the provisions of ' the Delhi and Ajmer Rent Control Act, 1952 (Act No. 38 of 1952) hereinafter referred to as the Act.
The material provisions of section 13(1) of the, Act are as follows : "13.
(1) Notwithstanding anything to the contrary contained.
in any other law or any contract, no decree or order for the recovery of possession of any premises shall be passed by any Court in favour of the landlord against any tenant (including a tenant whose tenancy is terminated) : Provided that nothing in this sub section shall apply to any suit or other proceeding for such recovery of possession if the Court is satisfied (b)that the tenant without obtaining the consent of the landlord in writing has, after the commencement of this Act, (i)sub let, assigned or otherwise parted with the possession of the whole or any part of the premises; or 550 (ii) used the premises for a purpose other than that for which they were let; or, (c) that the tenant without obtaining the consent of the landlord has before the commencement of this Act, (i)sub let, assigned or otherwise parted with the possession of, the whole or any part of the premises;, or (ii)used the premises for a purpose other than that for which they were let; or (k)that the tenant has, whether before or after the commencement of this Act, caused or permitted to be ,caused substantial damage to the premises, or notwithstanding previous notice has used or dealt 'with the premises in a manner contrary to any condition imposed on the landlord by the Government, or the Delhi Improvement Trust while giving him a lease of the land on which the premises are situated;" The respondent constructed the building known as the Hotel Imperial, New Delhi, on land leased to him by the Secretary of State for India in Council under a perpetual lease deed dated July 9, 1937.
By a deed dated August 18, 1939, he leased to the appellant the hotel premises together with fittings and furniture for a term of 20 years commencing on September 15, 1939.
On January 28, 1958, the respondent instituted the present suit alleging that in breach of the express conditions of the lease dated August .18, 1939, the appellant sub let portions of the premises and made unauthorised additions and alterations in the premises, that on such breaches he was entitled to determine the lease and he did so, by notice in writing dated January 6, 1958.
He claimed eviction of the appellant on the grounds mentioned in cls.
(b), (c) and (k) of the proviso to section 13(1) of the Act.
The appellant filed its written statement on April 3, 1958 denying most of the material allegations in the plaint.
The appellant also pleaded that the respondent had waived the breaches, if any, of the conditions of the lease by accepting rents with knowledge of such breaches and particularly by accepting rent on or about January 3, 1958.
On April 24, 1958, Sri P. L. Vohra, counsel for the appellant, made the following statement before the trial Court : "The plaintiff can seek ejectment of the defendant only under section 13 of Act 38 of 1952.
In case the 551 plaintiff succeeds in establishing the liability of, the defendant for ejectment on any of the grounds given in .section 13 of the Rent Act, the defendant would not seek any protection under the terms of the lease deed dated 18th August, 1939 executed between the parties, as regards the period of lease fixed therein.
" Having regard to the pleadings and statement of counsel, the Court settled the following issues on May 12, 1958 : "1.
Whether the defendant had sublet, assigned or otherwise parted with possession, of any part of the suit premises before the commencement of Act 38 of 1952 ? 2.
If so, was the same done with express or implied consent of the plaintiff ? 3.
Whether the defendant had sublet, assigned or otherwise parted with possession of any part of the suit premises after the commencement of Act 38 of 1952 ? 4.If so, was the same done with the prior consent in writing of the plaintiff ? 5.Whether the defendant has used the tenancy premises for a purpose other than that for which they were let ? 6.
Whether the defendant has caused substantial damage to the tenancy premises ? 7.
Whether the defendant notwithstanding previous notice has been.
using and dealing with the tenancy premises in a manner contrary to the conditions imposed on the plaintiff by, the Government while giving him lease of the site of the tenancy premises ? 8.
Is the defendant entitled to special cost ? 9.
Whether the plaintiff is estopped or has waived his right to seek ejectment of the defendant on any of the grounds mentioned above ? If so, what and to what effect ? 10.Whether the defendant is entitled to sublet any part of the hotel premises even when there was a clause to the contra in the lease dated the 18th August, 1939.
and in face of statutory provisions under the Rent Control Act (for reasons given in para 16 of the amended written statement) ?" A tenant holding premises under a subsisting lease is pro tected by the lease and needs no protection under the Rent Act.
It was open to the appellant to contend that it was protected by 552 the terms of the lease dated August 18, 1939, that the breaches, if any, of the conditions of the lease had been waived by the respondent and that the lease had not determined.
But the appellant deliberately elected to seek protection under section 13 of the Act only.
The appellant 's counsel made a ' formal statement in the trial Court that the appellant would not seek any protection under the terms of the lease deed as regards the period of the lease fixed therein.
The Court accordingly settled the ten issues.
Issue No. 8 was not pressed.
All the other issues relate to thegrounds of eviction mentioned in cls.
(b), (c) and (k) of theproviso to section 13(1) of the Act.
Issue No. 9 raises the question of waiver of the respondent 's right to seek ejectment on those grounds.
Thus, the only questions in issue between the parties was whether the appellant was entitled to protection from eviction under section 13 and whether any ground for eviction under the Act was made out.
The case was tried and decided on this footing.
We have come to this conclusion after a close examination of the 'pleadings, particulars, statement of counsel, issues and the judgment of the trial Court.
No issue was raised on the question whether the breaches of the express conditions of the lease had been waived by the respondent, and whether the lease was still subsisting.
The appellant sought to raise this plea in the High Court and also in this Court Having regard to the deliberate stand taken by the appellant in the trial Court, the appellant cannot be allowed to raise the plea at a later stage.
The lease determined by efflux of time on September 15, 1959.
Had the appellant taken the plea that the lease had not determined by forfeiture on the date of the institution of the suit, it is possible that the respondent might have filed another suit for ejectment of the appellant immediately after September 15, 1959.
Because of the stand taken by the appellant, it was not necessary for the respondent to file another suit.
This appeal must be decided on the footing that the lease had determined by forfeiture on the date of the institution of the present suit.
The respondent is entitled to a decree for eviction if any of the grounds mentioned in cls.
(b), (c) and (k) of the proviso to section 13(1) is made out.
The trial Court answered issue No. 5 in the negative.
With regard to all the other issues, the trial Court found in favour of the respondent, and held that the grounds of eviction mentioned in cls.
(b)(1), (c)(i) and (k) were proved.
With regard to the ground of eviction mentioned in cl.
(k), the trial Court held that the appellant was entitled to relief on certain conditions.
The trial Court, however, held that the respondent was entitled to an unconditional decree, for eviction on the ground of sub letting mentioned in cls.
(b)(i) and (c)(i).
The appellant preferred 553 an, appeal to the High Court.
The High Court agreed with all the findings of the trial Court, and dismissed the appeal.
The two Courts concurrently found that the appellant had sub let several rooms, counters, showcases and garages.
The two Courts found that the appellant had sub let rooms to (1) Pan American World Airways, (2) Mercury Travels, India (Private) Ltd., travel agents, (3) Indian Art Emporium, dealers in curios and jewellery, (4) Shanti Vijay and Co., dealers in jewellery, (5) Roy and James, hairdressers, (6) Sita World Travels, travel agents and (7) Ranee Silk Shop, dealers in saris and curios.
The businesses of the sub lessees were not confined to the residents of the hotel.
The letting to Pan American World Airways and Indian Art Emporium were before the commencement of the Act and the lettings to Mercury Travels, Shanti Vijay and Co., and Roy and James were after the commencement of the Act.
Sita Travels and Ranee Silk Shop were inducted as tenants after the institution of, the suit.
The entrances to the rooms were in ,the main corridor of the hotel on the ground floor.
The concurrent finding is that the occupants were given exclusive possession of the rooms occupied by them.
The appellant did not retain any control and dominion over the rooms.
It is possible that the keys of the apartments were sometimes left at the reception counter, but the evidence on this point was not convincing.
It was not a condition Of the grants that the keys would be left at the reception counter, or that the duplicate keys would be retained by the appellant.
The occupants were at liberty to take away the keys if they liked '.
The occupants availed themselves of the services of the hotel sweeper for, their own convenience.
The appellant retained control of the corridor, but it is common case before us that the entrance to the corridor was open day and night.
The occupants paid monthly sums to the appellant as the consideration of the sub leases.
The consideration though described as license fee was in reality rent.
The portion occupied by Roy and James has an interesting history.
It was formerly sub let to R. N., Kapoor.
In Associated Hotels of India Ltd. vs R. N. Kapoor(1), this Court held by a majority on a construction of the grant to R. N. Kapoor that he was a lessee and not a licensee.
Roy and James began to occupy this portion of the premises from February, 1955.
According to the appellant, the agreements with Roy and James, Mercury Travels and Shanti Vijay and Co., were in writing.
The appellant produced several documents in Court at an early stage of the suit.
The appellant 's case was that these documents were the relevant agreements.
According to the respondent, the documents were not genuine and the real agree (1) [196] 1 S.C.R. 36F 554 meats were being withheld.
The stamp auditor noted on the documents the deficiency in stamps and penalty leviable on them on the footing that they were lease deeds.
The appellant did not contest this note nor paid the penalty and deficiency as directed by the trial Court.
The surprising feature of the case is that the appellant did not attempt to prove any of the documents.
Where the agreement is in writing, it is a question of construction of the agreement whether the grant is a lease or a license.
It was for the appellant to prove the written agreements, and the Court could then construe them.
The appellant has not brought before the Court the best and the primary evidence of the terms on which the apartments were being occupied.
The onus to prove sub letting was on the respondent.
The respondent discharged the onus by leading evidence showing that the occupants were in exclusive possession of the apartments for valuable consideration.
The appellant chose not to rebut this prime facie evidence by proving and exhibiting the relevant agreements.
The documents formed part of the appellant 's case.
The appellant bad no right to withhold them from the scrutiny of the Court.
In the absence of the best evidence of the grants, the Courts below properly inferred sub lettings from the other materials on the record.
The test of exclusive possession, though not conclusive, is a very important indication in favour of tenancy, see Addiscombe Garden Estates Ltd. and Anr.
vs Crabbe and Ors.(1) The argument is that as the landlord is living in the premises, that fact raises the presumption that he intends to retain the control of the whole of the premises and that the occupation of the other parts is that of a lodger or inmate and not that of a tenant, and reliance was placed on Helman vs Horsham Assessment Committee(2) and the cases referred to therein.
Those cases consider what constitute rateable occupation.
In the case last cited, Denning, L. J. said that a person who is regarded as a lodger for rating purposes need not necessarily be a lodger for the purposes of the Rent Restriction Acts, while Evershed L.J. seems to have expressed a contrary opinion.
Normally, an occupier of an apartment in a hotel is in the position of a licensee as the hotel keeper retains the general control of the hotel including the apartment.
But it is not a necessary inference of law that the occupier of an apartment in a hotel is not a tenant.
Where, as in this case, the hotel keeper retains no control over the apart ment, the occupier is in the position of a tenant.
In Halsbury 's Laws of England, Vol. 23, article 1028, p. 433, the law is accurately summarised thus "A lodger who has no separate apartment is only a licensee, and, even though he has a separate apart (1) , 525.
(2) 555 ment, he has not in law an exclusive occupation, and is therefore in the position of a licensee, if the landlord retains the general control and dominion of the house, including the part occupied by the lodger; but, if in fact the landlord exercises no control over that part, the occupier is a tenant.
The occupier does not, however, become a lodger merely by reason of the fact that the landlord resides on the premises and retains control of the passages and staircases and other parts used in common.
" On the question whether the occupier of a separate apartment in a premises is a licensee or a tenant, the test is has the landlord retained control over the apartment ? The fact that the apartment is a room in a hotel may lead to the inference that the hotel keeper retains the general dominion of the en tire hotel including the apartment and that the occupier is in the position of a lodger or inmate.
But the inference is not a necessary inference of law.
Where, as in this case, the best evidence of the rant was withheld from the scrutiny of the Court, the inference was rightly drawn that the occupiers were tenants.
At the hearing of this appeal, the appellant moved an appli cation for reception of the documents as additional evidence.
The genuineness of the documents was disputed by the respondent.
In the Courts below, the appellant made no attempt to prove these documents.
We found no ground for directing a new trial.
Having regard to all these facts, we dismissed the application.
The hotel building constitutes premises within the meaning of section 2(g) of the Act. ' It is because the hotel building constitutes Premises that the appellant can claim protection from eviction under the Act.
A room in a hotel is a part of the hotel premises.
A sub letting of a room in a hotel in contravention of cls.
(b) and (c) of the proviso to section 13(1 ) is a ground for eviction under the Act.
Section 2(g) provides that 'premises ' does not include " a room in a hotel or lodging house.
" The sub lessee of a room in a hotel is, therefore, not a tenant and cannot claim protection under section 13 from eviction, nor can he ask for fixation of standard rent.
see Associated Hotels of India Ltd. vs R. N. Kapoor(1).
If the interest of the tenant of the hotel premises is determined, the sub tenant to whom a room in the hotel has been lawfully sublet becomes under s, 20 a direct tenant of the landlord, It may be that when the sub tenant of a room in a hotel becomes a direct tenant under section 20 he enjoys the protection of the Act because the room is no, longer a room in a hotel.
But that point does not arise and need not be decided.
Because a room in a hotel is not (1) ; 556 premises, it does not follow that the room is not a part of the hotel premises or that a sub letting of the room is not a contravention of cls.
(b) and (c) of the proviso to section 13(1).
The Courts below concurrently found that the sub lettings after the commencement of the Act were made without obtaining the consent of the landlord in writing, and the sub lettings before the commencement of the Act were made without obtaining the consent of the landlord either orally or in writing.
We are not inclined to interfere with this concurrent finding.
It is said that by the lease deed dated August 18, 1939 the respondent impliedly consented to this sub letting.
Clauses 21 .and 22 of the lease are in these terms "21.
That the lessee shall not be entitled to either transfer or sub lease the premises or any part thereof to any other party without the written consent of the lessor and on such transfer, both the transferee and the lessee shall be liable for the payment of rent to the lessor and responsible to deliver,possession of the building and equipments in the same condition as when taken.
22.That the lessee will use the premises only for the purpose of running a first class hotel.
" It is ,aid that for the purpose of running a first class hotel it was necessary to sub let the apartments.
It is impossible to accept the contention.
A hotel keeper may run a first class hotel without sub letting any part of it.
Clause 21 clearly provided that the lessee shall not sub lease the hotel premises or any part thereof.
In the teeth of cl. 21, it is impossible to read in cl. 22 an implied consent to sub letting.
Reliance is placed on the correspondence passed between the Land Development Officer, New Delhi and the respondent bet ween April 1948 and February 1949 for establishing that the respondent gave written consent to the sub lettings.
The Land and Development Officer was then complaining of the occupation of portions of the premises by Pan American World Airways and other persons.
By his letters dated November 4, 1948 and February 23, 1949, the respondent requested the Land and Development Officer to regularise the matter adding that in an first class hotels counters of air lines and show rooms of jewellery and curios were always provided.
These letter,.; do not amount to a consent in writing to sub lettings of portions of the hotel to the persons mentioned therein.
Moreover, the consent, if any, 'was to the sub lettings made before 1949 and not to the sub lettings made thereafter.
It is not possible to infer from these letters a general consent to all sub lettings.
557 It is argued that the respondent waived the requirement of consent to the sub letting.
Any subletting in breach of the provisions of cl.
(b) of the proviso to section 13 ( 1) is an offence punish able under section 44.
Assuming that the landlord can waive the requirement as to consent, it is not shown that the respondent waived it.
A waiver is an intentional relinquishment of a known right.
, There can be no waiver unless the person against whom the waiver is claimed had full knowledge of his rights and of facts enabling him to take effectual action for the enforcement of such rights.
See Dhanukdhari Singh vs Nathima Sahu(1).
It is said that the respondent knew of the sub lettings as he frequently visited the hotel.
It appears that he visited the hotel up to 1953 and he must have known of the occupation of R. N. Kapoor, Indian Art Emporium and Pan American World Airways.
But he came to know of the other lettings in January 1958 only.
Moreover, the precise nature of the grant was never communicated ,to the respondent.
The Courts below rightly held that the respondent did not waive his right to evict the appellant on the , rounds mentioned in cls.
(b) and (c) of the proviso to section 13 (1).
We are therefore satisfied that the respondent is entitled to evict the appellant on the ground of sub letting of the rooms.
The Courts below held that the appellant had also sublet several counters, show cases and garages to various persons.
We express no opinion on the question whether there was any sub letting of the counters, show cases and garages.
The sublettings of the rooms are sufficient grounds of eviction tinder cls.
(b) and (c) of the proviso to section 13(1).
Clause 2(v) of the head lease granted by the Government to the respondent provided that the respondent would not, without the previous consent in writing of the Chief Commissioner.
Delhi or a duly authorised officer, erect or suffer to be erected on any part of the demised premises any building other than the buildings erected there on the date of the lease.
The appellant had due notice of the conditions of the head lease.
Notwithstanding such previous notice, the appellant dealt with the premises in a manner contrary to the conditions imposed by cl. 2 (v).
The Courts below found that contrary to this condition, the appellant made several unauthorised constructions without obtaining the requisite consent.
To give one illustration, the appellant admittedly constructed a room 16 ft. 6 in X 19 ft. 6 in.
with R.C.C. slab and brick masonry walls.
This newly constructed room was let to Shanti Vijay and Co.
On the ground of unauthorised construction of this room alone it must be held that the appellant in contravention of cl.
(k) of the proviso to section 13 (1), notwithstanding previous notice, dealt with the premises in a manner contrary to (1) , 852.
558 a condition imposed on the respondent by the Government while ,giving him a lease of the land on which the premises are situated.
The notice of the conditions imposed by the head lease was sufficient notice for the purposes of cl.
The ground of eviction under cl.
(k) was thus made out.
The Courts below also held that the appellant caused substantial damage to the premises.
We express no opinion on it, and this question is left open.
It follows that the respondent is entitled to evict the appellant on the grounds mentioned in cls.
(b) (i), (c) (i) and (k) of the proviso to section 13(1).
In the result, the appeal is dismissed with costs.
The execution of the decree is stayed for a period of six months from today.
The appellant through Mr. A. K. Sen gives an undertaking that the appellant will hand over to the respondent, on the expiry of six months, vacant possession of the entire hotel premises except the portion in the possession of sub lessees.
Y.P. Appeal dismissed.
| The respondent landlord of a hotel filed a suit for eviction of his tenant appellant under section 13(1) proviso (b) and (c) of the Delhi and Ajmer Rent Control Act, 1952 on the allegation that the appellant had sub let several rooms.
These occupants were doing business, which were not confined to the residents of the hotel.
The occupants were given ex clusive possession of the rooms occupied by them.
The appellant did not retain any control and dominion over these rooms.
It was not a condition of the grants that the keys would be left at the reception counter, or that the keys would be retained by the appellant.
The occupants were at liberty to take away the keys if they liked.
The occupants availed themselves of the services of the hotel sweeper for their own convenience.
The appellant retained control of the corridor, but the entrance to the corridor was open day and night.
The occupants paid monthly sums to the appellant as the consideration of the sub leases.
The appellanttenant denied the allegations and pleaded that the respondent landlord had waived the breaches, if any.
The suit was decreed which the High Court, in appeal maintained HELD : The landlord was entitled to the decree for eviction.
[558 B] On the question whether the occupier of a separate apartment in a premises is a licensee or a tenant, the test is has the landlord retained control over, the apartment Normally, an occupier of an apartment in a hotel is in the position of licensee as the hotel keeper retains the general control of the hotel including the apartment.
But it is not a necessary inference of law that the occupier of an apartment in a hotel is not a tenant.
A hotel keeper may run a first class hotel without sub letting any part of it.
Where as in this case, the hotel keeper retained no control over the apartment, the occupier was in the position of a tenant.
The onus to prove sub letting was on the respondent.
The respondent discharged the onus by leading evidence showing that the occupants were in exclusive possession of the apartments for valuable consideration.
The appellant chose not to rebut this prima facie evidence by proving and exhibiting the relevant agreements.
[553 D; 554 C D, F H; 555 C; 556 E] Under section 2(g) "premises" does not include " a room in a hotel or lodging house".
The sub lessee of a room in a hotel is, therefore, not a tenant and cannot claim protection under section 13 from eviction, nor can he ask for fixation of standard rent.
But, because a room in a hotel is not premises, it does not follow that the room is not a part of the hotel premises or that a sub letting of the room is not a contravention of cls.
(b) and (c) of the proviso to section 13(1).
[555 F G 556 A] Associated Hotels of India Ltd. vs R. N. Kapoor, [1960]1 S.C.R. 368, followed.
Addiscombe Garden Estates Ltd. & Anr.
vs Grabbe and Ors.
and Helman vs Horsham Assessment Committee, [1949] 2 K.B. 335,referred to.
549 A waiver is an intentional relinquishment of a known right.
There can be no waiver unless the person against whom the waiver is claimed had full knowledge of his rights and of facts enabling him to take effectual action for the enforcement of such rights.
Assuming that the landlord can waive the requirement as to consent, it was not shown that the respondent waived it.
It is said that the respondent knew of the sub lettings as be frequently visited the hotel up to 1953 and he must have known of the occupation of some of the occupants.
But he came to know of the other lettings in 1958 only.
Moreover, the precise nature of the grant was never communicated to the respondent.
[557 B D] Dhanukdhari Singh vs Nathima Sahu, , referred to.
|
Appeal No. 765 of1964.
Appeal by special leave from the judgment and order, dated April 23, 1963, of the Madhya Pradesh High Court in First Appeal No. 24 of 1963.
N.C. Chatterjee, V. section Sawhney, section section Kanjuja and Ganpat Rai, for the appellant.
G.S. Pathak and Dipak Datta Chaudhry, for respondent No. 1.
The Judgment of the Court was delivered by Gajendragadkar, C.J.
This appeal by special leave arises out of an Election petition filed by respondent No. 1, Harikishan 878 Singh, challenging the validity of the election of the appellant, Bhaiyalal, in a reserved seat in the Berasia Constituency in the district of Sehore in Madhya Pradesh.
The election in question was held in February, 1962; at this election the appellant, respondent No. 1, and three others offered themselves as candidates.
The appellant was declared duly elected on the 26th February, 1962 since he had polled the highest number of votes.
His next rival was respondent No. 1.
By this petition, respondent No. 1 challenged the validity of the appellant 's election on the ground that the appellant belonged to the Dohar caste and was not a Chamar.
The appellant had filed his nomination paper on the 19th January, 1962 before the Returning Officer at Sehore and had declared that he was a member of the Chamar scheduled caste of the State of Madhya Pradesh in relation to Sehore district.
This declaration was accepted by the Returning Officer.
Respondent No. 1 contended that Dohar caste was not recognised as the scheduled caste for the district of Sehore and Raisen, and so, the Returning Officer bad improperly and illegally accepted the declaration of the appellant as one belonging to the Chamar scheduled caste.
Since the appellant did not belong to the scheduled caste in question, he was not entitled to stand for election for the reserved seat in respect of the said Constituency.
This is the basis on which the validity of the appellant 's election was challenged by respondent No. 1.
On the other hand, the appellant urged that the election petition filed by respondent No. 1 was not maintainable inasmuch as he had not deposited the security of Rs. 2,000 in the manner prescribed by the statutory rules.
On these pleadings, the Election Tribunal framed appropriate issues.
The first four issues covered the principal contention raised by respondent No. 1 against the validity of the appellant 's nomination as a member belonging to the Chamar scheduled caste, whereas the fifth issue related to the appellant 's contention about the incompetence of the election petition filed by respondent No. 1.
Both parties led evidence in support of their pleas on the principal point of dispute between them.
The Election Tribunal con sidered the oral evidence adduced by the parties, examined the documents on which they respectively relied, and found in favour of respondent No. 1.
In regard to the plea raised by the appellant against the competence of the election petition, the Tribunal found against him.
In the result, the election petition was allowed and the appellant 's election declared invalid.
Against this decision of the Election Tribunal, the appellant preferred an appeal to the Madhya Pradesh High Court.
Before 879 the High Court, the same two points were urged.
The High Court has confirmed the finding of the Election Tribunal on both the points.
It has held that the election petition filed by respondent No. 1 was valid and the security deposit was made by him in accordance with the statutory requirements.
On the merits of the, controversy as to whether the appellant was a Chamar by caste and as such was entitled to be elected for the reserved seat in the, Constituency in question, the High Court, in substance, has agreed with the conclusion of the Election Tribunal.
In consequence, the appeal preferred by the appellant was dismissed on the 23rd April, 1963.
It is against this decision that the appellant has come to this Court by special leave.
On behalf of the appellant Mr. Chatterjee has contended that the High Court was in error in confirming the finding of the Election Tribunal in regard to the caste to which the appellant belonged.
It appears that the appellant 's case was that he was a Dohar Chamar which according to him is a sub caste of the Chamar scheduled caste.
He urged that the said sub caste was also called 'Mochi '.
In support of this plea, the appellant examined witnesses and produced documents, and a, we have just indicated, respondent No. 1 also produced witnesses and examined documents to show that the Dohar caste was distinct from and independent of the Chamar caste and Dohars could not, therefore, claim to be Chamars within the meaning of the Presidential Order.
Thus, the question which arose between the parties for decision in the present proceedings is a question of fact and on this question both the Tribunal and the High Court have made concurrent findings against the appellant.
It is true that in reaching their conclusion on this point, the Tribunal as well as the High Court had to consider oral as well as documentary evidence; but in cases of this kind where the Tribunal and the High Court make concurrent findings on questions of fact, this Court does not usually interfere; and after hearing Mr. Chatterjee we see no reason to depart from our usual practice in this matter.
Respondent No. 1 examined 13 witnesses belonging to the caste of the appellant.
All of them asserted that they did not belong to the Chamar caste.
According to their evidence, the Dohar caste was different from the Chamar caste.
There was no intercaste marriage nor even inter caste dinners between the members of the said two castes.
This evidence shows that Chamars and Mochis of Sehore district lived in mohallas different from the mohallas in which the Dohars lived.
Amongst the witnesses examined by respondent No. 1, the High Court has attached considerable significance to the evidence of Kishanlal, P. W. 4., 880 He was the Secretary of the Dohar Samaj started by the appellant himself.
The appellant was then the Sirpanch of that Samaj.
It is true that the Samaj did not function for long; but the documents produced by respondent No. 1 to show the constitution of the Samaj clearly indicate that the appellant had taken a prominent part in that matter.
Kishanlal 's evidence is absolutely clear and unambiguous.
He has stated on oath that the Dohar and the Chamar castes are entirely different.
The Chamars, according to him, take off skins from dead animals, prepare shoes and do leather work; the Dohar, said the witness, is not the sub caste of Chamar caste; there is no relationship of inter dining and intermarriage between the two.
He denied that the Dohars are called Mochis.
Mr. Chatterjee has not been able to show any reason why the evidence of this witness should not have been believed by the High Court.
The witness belongs to the same caste as the appellant and there is no motive shown why he should take a false oath in respect of a matter which to persons of his status has great significance.
It is not likely that a person like Kishanlal would make false statement about his own caste.
In support of his oral evidence, respondent No. 1 produced certain documents, Exts.
P. , P. 4 and P. 5.
These are all signed by the appellant and they relate to the year 1956.
In these documents, the appellant has described himself as Dohar; in none of them has he mentioned his caste as Chamar.
Similar is the effect of other documents on which respondent No. 1 relied; they are P. , P. , P. , P. , P. , to P. 27.
In rebuttal the appellant examined himself and his witnesses.
This oral evidence was intended to show that the Dohar caste is the same as Mochi caste and it is a sub caste of the Chamar caste.
In addition to the oral evidence, the appellant produced 22 documents.
It is true that some of these documents which had been discarded by the Election Tribunal as unworthy of credence or as irrelevant, have been accepted by the High Court as relevant and genuine.
Even so, the High Court has come to the conclusion that these documents do not show satisfactorily that the Dohar caste is a sub caste of the Chamar caste.
In that connection, the High Court has pointed out that the documents relied upon by the appellant do not support his case that the Dohar caste is a sub caste of the Chamar caste, and in that sense, they are not consistent with the plea made by the appellant in the present proceedings.
We allowed Mr. Chatterjee to take us through the material evidence; and on considering the said evidence in the 881 light of the criticism made by Mr. Chatterjee, we are satisfied that there is no reason to interfere with the concurrent finding recorded by the Tribunal and the High Court on the main question of fact.
We must, accordingly, hold that the appellant does not belong to the Chamar caste and as such was not qualified to contest the reserved seat for the scheduled caste of Chamars in the Constituency in question.
Incidentally, we may point out that the plea that the Dohar caste is a sub caste of the Chamar caste cannot be entertained in the present proceedings in view of the Constitution (Scheduled Castes) Order, 1950.
This Order has been issued by the President under Article 341 of the Constitution.
Article 341 (1) provides that the President may with respect to any State or Union territory, and where it is a State, after consultation with the Governor thereof, by public notification, specify the castes, races or tribes or parts of or groups within castes, races, or tribes which shall for the purposes of this Constitution be deemed to be Scheduled Castes in relation to that State or Union territory, as the case may be.
Sub Article (2) lays down that Parliament may by law include in or exclude from the list of Scheduled Castes specified in a notification issued under clause (1) any caste, race or tribe or part of or group within any caste, race or tribe, but save as aforesaid a notification issued under the said clause shall not be varied by any subsequent notification.
It is thus clear that in order to determine whether or not a particular caste is a scheduled caste within the meaning of article 341, one has to look at the public notification issued by the President in that behalf.
In the present case, the notification refers to Chamar, Jatav or Mochi, and so, in dealing with the question in dispute between the parties, the enquiry which the Election Tribunal can hold is whether or not the appellant is a Chamar, Jatav or Mochi.
The plea that though the appellant is not a Chamar as such, he can claim the same status by reason of the fact that he belongs to the Dobar caste which is a sub caste of the Chamar caste, cannot be accepted.
It appears to us that an enquiry of this kind would not be permissible having regard to the provisions contained in article 341.
In the case of B. Basavalingappa vs D. Munichinnappa & Others,(1) this Court had occasion to consider a similar question.
The question which arose for decision in that case was whether respondent No. 1, though Voddar by caste, belonged to the scheduled caste of Bhovi mentioned in the Order, and while holding that an enquiry into the said question was permissible, the Court has elaborately referred to the special and unusual (1) ; 882 circumstances which justified the High Court in holding that Voddar caste was the same as the Bhovi caste within the meaning of the Order; otherwise the normal rule would be : "it may be accepted that it is not open to make any modification in the Order by producing evidence to show, for example, that though caste A alone is mentioned in the Order, caste B is also a part of caste A and, therefore, must be deemed to be included in caste A." That is another reason why the plea made by the appellant that the Dohar caste is a sub caste of the Chamar caste and as such must be deemed to be included in the Order, cannot be accepted.
Whilst we are referring to this aspect of the matter, we may point out that the Order has taken good care to specify different castes under the same heading where enquiry showed that the same caste bore different names, or it had sub castes which were entitled to be treated as scheduled castes for the purposes of the Order.
In the district of Datia, for instance, entry 3 refers to Chamar, Ahirwar, Chamar Mangan, Mochi or Raidas.
Similarly, in respect of Maharashtra, Item 1, entries 3 and 4 refer to the same castes by different names which shows either that the said castes are known differently or consist of different sub castes.
Likewise, item 2, entry 4 in the said list refers to Chamar, Chamari, Mochi, Nona, Rohidas, Ramnami, Satnami, Surjyabanshi or Surjyaramnami.
It is also remarkable that in Maharashtra in certain districts Chambhar and Dhor are included in the list separately.
Therefore, we do not think that Mr. Chatterjee can seriously quarrel with the conclusion of the High Court that the appellant has not shown that he belongs to the Chamar caste which has been shown in the Order as a scheduled caste in respect of the Constituency in question.
Mr. Chattejee attempted to argue that it was not competent to the President to specify the lists of Scheduled Castes by reference to different districts or sub areas of the States.
His argument was that what the President can do under article 341(1) is to specify the castes, races or tribes or parts thereof, but that must be done in relation to the entire State or the Union territory, as the case may be.
In other words, says Mr. Chatterjee, the President cannot divide the State into different districts or subareas and specify the castes, races or tribes for the purpose of article 341(1).
In our opinion, there is no substance in this argument.
The object of article 341(1) plainly is to provide additional protection to the members of the Scheduled Castes having regard to the economic and educational backwardness from which they suffer.
It is obvious that in specifying castes, races or tribes, 883 the President has been expressly authorised to limit the notification to parts of or groups within the castes, races or tribes, and that must mean that after examining the educational and social backwardness of a caste, race or tribe, the President may well come to the conclusion that not the whole caste, race or tribe but parts of or groups within them should be specified.
Similarly, the President can specify castes, races or tribes or parts thereof in relation not only to the entire State, but in relation to parts of the State where he is satisfied that the examination of the social and education are backwardness of the race, caste or tribe justifies such specification.
In fact, it is well known that before a notification is issued under article 341(1), an elaborate enquiry is made and it is as a result of this enquiry that social justice is sought to be done to the castes, races or tribes as may appear to be necessary, and in doing justice, it would obviously be expedient not only to specify parts or groups of castes, races or tribes, but to make the said specification by reference to different areas in the State.
Educational and social backwardness in regard to these castes, races or tribes may not be uniform or of the same intensity in the whole of the State; it may vary in degree or in kind in different areas and that may justify the division of the State into convenient and suitable areas for the purpose of issuing the public notification in question.
Therefore, Mr. Chatterjee is in error when he contends that the notification issued by the President by reference to the different areas is outside his authority under article 341 (1).
The result is, the appeal fails and is dismissed with costs.
Appeal dismissed.
| The appellant 's election was challenged inter alia, on the ground that he belonged to the Dohar caste which was not recognised as a Scheduled Caste for the district in question and so his declaration that he belonged to the Chamar caste which was a Schedule Caste was improperly and illegally accepted by the Returning Officer.
The Election Tribunal declared the election invalid.
The finding was confirmed on appeal by the High Court.
In appeal to the Supreme Court.
HELD : (i) The plea that though the appellant is not a Chamar as such, he can claim the same status by reason of the fact that he belonged to Dohar Caste which is a sub caste of the Chamar caste cannot be accepted.
An enquiry of this kind would not be permissible having regard to the provisions contained in article 341 of the Constitution.
[881 F G] Basavalingappa vs D. Munichinnappa, ; , referred to.
(ii)In specifying castes, races or tribes under article 341 of the Constitution, the President has been expressly authorised to limit the notification to parts of or groups within the castes, race or tribe, the President may well come to the conclusion that not the whole caste, race or tribe but parts of or groups within them should be specified.
Similarly the President can specify castes, races or tribes or parts thereof in relation not only to the entire State, but in relation to the parts of the State where he is satisfied that the examination of the social and educational backwardness of the race, caste or tribe justifies such specification.
[882 H 883 C]
|
Appeal No. 358 of 1958.
645 Appeal by special leave from the judgment and order dated 8th March, 1956, of the former Bombay High Court in I.T.R. No. 55 of 1955.
A. N. Kripal and D. Gupta, for the appellant.
N. A. Palkhivala and B. P. Maheshwari, for the respondents.
November 24.
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 Bombay in Income tax Reference No. 55 of 1955, in which two questions of law were stated for opinion and both were answered in favour of the assessee and against the Commissioner of Income tax who is the appellant before us and the assessee is the respondent.
The facts of this case are these: The respondent is a registered firm carrying on business as commission agents in Bombay.
For purposes of its business it borrowed money from time to time from Banks on joint promissory notes executed by it and by others with joint and several liability.
On September 26, 1949, the respondent borrowed Rs. 1,00,000 from the Bank of India on a pronote executed jointly with one Kishorilal.
Out of this amount a sum of Rs. 50,000 was taken by the respondent for purposes of its business and the rest by Kishorilal.
Kishorilal however failed to meet his liability and became a bankrupt.
The respondent had therefore to pay the Bank the whole amount, i.e., Rs. 1,00,000 with interest.
Out of the amount taken by Kishorilal the respondent received in the accounting year, from the Official Assignee, a sum of Rs. 18,805 and claimed the balance, i.e., Rs. 31,740 as deduction.
The accounting year was from August 26, 1949 to July 17, 1950, the assessment year being 1951 52.
This claim was disallowed both by the Income tax Officer as well as the Appellate Assistant Commissioner.
On Appeal to the Income tax Appellate Tribunal this sum was allowed ,as an allowable deduction under section 10(2)(xv) of the Income tax Act and as business loss.
82 646 At the instance of the Commissioner a case was stated to the High Court of Bombay by the Income tax Appellate Tribunal.
In the statement of the case which was agreed to by both parties the Tribunal said: "For the purpose of his business, he borrows from time to time money on joint and several liability from banks.
The Commercial practice is to borrow money from banks on joint and several liability.
An illustration will explain what we mean.
A and B require Rs. 50,000 each.
They find that the Bank would not advance Rs. 50,000 to each on his individual security.
They however, find that the Bank would be prepared to advance Rupees one lach on their joint and several liability.
They take Rupees one lac on joint and several liability and then divide the money equally between themselves.
" It also found that the Banks advanced monies to some constituents on their personal security also but they had to pay a higher rate of interest than when the money was borrowed on joint and several responsibility; that Rs. 1,00,000 borrowed from the Bank was in accordance with the commercial practice of Bombay.
On these facts the following two questions of law were referred to the High Court: "(1) Whether the assessee 's claim is sustainable under section 10(2)(xv) of the Act? (2) Whether the assessee 's claim that the loss was a business loss and, therefore, allowable as a deduction in computing the profits of the assessee 's business is sustainable under law?" Both these questions were answered in favour of the respondent and against the appellant.
Counsel for the Commissioner challenged the findings of the Tribunal in regard to the existence of commercial practice in Bombay but this ground of attack is not available to him because not only did the Tribunal give this finding in its Order, but in the agreed statement of the case also this finding was repeated as is shown by the passage quoted above.
The High Court also has proceeded on the basis of this commercial practice.
In the judgment under appeal the learned Chief Justice said: 647 "The finding of the Tribunal is clear and explicit that what the assessee was doing was not something out of the ordinary, but in borrowing this money on joint and several liability he was following a practice which was established as a commercial practice.
Therefore, the transaction was clearly in the course of the business and incidental to the business and it is this transaction which resulted in a loss to the assesses, he having to pay the liability of the surety.
" Therefore this appeal has to be decided on the basis that a commercial practice of financing business by borrowing money on joint and several liability was established.
It was argued on behalf of the appellant that this court in Madan Gopal Bagla vs Commissioner of Income Tax, West Bengal (1) had decided against the allowability of such losses.
But the facts of that case when carefully scrutinised are distinguishable and the decision does not support the contentions of the appellant.
No doubt certain features of that case and the present one are similar but they differ in essential features.
In that case the assessee was a timber merchant who obtained a loan of Rs. 1 lac from the Bank of India on the joint security of himself and one Mamraj, which the assessee paid off.
Mamraj also obtained a loan of Rs.
I lac on the joint security of himself and the assessee.
Mamraj became an insolvent and the assessee had to pay the whole of the amount borrowed with interest thereon.
The assessee there received a certain amount of money by way of dividends from the Receiver and the balance he wrote off as bad debt in the assessment year and claimed it as an allowable deduction under section 10.
The High Court there held that the debt could not be said to be a debt in respect of the business of the assessee as he was not carrying on the business of standing surety for other persons nor was he a money lender, he being simply a timber merchant; that it had not been established nor was it alleged that he was in the habit of standing surety for other persons "along with them for purposes of securing loans for their use and benefit" and even if money (1) ; 648 had been so borrowed and there had been a loss the loss would have been a capital loss and not a business loss to the assessee.
This statement of the law was approved by this Court but there mutuality, as an essential ingredient of the custom established, was found to be lacking as is shown by the following passage from the judgment of the court.
"The custom stated before the Appellate Assistant Commissioner was that persons carrying on business in Bombay used to borrow monies on joint security from the Banks in order to facilitate getting financial assistance from the Banks and that too at lower rates of interest.
A businessman could procure financial assistance from the Banks on his own, but he would in that case have to pay a higher rate of interest.
He would have to pay a lower rate of interest if he could procure as surety another business man, who would be approved by the Bank.
This, however, did not mean that mutual accommodation by businessmen was necessarily an ingredient part of that custom.
A could procure B, C or D to join him as surety in order to achieve this objective, but it did not necessarily follow that if A wanted to procure B, C or D to thus join him as surety he could only do so if he in his own turn joined B, C or D as surety in the loans which B, C or D procured in their turns from the Banks for financing their respective businesses.
Unless that factor was established, the mere procurement by A of B, C or D as surety would not be sufficient to establish the custom sought to be relied upon by the appellant so as to make the transaction of his having joined Mumraj Rambhagat as surety in the loan procured by Mumraj Rambhagat from Imperial Bank of India, a transaction in the course of carrying on his own timber business and to make the loss in the transaction a trading loss or a bad debt of the timber business of the appellant.
" Continuing at page 558 it was observed: "There were thus elements of mutuality and the essential ingredient in the carrying on of the money lending business, which were elements of the custom 649 proved in that case, both of which are wanting in the present case before us." Mr. Palkhivala for the respondent rightly argued that Madan Gopal Bagla 's case (1) was decided against the assessee because the custom of persons standing surety for each other for borrowing money and the element of mutuality which was an essential ingredient in the case of Commissioner of Income Tax, Madras vs section A. section Ramaswamy Chettiar (2) was not proved.
In the latter case it was established that there was a well recognised custom amongst Chettiars of raising funds for their business of money lenders by the execution of joint pronotes and that if a loss was sustained by one of the executants having to pay the whole on account of inability of the other it was a deductible loss.
The appellant also relied on a judgment of the Madras High Court in Commissioner of Income Tax vs section R. Subramanya Pillai (3).
In that case the assessee was a book seller who from time to time jointly with another person borrowed money out of which he employed a portion in his business.
One of such amounts borrowed was Rs. 16,200 out of which the assessee took Rs. 10,450 for his business needs and the other debtor took the balance.
The latter became insolvent and the assessee had to pay the whole of the money borrowed and claimed it as allowable deduction under section 10(2)(xi) or section 10(2)(xv) of the Act or as business loss and it was hold that he was not entitled, because the loss sustained by the assessee was too remote from the business of book selling carried on by him and was not sufficiently connected with the trade and therefore fell outside the range of those amounts which could properly be brought into profit and loss account of the business.
The decision in Commissioner of Income Tax vs section A. section Ramaswamy Chettiar (2) was there distinguished on the ground that the decision must be confined to its own peculiar facts and did not apply to business as the one in Subramanya Pillai 's Case (3).
The following passage from (1) ; , (2) (3) 650 the judgment of Viswanatha Sastri, J., in that case is relevant: "But there the business was one of money lending and the Court found that according to the wellknown and well recognised mercantile custom of Nattukottai bankers, they were in the habit of raising 'funds which formed the stock in trade of their money lending business by the execution of joint promissory notes in favour of bankers.
That was apparently the usual technique of obtaining credit adopted by the Nattukottai Chetti community money lenders.
In the context this Court held that where a Nattukottai Chetti money lender paid off in their entirety the debts jointly due by him and another as a result of the latter 's inability to pay, the loss sustained as a result of this transaction was a loss of the moneylending business itself and therefore a deductible item in computing profits.
" In the instant case it has been found that there was a well recognised commercial practice in Bombay of carrying on business by borrowing money from Banks on joint and several liability.
It was also found that by so doing the borrower could borrow money at a lower rate of interest than he otherwise would have paid; that the respondent had, in accordance with the commercial practice, borrowed the money, the whole of which he had to return because the joint promisor Kishori Lal had become bankrupt; mutuality was also held proved.
It cannot be said that the essential feature of the case now before us is in principle different from that of the Commissioner of Income tax vs Ramaswamy Chettiar (1).
In both cases the finding is that there is mutuality and custom of borrowing money on joint pronotes for the carrying on of business.
In our opinion in the circumstances proved in the present case, and on the facts established and on the findings given, the respondent was rightly held to be entitled to deduct the loss which was suffered by him in the transaction in dispute.
Counsel for the assessee drew our attention to a (1) 651 Privy Council judgment Montreal Coke and Manufacturing Co. vs Minister of National Revenue (1) but that, case can have no application to the facts of the present case because it was found there as a fact that the assessees 's financial arrangements were quite distinct from the activities by which they earned their income and expenditure incurred in relation to the financing ' of their business was not expenditure in the earning of their income within the statute.
It was then contended that the loss of the respondent was a 0capital loss and for this again reliance was placed on the judgment of this Court in Madan Gopal Bagla 's case (2 ) and particularly on the observation at page 559 where Bhagwati, J., quoted with approval the observations of the High Court in the judgment but as we have pointed out the facts of that case are distinguishable and what was said there has no application to the facts and circumstances proved in the present case.
In our view the judgment of the High Court is right and we therefore dismiss this appeal with costs.
Appeal dismissed.
| For the purposes of its business the respondent borrowed a certain sum of money from the Bank of India on a pronote executed jointly by him and one Kishorilal in accordance with a commercial practice of carrying on business by borrowing money from Banks on joint and several liability.
The money was divided half and half between the respondent and Kishorilal but Kishorilal failed to pay off his liability as he became a bankrupt and the respondent had to pay the whole amount to the Bank.
The respondent, however, received from the Official Assignee a part of the sum taken by the Kishorilal leaving a balance still unpaid.
The respondent 's claim to deduct this unpaid balance under section 10(2)(XV) of the Income tax Act was refused by the Income tax Officer and the Appellate Assistant Commissioner but was allowed by the Income tax Appellate Tribunal on appeal.
On a reference made at the instance of the appellant the High Court decided the question in favour of the respondent assessee.
On appeal by the appellant by special leave, Held, that the view taken by the High Court was correct.
On the finding that there was a well establised Commercial practice of financing business by borrowing money on joint and several liability and by so doing the respondent could borrow at a lower rate of interest, and that there was mutuality between the borrowers for standing surety for each other for loans taken for business purposes, the respondent assessee in computing his business profits was entitled to deduct the loss suffered by him in paying the sum not paid by his co borrower.
Commissioner of Income tax vs Ramaswami Chettiar, , applied.
Madan Gopal Bagla vs Commissioner of Income tax, West Bengal, ; , Commissioner or Income tax vs section R. Subramanya Pillai, distinguished.
Montreal Coke and Manufacturing Co. vs Minister of National Revenue, [1945] 13 I.T.R. Supp. 1, not applicable.
|
Civil Appeal (NCE) No. 735 of 1982.
From the Judgment and order dated the 22nd April, 1981 of the Punjab &; Haryana High Court in Election Petition No. 6 of 1980.
K.L. Sharma, A.S. Sohal and MC Phingra for the Appellant.
M. Yeerappa and Ashok Kumar Sharma for Respondent No. 1.
416 A.S. Pundir for Respondent No. 2.
The Judgment of the Court was delivered by FAZAL ALI, J.
This election appeal arises out of an election to the Baghapurana Constituency (District Faridkot) to the Punjab Legislative Assembly.
The polling took place on May 31, 1980 and the counting was done on June 1, 1980.
Tej Singh, respondent, secured 25694 votes whereas Avtar Singh (appellant) secured 25571 votes.
There were three other candidates also in the field, viz., (1) Sathi Ruplal, (2) Bhagat Puran Singh, and (3) Jagdish Chander.
Ruplal secured,.
1347 votes while Bhagat Puran Singh and Jagdish Chander secured 140 and 2856 votes.
respectively.
It appears that the margin between the votes secured by Tej Singh (respondent) and .
Avtar Singh (appellant) was only 123.
Avtar Singh filed an election petition in the Punjab & Haryana High Court against Tej Singh alleging that he was guilty of committing corrupt practices, detailed in the petition an(l in the Statement of facts.
Ruplal supported the appellant but Bhagat Puran Singh and Jagdish did not put in any appearance despite service and, therefore, the proceedings.
were taken ex parte against them.
Tej Singh denied having indulged in any corrupt practice as alleged by Avtar Singh.
It is not necessary for us to .
go into further details because, in our opinion, the appeal must succeed on a short point.
The main corrupt practice said to have been indulged in Tej Singh was that he had got circulated pamphlets and posters among the voters of the constituency wherein he had mentioned that Ruplal: had withdrawn his candidature and any vote given to him (Tej Singh) would be deemed to be a vote for Ruplal, and the said posters were printed not by Ruplal but at the instance of Tej Singh., on a perusal of the evidence both oral and documentary adduced by the parties, we are clearly of the opinion that the allegations of corrupt practices indulged in by Tej Singh have been clearly proved.
The posters said.
to have been printed and circulated are Annexures P 1 and P:2 which appear at page 42 of the second paper book and it may be necessary to extract certain portions thereof "Keeping in view the present conditions in the country it is imperative to defeat the dictatorial Congress in these elections.
417 Therefore, I fervently appeal to all the voters of Baghapurana Constituency to vote and elect Shri Tej.
Singh, the joint .
front candidate of the Akali Dal, because Shri Tej Singh is the only candidate who can defeat the Congress.
In the end r submit that every vote.
cast in favour of section Tej Singh will be deemed to have been cast in my favour," According to PW 4 (Roshanlal) in whose press the posters were printed, the order for the printing was placed by Darshan Singh and Mukhtiar Singh.
The witness goes on to state that a few (lays before Tej Singh had come to his printing press and informed him that he (Tej Singh) would be sending some work for printing.
Soon thereafter the witness was approached by Darshan Singh and Mukhtiar Singh.
Roshan Lal also admitted that Tej Singh was known to him.
The witness further proved exhibit P 5 and P 6 (vouchers) which were issued by his press and signed by him, and he stated that the payment was made to him by Darshan Singh and Mukhtiar Singh.
The effect of the posters was to mislead the voters so as to make them believe that one of the candidates, viz.; Ruplal, had withdrawn and any vote given to Tej Singh would be considered as a vote given to Ruplal.
In other words, the effect of the posters was that all the voters who would have voted for Ruplal would now cast their votes in favour of Tej Singh.
As the margin of votes between the defeated and the returned candidates was very small, viz. 123 votes, if such a misrepresentation was not made, in all probability the votes would have gone to the appellant (Avtar Singh) and, therefore, the result of the election would have been materially altered.
We find a good deal of substance in the argument of the appellant.
Tej Singh (R.W. 2) has not disputed that the payment of the vouchers .(Ex.
P 5 and P 6) was made by him and the vouchers were appended by him along with the return of expenses incurred during his election campaign, which was verified by him to be a true and correct statement.
In these circumstances, therefore, the irresistible inference and inescapable conclusion that can be arrived at is that Tej Singh had actually paid for the posters which were printed at his instance and Rup Lal was not collected with the printing of the posters.
Tej Singh further admitted that Bhum Raj was incharge of his election office at Moga and that Exs.
P 5 and P 6 were taken by him from Bhum Raj.
He further admits that whatever expenses were incurred by Bhum Raj were incurred on his behalf.
In other words, Tej Singh.
falsely represented to the voters that the posters were circulated by 418 Ruplal whereas the same was done by or with the consent of Tej Singh.
Therefore, it is clear that Ex P 1 and P 2 which contained the appeal purporting to be of Ruplal were in fact printed at the instance of Tej Singh and Ruplal had no connection with the same.
In these circumstances, we are satisfied that the appellant has , proved beyond reasonable doubt that Tej Singh had indulged in corrupt practices particularly when the printing of the posters by Tej.
Singh has been clearly admitted by him, as indicated above.
It is also clear to us that in view of the very narrow margin of votes (123) between Tej Singh and Avtar Singh, a strong presumption and possibility that the votes polled in favour of Rup Lal would have gone to Avtar Singh cannot be ruled out and that would have doubtless materially altered the result of the election.
Leaving aside other grounds taken by the appellant which were in fact not pressed before us, the appellant is entitled to succeed on the ground of corrupt practices (referred to above) as contemplated by section 123(2) of the Act having been adopted by the first respondent (Tej. Singh) which have been fully proved.
The result is that the appeal is allowed, the judgment of the High Court is quashed and the election of the first respondent (Tej Singh) is set aside.
In the circumstances, we make no order as to costs.
H.S.K. Appeal allowed.
| The Revenue who had seized the books of account and documents of the assessee under sec.
132(1) of the Income Tax Act, 1961 did not return the same to the assessee after a period of 180 days of the seizure.
The assessee filed a writ petition in the High Court inter alia praying for a direction to the Revenue to return the said books of account.
The assessee submitted that the retention of the seized books of accounts and documents beyond the period of 180 days was illegal and invalid inasmuch as neither the approval accorded by the Commissioner of Income Tax for such extended retention nor the recorded reasons of the Income Tax Officer on which such approval was based had been communicated to him.
A single Judge of the High Court held that the retention of the books and documents beyond 180 days was unlawful.
A Division Bench dismissed the Revenue 's appeal.
In these appeals the Revenue submitted that sec.
132(8) of the Act did not impose any obligation on the Revenue to communicate the approval of the commissioner or the recorded reason of the Income Tax Officer on which it is based to the person from whose custody the books of accounts and documents had been seized.
Dismissing the appeals, ^ HELD: It is true that sub sec.(8) of sec.
132 of the Income Tax Act, 1961 does not in terms provide that the Commissioner 's approval of the recorded reasons on which it might be based should be communicated to the concerned person but since the person concerned is bound to be materially prejudiced in the enforcement of his right to have such books and documents returned to him by being kept ignorant about the factum of fulfilment of either of the two conditions laid down therein it is obligatory upon the Revenue to communicate the Commissioner 's approval as also the recorded reasons to the person concerned.
In the absence of such communication the Commissioner 's decision according his approval will not become effective.
[823 H; 824 A] Moreover, sub sec.(10) of sec.132 confers upon the person legally entitled to the return of the seized books and documents a right to object to the 818 approval given by the Commissioner under sub sec.(8) by making an application to the Central Board stating therein the reasons for such objection and under sub sec.(12) of sec.132 it is provided that the Central Board may, after giving the applicant an opportunity of being heard pass such orders as it thinks fit.
It is obvious that without the knowledge of the factum of the Commissioner 's approval as also of the recorded reasons on the basis of which such approval has been obtained it will not be possible for the person to whom the seized books or documents belong to make any effective objection to the approval before the Board and get back his books or documents.
[824 B C] The scheme of sub secs (8), (10) and (12) of sec.132 makes it amply clear that there is a statutory obligation on the Revenue to communicate to the person concerned not merely the Commissioner 's approval but the recorded reasons on which the same has been obtained and that such communication must be made as expeditiously as possible after the passing of the order of approval by the Commissioner and in default of such expeditious communication any further retention of the seized books or documents would become invalid and unlawful.
It is obvious that such obligation arises in regard to every approval of the Commissioner that might have been accorded from time to time.
[824 D F]
|
Civil Appeal No. 2534 of 1969.
(Appeal by special leave from the judgment and order dated the 19 8 1969 of the Andhra Pradesh High Court at Hyderabad in C.R.P. No. 2190 of 1968.) P. P. Juneja, for the appellant.
G. N. Rao, for the respondent.
552 The Judgment of the Court was delivered by BEG J.
The defendant appellant had taken a house on rent under a registered lease dated 10th February, 1958, on a monthly rent of rent Rs. 250/ for a period of five years for running a lodging house.
It J is admitted by both sides that in February, 1963, the lease had expired.
According to the landlord respondent, the defendant appellant had continued to hold over as a tenant "on the same terms" by which he, presumably, meant that it was a month to month tenancy.
The Andhra Pradesh Building (Lease, Rent and Eviction) Control Act, 1960, (hereinafter referred to as 'the Act ') came into opera ton before the lease expired.
The appellant seemed to be constantly making defaults in payments of rent.
The landlord responden had, therefore, to file a suit for arrears of rent in the Court of District Munsif, Visakhapatnam, which was decreed on 4th April, 1962.
The landlord respondent had to file a petition on 21st April, 1962, under Section 10 of the Act before the Rent Controller, Visakhapatnam for the eviction of the appellant as no rent was paid from 1st December, 1961 to 31st March, 1962.
There was a compromise on 12th October, 1962.
The appellant agreed to clear arrears and to pay rents regularly.
The appellant, however, wailfully defaulted again in payments of rent from September, 1963 to April, 1964.
A notice dated 8th April, 1964, was sent by registered post by the landlord respondent to the appellant terminating his tenancy and calling upon him to pay up the arrears of rent and vacate the house by the end of April, 1964.
This came back with the endorsement that the appellant was refusing to accept it.
On 9th `` April, 1964, the respondent filed another petition under Section 10 of the Act before the Rent Controller of Visakhapatnam who ordered the eviction of the appellant after holding all the flimsy defenses of the t appellant to be unsubstantiated.
The Subordinate Judge of Visakhapatnam dismissed the tenant 's appeal on 23rd October, 1968.
The appellant 's revision application to the High Court was also rejected on 19th August, 1969.
The only question raised by the appellant before us, in this appeal by special leave, is that no notice under Section 106 of the Transfer of Property Act had been served upon the appellant according to the finding of the Andhra Pradesh High Court itself.
It was, therefore, urged , that the petition under Section 10 of the Act could not succeed.
The Andhra Pradesh High Court had, however, relied upon Ulligamma Ors.
V. section Mohan Rao & ors.
(1), where a Division Bench of that High Court had held that the Act, with which we are now concerned, provided a procedure for eviction of tenants which was self contained so that no recourse to the provisions of Section 106 of the Transfer of Property Act was necessary.
We may also refer here to the observations of this Court.
in Raval & Co. vs K. C. Ramachandran & ors.(2).
There, this Court noticed (1) (1969) 1 An.
P.R. Law Jolurnal 351.
(2) [197412 S.C.R. 629 @ 634 553 Shri Hem Chand vs Shrmati Sham Devi(1), and pointed out "that it was held there that the Act under consideration in that case provided the whole procedure for obtaining the relief of ejectment, and, that being so, provisions of Section 106 of the Transfer of Property Act had no relevance".
No doubt the decision mentioned with approval by this Court related to another enactment.
But, the principle indicated by this Court was the same as that applied by the Andhra Pradesh High Court.
It is true that, in Mangilal vs Sugan.
Chand Rathi (Deceased) etc.(2), this Court has held that the provisions of Section 4 of the Madhya Pradesh Accommodation Control Act of 1955 do not dispense with the requirement to comply with the provisions of Section 16 of the Transfer of Property Act.
In that case, however, Section 4 of the Madhya Pradesh Act merely operated as a bar to an ordinary civil suit so that service of a notice under Section 106 of the Transfer of Property Act became relevant in considering whether an ordinary civil suit filed on a ground which constituted an exception to the bar contained in Section 4 had to be preceded by a notice under Section 106 of the Transfer of Property Act.
In the context of the remedy of ejectment by an ordinary civil suit, it was held that the usual notice of termination of tenancy under Section long of the Transfer of Pro party Act was necessary to terminate a tenancy as a condition precedent to the maintainability of such a suit.
In the case before us, the respondent landlord relied upon a provision for special summary proceedings for eviction of tenants under an Act which contains all the requirements for those proceedings.
We, therefore think that the learned Judge of the Andhra Pradesh High Court had correctly applied the principle laid down by a Division Bench decision of that Court.
He rightly distinguished such a case from Mangilal 's case (supra), where an entirely different kind of provision of another Act in another State was being considered by this Court.
The Division Bench decision of the High Court, applied by the learned Judge, had, we think, enunciated the correct principle.
A question raised before us by learned Counsel for the respondent is whether the notice sent by the respondent landlord could be held not to have been served at all simply because the postman, who had made the endorsement of refusal, had not been produced.
The Andhra Pradesh High Court had relied upon Meghji Kanji Patel vs Kundanmal Chamanlal (a), to hold that the notice was not served.
There, a writ of summons, sought to be served by registered post, had been returned with the endorsement "refused".
The Bombay High Court held G that the presumption of service had been repelled by the defendant 's statement on oath that he had not refused it as it was never brought to him.
In this state of evidence, it was held that, unless the postman was produced, the statement of the defendant on oath must prevail.
An (1) I.L.R. [1955] Punj.
(2) A.I.R. 1965 SC 101.
(3) A.I.R. 1968 Bombay 387.
3 608SCI/76 554 ex paste decree, passed on the basis of such an alleged service was, therefore, set aside.
On facts found, the view expressed could not be held to be incorrect.
In Nirmalabala Debi vs Provat Kumar Basa(1), it was held by the Calcutta High Court, that a letter sent by registered post, with the endorsement "refused" on the cover, could be presumed to have been duly served upon the addressee without examining the postman who had tried to effect service.
What was held there was that the mere fact that the latter had come back with the endorsement "refused" could not raise a presumption of failure to serve.
On the other hand, the presumption under section 114 of the Evidence Act would be that, in the ordinary course of business, it was received by the addressee and actually refused by him.
This is also a correct statement of the law.
The two decisions are reconcilable.
The Calcutta High Court applied a rebuttable presumption which had not been repelled by any evidence.
In the Bombay case, the presumption had been held to have been rebutted by the evidence of the defendant on oath so that it meant that the plaintiff could not succeed without further evidence.
The Andhra Pradesh High Court had applied the ratio disdained of the Bombay case because the defendant appellant before us had deposed that he had not received the notice.
It may be that, on a closer examination of evidence on record, the Court could have reached the conclusion that the defendant had full knowledge of the notice and had actually refused it knowingly.
It is not always necessary, in such cases, to produce the postman who tried to effect service.
The denial of service by a party may be found to be incorrect from its own admissions or conduct.
We do not think it necessary to go into this question any further as we agree with the High Court on the first point argued before us.
Consequently, this appeal is dismissed with costs.
P.B.R. Appear dismissed.
| "B" the appellant/Head Constable with a view to help the accused not only to get an acquittal but get back the seized coins approached "J" a constable who was in charge of an investigation of a case under section 411 I.P.C. to substitute the J seized gold coins with different markings offering a bribe of Rs. 1,000/ .
J reported the matter to the D.S.P. concerned and as per the directions, the raiding party arrested 'B ' and the other accused in a hotel and also recovered from him the gold coins of different markings.
The currency notes of Rs. 1,000/ in the hands of 'J ' offered by 'B ' were also recovered.
The Special Judge convicted 'B ' and sentenced him to undergo R.I. for one year which was maintained by the High Court.
On appeal by special leave, the appellant contended that since the prosecution case rested principally on the testimony of 'J ', the whole edifice is destroyed on that witness being declared 'hostile '.
Rejecting the contention and dismissing the appeal, the Court ^ HELD: The prosecution could have even avoided requesting for permission to cross examine the witness u/s 154 evidence Act.
But the fact that the court gave permission to the prosecutor to cross examine him as what is described as "hostile witness", does not completely efface his evidence.
The evidence remains admissible in the trial and there is no legal bar to have a conviction upon his testimony if corroborated by other reliable evidence.
[923D E]
|
als Nos.
56 and 57 of 1949.
Appeals from the orders of the High Court of Judica ture at Madras (Wadsworth and Patanjali Sastri JJ.) dated 24th October, 1945, in A.A.O. Nos.
372 of 1943 and 634 of 1944 which were appeals from the orders of the Subordinate Judge of Ellore in E.A. No. 440 of 1937 and C.M.P. No. 152 of 1943 in O.S. No. 87 of 1923.
P. Somasundaram (V. V. Choudhry, with him) for the appellant.
V. Rangachari (K. Mangachari, with him) for the respond ents. 1950.
October 17.
The Court delivered judgment as follows.
FAZL ALI J.
These appeals arise out of an execution proceeding, and the main point to be decided in them is what is the effect of certain provisions of the Madras Agricul turists ' Relief Act (Madras Act IV of 1938, which will hereinafter be referred to as "the Madras Act"), on the rights of the parties.
How this point arises will be clear from a brief statement of the facts of the case.
It appears that in 1908, one Veeresalingam, the husband of the first respondent, borrowed a sum of Rs. 9,000 from one Sitharamayya, and executed a mortgage bond in his fa vour.
Subsequently a suit was 808 instituted by the mortgagee to enforce the mortgage and a final decree in that suit was passed on the 19th August, 1926.
Thereafter, on the 28th October, 1931,the decree holder applied for the execution of the decree by the sale of the mortgaged property.
In 193a, the decree holder transferred the decree to one Sobhanadri, after whose death his son, the appellant before us, was brought on the record as his legal representative in the execution proceedings.
Several years before the assignment of the decree, Veeresa lingam, the defendant, had died and his widow, the first respondent.
was therefore brought on the record as his legal representative.
On the 6th July, 1935, two items of proper ty were sold in execution of the decree and purchased by the decree holder, these being : (1) a village called Tedlam in in West Godavari District; and (2) 4 acres and 64 cents of land in Madepalli village.
The first property was sold for Rs. 21,000 and the second for ' Rs. 1,025.
As, however, the amount due under the decree was only about Rs. 17,860 and odd, the sale of the second property was subsequently set aside and the decree holder deposited into Court the excess amount of about Rs. 3,000 and odd after setting off the decretal amount against the price of the first item of property.
On the 5th August, 1935, the first respondent filed an application under Order XXI, rule 90, and section 47 of the Code of Civil Procedure, to set aside the sale held in July, 1935, alleging certain irregularities in the conduct of the sale.
That application was after several years heard by the Subordinate Judge of Ellore, who by his order dated the 6th March, 1943, dismissed it and directed the sale of the first property to be confirmed and full satisfaction of the decree to be entered.
After about 12 days, i.e., on the 18th March, 1943, the first respondent and the second respondent, who had been adopted by the former on the 12th March, 1936, under the will of her hus band and was subsequently brought on record, filed an appli cation under section 19 of the Madras Act praying for cer tain reliefs under that Act.
This application ' was dismissed on the 22nd March, 1943.
Subsequently, two appeals were filed on behalf 809 of the respondents (who will hereinafter be sometimes re ferred to as judgment debtors), one against the order refus ing to set aside the sale under Order XXI, rule 90 of the Civil Procedure Code, and the other against the order dis missing the application under the Madras Act.
These appeals were heard together by two learned Judges of the Madras High Court and they took the view that the judgment debtors ' application under the Madras Act was maintainable notwith standing the fact that the sale had been confirmed and full satisfaction of the decree recorded, and remitted the case to the trial Court for a finding on the following questions, namely (1) whether the applicants were agriculturists; and (2) if so, what would be the result of applying the provisions of Madras Act IV of 1938 to the decretal debt against them ? So far as regards the judgment debtors ' appeal against the order dismissing their application under Order XXI, rule 90, the Learned Judges were inclined to agree with the trial Court that the sale should stand but declined to pass final orders in the appeal on the ground that "it would seriously prejudice the judgment debtors in the connected application for relief under section 19 of the Madras Act IV of 1938.
" The Subordinate Judge answered the questions referred to him by the High Court on remand as follows : (1) The judgment debtors were not agriculturists and were not therefore entitled to the benefits of the Madras Act;and (2) If they were agriculturists, they were not liable to pay anything under the decree, as, in view of the provisions of the Act, the debt stood discharged on the date of sale.
When however the matter came up before the learned Judges of the High Court, they reversed the first finding of the trial Court and held that the judgmentdebtors were agriculturists within the meaning of the 810 Act, and that the debt stood discharged in view of section 8 (2) of the Act.
At the same time, they held that the sale was not liable to be set aside, and in this view dismissed one of the appeals and allowed the other.
Then followed certain proceedings to which it would have been unnecessary to refer but for the fact that the judgment debtors have attempted to rely on "them in support of one of their preliminary objections to the maintainability of these appeals.
It appears that on the next day after the judgment of the High Court was delivered in the two appeals, counsel for the respondents wrote a letter to the Registrar of the High Court to direct the posting of the two cases 'for being mentioned ' before the Court in order to obtain necessary directions consequent on the orders passed by it in the appeals.
This letter was not placed before the learned Judges until the judgment had been signed by them and ac cordingly the judgment debtors filed two petitions, one being a review petition to the High Court and the other being a petition to the trial Court praying "that the de creeholder may be ordered to pay to the petitioners the purchase money of Rs. 21,000 with interest thereon at 6 per cent.
per annum from the date of sale till the date of payment.
" The trial Court dismissed the latter petition on the ground that it was not maintainable, and the judgment debtors filed an appeal against the order.
The appeal as well as the review petition of the judgment debtors were heard together by the learned Judges who directed the decree holder 's counsel to elect whether his client would deposit the purchase money into Court or have the sale set aside.
The decree holder applied for a short adjournment and ultimately on the 15th November, 1946, his counsel stated that his client wished to retain the property which he had purchased and to pay the purchase money into Court.
Thereupon, he was directed to pay the sum of Rs. 21,000 together with interest within a months from that date.
Subsequently, the appellant (decree holder) having obtained leave to appeal from the High Court preferred 811 these appeals before us.
It may be stated here that along with the application for leave to appeal, the appellant had filed an application for excusing the delay in filing the former application which he accounted for mainly by refer ring to the proceedings for the review of the judgments in the previous appeals to the High Court.
This application was granted and the delay was condoned.
As has been already stated, the main point arising in these appeals relates to the effect of the Madras Act upon this litigation.
That Act was passed and came into effect in 1938, while the execution proceedings were still continu ing.
It will be recalled that the sale took place on the 6th July, 1935; and the application for setting it aside was not disposed of until the 6th March, 1943.
But, strangely enough, the judgmentdebtors did not apply for any relief under the Madras Act during this period, and they made their application only after the sale had been confirmed and satisfaction of the decree had been entered.
How far this belated application affects the right claimed by the judg ment debtors under the Act is one of the questions raised in these appeals, and I shall deal with it after referring to the material provisions of the Act and the findings of the High Court which have given rise to several debatable points.
The sections of the Act which are material for the purpose of these appeals are sections 3, 8 and 19.
Section 3 defines an agriculturist and has a proviso stating that in certain cases a person shall not be deemed to be an agricul turist.
The relevant clause of this proviso, to which I shall also have to advert later, is clause (D) which runs thus : "Provided that a person shall not be deemed to be an 'agriculturist ' if he (D) is a landholder of an estate under the Madras Es tates Land Act, 1908, or of a share or portion thereof in respect of which estate, share or portion any sum exceeding Rs. 500 is paid as peshkash or any sum exceeding Rs. 100 is paid as quit rent, jodi, kattubadi, 812 poruppu or the like or is a janmi under the Malabar Tenancy Act, 1929, who pays any sum exceeding Rs. 500 as land reve nue to the Provincial Government. ' ' The precise question which is said to arise with refer ence to this provision is whether by reason of being the owners of village Tedlam, the judgment debtors should be held to be not entitled to relief under the Act.
The other material sections 8 and 19 run as follows : "8.
Debts incurred before the 1st October, 1932, shall be scaled down in the manner mentioned hereunder, namely: (1) All interest outstanding on the 1st October, 1937, in favour of any creditor of an agriculturist whether the same be payable under law, custom or contract or under a decree of Court and whether the debt or other obligation has ripened into a decree or not, shall be deemed to be dis charged, and only the principal or such portion thereof as may be outstanding shall be deemed to be the amount repay able by the agriculturist on that date.
(2) Where an agriculturist has paid to any creditor twice the amount of the principal whether by way of princi pal or interest or both, such debt including the principal, shall be deemed to be wholly discharged.
(3) Where the sums repaid by way of principal or inter est or both fall short of twice the amount of the principal, such amount only as would make up this shortage, or the principal amount or such portion of the principal amount as is outstanding, whichever is smaller, shall be repayable.
(4) Subject to the provisions of sections 22 to 25, nothing contained in sub sections (1), (2) and (8) shall be deemed to require the creditor to refund any sum which has been paid to him, or to increase the liability of a debtor to pay any sum in excess of the amount which would have been payable by him if this Act had not been passed.
813 Explanation.
Where a debt has been renewed or included in a fresh document in favour of the same creditor, the principal originally advanced by the creditor together with such sums, if any, as have been subsequently advanced as principal shall alone be treated as the principal sum repay able by the agriculturist under this section.
Where ' before the commencement of this Act, a Court has passed a decree for the repayment of a debt, it shall, on the application of any judgmentdebtor who is an agricul turist or in respect of a Hindu joint family debt, on the application of any member of the family whether or not he is the judgment debtor or on the application of the decree holder, apply the provisions of this Act to such decree and shall, notwithstanding anything contained in the Code of Civil Procedure, 1908, amend the decree accordingly or enter satisfaction, as the case may be: Provided that all payments made or amounts recovered, whether before or after the commencement of this Act, in respect of any such decree shall first be applied in payment of all costs as originally decreed to the creditor.
" These sections are material, because in the present case the judgment debtors asked the decree to be amended under section 19 of the Act and they were held to be entitled to relief under section 8.
Having referred to the relevant provisions of the Act, it becomes necessary now to state the main findings of the High Court upon which the decision of this appeal will turn.
These findings are (1) that the sale of Tedlam village, which was held on the 6th July, 1935, and confirmed on the 6th March, 19 13, was a good sale; (2) that by this sale.
the title to the Tedlain village passed to the decree hoMer.
and in hearing the appeal the High Court was justified in proceeding on the footing that the judgment debtors having ceased to be the owners of Tedlam village after its sale, were not 104 814 hit by clause (D) of the proviso to section a of the Act; and (3) that the decree had been satisfied at the date of the sale and the decree holder was liable to repay to the judg ment debtors the full price of the property which was sold.
The main contentions directed against the conclusions arrived at by the High Court are :firstly, that they are self contradictory, because if the sale was an effective sale on the date it was held or confirmed, the decree was also satisfied on that date and the judgmentdebtors were no longer entitled to invoke the provisions of the Madras Act; and secondly, that the view taken by the learned Judges of the High Court that notwithstanding the appeal against the order refusing to set aside the sale they could proceed on the footing that the judgment debtors had ceased to be the owners of Tedlarn village on the date of the sale was un sound in law.
It will first deal with the second point which appears to me to require serious consideration.
The High Court has in my opinion rightly proceeded on the footing that the ownership of Tedlam village would bring the judgment debtors within the mischief of clause (D) of the proviso to section 3 of the Act, and would disentitle them to any relief thereunder.
This view was contested before us on behalf of the judgment debtors on two grounds : (1) that the grant in favour of the ancestor of the judgment debtors did not comprise a whole inam village and what they owned was therefore not an estate under the Madras Estates Land Act (Madras Act I of 1908); (2) that on the date of the application, the judg ment debtxrs were not landholders of village Tedlam because the village was in the possession of a receiver since 1st February, 1937, and the latter was in law the landholder on the crucial date.
None of these contentions however appears to me to have any force.
The first contention was sought to be supported by Exhibit P 1 which is a register of inams and which shows that poramboke or waste lands to the extent of 596 acres had to be deducted from the area 815 of the inam.
The point however has been dealt with very fully and clearly by the learned Subordinate Judge, who has rightly pointed out that it has no force in view of the Madras Estates Land (Amendment) Act, 1945 [Madras Act No. II of 1945].
The second point is equally unsubstantial, be cause it is well settled that the owner of a property does not cease to be its owner merely because it is placed in the hands of a receiver.
The true position is that the receiver represents the real owner whoever he may be, and the true owner does not by the mere appointment of a receiver cease to be a landholder under the Madras Estates Land Act.
I will now revert to the crucial question in the case, viz., whether the learned Judges of the High Court were justified in law in deciding the appeal on the footing that the judgment debtors had ceased to be the owners of Tedlain village and on that account they were not hit by clause (D).
of the proviso to section 3 of the Madras Act.
At this stage, it will be useful to refer to certain provisions of the Civil Procedure Code which directly bear on the question as to when title to immovable property which is sold in execution of a decree is deemed to pass to the purchaser.
One of the provisions is Order XXI, rule 92, which provides that "where no application is made under rule 89, rule 90 or rule 91, or where such application is made and disallowed, the Court shall make an order confirming the sale, and thereupon the sale shall become absolute.
" The second rele vant provision is section 65 which runs thus : "Where immovable property is sold in execution of a decree and such sale has become absolute, the property shall be deemed to have vested in the purchaser from the time when the property is sold and not from the time when the sale becomes absolute.
" In Bhawani Kunwar vs Mathurn Prasad Singh(1) the ques tion as to when a mortgagee who has purchased certain vil lages in execution of the decree acquired title to the properties purchased by him directly arose for considera tion, and the Privy Council rightly pointed (1) T.L.R. 816 out that "the sale in execution of the mortgage decree took effect from the actual date of the sale and not from its confirmation." In a simple case, the provisions cited above should settle the controversy, but, in the present case, the matter has been complicated on account of the appeal against the order refusing to set aside the sale under Order XXI, rule 90.
In such a case, generally speaking, the true position seems to be that there is no finality until the litigation is finally determined by the appellate Court.
This principle has been recognized in a number of cases, but it will be enough to cite Chandramani Shaha vs Anarjan Bibi(1).
The headnote of that case runs as follows : "Where a Subordinate Judge has disallowed an applica tion under Order XXI, rule 90, to set aside a sale in execu tion, and has made an order under rule (1) confirming the sale, and an appeal from disallowance has been dismissed by the High Court, the three years ' period provided by the Indian Limitation Act, 1908, Schedule I, article 180, for an application under Order XXI, rule 95.
by the purchaser for delivery of possession runs from the date of the order on appeal; the High Court having under the Code of Civil Proce dure, 1908, the same powers as the Subordinate Judge, the 'time when the sale becomes absolute ', for the purpose of article 180 is when the High Court disposes of the appeal." Under article 180 of the Indian Limitation Act, the period of limitation runs "from the date when the sale becomes absolute.
" If we give a narrow and literal meaning to these words, the period of limitation should be held to run from the date when the original Court of execution confirms the sale.
But, as was pointed out by the Privy Council, the High Court as an appellate Court had the same powers as the trial Court and it is only when the appeal was dismissed by the High Court that the order of the trial Court confirming the sale became absolute.
Till the deci sion of the appellate Court, no finality was attached to the order confirming the sale.
(1) I.L.R. 61 Cal.
g45. 817 It is clear that in this case the same rule would apply to the order recording satisfaction of the decree and to the order confirming the sale.
If the order recording satisfac tion of the decree was not final and remained an inchoate order until the appeal was decided, the order confirming the sale would have the same inchoate character.
This position seems to have been fully conceded in the statement of their case filed on behalf of the respondents in this Court.
It is quite clear that in this case the learned Judges of the High Court have taken up an inconsistent position.
As I have already stated, they have held, for the purpose of allowing one of the appeals, that the judgment debtors were not hit by clause (D)of the proviso to section 3 of the Act because they ceased to be the owners of Tedlain village at the date of the sale in 1935.
If this conclusion is cor rect, it must follow as a matter of logic that the decree was completely satisfied on the date of the sale, because the sale fetched a larger amount than what was payable under the decree and the excess amount was deposited by the de cree holder in Court.
The sale and satisfaction must go together and if finality is to be attached to the sale it should have been held to attach also to the order recording satisfaction of the decree.
It seems clear to me that if the decree had ceased to exist, no relief could be claimed by the judgment debtors under the Madras Act.
On the other hand, if the appeal had to be decided on the footing that the order recording satisfaction of the decree was not final, the same approach should have been made in regard to the effect of the sale.
It is also clear that if the decree was satisfied on the date of sale by the application of the provisions of the Act, the sale could not stand, because how could the property be sold in execution of a decree which had been already satisfied.
Yet, notwithstanding the fact that nothing was due under the decree, the High Court has held that the sale was a good sale and was to stand.
The correct approach to the case would have been to assume for the purpose of the appeals that neither of the orders passed by the 818 Subordinate Judge was final.
On that view, the appeals to the High Court could not have been decided on the footing that the judgment debtors had ceased to be the owners of Tedlain property and were therefore not hit by clause (D) of the proviso to section 3 of the Madras Act.
In my opinion, the judgment of the High Court cannot be sustained, and the appeal s will have to be allowed.
I will now deal very briefly with two preliminary objec tions raised on behalf of the respondents.
The first objec tion is that the application for leave to appeal to his Majesty in Council against the order of the High Court was barred by limitation, inasmuch as the reasons stated in the affidavit filed by the appellant in the High Court in sup port of his application for excusing delay do not consti tute sufficient reason within the meaning of section 5 of the Limitation Act.
The answer to this objection will be found in the facts which have been already narrated.
The delay was caused mainly by reason of the review of the order of the High Court and the High Court considered that there as sufficient reason for condoning the delay.
This Court cannot override the discretion exercised by the High Court and the matter cannot be reopened in these appeals.
The second objection is based on the fact that the decree holder was given a choice by the High Court to elect wheth er he would deposit the purchase money or have the sale set aside, and his counsel told the learned Judges on the 15th November, 1946 that his client wished to retain the property which he had purchased and pay the purchase money in cash.
It is contended that in view of this statement it was not open to the appellant to contend that he need not pay any amount to the judgment debtors.
This objection also is entirely devoid of any substance,because there is nothing on record to show that the appellant has consented to be bound by the order of the High Court and waived his right to appeal against it by reason of the election.
The learned counsel for the respondents also contended that the sale should have been set aside by the 819 High Court because the permission given to the decreeholder on the 16th February, 1934, to bid and set off the decretal amount against the purchase price was confined to an earlier sale and did not extend to the sate which took place on the 16th March, 1935, after the upset price which had been originally fixed was reduced.
Personally, I am inclined to hold that the permission covered the sale in question, but in any case it is difficult to hold on the facts stated that there was any such material irregularity as would vitiate the sale.
The precise argument which is put forward here was advanced in the Courts below but it did not find favour either with the Subordinate Judge or with the High Court.
Besides, the respondents cannot raise the point in these appeals because they have filed no appeal against the order of the High Court upholding the sale.
In these circumstances, I would allow the appeals, set aside the orders of the High Court and restore the order of the learned Subordinate Judge.
There will however be no order as to costs in these appeals.
MUKHERJEA J. I concur in the judgment just now deliv ered by ray learned brother, Fazl Ali J., and there is nothing further which I can usefully add.
CHANDRASEKHARA AIYAR J.
The facts which have cha given rise to these appeals and the questions for decision have been stated in the judgment just now pronounced by my learned brother Fazl Ali J. I wish to add only a few words on the main contention advanced for the respondents by their learned Advocate, Mr. V. Rangachari.
If by reason of the confirmation of sale and satisfac tion of the decree having been entered up, the title to the village had passed indefeasibly to the decreeholder, there was no longer any decree or decree debt to be scaled down.
If, however, the title did not pass, because it was still open to the respondents to attack the Court sale under Order XXI, rule 90, they were landholders of the village and, as such, they would 820 come within the scope of proviso (D) to section 3 of the Madras Agriculturists ' Relief Act, 1938, which enacts that a landholder who holds a village paying more than Rs. 100 as quit rent or jodi is not an agriculturist within the meaning of the Act.
The apparent inconsistency in the view taken by the High Court was recognised, if not conceded, by the learned coun sel.
In one view, there ,,as no longer any decree in respect of which the Agriculturists ' Relief Act could operate; and in the other view, the respondents could not take advantage of the Act, as their ownership of the village precluded them.
Faced with this dilemma, Mr. Rangachari urged a some what ingenious argument.
He contended that though the.
title passed to the decree holder on the confirmation of sale and became vested in him from the date of the sale, the respo dents could still be regarded as having an interest in the village, as the sale was open or liable to challenge and the title 'of the decree holder was inchoate or incomplete.
There is, however, really no support for this position.
On confir mation, the title of the decree holder became absolute or complete.
If the sale was set aside, the title would revest in the judgment debtor.
There is nothing like an equitable title in the decree holder which could be recognised for certain purposes and not recognised for others.
Under the Madras Act, "agriculturist" means "a person who has a saleable interest in any agricultural or horticul tural land or one who holds interest in such land under a landholder as a tenant, ryot or undertenure holder." Section 10, sub clause (i) of the Act provides that the right conferred on an agriculturist to have a debt scaled down will not apply to any person who, though an "agriculturist" as defined in the Act, did not on 1 10 1937 hold an interest in or a lease or sub lease of any land.
After the sale in 1935, the only interest which the judgment debtors had in the village was to have the sale set aside, under the rele vant provisions of the Civil Procedure Code.
This interest is not the interest contemplated by section 3, sub clause (ii) (a) & (b) of the Act which speaks of a 821 saleable interest or interest as a tenant, ryot or underten ure holder.
I agree in the conclusion reached by my learned broth er.
Appeals allowed.
| In the year 1943 the Divisional Superintendent, East Indian Railway placed certain purchase orders with the appellant for the supply of foodgrains for the employees of the East Indian Railway.
The orders were not expressed to be made in the name of the Governor General and were not "executed on behalf of the Governor General as required by section 175 (3) of the Government of India Act, 1935.
They were signed by the Divisional Superintendent either in his own hand or in the hand of his Personal Assistant.
Some deliveries of foodgrain s were made under these orders and were accepted and paid for by the Railway Administration.
But the Railway Administration declined to accept further deliveries of foodgrains.
The appellant sold the balance of foodgrains under the purchase orders and filed a suit to recover the difference between the price realised by sale and the contract price.
The respondent resisted the suit inter alia on the ground that the contracts were not binding on it.
Held, that the contracts were not binding on the respondent and it was not liable for damages for breach of the contracts.
Under s 175 (3) of the Government of India Act, 1935, as it stood at the relevant time, the contracts had: (a) to be expressed to be made by the Governor General, (b) to be executed on behalf of the Governor General and (F) to be executed by officers duly appointed in that behalf and in such mariner as the Governor General directed or authorised.
The 881 authority to a person to execute contracts may be conferred not only by rules expressly trained and by formal notifications issued in this behalf but may also be specially conferred.
The evidence in the case showed that such authority was specially conferred upon the Divisional Superintendent.
But the contracts were not expressed to be made by the Governor General and were not executed on his behalf The provisions of section 175(3) were mandatory.
The object of enacting these provisions was that the State should not be saddled with liability for unauthorised contracts and hence it was provided that the contracts trust show on their face that they were made by the Governor General and executed on his behalf in the manner prescribed by the person authorised.
State of Bihar vs M/s. Karam Chand Thapar and Bros., Ltd. ; , followed.
Liverpool Borough Bank vs Turner, ; , Municipal Corporation of Bombay vs Secretary of State, I. L. R. , Kessoram Poddar and Co., vs Secretary of State for India, I. L. R. section C. Mitra and Co., vs Governor General of India in Council, I.L.R. , Secretary of State vs Yadavgir Dharamgir, I. L. R. , Secretary of State vs G.T. Sarin and Co., 1.
L. R. , U. I '.
Government vs Lal Nanhoo Mal Gupta, A. 1.
R. (1960) All. 420, and Devi Prasad Sri Krishna Prasad Ltd. vs Secretary of State, I. L. R. (1941) All. 741, referred to.
section K. Sen vs Provincial P. W. D., State of Bihar, A. 1.
R. (1960) Pat., Chatturbhui Vithaldas Jasani vs Moreshwar Prashram, ; ,J. K. Gas Plant Mfg., Co. (Rampur) Ltd. vs King Emperor, , Moreshwar Pangarkar vs State of Bombay, ; , State of Bombay vs Purshottam Jog Naik, ; and State of U.P. vs Manbodhan Lal Srivastava, (1958) section C. R. 533, distinguished.
|
ivil Appeal Nos.
2316/69 and 1598/70.
From the Judgment and order dated 14/17/18th March, 1969 of the Gujarat High Court in S.C.A. No. 729/68.
908 R. H. Dhebar and M. N. Shroff for the Appellants in C.A. 2316/69.
D. V. Patel, M. V. Goswami and Ambrish Kumar for RR 1 5 in C.A. 2316/69 and RR.
1 4 in C.A. No. 1598/70.
The Judgment of the Court was delivered by DESAI, J.
These two appeals by certificate under article 133(1)(c) of the Constitution arise from a judgment rendered by the Gujarat High Court in Special Civil Application No. 720/68, being a petition under article 226 of the Constitution challenging the validity of a notification issued by the Government of Gujarat on 10th october 1967 under section 6 of the Land Acquisition Act, 1894 ( 'Act ' for short).
Civil Appeal No. 2316/69 is preferred by the original respondent No. 2 Gujarat State Transport Corporation, and the cognate Civil Appeal No. 1598/70 is preferred by the State of Gujarat, the first respondent in the petition.
As both the appeals arise from the same proceedings and raise identical contentions they were heard together and are being disposed of by this common judgment.
A notification under section 4 of the Act was issued by the former Governent of Bombay on 10th October 1952 notifying that final plots 41, 42 and 43 were likely to be needed for a public purpose, viz., State Transport.
The respondents who are tenants of different parcels of land comprised in the aforementioned final plots objected to the proposed acquisition.
Soon after filing the objections under section 5A of the Act the respondents fild Civil Suit No. 1262/53 in the Court of Civil Judge, Second Division, Ahmedabad, for a declaration that the notification under section 4 was illegal and ultra vires and for an injunction restraining the respondent State from proceeding with the acquisition of the lands in possession of the respondents.
During the pendency of this suit the then Government of Bombay, after considering the report submitted under section 5A, made a declaration under section 6 as per the notification dated 14th August 1953 declaring, inter alia, that final plots 41, 42 and 43 were required for the purpose of State Transport.
The respondents amended their plaint adding a relief for quashing the notification under section 6.
The suit filed by the petitioners was dismissed by the trial court and first and second appeals did not meet with success.
They carried the matter to this Court and succeeded as per judgment reported in Valjibhai Muljibhai Soneji & Anr.
vs The State of Bombay (now Gujarat) & Ors.(1).
As per that judgment this Court decreed the plaintiff 's suit which would imply that this Court quashed both notifications under sections 4 and 6.
Reading the judgment as a whole it 909 appears that the validity of section 4 notification was upheld and only the notification under section 6 was struck down.
In the mean timn on the bifurcation of the erstwhile State of Bombay these land acquisition proceedings came within the cognizance of Government of Gujarat and when the State Government became aware some where in 1965 about the error in the decree, Review Applications Nos. 11 and 12 of 1965 were made for correcting the decree.
This Court granted the applications and modified the decree on 13th September 1965.
The Government taking its clue from the judgment of this Court which invalidated section 6 notification on the ground that the acquisition having been made for the benefit of a Corporation, though for public purpose, is bad because no part of the compensation is to come out of the public revenue and provisions of Part VII of the Land Acquisition Act have not been complied with, decided as per its letter dated 22nd August 1966 to contribute Re. 1/ , which was subsequently raised to Rs. 500/ towards payment of compensation.
The Government, however, felt that as long time has elapsed since the earlier report under section 5A was submitted by the Collector, a fresh enquiry should be made Accordingly the Additional Special Land Acquisition Officer issued a notice dated 1st August 1966 intimating to the respondents that if they so desired the may submit their further objections by or before 16th August 1966.
Complying with this notice the respondents submitted further objections on 31st August 1966 and they were also given a personal hearing.
After examining the report submitted by the enquiry officer the Government of Gujarat issued a notification under section 6 on 10th October, 1967.
The respondents questioned the validity and legality of this notification in the petition filed by them on 14th February, 1968.
Respondents questioned the validity of the impugned section 6 notification on the only ground that it was issued more than 15 years after the date of section 4 notification and thus it had been issued after an unreasonable delay and it was illegal and void.
While this was the only contention which found favour with the High Court, in reaching this conclusion the High Court, after taking note of the fact that there was no express provision in the Act requiring that the notification under section 6 must be issued within a reasonable time after issue of section 4 notification, primarily relied upon the postulate that every statutory power must be exercised reasonably, a doctrine too finally entrenched in our jurisprudence to brook any refutation which would assist in raising the implication that section 6 notification must follow within a reasonable time 910 after issue of section 4 notification.
The Court also drew support from the scheme of sections 4, 5A and 6 as well as the history of the legislation.
On behalf of the appellants it was pointed out to the High Court that in view of the provisions contained in sub section
(2) of section 4 of the Land Acquisition (Amendment and Validation) Act, 1967 ( 'Amendment Act ' for short), as well as the proviso to section 6(1) also introduced by the same amendment Act the situation as has arisen in this case is not likely to arise and the apprehended mischief is not likely to be committed in future and, therefore, the Court should not go in search of the fetters on the power of the Government to issue section 6 notification, in the absence of any express provision, by implication that statutory power must be exercised within a reasonable time.
It was further submitted on their behalf that once the legislature has clearly permitted a thing to be done within the time specified in the statute it would be impermissible by a process of interpretation to reduce the statutory period by implying a further fetter on the power of the Government and that would be the effect if the contention on behalf of the respondents was accepted.
In other words, as the legislature has now provided that in respect of a notification issued under section 4 before the commencement of the Land Acquisition (Amendment and Validation) Ordinance, 1967, no declaration under section 6 shall be made after the expiry of two years from the commencement of the aforesaid Ordinance, and futher that in case of section 4 notification issued after the commencement of the Ordinance a statutory limit of three years is fixed within which declaration under section 6 can be made, the apprehended arbitrary exercise of power is thwarted and the Court should not further restrict or curtail the power of the Government to issue notification under section 6 within the time prescribed by the statute.
The High Court was of the opinion that if the power to make a declaration under section 6 is exercised after an unreasonable delay from the date on which notification under section 4 is issued such exercies of power would be invalid and accordingly struck down the notificatio under section 6.
Hence these two appeals.
A preliminary objection was raised by the learined counsel for the respondents in both the appeals contending that as the appellants in both the appels failed to seek within the prescribed time substitution of the heirs and legal representatives of respondent 5 who died on 8th March, 1970 during the pendency of the appeal in this Court, in the circumstances of the case these appeals would abate as a whole.
Undoubtedly, respondent 5 who is described in the cause title of the Memos.
of Appeals as "Ramesh Ramjibhai, Manager, Ramesh Restaurant, a joint hindu family business", died on 8th March 1970.
what 911 appears to have happened thereafter is that applications were made by the appellants under Order 22, Rule 10, Code of Civil Procedure, for bringing Shri Krishnakant Ramjibhai, Manager of Ramesh Restaurant, a joint hindu family business, on record in place of deceased respondent 5.
According to the appellants the deceased respondent 5 had filed the original petition in his capacity as manager of joint hindu family business and on his death as the interest devolved upon the succeeding manager of the joint hindu family business, applications under order 22, rule 10, C.P.C. were made to bring the person on record on whom the interest devolved pending the appeal.
Mr. D. V. Patel took serious exception to the procedure adopted by the appellants and there is some merit in this criticism.
In fact, when Ramesh Ramjibhai who filed the initial petition in his capacity as karta of the undivided hindu family business died during the pendency of the appeal, proper applications should have been made by the appeal, proper applications should have been made by the appellants under O. 22, r. 4, to substitute heirs of Ramesh Ramjibhai who was respondent 5 in the appeals before this Court.
In case of death of a party to a proceeding who is joined in his capacity as karta of an undivided hindu family, if the undivided hindu family continues to be in existence the succeeding karta can be substituted for the deceased karta of the family and that would be sufficient compliance with Order 22, r. 4.
What appears to have been done is to make applications under O. 22, r. 10 and those applications appear to have been granted subject to just exceptions.
The applications appear to have been made after the prescribed period of limitation, and in order to avoid seeking condonation of delay for setting aside abatement, O 22, r. 10 appears to have been invoked.
Mr. Patel is right in saying that this was a device but in any event if proper applications were made under O. 22.
r. 4 the gentleman who became the karta of the undivided hindu family after the death of the former karta could have been substituted on record for the deceased respondent 5.
In any event, succeeding karta of the undivided hindu family having been brought on record though not strictly in accordance with law, we do not propese to give any importance to this technical objection and overrule the same.
In a decision inter partes, Valjibhai 's case, (supra) this Court struck down the first section 6 notification issued on 14th August 1953 on the ground that the acquisition being for the benefit of a Corporation, though for a public purpose, was bad because no part of the compensation was to come out of the public revenue and the provisions of Part VII of the Act had not been complied with.
It would appear that section 4 notification was issued on 10th October 1952 and within less than one year, after completing the enquiry under section 5A and the 912 examination of the report by the appropriate Government, section 6 notification was issued on 4th August 1953.
By any yard stick it could not have been said that there was delay, much less an unreasonable delay, in making the necessary declaration under section 6 after the issue of the notification under section 4.
The chronology of events that followed in the wake of issuance of a notification under section 6 dated 14th August 1953 would wholly exonerate the Government of any charge of dithering or dilatoriness or inaction.
These events be noticed now so as to appreciate the submission on behalf of the appellants that they cannot be accused of any inaction, deliberate dilatoriness or dithering.
Soon after the issue of the notification under section 4 dated 10th October 1952 and even before the declaration was made under section 6 as per notification dated 14th August 1953 the respondents filed Civil Suit No. 1262/53 challenging the notification under section 4 and sought an injunction restraining the then State of Bombay from proceeding with the acquisition of the lands in possession of the respondents.
An interim injunction was sought but the same was refused.
Thereafter came the notification under section 6 dated 14th August 1953.
It appears that thereafter the respondents amended the plaint to add a relief for quashing and setting aside the notification under section 6 also.
It would thus appear that whatever was required to be done by the Government for completing the proceedings of acquisition was undertaken and finished within a period of less than one year from the date of the notification under section 4.
The suit filed by the respondents was dismissed by the trial court as per its judgment dated 28th January 1959.
Both the notifications were held valid and they were not found to suffer from any infirmity as contended for and on behalf of the respondents.
The respondents carried the matter in appeal to the District Court and this appeal was dismissed by the first appellate court as per its judgment dated 28th September 1959.
The respondents preferred second appeal to the High Court but failed to carry conviction with the High Court, with the result that the appeal failed and was dismissed on 1st August 1960.
The respondents did not rest content with the dismissal of their second appeal and applied for and obtained special leave of this Court under article 136 of the Constitution.
The appeal of the respondents by special leave succeeded as per judgment rendered by this Court on 8th May 1963.
The question is whether there was any delay much less unreasonable delay on the part of the State Government in taking follow up action after issuing notification under section 4.
The State Government had actually taken the follow up action expeditiously within less than a year when on 14th August 1953, section 6 notification was issued.
Even 913 before section 6 notification was issued the respondents filed the suit and went on preferring appeals.
They succeeded for the first time in this when this Court allowed their appeals on May 8, 1963.
Till then the Government could not be accused of any inaction or delay in taking the follow up action.
What was the Government expected to do during the time the respondents went on preferring successive appeals ? Was the Government expected, even though it succeeded in the trial court and first and second appellate courts to foresee in advance that at some stage by some court in the pyramid of appeals its notification under section 6 would be found to be ineffective and forestall such a decision by issuing another section 6 notification ex major cautela ? If the Government succeeded in three courts and was assured by three courts that both its notifications under sections 4 and 6 were valid and effective, it is difficult to appreciate the observation of the High Court that when the Government issued the first section 6 notification it was ineffective exercise of power under section 6 and the Government wrongly went on contending that it was a valid exercise of power.
This criticism is not well merited.
There would have been some legitimacy in this criticism of the stand of the Government if the Government had lost in the first court and went on filing successive appeals even if each court went on holding the notification ineffective.
The reverse is the position.
The Government went on succeeding and the courts went on upholding the notification.
There was no alternative with the Government but to go on defending its action before the courts to which it was dragged by the respondents after their successive failures.
In this background the question was posed by the High Court: Can the Government then contend, when it is found to be wrong by the highest court in the land, that the delay in the exercise of the power under section 6 occasioned by its own wrong stand should be regarded as reasonable ? and answered by it by saying that if the Government had not persisted in wrongly asserting the validity of the first section 6 notification and accepting its invalidity, had cancelled it, the delay in the effective exercise of the power under section 6 could have been avoided.
This answer is unfortunately not borne out by the events succeeding the issuance of the first section 6 notification.
Not only the Government stand was not found to be wrong but by three courts it was found to be correct.
It is this Court in the last appeal found section 6 notification invalid.
Could the Government be expected to speculate in advance that ultimately it may fail to convince this Court though it had convinced three other courts and, therefore, right at the time of institution of the suit in the court, concede the contention of the respondents and cancel the first section 6 notification and issue a second one ? There was no guarantee that the second one would not have been challenged and obviously there was 914 no assurance that some defect may not be found by some court even in the second section 6 notification.
The Government cannot be put on the horns of a dilemma.
Therefore, we find it difficult to agree with the High Court that having adopted a wrong stand and thus taken about 11 years the Government cannot now be permitted to urge that the delay so occasioned should not be regarded as unreasonable.
In fact the Government had practically little or no option but to support the decisions of the Courts which were in its favour till this Court for the first time found some defect in its notification under section 6.
Any other view may lead to a starting result that every litigant before it can explain the delay on the ground of being led from court to court must foresee a possible error that the hierarchy of courts may at some stage notice and rectify its stand in advance.
It would be nothing short of a speculative approach which may ill suit any litigant and more so the Government.
The High Court was further of the opinion that even if there was some explanation for the delay from 14th August 1953 to 8th May 1963, there was no explanation for the delay in making the review application in the beginning of 1965 before the Supreme Court and that this period of one year and 9 months remains totally unexplained.
In this context it may be advantageous to state that the respondents in the earlier round of litigation had challenged both the notifications under sections 4 and 6 had lost before the first three courts.
This Court while allowing the appeal by its judgment dated 8th May 1963 passed the final order as under: "We, therefore, allow the appeals and decree the suits of the appellants with costs in all the Courts.
" Literally implemented, the decretal portion would mean that both section 4 and section 6 notifications were struck down.
Reading the body of the judgment it clearly transpires that this Court upheld the validity of the notification under section 4.
When this inconsistency between the judgment and the decree came to the notice of the Government, Review Petitions Nos. 11 and 12 of 1965 appear to have been filed in the year 1965, and these petitions were allowed by this Court as per its order dated 13th September 1965 by deleting the decretal portion of the judgment as extracted hereinabove and substituting it in the following words: "and decree the suit for permanent injunction restraining the respondents from proceeding further with the land acquisition proceedings under the said notification issued under section 6(1) of the Act with costs in all the courts".
915 The High Court was of the opinion that the Government took a long time of one year and 9 months in ascertaining this inconsistency between the decretal portion of the judgment and the main body of the judgment and there was delay in moving the review applications.
In this connection a reference to the affidavit of Mr. D. K. Motwani, Secretary to the Gujarat State Road Transport Corporation for whose benefit the acquisition was made, as well as the affidavit of Shri section R. Pardhan, Under Secretary to Government of Gujarat, would show that after the copy of the judgment was received and it was examined to ascertain what further steps were required to be taken to complete the process of acquisition consistent with the judgment of the Supreme Court, the error was discovered and then the learned advocate was instructed to file review applications.
This delay of a year and few months in the context of the facts in this case cannot be said to be unreasonable.
The third stage where the High Court found the delay in taking the follow up action was after the grant of review application and before the impugned notification dated 10th October 1967 was issued.
This Court allowed the review applications on 13th September 1965.
Thereafter the Government directed a fresh enquiry under section 5A.
This was done in fairness to the respondents, though Mr. D. V. Patel learned counsel for the respondents was rather critical of this fairness of the Government inasmuch as he said that there was no necessity for a fresh enquiry.
Earlier enquiry under section 5A was in 1952.
By this time nearly 15 years had elapsed since the enquiry.
If the Government in the backdrop of these facts considered it fair and just to order a fresh enquiry to give the respondents an opportunity to file fresh objections, the Government cannot be accused of dithering or whiling away precious time on what was described as a futile exercise.
This second enquiry under section 5A was held after giving an opportunity as per notice dated August 1966, to file objections which in fact were filed on August 31, 1966, and then a notice dated 30th December 1966 was served upon the respondents calling upon them to appear for personal hearing on 12th January 1967.
The enquiry was adjourned at the request of the respondents 9 times as set out in the affidavit of Shri section R. Pardhan.
The enquiry was over on 13th April 1967.
During the course of personal hearing the respondents appeared through their advocates Sarvashri K. M. Vyas, A. L. Shah, V. R. Bhatt and N. D. Pandey.
The last of the submissions appear to have been made on 13th April 1967.
Thereafter the enquiry officer submitted his report and the Government took the prompt action of issuing the impugned notification on 10th October 1967.
Even here the High Court found a further unexplained delay after 13th September 1965 till 10th October 916 1967 when the impugned notification was issued.
The High Court possibly overlooked the affidavit of Shri section R. Pradhan when it observed that there was no satisfactory answer to the question posed by it, in the affidavit filed on behalf of the respondents.
With respect, it is not possible to subscribe to this view of the High Court in view of the facts clearly set out hereinabove.
It, therefore, unmistakably transpires that in the facts and circumstances of this case there was no delay, though apparently there appears a time lag of nearly 15 years between section 4 and section 6 notifications because the events in the interregnum clearly made it impossible for the Government to issue a second section 6 notification when it had already issued a first section 6 notification within a period of less than one year from the date of the issue of the section 4 notification and the validity of which was beyond reproach till May 6, 1963.
Assuming that the High Court was right in rejecting the explanation preferred by the Government for the delay in issuing the second section 6 notification, would it still be fair to hold that there was an unreasonable delay in issuing the second section 6 notification in view of the specific provision contained in sub section
(2) of section 4 of the 1967 Amendment Act which provides that notwithstanding anything contained in clause (b) of sub section
(1), no declaration under section 6 of the principal Act in respect of any land which has been notified before the commencement of the Land Acquisition (Amendment & Validation) Ordinance, 1967, under sub section
(1) of section 4 of the principal Act, shall be made after the expiry of two years from the commencement of the Ordinance.
The Ordinance came into force on 20th January 1967.
Simultaneously a proviso was added to sub section
(1) of section 6 in the following terms: "Provided that no declaration in respect of any particular land covered by a notification under section 4 sub section
(1) published after the commencement of the Land Acquisition (Amendment & Validation) Ordinance, 1967, shall be made after the expiry of three years from the date of such publication".
A combined reading of the provisions contained in sub section
(2) of section 4 with the one contained in the proviso to sub section
(1) of section 6 introduced by the Amendment Act would clearly put an end to the unsatisfactory situation which troubled the High Court in this case.
In view of the statutory provision noticed herein the Government would be precluded from making a declaration under section 6 after the expiry of a period of three years from the date of the issue of a notification under section 4 which may be issued after the Amendment Act came into force.
And in respect of those section 4 notifications which were issued perior to the 917 commencement of the Ordinance hereinabove noted on 20th January 1967 any notification which is required to be issued under section 6 must be made within a period of two years whereafter as a necessary corollary all section 4 notifications issued prior to 20th January 1967 would stand exhausted and would not provide either a source or reservoir for issuing section 6 notification.
Consequently the mischief sought to be set at naught by the High Court by reading by necessary implication in the scheme of sections 4, 5A and 6 the concept of exercise of statutory power within a reasonable time has been statutorily remedied.
The apprehensions of the High Court that if not checkmated by implying that such statutory power must be exercised within a reasonable time to curb arbitrary exercise of power to the detriment of a citizen have been taken note of by the legislature and fully met.
Absence of any decided case on the subject of which High Court took note could not permit an inference as has been done by the High Court that in the absence of a decided case the legislature would not remedy the possible mischief.
Legislature often does take note of a possible abuse of power by the executive and proceed to nip it in the bud by appropriate legislation and that has been done in this case.
There is now no more possibility of a gap of more than three years between section 4 and section 6 notifications because any declaration made after the expiry of a period of three years from the date on which section 4 notification is issued would be invalid as being beyond the prescribed period.
These newly inserted provisions were brought to the notice of the High Court.
Now, as pointed out earlier, the Ordinance came into force on 20th January 1967.
The notification under section 4 in this case was prior to the commencement of the Ordinance.
Therefore, the provision contained in sub section
(2) section 4 of the 1967 Amendment Act would be directly attracted.
The Government could, therefore make a declaration within a period of two years from 20th January 1967.
The Government has in fact issued the impugned notification under section 6 on 10th October 1967, i.e. within the period prescribed by the statute.
The question then is: when a statute confers power and prescribes time within which it can be exercised, could it ever be said that even though the power is exercised within the statutory period yet the Court can examine the question of delay and record a finding that there was an unreasonable delay in exercise of the power and, therefore, the exercise of power is bad ? This approach would defeat the very purpose for prescribing a sort of a period of limitation on exercise of power.
When a period is prescribed for exercise of power it manifests the legislative intention that the authority exercising the power 918 within the prescribed time could not at least be accused of inaction or dithering and, therefore, such exercise of power could not be said to be bad or invalid on the only ground that there was unreasonable delay in the exercise of the power.
The very prescription of time in heres a belief that the nature and quantum of power and the manner in which it is to be exercised would consume at least that much time which the statute prescribes as reasonable and, therefore, exercise of power within that time could not be negatived on the only ground of unreasonable delay.
Therefore, in this case it is difficult to agree with the High Court that there was an unreasonable delay in exercise of power and hence the exercise was either bad or invalid.
The High Court by implication read a fetter on the power of the Government to issue section 6 notification within a reasonable time after the issue of section 4 notification after observing that there was no express provision that such power ought to be exercised within a reasonable time.
In raising this implication the High Court took into account the postulate that every statutory power must be exercised reasonably and a reasonable exercise of power implies its exercise within a reasonable time.
Coupled with it two other factors were taken into consideration such as the effect of issuing a section 4 notification on the rights and obligations of the owner of the land whose land is proposed to be acquired; the right of the Government to unilaterally cancel section 4 notification in the event of falling prices; history of legislation; and delayed issue of section 6 notification would deny adequate compensation to the owner.
But by the time the High Court examined this matter the legislature had already introduced a provision by which the power to issue section 6 notification was to be exercised within the prescribed period of time.
At that stage there hardly arose a question of a search of the fetter on the power of the Government ignoring to some extent the express statutory provision.
Therefore, while appreciating the anxiety of the High Court we are of the opinion that once the legislature stepped in and prescribed a sort of period of limitation within which power to issue notification under section 6 could be exercised it was not necessary to go in search of a further fetter on the power of the Government by raising the implication.
It thus appears to be satisfactorily established that the impugned section 6 notification was issued within the prescribed period introduced by the 1967 Amendment Act and, therefore, could not be struck down on the only ground that the power to issue second section 6 notification was exercised after an unreasonable and unexplained delay.
This being the only infirmity found by the High Court to which we are not able to 919 subscribe, it must be held that the second section 6 notification dated 10th October 1967 is valid and legal.
Accordingly both these appeals succeed and are allowed and the decision of the High Court is set aside and Special Civil Application No. 729/68 filed by the respondents is dismissed but in the circumstances of the case, with no order as to costs.
S.R. Appeals allowed.
| There was a dispute between the appellants and the complainant 's party over the 'turns of water ' for irrigation of their agricultural lands.
The dispute was settled by a patchwork mediation but it was of no avail.
On the fateful day, the complainant 's party were making merry with alcohol in the house of the prosecution witness when the 3rd appellant joined them.
His unwelcome presence resulted in frayed tempers, and beatings of the 3rd appellant.
The latter, bent on reprisal for the flagellation and humilation, waited till sundown and returned armed with friends and weapons.
He ignited the attack by instigation and the 1st and 2nd appellants fired with their guns as a result of which 3 members of the complainants ' party died on the spot.
At this situation, PW 14 brought out his licensed gun from his house, and thereupon both sides started firing and a number of persons sustained gun shot injuries on their person.
In the midst of this firing, the lambardar of the village appeared on the scene and made an attempt to pacify both the sides, but he also received gun shot injuries as a result of which he died two days later.
A fourth person made a dying declaration that he had been shot by the appellants.
The Sessions Court held the appellants guilty under Section 302 I.P.C. and sentenced them to death, and the High Court on appeal confirmed the sentence.
Allowing the appeal to this court, ^ HELD: [Per Krishna Iyer & Desai, JJ.] 1.
Death sentence on death sentence is Parliament 's function.
Interpretative non application of death sentence when legislative alternatives exist is within judicial discretion.
[1065B] 2.
The dignity of man, a sublime value of the Constitution and the heart of penelogical 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, enlightened by the fundamental right to life which the Founding Fathers of the Constitution made manifest, the judicial oath to uphold the Constitution will unfold profound implications 1060 beyond lip service to Form VIII of the Third Schedule and this lofty obligation and cultural Constitutional behest validates the exploration of the meaning of meanings wrapped in the uncharted either/or of the text of section 302 IPC.
[1065E F] 3.
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 dawn if hangman and firing squads were kept feverishly busy.
[1066A B] 4.
The myopic view that public executions backed by judicial sentences 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 global 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.
[1067B C] 5.
The jurisprudence of sentencing in Free India has been a Cinderella and the values of our Constitution have not adequately humanised the punitive diagnostics of criminal courts, which sometimes, though rarely, remind us of the torture some 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.
[1068G] 6.
After Ediga Annamas 's case ; the law of punishment under section 302 IPC has been largely settled by this court and the High Courts are bound thereby.
[1068H] 7.
Rajendra Prasad 's case ; and Bishnu Deo Shaw 's case [1979] 3 SCR p. 355 have indubitably laid down the normative cynosure and until over ruled by a larger bench of this court that is the law of 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.
Today, the law is what Rajendra Prasad, in its majority judgment, has laid down and that has been done at unmistakable length.
Willy nilly, that binds judges and parties alike.
[1068H 1069A, 1069C] 8.
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.
[1069B] 9.
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.
In Rajendra Prasad 's case it has been explained how the prosecution must make out, by special factors, why the graver penalty should be inflicted.
Evidence may be led and arguments addressed by both sides, but in practice section 235(2) has been frustratingly ritualised.
[1069D E] 1061 10.
Section 302 of the Penal Code, read with section 354(3) of the Criminal Procedure Code demands special reasons four awarding the graver sentence.
[1070El ll.
Taking the cue from the English legislation on abolition, the majority opinion suggested 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.
[1071F G] 12.
The gallows swallow, in most cases, the social dissenter, the political dissenter, the poor and the under privileged, 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.
Judicial error leading to innocent men being executed is not too recondite a reality.
Evidence in Court and assessments by judges have human limitation.
[1071H 1072Bl 13.
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 ten years later by the Privy Council in Had it been done before Goundan was gallowed many judicial hangings could have been halted.
[1072C] (A) In the instant case 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 irritation between them.
There was no pre planned, well laid attack, hell bent on liquidating the enemy.
[1069E] (B) The sentences of death in the present appeal are liable to be reduced to life imprisonment.
[1071E] (Per Sen, J. dissenting) 1.
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.
[1072H] 2.
The question whether 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 statesmen, and, therefore, the domain of the Legislature land not the Judiciary.
[1073A] 3.
It is not within the province of this Court while dealing with an appeal confined to sentence under article 136, to curtail the scope of death sentence under section 302 l.
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 1062 of imprisonment for life, irrespective of the gravity of the crime and the surrounding circumstances i.e., virtually abolish the extreme penalty.
[1072G] 4.
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 the 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, 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 each case.
A sentence of death when passed, is subject to confirmation by the High Court under section 366(1) of the Code.
The accused also has a right of appeal to the High Court under section 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.
[1073B E] 5.
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.
[1073F] 6.
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, (iii) Judgment based on the combined effect of (i) and (ii).
For the purposes of the parties themselves and their privies, ingredient No. (iii) is the material element in the decision for it determines 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.
It is not everything said by a judge when giving judgment that constitutes a precedent.
The only thing in a judge 's decision binding a 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 radio decidendi.
[1073G 1074B] 7.
The ratio decidendi may be defined as a statement of law applied to the legal problems raised by the facts as found, upon which the decision is based.
The other elements in the decision are not precedents.
[1074C] Qualcast (Wolverhampton) Ltd. vs Haynes L.R. 1959 A.C. 743 referred to.
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.
[1074D] 1063 9.
There are no rationes decidendi much less any ratio decidendi in Rajendra Prasad 's case.
[1074 E] (i) In the minority opinion the need for judicial restraint was emphasised and the duty to avoid encroachment on the powers conferred upon Parliament.
The assessment of public opinion on this difficult and complex question was essentially a legislatives not a judicial, function.
[1074El (ii) Buttressed by the belief that Capital punishment served no useful purpose, the majority, asserted that it 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, was a denial of human dignity and the death penalty was usually inflicted only on a few, i.e. the poor and downtrodden who are outcasts of a society, which led to the irresistible inference that the punishment was not fairly applied.
[1074F] (iii) This may be 'progressive ' stance which is out of place in a judicial pronouncement, which ought to be based on the facts and circumstances of the case and the law applicable.
But the professed view does not stem from a firm belief in dignity of human life for the death penalty is advocated for certain classes of offenders namely (l) white collar offenders, (2) anti social Offenders and (3 ) hardened murderers.
This shows that the majority was not against the capital punishment in principle.
[1074G 1075A] (iv) on the facts, the majority 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.
[1075B 10.
The majority decision tested in the light of the theory of precedents clearly does not lay down any 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.
Any 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 nonwhite 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.[1075C D] 11.
If the general observations on sentencing jurisprudence made in Rajendra Prasad 's ease are to be regarded as 'law declared by this Court ' within the meaning of article 141 so, as to bind all courts in the country, then the observation or the so called guidelines 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 stated, would be unwarranted and contrary to s 302 of the Indian Penal Code read with section 354(3) of the Code of Criminal Procedure.
[1075E F] 1064 12.
section 302 of the I.P.C. gives a choice while section 354(3) of the Code merely requires 'special reasons ' to be 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.
[1075G] 13.
In the majority judgment in Rajendra Prasad 's case 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 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.
[1075H 1076A] 14.
The obsession to get the death penalty abolished from the Statute Book i.e. Indian Penal Code 1860 is so great great 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(1973) 1 S.C.C. 20] a constitution bench of this Court unanimously held that the death penalty and the judicial discretion vested in the Court regarding its imposition on an accused are constitutionally valid.
[1076B C] 15.
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.
[1076D] (a) In the instant case it cannot be said that the award of death sentence to any of the two appellants, was not proper or uncalled for.
Though the dispute was over the 'turns of water, ' that would hardly furnish any justification for the commission of the pre planned triple murder.
The dastardly act of the appellants resulted in the loss of three precious lives.
These were nothing but intentional, cold blooded and brutal murders.
[1077A, E] (b) The High Court was justified in confirming the death sentence 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.
[1077A] (c) On the facts and circumstances of the case the award of death sentence to the two appellants who were trigger happy gentlemen was neither 'erroneous in principle ' nor was 'arbitrary or excessive ', or 'indicative of an improper exercise of discretion ', and is well merited.
[1077G]
|
Appeal No. 54 of 1958.
Appeal by special leave from the Award dated January 14, 1957, of the Industrial Tribunal at Bombay in Reference (I. T.) No. 75 of 1956.
M. C. Setalvad, Attorney Generalfor India and I. N. Shroff for the appellants.
N. V. Phadke, T. section Venkataraman K. R. Sharma and K. R. Chaudhury, for respondent No. I and the Intervener.
May 5.
The Judgment of the Court was delivered by 950 BHAGWATI, J.
This appeal with special leave challenges the award made by the Industrial Tribunal, Bombay, in Reference (IT) No. 75 of 1956 between the appellant and the respondents whereby the Industrial Tribunal awarded to the respondents 4 1/2 months ' basic wages as bonus for the year 1954 55 (year ending June 30, 1955).
The appellant is a subsidiary of the Premier Construction Co., Ltd., and manufactures Hume Pipes.
It has factories in different parts of India, Pakistan and Ceylon.
The respondents are the workers employed in the appellant 's factory at Antop Hill, Wadala, Bombay.
In October 1955, respondent I who are workmen represented by the Engineering Mazdoor Sabha made a demand for the payment of six months ' wages as bonus for the year 1954 55.
The matter was also referred to the Conciliation Officer requesting him to initiate Conciliation Proceedings.
The Conciliation Proceedings went on before the Conciliation Officer upto March 23, 1956, on which date both the parties arrived at and executed an Agreement to refer the matter to an Industrial Tribunal for adjudication.
Accordingly, on April 30, 1956, both the parties drew up and signed a joint application for referring the dispute for adjudication to a Tribunal and the Government of Bombay thereupon in exercise of the powers conferred by sub section
(2) of section 10 of the , by its order dated June 11, 1956, referred the following dispute to the Tribunal : " DEMAND: Every Workman (daily rated) should be paid bonus for the year 1954 55 (year ending 30th June, 1955) equivalent to six months ' wages without it attaching any condition thereto ".
Respondent No. I filed their statement of claim before the Tribunal on June 29, 1956.
They alleged that the profits of the appellant during the year 195455 were higher than those during the year 1953 54 for which year the appellant had paid four months ' basic wages as bonus.
They also alleged that the wages paid to them by the appellant fell short of the, living wage and therefore the appellant should pay the in six months ' basic wages as bonus for the relative year.
951 The appellant filed its written statement in answer on August 14, 1956.
The appellant submitted that, after providing for " the prior charges " according to the formula laid down by the Labour Appellate Tribunal the profits made during the year under consideration did riot leave any surplus and tile, respondents were not entitled to any bonus.
It denied that it bad made huge profits during the year in question and submitted that the profits made were not even sufficient to provide for " the prior charges ", etc.
The Tribunal after hearing the parties came to the conclusion that even if payment of a bonus equal to 4 1/2 months ' basic wages were made a fair surplus would be left in the hands of the appellant to the tune of Rs. 3.30 lacs and therefore awarded the same subject to the following conditions: (a) Any employee who has been dismissed for misconduct resulting in financial loss to the company shall not be entitled to bonus to the extent of the loss caused.
(b) Persons who are eligible for bonus but who are no longer in the service of the company on the date of the payment shall be paid the same provided that they make a written application for the same within three months of publication of this award.
Such bonus shall be paid within one month of receipt of application provided that no claim can be enforced before six weeks from the date this award becomes enforceable.
Being aggrieved by the said award of the Tribunal, the appellant applied for and obtained from this Court special leave to appeal against the same under article 136 of the Constitution and hence this appeal.
The formula evolved by the Full Bench of the Labour Appellate Tribunal in Millowners ' Association, Bombay vs Rashtreeya Mill Mazdoor Sangh, Bombay(1) is based on this idea that " as both labour and capital contribute to the earnings of the industrial concerti, it is fair that labour should derive some benefit, if there is a surplus after meeting " prior or necessary charges ".
The following were prescribed as the first charges on (1) 952 gross profits, viz., (1) Provision for depreciation ;(2) reserves for rehabilitation ; (3) a return at 6%on the paid up capital; (4) a return on the working capital at a lesser rate than the return on paid up capital and (5) an estimated amount in respect of the payment of income tax.
The surplus that remained after making the aforesaid deductions would be available for distribution among the three sharers, viz., the shareholders, the industry and the workmen [See Muir Mills Co., Ltd. vs Suti Mills Mazdoor Union, Kanpur (1) and Sree Meenakshi Mills Ltd. vs Their Workmen (2)].
This Full Bench Formula has been working all throughout the country since its enunciation as aforesaid and has been found to be, in the main, fairly satisfactory.
It is conducive to the benefit of both labour and capital and even though certain variations have been attempted to be made therein from time to time the main features thereof have not been substantially departed from.
We feel that a formula which has been thus adopted all throughout the country and has so far worked fairly satisfactorily should be adhered, ' to, though there is scope for certain flexibility in the working thereof in accordance with the exigencies of the situation.
In the working of the said formula, however, regard must be had both to the interests of capital and labour.
In any given industry there are three interests involved, viz., the shareholders, the Company and the workmen and all these interests have got to get their proper share in the surplus profits ascertained after due provision is made for these " prior charges ".
The shareholders may look to larger dividends commensurate with the prosperity of the industrial concern, the company would, apart from rehabilitation and replacement of buildings, plant and machinery, look forward to expansion and satisfaction of other needs of the industry and the workmen would certainly be entitled to ask for a share in the surplus profits with a view to bridge the gap between the wages earned by them and the living wages.
All these interests (1) [1955]1 1,s.
C.R. 991, 998.
(2) ; , 884, 953 have, therefore, got to be duly and properly provided for having regard to the principles of social justice and once surplus profits available for distribution amongst these respective interests are determined after making due provision for the " prior charges " as aforesaid the Industrial Tribunal adjudicating upon the dispute would have a free hand in the distribution of the same having regard, of course, to the considerations mentioned hereinabove.
But so far as the determination of the surplus profits is concerned the formula must be adhered to in its essential particulars as otherwise there would be no stability nor uniformity of practice in regard to the same.
It maybe noted, 'however, that in regard to the depreciation which is a prior charge on the gross profits earned by a concern there is always a difference in the method of approach which is adopted by the income tax authorities and by the industrial tribunals.
It was pointed out by us in Sree Meenakshi Mills Ltd. vs Their Workmen (1) that the whole of the depreciation admissible under the Income tax Act was not allowable in determining the available surplus.
The initial depreciation and the additional depreciation were abnormal additions to the income tax depreciation and it would not be fair to the workmen if these depreciations were rated as prior charges before the available surplus was ascertained.
Considerations on which the grant of initial and additional depreciations might be justified under the Income tax Act were different from considerations of social justice and fair apportionment on which the Full Bench Formula in regard to the payment of bonus to workmen was based.
This was the reason why we held in that case that only normal depreciation including multiple shift depreciation, but not initial or additional depreciation should rank as prior charge.
We approved of the decision of the Labour Appellate Tribunal in U. P. Electric Supply Co., Ltd. vs Their Workmen (2) in arriving at the above conclusion and disallowed the claim of the company there to deduct the initial or additional depreciation as prior charge in bonus calculations.
(1) ; 120 (2) 954 When this decision was reached we had not before us the decision of the Labour Appellate Tribunal in Surat Electricity Company 's Staff Union vs The Surat Electricity Co., Ltd. (1) where a Bench of the Labour Appellate Tribunal had negatived the contention that if only the " normal " depreciation allowed by the Income tax law were allowed a company would be able to recoup the original cost of the assets and observed that: " For the purpose of bonus formula the initial and additional depreciation, which are disallowed by that formula, must be ignored in fixing the written down value and in determining the period over which the normal depreciation will be allowed.
The result will be a notional amount of normal depreciation ; but, as we have said repeatedly the bonus formula is a notional formula.
" We have already expressed in the judgment delivered by us in Associated Cement Co., Ltd. vs Its Workmen (1) that for the purpose of the bonus formula the notional normal depreciation should be deducted from the gross profits calculated on the basis adopted in Surat Electric Supply Co. Staff Union vs Surat Electricity Co., Ltd. (1) and not merely the normal depreciation including multiple shift depreciation allowed by the income tax authorities as stated in U. P. Electric Supply Co., Ltd. vs Their Workmen (3).
It is well settled that the actual income tax payable by the company on the basis of the full statutory depreciation allowed by the income tax authorities for the relevant accounting year should be taken into account as a prior charge irrespective of any set off allowed by the Income tax authorities for prior charges or any other considerations such as building up of income tax reserves for payment of enhanced liabilities of income tax accruing in future.
It is also well settled that the calculations of the surplus available for distribution should be made having regard to the working of the industrial concern in the relevant (1) (2) (3) 955 accounting year without taking into consideration the credits or debits which are referable to the working of the previous years, e.g., the refund of excess profits tax paid in the past or loss of previous years carried forward but written off in the accounting year as also any provision that may have to be made to meet future liabilities, e.g., redemption of debenture stock, or provision for Provident Fund and Gratuity and other benefits, etc., which, however, necessary they may be, cannot be included in the category of prior charges.
If regard be had to the principles enunciated above it is clear that the items of Rs. 1.14 lacs representing the Lahore factory balance written off, Rs. 0.34 lacs being patents written off, and Rs. 0.09 lacs shown as loss on sale of Tardeo property cannot be allowed as proper deductions from the gross profits for the purposes of bonus calculations.
The first two items represented debits in connection with the working of previous years.
Loss of the Lahore factory had been incurred during the three previous accounting years and had been carried forward from year to year and the only thing which was done during the year under consideration was that it was then written off as irre coverable.
The patents also had been worked off in previous years and the amounts spent in the purchase thereof were therefore to be written off but had reference to the working of the company during the previous years.
The last item of Rs. 0.09 lacs was trivial and was therefore not pressed with the result that all these three items were rightly added back in the calculations of the gross profits of the appellant and the figure of gross profits taken at Rs. 36.21 lacs was correctly arrived at by the Tribunal.
The depreciation allowed by the Tribunal was Rs. 9.82 lacs which was the full statutory depreciation allowed by the Income tax authorities.
That should not have been done and the only depreciation allowed should have been the notional normal depreciation which was agreed between the parties before us at Rs. 6.23 lacs.
Working the figure of income tax deducted by the 956 appellant on the basis adopted in Shree Meenakshi Mills Ltd. vs Their Workmen (1) the income tax on the gross profits of Rs. 36.21 lacs less the statutory depreciation allowed by the income tax authorities, viz., Rs. 9.82 lacs would be equivalent to 7 annas in the rupee on Rs. 26.39 lacs, i.e., Rs. 11.55 lacs thus leaving a balance of Rs. 16.82 lacs from which the other prior charges would have to be deducted in order to ascertain the distributable surplus.
6% return on the ordinary share capital and 5% return on the preference share capital would come to Rs. 4.30 lacs.
The appellant, however, claimed that even on the preference shares 6% return should be allowed and not 5% even though preference shareholders were not entitled to anything beyond 5% under the terms of issue.
The appellant obviously relied upon the wording of the formula: " return at 6% on the paid up capital " and contended that the preference shares also being paid up capital it would be entitled to a return of 6% on the preference shares for the purposes of the bonus formula even though in fact it would have to pay only 5% return on the same.
We cannot accept this contention.
Even though the bonus formula is a notional one we cannot ignore the fact that in no event would the appellant be bound to pay to the preference shareholders anything beyond 5% by way of return.
The Full Bench Formula cannot be so literally construed.
There is bound to be some flexibility therein, the 6% which is prescribed there as the return on paid up capital is not inexorable, and the Tribunals could if the circumstances warrant vary the rate of interest either by increasing or decreasing the same.
On the facts of this case however there is no warrant for allowing anything beyond 5% return on preference share capital and the amount of Rs. 4.30 lacs should therefore be deducted as another prior charge from the grsos profits of the appellant.
4% return on reserves used as working capital was calculated merely at a figure of Rs. 0.29 lacs worked out on a total figure of Rs. 7,42,139.
The Tribunal (1) 957 did not take into consideration another sum of Rs. 41,81,196 which represented the depreciation fund which according to the appellant had been used as working capital during the year.
If that had been allowed a further sum of Rs. 1.67 lacs should have been added to Rs. 0.29 lacs and the total amount of 4% return on reserves used as working capital would have amounted to Rs. 1.96 lacs.
Two arguments were advanced against this contention of the appellant.
One was that there was nothing like a depreciation fund, that it merely represented a credit item introduced in the balance sheet as against the value of the fixed capital at its original cost and would have disappeared as such if the proper accounting basis had been adopted, viz., the fixed block bad been showed at its depreciated value after deducting the amount of depreciation from the original cost.
Such book entries, it was contended, did not convert that credit item into a depreciation fund available to the company and there was therefore no basis for the contention that such a depreciation fund ever existed and could be used as working capital in the business.
The other was that there was nothing on the record to show that such a depreciation fund, if any, had been, in fact, used as working capital in the business during that year.
The answer furnished by the appellant in regard to both these contentions was that on a true reading of the balance sheet Rs. 41,81,196 were reserves used as working capital, vide calculations in Exhibit C 12.
Provision for depreciation was Rs. 1,10,29,954 and the paid up capital was Rs. 80,00,000 thus totaling to Rs. 1,90,29,954.
The total capital block as shown in page 5 of the balance sheet for the year ending June 30, 1955, was Rs. 1,48,48,758 and the working capital therefore was Rs. 41,81,196.
This was apart from Rs. 7,42,139 which was the total of the three items at page 4 of the balance sheet: Rs. 98,405 capital reserves, Rs. 4,73,734 other reserves and Rs. 1,70,000 provision for doubtful debts as also the investments, cash and bank balance.
This being the true position it follows on the facts of the present case that this 958 amount was available for use as working capital and the balance sheet showed that it was in fact so used.
Moreover, DO objection was urged in this behalf nor was any finding to the contrary recorded by the Tribunal.
We are, therefore, of the opinion that the reasoning adopted by the Tribunal was not correct and the appellant was entitled to 4% return on the reserves used as working capital including the sum of Rs. 41,81,196.
The appellant was thus entitled to Rs. 1.96 lacs as the 4% return on reserves used as working capital and not merely Rs. 0.29 lacs as allowed by the Tribunal.
The provision for rehabilitation bad been claimed by the appellant at Rs. 1.10 lacs on the basis of 10% of the net profits relying upon para.
20 of the Report of the Committee on Profit Sharing in which the Committee had proposed that 10% of the net profits should compulsorily be set aside for reserves to meet emergencies as well as for rehabilitation, modernization and reasonable expansion.
No evidence was at all led by the appellant before the Tribunal showing the cost of the machinery as purchased, the age of the machinery, the estimate for replacement etc.
, in order to substantiate this claim for rehabilitation and the appellant was content merely to rely upon this recommendation of the Committee on Profit sharing.
This was rightly considered by the Tribunal as insufficient to support the appellant 's claim, though it allowed for rehabilitation, in addition to the statutory depreciation, the amount for which the appellant had actually made provision, viz., the sum by which the depreciation written off for the year exceeded the statutory depreciation (i. e., Rs. 10,00,000 minus Rs. 9,82,799Rs. 17,201).
The amount was really small and did not affect the bonus to be awarded.
The Tribunal, in fact, allowed the same, though it appears that in the absence of evidence of the nature above referred to even that sum of Rs. 0.17 lacs ought not to have been allowed.
In this state of affairs it is really impossible for us to allow the appellant 's claim for rehabilitation in anything beyond the sum of Rs. 0.17 lacs actually 959 allowed by the Tribunal and the claim of the appellant for any further provision for rehabilitation must be disallowed for the purpose of the bonus calculations for the year under consideration.
It will however be open to the appellant to claim higher rehabilitation for subsequent years if it can substantiate its claim by adducing proper evidence.
In addition to these various sums allowed to the appellant by way of prior charges against the gross profits earned during the accounting year the Tribunal also allowed to the appellant Rs. 2.50 lacs by way of provision for debenture redemption fund.
The claim of the appellant was for a sum of Rs. 3.50 lacs for the same and it arose under the following circumstances.
The appellant had issued debentures of the value of Rs. 30 lacs in the year 1942 43 and they were redeemable in the year 1962 63.
No annual provision had been made from profits for redemption of the same inasmuch as until the year 1949 the appellant was not working at a profit.
Such provision was made only thereafter.
For the year 1950 51, the appellant made a provision for Rs. 75,000 for debenture redemption fund, for 1951.52, Rs. 1,50,000, for 1952 53 Rs. 1,50,000, for 1953 54 Rs. 75,000 and further provision had to be made for redemption of debentures in a sum of Rs. 24,50,000.
In so far as 7 more years were left before the due date for redemption the appellant claimed Rs. 3,50,000 as the annual sum to be set apart, though as a matter of fact in the balance sheet only a provision of Rs. 2,50,000 had been made by it for debenture redemption reserve.
The Tribunal pointed out that when the appellant had in its accounts appropriated Rs. 2,50,000 for the debenture redemption fund the claim to have Rs. 3,50,000 for the purposes of bonus formula was clearly untenable.
It however was of the opinion that a reasonable provision for redemption fund should be allowed as a prior charge and actually allowed the sum of Rs. 2,50,000 which had been actually provided for the purpose in the balance sheet, negativing the contention of the respondents that no provision should be allowed for debenture redemption fund in the bonus formula.
960 We are of the opinion that the Tribunal was not justified in allowing the sum of Rs. 2,50,000/ for debenture redemption fund as a prior charge in the bonus calculations.
The Full Bench Formula does not envisage any such prior charge.
It is no doubt true that capital is shy and it would not be practicable for the industrial concern to raise large amounts by way of fresh debentures when they become due.
It is also true that the debentures do not stand on a par with other debts of a concern because the debentureholders would in a conceivable situation be able to enforce their security by bringing the industry to a stand still by taking over charge of the whole concern.
It would therefore appear that the redemption of these debentures would be one of the primary obligations of the industrial concern and due provision has of necessity to be made for redemption thereof on due date.
This however does not mean that in the calculations of the distributable surplus the provision for such redemption should be given the status of a prior charge, though of course that would be a relevant con sideration while distributing the available surplus between the various interests entitled thereto.
We are therefore of opinion that the Tribunal was wrong in allowing Rs. 2,50,000/ as a prior charge in the bonus calculations.
This disposes of all the contentions which have been urged on behalf of both the parties and calculating the figure on that basis we arrive atthe following Rs. in lacs.
Gross Profit as per Tribudal 's calculations 36.21 Less: Notional Normal Depreciation 6.23 29.98 Less: Tax @ 7 as.
in a rupee 11.55 18.43 Less: 6% return on ordinary share capital and 5% on preference share capital 4.30 14.13 961 Less: 4% Return on reserves used as working capital: 7,42,139 29 + 41,81,196 1.67 49,23,335 1.96 12.17 Less:Provision for Rehabilitation 0.17 Available Surplus 12.00 This would bring the available surplusfor distribution to a sum of Rs. 12 lacs and this would be distributable amongst the shareholders, the company and the workmen concerned.
It is not feasible to lay down any rigid formula as to what the proportion of such distribution amongst these various interests should be.
The shareholders as well as the company would both be naturally interested inter alia in providing the debenture redemption reserves as also meeting the needs of the industry for further expansion.
The workmen would no doubt be interested in trying to bridge the gap between their actual wage and the living wage to the extent feasible.
This surplus of Rs. 12 lacs would have to be distributed amongst them having regard to the facts and circumstances of the case, of course bearing in mind the various considerations indicated above.
Before we arrive at the figure of the actual bonus which it will be appropriate in the circumstances of this case to allow to the workmen, we may advert to one argument which was pressed before us.
on their behalf and that was that the bonus calculations should not be made on the basis of the All India figures which were adopted by the Tribunal but on the basis of the actual amounts which the appellant had paid and would have to pay to the workmen concerned.
It was pointed out that the respondents here were only the workmen in the Wadala Factory of the appellant.
The appellant had, however, paid to the various workmen elsewhere as and by way of bonus sums varying between 4% and 29% of the basic wages for the year in question.
The sum of Rs. 1,23,138/ only had been 121 962 paid in full and final settlement to the workmen in some of the factories and the bonus calculations on an All India basis would thus work to the advantage of the appellant in so far as they would result in saving to the appellant of the difference between the amounts to which those workmen would be entitled on the basis of the All India figures adopted by the Tribunal and the amounts actually paid to them as a result of agreements, conciliation or adjudication.
It was therefore contended that the calculations should be made after taking into account the savings thus effected by the appellant and only a sum of Rs. 1,23,138 / which was the actual sum paid to those workmen should be taken into account and no more.
We are afraid, we cannot accept this contention.
If this contention was accepted the respondents before us would have an advantage over those workmen with whom settlements have been made and would get larger amounts by way of bonus merely by reason of the fact that the appellant had managed to settle the claims of those workmen at lesser figures.
If this contention of the respondents was pushed to its logical extent it would also mean that in the event of the non fulfilment of the conditions imposed by the Tribunal in the award of bonus herein bringing in savings in the hands of the appellant, the respondents would be entitled to take advantage of those savings also and should be awarded larger amounts by way of bonus, which would really be the result of the claimants entitled to the same not receiving it under certain circumstances an event which would be purely an extraneous one and unconnected with the contribution of the respondents towards the gross profits earned by the appellant.
The Tribunal was, therefore, right in calculating the bonus on an All India basis.
By our order dated April 12, 1957, the appellant was ordered to pay to the respondents within a fortnight from the date thereof bonus for the year 1954 55 equivalent to two months ' basic wages; that amount has already been paid and works out at Rs. 3.39 lacs on an All India basis.
The only question which therefore survives is what further bonus, if any, would the respondents be entitled 963 to from the distributable surplus of Rs. 12 lacs.
The sum of Rs. 3.50 lacs required for building up the debenture redemption reserve is an all engrossing need of the appellant and that is a factor which must of necessity be taken into consideration while arriving at the ultimate figure, particularly because such redemption of the debentures would enure not only for the benefit of the Company and its shareholders but also of the workmen employed therein.
Having regard to all the circumstances of the case, we feel that an award of four months ' basic wages as aggregate bonus for the year 1954 55 (which by the way was the bonus awarded for the previous year 1953 54 also) would give a fair share to the labour in the distributable surplus, leaving to the shareholders and the company a balance of Rs. 5.22 lacs to be utilised by them not only towards building up of the debenture redemption reserve but also for building up other reserves, which would be utilised for various other purposes indicated above.
The appellant would no doubt get also the refund of the income tax on the bonus payments made by it.
This rebate would also go towards the fulfilment of the very same objectives, which would ultimately enure both for the benefit of the capital as well as labour.
We have, therefore, come.
to the conclusion that the appellant should pay to the respondents, in addition to the two months ' basic wages already paid to them in pursuance of this Court 's order dated April 12, 1957, an additional sum equivalent to two months ' basic wages by way of bonus for the year 1954 55 subject to the same conditions as were laid down in the award of the Tribunal above referred to, all the dates mentioned therein being calculated from the date of this judgment.
We accordingly allow the appeal, modify the award of the Industrial Tribunal to the extent mentioned above, but in the circumstances of the case we make no order as to costs, each party bearing and paying its own costs thereof.
Appeal allowed.
| A communal riot broke out in a town between some Sindhi refugees and the local Muslims.
The trouble started in a locality where most of the shopkeepers were Sindhis.
The goods in the Muslim shops there were scattered and some Muslims lost their lives.
Alarm spread to another locality where the shops of appellant and his brother (both Muslims) were situated and the people there, including the appellant, started closing their shops.
The family of the appellant 's brother had taken shelter in the appellant 's portion of the building through a hole in the wall between the two portions of the building in which the two shops were situated.
A mob collected there and approached the appellant 's locality and looted his brother 's shop and began to beat the doors of his shop with lathis.
The appellant fired two shots from his gun which caused the death of one Sindhi and injured three other Sindhis.
The question for determination was whether the appellant acted in his right of private defence: Held, that the facts of the case afforded a right of private defence to the appellant under the provisions of the Indian Penal Code.
The circumstances in which he was placed were amply sufficient to give him a right of private defence of the body even to the extent of causing death as the appellant had no time to have recourse to the authorities and has reasonable grounds for apprehending that either death or grievous hurt would be caused either to himself or to his family.
These things could not be weighed in too fine a set of scales or "in golden scales."
|
Appeal Nos.
2182/93 with 2181/93.
From the Judgment and Order dated 30.4.1992 of the Gauhati High Court in Civil Rule No. 166 of 1984.
A.M. Mazumdar, Attorney General, Arunachal, K.K. Venugopal, Shahid Rizvi and Ms. Manjula Gupta, Appellant in C.A. No. 2182 of 93 and for the Respondent in C.A. No. 2181/93.
Govind Mukhoty and S.K. Bhattacharya for the respondent in C.A. No. 2182/93 and for the Appellant in C.A. No. 2181/93.
The Judgment of the Court was delivered by MOHAN.J.
Leave granted.
Both these civil appeals arise out of the judgment of the Gauhati High Court dated 30th April, 1992 rendered in CR.
No. 166 of 1984.
The short facts are as under: The parties will be referred to as the appellant and the State of Arunachal Pradesh.
The appellant alongwith his family members and other 56 families migrated to India on 30th March, 1964 from erstwhile East Pakistan, now Bangladesh, due to disturbances prevailing at that time.
They took shelter in a government camp at Abhayapur Block in Tirap District.
The appellant and other 56 families are known as Chakmas of the erstwhile East Pakistan.
They being the refugees were given shelter in government camp at Ledo in the District of Dibrugarh, Assam.
Later on, in 1966, they were shifted to the Camp at Miao within the State of Arunachal Pradesh.
Arunachal Pradesh was called NEFA (North East Frontier Agency) prior to 1972.
On 21st January, 1972 it was given the status of Union Territory of 406 Arunachal Pradesh.
It became a full fledged State on 20th February, 1987, Geooraphically, it is situated on the north east of India and has a long international border with Bhutan, China and Burma (Burma presently called Myanmar).
It is the largest State areawise in the north east region, even larger than Assam which is the most populous State.
The population of Arunachal Pradesh, according to the 1981 census is 6.32 lakhs.
It is scattered over 12 towns and 3,257 villages.
There are 26 Major tribes.
Broadly speaking, the people in the State can be divided into three cultural groups, on the basis of their socio regional affirmities.
i) The monpas and Sherdukpens of Tawang and West Kemeng District; ii)Khamptis and Singhphos inhabiting the entire easternpart of the State , and iii)The Neotes and Wanchos adjoining, Negal and in the Tirup District; In the year 1966, the State Government drew the Scheme known as Chakma Resettlement Scheme for these refugees.
Areas were earmarked for their settlement at different parts of the State and accordingly they were asked to move to the areas earmaked for them, In all, 5 Schemes were sanctioned for their settlement (comprising of about 3100 families of refugees) at the cost of more than Rs. 2 crores.
The appellants along with 56 families were allotted lands in the villages of Gautampur and Maitripur.
There were already a good number of Chakma refugee families who were allotted lands and were living there peacefully.
The appellants instead of residing in the said allotted areas under the Resettlement Scheme drawn by the Government, strayed away from it and negotiated with the Local Raja namely Nigrumong Singpho of Damba for an area of one sq.
mile of his private land and got the same from the said Singpho through an unregistered deed dated 20th November, 1972.
The State would contend that the said transfer is illegal because as per section 7 of the BEFR, 1873 (Regulation 5 of 1873) no person, who is not a native of the District, would acquire any interest in the land or the produce of the land beyond the inner line without the sanction of the State Government or such officer as the State Government may appoint in this behalf.
On the contrary, the stand of the appellant is that since the date of donation they have been residing and cultivating 407 the said land and they have developed the area for habitation purposes.
It is further alleged on behalf of the appellant that in 1975, a village panchayat of Joypur village was formed after election of the members.
The appellant was appointed as the Gaon Bura of the village.
This was with the approval of the Government, in token of which a sanad dated 20.11.75 was issued in his name.
The Deputt Commissioner at kenosa approved the transfer and the Extra Assistant Commissioner, Miao by his memorandum No. MR S (A) n5/8648 51 dated 26.4.70 issued instructions against any attempt to allot the land to other and generally against any eviction of the appellants from the said land.
Some Deori families who were allotted lands in the adjacant area of Joypur village attempted to encroach upon the lands of the appellant and on a complaint lodged, the authorities concerned i.e. Executive Magistrate at Miao by his letter dated 30.5.77 issued instructions to Ningronong Singpho Rajkumar to turn out the extra families from the appellant 's village with a direction to the Circle Officer, Diyun to report compliance.
It was after such intervention that such outsiders in due course were expelled.
After obtaining the donation from the Raja by dint of hard labour they developed the jungle area which was a hillly uneven tract of land.
In view of the tremendous agricultural success the Tirup District authorities granted two Rice Hullar Units in the name of the appellant.
The Chakmas transformed the land into a truly self sufficient village.
In view of prosperity and growth of land the nearby villagers sought to dislodge the appellant and families by raising various disputes, one of which was that the place cannot be utilised as refuge settlement and that they should be shifted to another place.
Circle Officer, Diyun issued an order dated 15.2.84 directing the appellant to shift to the vacant land at Gautampur and Maitripur villages latest by 24th of February, 1984.
The representation requesting the Chief Minister of Arunachal Pradesh to interfere was of no avail.
The appellant after settling in this unauthorised land started committing criminal and illegal activities.
There were several complaints to the effect that the appellant is encroaching upon the private lands illegally in connivance with the local people, particularly, Singphos.
In order to investigate the matter fully, the Government, vide its letter dated 4.4.1979, directed an enquiry into the whole matter through a Committee compris 408 ing of 9 persons with the Deputy Commissioner of the area as the Chairman.
The said committee after the investigation submitted its report on 11.6.79, stating therein that about 788 families of Refugees (Chakmas, Deori, and Bhufia) have illegally encroached upon about 872 Hectares in Miao Sub Division alone.
The said Committee observed that: "7.
The fear of the local people regarding heavy growth of population among the Chaknias has already been stated above and it is also well known to the Government.
But such fear maybe true in the case of Deoris and Ahoms too because it has been seen that in their case too the irpopulation is increasing by leaps and bounds, for instance it is learnt that when they were inducted there were only 6 Ahom families and 32 Deoria, where as this has now increased to 23 and 106 respectively, We should, therefore, watch by one method or the other that flow of Chakmas, Deoris and Ahoms does not at all take place.
For this purpose formal allotment of land to each family is very necessary and further in order to guard against new entrents, the DCs office is said to be taking up the issue of identity cards." "9.2 Land is still available in Innano, Dumba and Modoi, especially after the eviction of four Chakma villages during March last.
Singphos have been known to induct outsiders not only without Govt.
's approval but also by various undesirable mathods, this has to be properly watched and if found necessary we may have to give exemplary punishment to those who indulge in such practice.
Already there is some sign of dissension among the local people due to the activities of one Nirunong of Kumchai village who was mainly responsible for inducting Chaknias in Jaipur village, 10 Deori families and some other from outside.
It has also been seen that in Innano village there are six tea garden tribals who have been living and working since the last 10 years with Inner Line passes renewed from time to time but obviously with the understanding that the local people would subseqently give them land for permanent resettlement.
" The State received complaints that Chakma people were indulging in illegal activities such as commission of offences under various lands, collection of arms and anununitions, establishing conteracts with the Extremist groups, encroachment of adjoining areas.
The State, therefore, found it necessary to shift them to 409 a site where other Chakma families were already residing.
It was in these circumstances, by order dated 15.2.84, the State directed the appellant and the other Chakmas to shift.
The said order is to the following effect: "In connection to this office memoranodum No. LS 4/83/84/ 2478 79 dated 6.2.84, the Chakma of Joypur village are hereby directed to shift to the vacant land allotted at Gautampur and Maitripur village latest by 25.2.1984.
This may be treated as final notice, failing whichlegal action will be taken against the defaulters.
" Questioning the correctness of the order CR No. 166 of 1984 was filed before the High Court of Gauhati: It was urged: (i) The petitioners are citizens of India.
(ii) Their fundamental rights have been infringed.
(iii) The impugned notice dated 15th of February, 1984 is illegal, arbitrary and had been issued in violation of the principles of natural justice.
The High Court of Gauhati formulated three questions for determination: 1.
Whether the writ petitioner and the 56 chakma familes now settled in Joypur village, Miao subdivision, Arunachal Pradesh are citizens of India or foreigners, 2.
If they are not citizens of India, whether the authorities concerned have right to give direction to these Chakma people to move to another place.
Whether the impugned order dated 15.2.1984 is arbitrary, devoid of reason and violative of the provisions of the Constitution.
While urging the first question it was contended that the petitioner and the other Chakma families came to Assam in 1964 and stayed there for some time.
They were shifted to Miao Sub Division in Arunachal Pradesh.
In 1964, the territory of Arunachal Pradesh was included in Assam.
Since they stayed in Assam 410 they must be deemed to be citizens of India within the meaning of Section 6 A of the as amended in 1985.
They also contended that proviso to Section 2 of Immigrants (Expulsion from Assam) Act, 1950 would also protect them.
The High Court, on an elaborate consideration of the provisions of , came to the conclusion that language of Section 6 A of the is very clear.
It states that person who have come into Assam before January 1966 from the specified territory and who have been ordinarily resident in Assam since the date of their entry shall be deemed to be citizens.
Admittedly, the petitioners therein would not fell under this category as they stayed in Assam for a short while in 1964.
Accordingly, they will not be citizens of India.
On the second question, the High Court referred to Section 7 of the Bengal Eastern Frontier Regulation, 1873.
That section specifically prohibits the acquisition of interest in land by other than the natives of the district without the sanction of the State Government.
Admittedly, there was no sanction of the State Government in favour of the petitioners under the said Regulation which is applicable to Arunachal Pradesh.
Besides, clause 9 (2) (a) of the Foreigners Order 1948 prohibits acquisition of land or any interest thoreon or within the prohibited area by any foreigner.
Clause 9 (2) (b) states that the local authority may impose conditions regarding acquisition of land or any interest thereof or any other matter deemed necessary in the interest of public safety.
There was no controversy that the place where chakmas were staying is within the inner line which is protected area notified by the State Government.
In view of the facts, the High Court came to the conclusion that the petitioners had no right to seek a permanent place of abode in that area.
The authority had every right requiring them to shift.
On the third question.
after going through the various files produced by the State Government, in the court, the High Court found various complaints against these chakmas.
They were indulging in procuring arms and ammunation and were actively, associating with anti social elements Accordingly, it was concluded that the impugned order is not devoid of any reason.
Lastly, the High Court, on humanitarian grounds, directed the State Government to give adequate compensation in the event of these chakmas being evicted from the place.
The State of Arunachal Pradesh has preferred S.L.P. (C) No. 12429 of 1992 while Khudiram Chakma has filed S.L.P. (C) No. 13767 of 1992.
411 Mr. Govind Mukhoty, learned counsel for the appellant urges that in 1947 the appellants were Indian citizens.
Because of the partition of the country they went over to the then East Pakistan, presently Bangladesh.
But when they returned in 1964 to the erstwhile Assam State they stayed there for some time and shifted to Arunachal Pradesh.
To deprive them of the citizenship would be violative of Article 14 of the Constitution of India.
By mere accident of their going over to Arunachal Pradesh, they cannot lose their citizenship.
The learned counsel referred us to the various provisions of the .
He urges that there is evidence, in this case, of donation of lands in favour of these appellants by Raja Nirunong Singpho of Dumba.
That was approved by the Deputy Commissioner as seen from memorandum dated 26th of April, 1976.
The appellant was appointed Gaon Bura of Joypur village.
In proof of that Sanad was issued by the Deputy Commissioner.
Again, the Executive Magistrate had directed the Raja to turn out the extra families occupying lands at Joypur in the area allotted to the appellants and other Chakmas.
There is also evidence on record to show that chakmas have been paying taxes including house tax.
When that be the position, there is no justification at all calling upon the appellants and the other 56 families to shift.
There was no notice before calling upon the appellants to shift.
This Court in Scheduled Caste and Weaker Section Walfare Association vs
State of Karnataka ; , a case arising under karnataka Slum Areas (Improvement and Clearance) Act, 1973, held that before eviction a slum dweller does have a right to say.
Therefore, it is submitted that the principle of natural justice applies to noncitizens also.
In Louis De Raedt vs Union of India ; this Court took the view that the fundamental rights are available to foreigners as well, including Article 21 of the Constitution.
Mr. K.K. Venugopal, learned senior counsel, appearing for the State of Assam contends in opposition: The appellants cannot claim to be citizens of India by invoking Section 6 A of the as amended and incorporated on 7.12.85 in pursuance of the Assam Accord.
In order to get the benefit of Section 6 A two conditions mentioned in sub section (2) of the said Section must be satisifed simultaneously: (i) The persons who are of Indian origin (viz. undivided India) came before 1.1.66 to Assam from the specified territory ', and 412 (ii) have been "ordinarily resident ' in Assam (as it existed in 1985) since the date of their entry into Assam.
In so far as the appellants were residing in Miao sub division of Tirup District, Arunachal Pradesh since 1968 they did not satisfy these conditions.
As to what exactly is the meaning of "ordinarily resident" could be seen from Shanno Devi vs Mangal Saini ; at 590.
It is true that this Court in Louis De Raedt (supra) took the view that even foreigner has a fundamental right, but that fundemental right is confined only to Article 21 and does not include the right to move freely throughout and to reside and stay in any part of the territory of India, as conferred under Article 19(1) (d) and (e).
Such a right is available only to the citizens.
The appellants being foreigners, cannot invoke Article 14 of the Constitution to get the same right denied to them under Article 19 since Article 14 cannot operate in regard to a right specifically withheld from non citizens.
In support of this submission, reliance is placed on Indo China Steam Navigation Co vs Jasjit Singh 94 at 621 to 622 and Louis De Readt (supra).
The land donated in favour of the appellants by Raja Nirunong Singpho of Dumba by donation deed dated 20.11.72 is illegal.
Section 7 of the Bengal Eastern Frontier Regulation 1873 and clause 9 of the Foreigners under 1948, which are applicable to Arunachal Pradesh, specifically prohibit such transfer without prior permission of State Government.
No such permission, in this case, was obtained.
The tribals of North eastern States are historically protected races.
Part x of the Constitution of India contains provisions and laws goveming them.
The decision re arding settlement of foreigners is a matter of policy.
It is well settled in law that the Court does not interfere in a matter of governmental policy since it is for the Government to decide.
On the quesion of natural justice before passing the impugned order dated 15.2.84 the learned counsel.
, producing the relevant material from the file, would urge that it is not correct to state that the order came to be issued all of a sudden.
There is abundant material to show that the question of eviction was an ongoing process.
right from 1978.
Many notices were issued over a period of years to shift to villages Maitripur and Gautampur.
There were protests from chakmas.
From the file it is seen that the appellant was aware of the shift order dated 26.9.83.
There was also an oral hearing of the same.
It was because of the complaints filed by the residents of the locality against the appellant and in view of the report that they were induling in procuring arms and ammunition and were in close contact with anti social elements.
Taking an overall view of the matter, the impugned order 413 came to be passed.
On ground realities, natural justice is fully satisfied.
In support of the above submissions, the learned counsel relied on the following cases: p. 331 A to 332 H, 334 A to J: R.v.
Secretary of State for the Home Department ex party Cheblak.
; , Lord Bridge of Harwich, p. 723 F to 724G Lord Templeman, p. 725 J, 726 A to C. Lord Ackner.
p. 73 1 H 732G H 735 F J Lord Lowry, p. 737 D J. Brind vs Secretary of State ; Council of Civil Service Unions vs Minister for the Civil Service D) p. 219, 223 A J, 229 McInnes vs onslow Farne & Anr.
; at p. 722 723 para 12, 13 JR Vohra vs India Export House Pvt. Ltd. at p. 738 para 20 22 Maharashtra State Board of Secondary & Higher Education.
vs KS.
Gandhi at p. 263 Satya Vir Singh vs Union of India However, the learned counsel fairly conceded that the Chief Minister was willing to hear the appellants or any representative of their group, additionally, as a post decisional hearing, even though they had full opportunities over a period of four years.
It is his submission that it must be a post decisional hearing as otherwise, if the decisions were against the appellants a further round of litigation would be embarked upon.
We will proceed to consider the correctness of the above submissions 414 providing the necessary background and the factual matrix.
The history of the mountainous and multitribal north east frontier region which is now known as Arunachal Pradesh ascends for hundreds of years into the mists of tradition and mythology.
According to Puranic legend, Rukmini, the daughter of king Bhishmak, was carried away on the eve of her marriage by Lord Krishna himself.
the ruins of the fort at Bhalukpung are claimed by the Akas as the original home of their ancestor Bhaluka, the grandson of Banna Raja, who was defeated by Lord Krishnaat Tezpur (Assam).
A Kalita Kinu, Ramachandra, driven from his kingdom in the plains of Assam, fled to the Dafla (now Nishan) foothills and established there his capital of Mayapore, which is identified with the ruins on the It a hill.
A place of great sanctity in the beautiful lower reaches of the Lohit River, the Brahmakund, where Parasuram opened a passage through the hills with a single blow of his mighty axe, still attracts the Hindu pilgrims from all over the counrty.
In the year 1838, when the British took over the administrative control of Assam from the last Ahom king, Shri Purander Singh, it was thought necessary to extend elementary regular administration to the adjoining north east frontier region.
The first import and step in this direction was as such initiated with adoption of Regulation V of 1873 empowering the then Lieutenant Governor of Assam to prescribe a Line, called 'Inner Line ' with a view (1) "to bring the commercial relations of the hills with the plains under more, stringent control, (2) to prevent of operation of speculators in "caoutchouc" (raw rubber), (3) to prevent the spread of tea gardens, and (4) to lay down rules for the possession of land and property beyond the 'Inner Line ' without special permit.
" A Notification bearing No. 1486, dated June 21, 1876 was issued by the Government of India, foreign Department to the effect that the Governor General was pleased to prohibit all British Subjects from going beyond the inner line without a pass under the hand and seal of Deputy Commissioner.
After covering the hilly areas administratively, the whole of tribal region was divided into two Frontier Tracts in 1915.
By 1937, the administrative status of North East Frontier Tract could be effected to under the Govemment of India 's (Excluded and Partially Excluded Area) Order of 1936.
Under the effective provision of the Section 91 (i) of the governmentoflndia Act, 1935, the above Frontier Tract came to be known as Excluded Area of Assam.
Again, the 1942 administrative change took place as a consequence of which Tirap Frontier Tract was carved out of the Sadiya Frountier Tract.
In 1943.
an adviser was appointed as the administrative head with a purpose to develop the region 415 through gradual penetration of the administrative machinery.
Another change was effected in the administrative set up on the 26th of January 1950 when the Government of Assam was relieved of its responsibility for looking after the administration of the Excluded Area.
However, the discretionary power was vested in the Governor of Assam, under the provision of the paragraph 18 of the Sixth Schedule to the Constitution and Part 8 of the Table 20 of the Schedule, who served as the agent of the President of the Union of the Republic of India.
In the course of administrative and political events Arunachal Pradesh has travelled from the Tract to the Union Territory.
Under the provision of (Central Act 81 of 1971), the present status of Union Territory was granted to the erstwhile North East Frontier Agency and renamed as Arunachal Pradesh on January 21,1972.
The Union Territory of Arunachal Pradesh was placed under the charge of Chief Commissioner during that year.
The year of 1975 also proved eventful for Arunachal Pradesh.
On 15 August, 1975, then existing Pradesh Council was constituted into the Union Territory legislature.
The panel of then existing five counsellors was constituted into provisional Council of Ministers.
Consequent upon the above change, the post of Chief Commissioner was further elevated to the position of Leutenant Governor on 15 August, 1975.
The first general election to Arunachal Legislature was held in the month of February, 1978.
The Arunachal Pradesh Legislative Assembly has 33 members in total, out of which 3 members are nominated.
Earlier, Arunachal Pradesh had nominated a representative in the Parliament.
By an Act of the Government of India in 1971, the Union Territory was provided with one seat each in Lok Sabha and Rajya Sabha, but these representatives were nominated by the President of India.
But at present, Arunachal Pradesh enjoys two elective seats in the Lok Sabha based on the Universal franchise.
On 20th of February, 1987 Arunachal Pradesh was made a full fledged State.
Thus, it will be seen that at no time Arunachal Pradesh was part of the Territory of the State of the Assam though it was being administered by the Governor of Assam or the President of India, as the case may be.
The following Charonological Statment of changes in the pattern of Administration in NEFA occuring in P.N. Luthra 's constitutional and Administrative Growth of the North East Frontier Agency is useful: 416 1 2 3 4 5 6 1914 1919 1937 1947.
1950 1965 Adminis Administ Adminis Adminis Admin Admini tered by ered by tered by tered by tered by tered the Gove the Gov the Gov the Gov the Pre as be rnment of ernment ernor of ernor of sident fore by Assam of Assam Assam Assam through theGov with acting in acting on the Gover erner special his disc the nor of as agent safe retion advice of Assam as of the guards.
indepen the Pro his agent Presi dently of vincial acting in dentbut the provi Ministry, his disc under ncial Minis retion the try underthe general general supervi super sion and visionand control control of the of Mini Minis try of try of External Home Affairs.
Affairs.
Arunachal Pradesh is situate in the North East of India skirted by Bhutan in West, Tibet and China in North and North East, Burma (Myanmar) in East and Assam in South.
It consists of the sub mountains and mountainous ranges sloping to the plains of Asswn.
It 's capital is Itanagar.
It is the largest state areas wise (33,743 sq kms.) in the North East region even larger than Assam which is the most populous.
Arunachal Pradesh is the most thinly populated state in India.
According to 1991 census the population of Arunachal Pradesh is 6.32 lakh and is scattered over 12 towns and 3,257 villages.
There ate 26 major tribes in Arunachal Pradesh.
Broadly speaking, the people in the state may be divided into three cultural groups on the basis of their socio regional affinities.
i) The Monpas and Sherdukpens of Tawang and West Kemeng District; ii) Khamptis and Singphos inhabiting the entire eastern part of the State; and 417 iii) The Noetes and Wanchos adjoining Negaland in the Tirap District.
This is the history of Arunachal Pradesh, a rich land and poor people.
It was in the year 1964 thousands of chakma families migrated from the then East Pakistan to India.
The appellant along with other 56 families also migrated to India.
Being refugees they were given shelter in government camps at Ledo within the district of Dibrugarh, Assam.
Later on they were shifted to the camp at Miao subdivision in Tirap District, now within the State of Arunachal Pradesh which was then known as North East Frontier Agency (NEFA).
In the years 1966 68 the then Government drew up the Chakma resettlement schemes.
Altogether 5 schemes were sancitioned for settlement of 3100 families at a cost of more than rupees two crores.
The appellants were allotted lands in the villages of Gautampur and Maitripur.
The other Chakmas were also staying there.
As stated earlier, on 2 1st January, 1972 NEFA was given the status of Union Territory and was renamed as Arunachal Pradesh.
The appellants strayed away from the original settlement area allotted to them by the Government under the schemes.
They got donation from the local Raja namely Ningrunong Singpho of Dumba, an area of 1 sq. mile at Joypur village which is inside the Inner Line.
Earlier we were referred to Bengal Eastern Frontier Regulation 1873.
Clause 2 of the said Regulation states thus: "It shall be lawful for the State Government to prescribe and from time to time to alter by notificaton in the Official Gazette line to be called "The inner Line" in each or any of the above named districts.
The State Government may, by notification in the Arunachal Pradesh Gazette prohibit all citizens of India or any class of such citizens or any persons residing in or passing through such districts from going beyond such line without a pass under the hand and seal of the Chief Executive Officer of such district or of such other officer as he may, authorise to grant such pass ', and the State Government may, from time to time, cancel or very such prohibition.
" Clause 7 is important.
That reads as follows: "It shall not be lawful for any person, not being a Native of the district comprised in the preamble of this Regulation, to acquire any interest in land or the product of land beyond the said "Inner Line" without the sanction of the State Government or such officer as the 418 State Government shall appoint in this behalf.
Any interest so acquired may be dealt with as the State Government or its said officer shall direct.
The State Government may also, by notification in the Arunachal Pradesh Gazette extend the prohibition contained in this section to any class of persons, natives of the said districts, and may from time to time in like manner cancel or very such extensions Under Section 3 of the of 1946, the central Government may.
by order, make provision for prohibiting regulating or restricting the entrt of foreioners into India.
In exercise of power conferred under Section 3 of the said Act Foreigners Order of 1948 dated 10.2.48 was issued.
Under clause 9 of tile said Order the Central Government or with prior sanction, a civil authority may, by order, declareany area to be a protected area for the purposes of this order.
On such declaration, the civil authority may, as to any protected area ,prohibit any forging or any class of foreigners from entering or remaining in the area, impose on any foreigner or class of foreigners entering or being entered in the area.
such conditions as may be mentioned under clause 9.
Clause 9 of the Foreigers Order of 1948 in sub clause (2) prohibits the acquisition of any land or anv interest thereon within the prohibited area by any foreigner.
Under Clause 9 the authorities concerned, by an order, may prohibit any foreigner from remaining in any part of the protected area as stated in the Foreigners Protected Area 0rder of 1958 which includes the territory of arunachal Pradesh.
Examined in this light, the donation by Raja is clearly invalid.
However, the memorandum dated 26th of April, 1976 issued by the Extra Assistant Commissioner Miao states that the agreement between the 'appellant, Khudiram Chakma and the local Raja dated 20.11.72 has been approved by the Deputy Commissioner.
That is again mentioned in the direction given by the Executive Magistrate Miao on 30th of May, 1977.
The effect of approval by the Deputy Commissioner will be considered later.
In this factual background, the question arises whether the appellants could claim citizenship under Section 6 A of of 1955.
We will now extract the said Section: 419 "6 A. Special Provisions as to the citizenship of persons covered by the Assam Accord: (1) For the purposes of this section: (a) "Assam" means the territories included in the State of Assam immediately before the commencement of the citizenship (Amendment) Act, 1985; (b) "detected to be a foreigner" means detected to be a foreigner in accordance with the provisions of the (31 of 1946) and the Foreigners (Tribunals) Order 1964 by a Tribunal constituted under the said Order, (c) "specified territory" means the territorises included in Bangladesh immediately before the commencement of the Citizenship (Amendment) Act, 1985; (d) a person shall be deemed to be of Indian origin, if he, or either of his parents or any of his grandparents was born in undivided India; (e) a person shall be deemed to have been detected to be a foreigner on the date on which a Tribunal constituted under the Foreigners (Tribunals) Order, 1964 submits its opnion to the effect that he is a foreigner to the officer or authority concerned.
(2) Subject to the provisions of sub sections (6) and (7), all persons of Indian origin who came before the 1st day of January, 1966 to Assam from the specified territory (including such of those whose names were included in the electoral rolls used for the purposes of the General Election to the House of the People held in 1967) and who have been ordinarily resident in Assam since the dates of their entry into Assam shall be deemed to be citizens of India as from the 1st day of January, 1966.
(3)to(8). . . (unnecessary)" As rightly urged by Mr. K.K. Venugopal, learned counsel for the State of Assam, two conditions are required to be satisfied under sub section (2).
They are: (i) Persons who are of Indian origin (undivided India) came before 1.1.66 to, 420 Assam from the specified territory; and (ii) have been "ordinarily resident" in assam as it existed in 1985 since their date of entry in Assam.
The appellants were no doubt persons of Indian origin.
They came to Assam prior to 1. 1.66, namely, 3 1.3.64 from the then East Pakistan, (presently Bangladesh) which is undoubtedly one of the specified territories under Section 6 (1) (c).
Assam, as seen from 6A (a), means the territories included in the State of Assam immediately before the commencement of the Citizenship (Amendment) Act, 1985.
It is the common case that chama people entered into Assam and stayed their for some time in Ledo within Dibrugarh District.
Thereafter they shifted to Miao, Arunachal Pradesh.
According to the appellant, since the territory of Arunachal Pradesh in 1964 was included in the State of Assam they would be entitled to the benefit of Section 6A.
This contention overlooks the fact the Immigrants (Expulsion from Assam) Act, 1950 (Act X of 1950) applied to the territories presently forming part of Meghalaya, Nagaland and Arunachal Pradesh.
However, by the , 197 1, the territories of Arunachal Pradesh were excluded from the purview of the Immigrants (Expulsion from Assam) Act of 1950.
Turning to Condition No. 2 the requirement is ordinarily resident in Assam from the date of entry till the incorporation of Section 6A, namely, 7.12.85.
As to the meaning of "ordinarily resident" we may refer to Smt.
Shanno Devi vs Mangal Saini ; We find the following observations at page 590 apposite: "It is not necessary that for every day of this period he should have resided in India.
In the absence of the definition of the words ,. 'ordinarily resident" in the constitution it is reasonable to take the words to mean "resident during this period without any serious break".
In so far as the appellants and the chakmas were residing in Miao subdivision of Tirap District in Arunachal Pradesh long before 1985, they cannot be regarded as citizens of India.
We find it difficult to appreciate the argument of Mr. Govind Mukhoty, learned counsel, that the accident of the appellants living in Arunachal Pradesh should not deprive them of citizenship.
In this connection, it 421 is worthwhile to note that Secion 6A of the came to be incorporated by Amending Act as a result of Assam Accord.
If law lays down certain conditions for acquiring citizenship, we cannot disregard the law.
As laid down in Kennedy, vs Mendoza Martinez ; , 159 [1963] "Citizenship is a most precious right.
" Aristotle, Politics, III, 5 States thus: "From earliest times, it has been such status alone that has enabled the individual to share fully in the benafits of the community in which he resides: "Compare Homer 's words, like some dishonored stranger ': he who is excluded from the honors of the state is no better than an alien.
" That is the position of appellant and the other 56 families.
If they are aliens, the donation deed dated 20th November, 1972 is illegal.
The Raja did not obtain any permission for sale from the Government.
From the records it is also clear that the Rajs had been donating the lands and wag indulging in anti social activities for which he was warned.
We do not know how the Deputy Commissioner or the Extra Assistant Commissioner ever approve of this donation without there being an express authorisation by the State.
It is an admitted fact that the place where the chakma families are residing is within the inner line notified by the State Government.
Therefore, the argument that they have cleared the forest and reclaimed the land and as such would be entitled to a permanent abode, cannot be accepted.
Now we come to the validity of the impugned order.
Mr. K.K. Venugopal, learned counsel has filed various notings and the orders from the relevant files.
From the files it is clear that there have been complaints against chakmas that they were procuring arms and ammunition and indulging in anti social activities.
The Deputy Commissioner, Tirap District on 19.8.81 wrote to the Extra Assistant Commissioner, Miao as follows: "Please refer to your report under reference, wherein it is indicated that a large number of arms and ammunitions seized from the possession of the Chakmas and are still kept in Quarterguard.
It is, therefore, requested to send us a detailed report indicating datails of arms and ammunitions seized.
422 2.It is further seen from your report regarding judicial cases, submitted to this office, that there are altogether 76 cases registered upto November, 1979 against the Chakmas and most of them were related to theft, assault and offences under Forest Act.
It is also therefore requested that more details on specific offences and results thereof may be furnished urgently.
3.The above two informations are urgently required by the Govt.
" A list of cases including ones under Section 302 I.P.C. and other offences under Section 25A of the Arms Act is enclosed to the letter quoted above.
The chakmas also encroached Upon the neighbouring area by unfair means and created trouble to the local people.
An appeal was made to the Chief Minister in 1980 itself that because of these criminal activities they should be removed.
It is not correct to state that the impugned notice came to be issued like a bolt from the blue.
The following letter of the appellant addressed to the Deputy Commissioner speaks eloquently: "With reference to the subject quoted above, 1 on behalf of the villagers of Joypur Village have the honour to draw your kind attention to the following few lines for favour of your needful action.
That, being landless in Abhoypur Village, a few Villagers consisting of fifty six families have been settled in Joypur Village in the year, 1968 with the mutual help of Sri Ningronong Rajkumar (Singphoo) and the same was approved by the then Deputy Commissioner, Khonsa in accordance with the agreement adopted by Sri Rajkumar Singphoo dated 20th Novn2.
Now, the most regretful matter is that in spite of our permanent cultivation on the area for long sixteen years.
keeping all conformities with the Govt.
as well as the neighbouring local people, we are being harassed by notice after notice to shift from the area.
On the contrary, I am to state that the land where we have been directed to shift is quite short and extremely unfit for cultivation due to which those vacant lands are not yet accupied by anybody in spite of lying considerable landless families in the said villages.
423 All documents created in regard to this matter are attached herewith for favour of your kind perusal necessary action.
Under the circumstances stated here, I earnestly pray and request you afresh to look into the matter and thereby revoke the shifting order at an early date.
I shall remain greteful to you thereor From the endorsement.
it is also seen that two representatives met the Deputy Commissioner on 13th Februaty, 1984.
Therefore, there was an oral hearing.
The above letter mentions notice after notice to shift.
It was alleged by a petition to the Chief Minister that the Extra Assistant Commissioner had been paid handsomely to allow chakma families to stay on illegally.
On 16th of November, 1982 the Extra Assisstant Commissioner called upon the Circle Officer, Diyum to issue notices to the chakms families 'staying at Joypur village to return to their original place of settlement within 31.12.82.
The survey Reports for resettlement of these chakmas dated 27.4.83 inter alia states: "Survey had been done in Maitripur and Gautampur areas where they have found 110 acres and 245 acres respectively which are liable for settlement of Chakma settlers.
" Thus, it will be clear that the reason for shifting these chakma families are: (1) They are in illegal occupation of the protected area.
(ii) They are indulging in procurement of arms and ammunition.
(iii) They are indulging in criminal activities and associating with anti social elements.
(iv) They have been source of constant/trouble to the other tribals.
As regards notice, it is seen from the above, that the very appellant had notice after notice proposing to evict which was resisted.
Therefore, as rightly urged by Mr. K.K. Venugopal, learned counsel on ground realities, the plea of natural justice is fully satisfied.
424 Ruling in Scheduled Caste and Weaker Section Welfare Association vs State of Karnataka ; affording a hearing to slum dwellers under the Karnataka Slum Areas (Improvement and Clearance) Act, 1973, relied on by Mr. Govind Mukhoty, learned counsel, has no application in the above circumstances.
Even then what is that is sought to be done to the appellants? They are asked to settle in Maitripur and Gautampur villages from Miao.
Cartainly, settling the chakmas in a particular place is a matter of policy.
This Court cannot enter into the wisdom of such a policy, in view of what has been stated above, Arunachal Pradesh is strategically important with Bhutan in the West, Tibet and China in the North and North East, Burma (Myanmar) in the East.
It is true that fundamental right is available to a foreigner as held in Louis De Raedt vs Union of India ; at 562.
"The next point taken on behalf of petitioners, that the foreigners also enjoy some fundamental rights under the Constitution of this country, is also of not much help to them.
The fundamental right of the foreigner is confined to Article 21 for life and liberty and does not include the right to reside and settle in this country, as mentioned in Article 19 (1) (e) which is applicable only to the citizens of this country As such Articles 19 (1) (d) and (e) are unavailable to foreigners because those rights are conferred only on the citizens.
Certainly, the machinery of Article 14 cannot be invoked to obtain that fundamental right.
Rights under Article 19 (1) (d) and (e) are expressly withheld to foreigners.
Now we come to the humanitarian grounds which prompted the High Court of Gauhati to direct compensation to the appellants in the event of their being evicted.
Blackburn and Taylor speaking on the right enjoy asylum in Human Rights for the 1990 s state at page 51 as under: "The most urgent need of a fugitive is a place of refuge.
His or her most fundamental right is to be granted asylum.
The Universal Declaration of Human Rights addressed this issue in deceptive language.
To the inexpert reader there is great comfort in Article 14 (1) of that Declaration, which provides that: 'Everyone has the right 425 to seek and enjoy in other cuntries ' asylum from persecution, it seems tolerably clear, however, that the right to enjoy asylum means no more than the right to enjoy it if is granted.
" Again at page 52 it is stated thus: "Article 14 of the Universal.
Declaration of Human Rights, which speaks of the right to enjoy asylum has to be interpreted in the light of the instrument as a whole; and must be taken to mean something.
It implies that although an asylum seeker has no right to be granted admission to a foreign state, equally a state which has granted him asylum must not later return him to the country whence he came.
Moreover, the Article carries considerable moral authority and embodies the legal prerequisite of regional declarations and instruments.
" Warwick Mckean, dealing with the equality in the treatment of aliens, states in Equality and Discrimination under International Law at pace 194 as under: "It has long been recognized that persons who reside on the territory of countries of which they are not nationals possess a special status under international law.
States have traditionally reserved the right to expel them from their territory and to refuse to grant them certain rights which are enjoyed by their own nationals, e.g. the right to vote, hold public office or to engage in political activities.
Aliens may be prohibited from joining the, civil service or certain professions, or from owning some categories of property, and states may place them under restrictions in the interests of nations security or public order.
Nevertheless, once lawfully admitted to a territory, they are entitled to certain minimum rights necessary to the enjoyment of ordinary private life.
" At pages 195 196 it is stated thus: "General international law provides that aliens should not be discriminated against in their enjoyment of property rights once they have been acquired.
If alien property is nationalized whereas the property of nationals remains unaffected then that act is dis criminatory and prohibited under international law.
As Fitzmaurice points out, it has long been recognized that in certain matters, e.g. 426 the general treatment of foreigeners in a country, or compensation for property which may be expropriated or nationalized, non discrimination as between persons of different nationality or against foreigners as compared with persons of local nationality, amounts to a rule of international law, the breach of which gives rise to a valid claim on the part of the foreign government whose national is involved." Certainly, if the acquisition had been legal, compensation could have been awarded.
But in view of the Bengal Eastern Frontier Regulation, 1873 and clause 9 (2) of the Foreigners Order 1948 we do not think this is a case for award of ' compenstion.
Though we have held that the principles of natural justice have been fully complied with in this case, we record the statement made by learned counsel for the State that the Chief Minister is ready to hear the Respondents (appellants herein) or any representative of their group.
Accordingly we direct that an opportunity be afforded to the appellants by the Chief Minister and grant such relief as he deems fit.
We make it clear that it will be a post decisional hearing.
Accordingly we dismiss civil appeal arising out of SLP (C) No. 13767 of 1992 filed by Khudiram Chakma while civil appeal arising out of SLP(C) No.12429 of 1992 filed by State of Arunachal Pradesh is allowed.
However,there shall be no order as to costs.
R.P. SLP (C) No. 13767/92 dismissed.
SLP (C) No. 12429/92 allowed.
| The appellant in Civil Appeal No.481 of 1983, and thousands of other families, known as Chakmas, migrated from the erstwhile East Pakistan to Assam where they were given shelter as refugees in 1964.
In the year 1966 the Government drew up the Chakma resettlement Schemes whereunder they were allotted lands within the North East Frontier Agency, which later became State of Arunachal Pradesh.
The appellant and 56 other Chakma families strayed away from the original settlement area and negotiated with the local Raja who through an unregistered deed donated land to them inside the inner line which was a protected area under the Foreigners ' Protection Area Order 1958.
Later, the State Govenment received complaints that the 402 Chakmas were making encroachment on lands of local people, indulging in illegal collection of arms and ammunition and establishing contacts with the extremist groups.
An inquiry into the matter was directed.
The Government found it necessary to shift them, and by order dated 15.2.1984 directed the appellant and the other Chakma families to vacate the land and to shift to the original settlementarea where other Chakma families were already` residing.
The appellant challenged the order before the High Court by filing a writ petition which was dismissed.
However, the High Court, on humanitarian grounds, directed the State Government to give adequate compensation to the Chakmas.
Both, the appellant and the State Government filed the appeals by special leave.
It was contended on behalf of the appellant that the appellant and the other Chakmas being of Indian origin and having returned to Assam State in 1964, would be entitled to citizenship under Section 6A of the , and by mere accident of their going to Arunachal Pradesh they cannot lose their citizenship; and that the order dated 15.2.1984, besides being against the principles of natunal justice, was violative of Article 14 of the Constitution as it infringed the rights of the appellant and other Chakmas under Articles 19(1) (d) and (e) of the Constitution.
Dismissing the appeal on behalf of the Chakmas and allowing that of the State, this Court, HELD : 1.1 The appellant and other Chakmas residing in Arunachal Pradesh long before 1985 cannot be regarded as citizens of India.
[420 H] 1.2 Under Section 6 A of the , which was incorporated by the Amending Act, 1985 as a result of Assam Accord, two conditions are required to be satisfied: (1) Persons of Indian origin (undivided India) who came before 1.1.1966 to Assam from the specified territory; and (2) they have been "ordinarily resident" in Assam as it existed in 1985 since their date of entry in Assam.
[411 G H; 412 A] 1.3 Though the appellant and other Chakmas were of Indian origin and came to Assam prior to 1.1.1966 from the then East Pakistan, one of the specified territories but, in 1966 they shifted to the area within North East Frontier Agency which later became State of Arunachal Pradesh, and at no time was part of the Territory of the State of Assam though was being administered by the Governors of Assam or the President of India, as the case 403 may be.
Besides, bt the , the territories of Arunachal Pradesh were excluded from the purview of the Immigrants (Explusion from Assam) Act, 1950.
The appellant and the other Chakmas were residing in Arunachal Pradesh long before 1985, and as such cannot be said to be "ordinarly resident" in Assam as it existed in 1985 since their date of en try in Assam.
(420 A F) Smt.
Shanno Devi vs Mangal Saini ; , relied on.
1.4 If the law lays down certain conditions for acquiring citizenship, the same cannot be disregarded.
(421 A) Kennedy vs Mendoza Martinez ; ,159 [1963], referred to.
Arstotle, Politics, III, 5, referred to.
2.The place where the Chakma families are residing is within the inner line notified by the State Government.
The place is the protected one under the Foreigners 'Protection Area Order, 1958, wherein acquisition of any land or any interest thereon by any foreigner is prohibited as envisaged by clause section 7 of the Bengal Eastern Frontier Regulation, 1873 and Clause 9(2) of the Foreigners ' Order 1948 issued under Section 3 of the .
(410 DE) 2.2Accordingly, the donation deed through which the Raja gave land to the appellant and the other Chakmas is illegal.(421 D) 2.3Unlike article 21, rights under Articles 19(1) (d) and (e) of the Constitution are unavailable to foreigners because these rights are conferred only on the citizens and are expressly withheld to foreigners.
The machinery of Article 14 cannot be invoked to obtain that fundamental right.(424 E) Indo China Steam Navigation Co. vs Jasjit Singh, [1964]6 SCR 594 at 621 to 622, followed.
Louis De Raedt vs Union of Indian ; , referredto.(412 CD) 404 3.1 Settling the Chakmas in a particular place is a matter of policy.
This Court cannot enter into the wisdom of such a policy.
Besides, the reasons for shifting the Chakma families are : they are in illegal occupation of the protected are, they are indulging in procurement of arms and anununitions and other criminal activities; they are associating with anti social elements, and have been source of constant trouble to the local tribals.
Arunachal Pradesh being a Border State is stategically important (424B, 423EFG) 4.
In the instant case, the principles of natural justice were fully complied with.
It cannot he said that the order dated 15.2.1984 for shifting the Chakmas came to be issued like 'a bolt from the blue '.
The record mentions that before passing of the shifting order, notice after notice were issued to chakma families to return to their original place of settlement.
Survey Reports for their settlement were submitted and representation were made to the authorities concerned who gave oral hearing to the representatives of Chakmas.
(412 GH) Scheduled Caste and Weaker Section Welfare Association vs State of Karnataka, [1991]2 SCC 604, inapplicable.
R. vs Secretary of Stale for the Home Department, ; Brind vs Secretary of State ; ; Council of Civil Service Unions vs Minister for the Civil Service; ; ; McInnes vs onslow Farme & Anr., D) p. 219; JR Vohra vs India Export House pvt.
Ltd.; , ; Maharashtra State Board of Secondary & Higher Education vs K.S. Gandhi, and Satya Vir Singh vs Union of India, , referred to.
5.1 In view of the Bengal Eastern Frontier Regulation, 1873 and Clause 9(2) of the Foreigners 'Order 1948 the acquisition of the land being illegal, the instant one is not a case for award of compensation.
(426 C) 5.2 However, having regard to the statement made on bahalf of the State that the Chief Minister is ready to hear the Chakmas, an opportunity be afforded to them by the Chief Minister who may grant such relief as may be deemed fit.
It is made clear that it will be a post decisional hearing.
(426 D) 405 Blackburn and Taylor on the right to enjoy asyum in Hussan Rightsior the 1990s, 'Equality and Discrimination under International Law ' by Warwick Mckean, referred to.
|
minal Appeal No. 3 of 1972.
Appeal by special leave from the judgment and order dated January 25, 1971 of the Madhya Pradesh High Court, Indore Bench in Criminal Appeal No. 391 of 1969.
section K. Gambhir, for the appellant.
M. N. Shroff, for the respondent.
The, Judgment of the Court was delivered by Beg, J. Shiv Govind, the appellant , has obtained Special.
Leave to appeal against only that part of the Judgment and order of the High Court of Madhya Pradesh by which his sentence of one, year 's Rigorous Imprisonment, passed by the Additional Sessions ' Judge, Indore, upon a conviction under Section 366 Indian Penal Code, was enhanced to seven years ' Rigorous Imprisonment 836 and a fine of Rs. 100/ , and, in.
default of payment of fine, to three months ' further rigorous imprisonment.
The appellant, aged about 20 years at the time of the alleged offence of 9th of August, 1969, was the youngest of three persons who were jointly charged and tried for offences punishable under Section 366 and 354 I.P.C. The prosecution case was : Kumari Seema, a girl below 18 years of age, was offered a lift on his bicycle by the accused, Kamal Singh, aged 30 years, while she was returning to her homefrom her School on 9th August, 1969.
The girl hesitated.
But, as she reposed confidence in Kamal Singh, whom she looked upon as her uncle, she accepted the offer.
Kamal Singh took Kumari Seema on his bicycle to the Regal Cinema where she part took of some.
refreshment ordered by Kamal Singh.
Meanwhile, the appellant Shiv Govind and the accused Punani, aged 26, arrived in a car.
Kamal Singh asked Kumari Seema to go with the two younger men in their car.
Seema refused.
Then, Kamal Singh asked her to go on his bicycle to Yashwant Talkies.
She complied with this request.
At this Cinema, Kanial Singh deposited his Cycle at the Cycle stand.
The appellant Shiv Govind and his companion Punam had followed in their car.
The three men succeeded in persuading Seema, despite her initial refusal, to sit in the car and to go for a short pleasure trip in it on the, definite assurance that she will soon be reached home.
After the girl had sat in the car she was driven to a place called Mandow, a number of miles away from Indore, and was made to alight at a tourist 's bungalow.
There two rooms were engaged by the accused.
, Kamal Singh occupied one of the two rooms and the girl was closeted in the other room with the appellant and his companion Punam, who were both drunk.
One of the two youngmen caught hold of the hands of the girl while the other tried to undress her with the object of raping her.
Kumari Seema, at this point, feigned sudden indisposition so that the two youngmen had to bring her out into the gallery for fresh air.
She managed to escape while the accused went inside to fetch some water for her, She rushed into the house of one Babulal Kamdar and complained to him about the incident.
This led to a communication of information of the offences to the Police which went to the tourist 's bungalow.
and arrested the three accused who were brought to Police Station Nalcha where a First Information Report was lodged.
The Trial Court had examined the evidence given in support of the case stated above.
This included medical evidence on the question of the age of the girl, because, while the prosecution alleged that she was below 16 years of age, the accused pleaded that she was above 18 years of age.
Evidently, the case of the accused 837 Was that Kumari Seema was a consenting party to whatever took place.
Although the girl was attending a School, the entry of her age in the School Register was not disclosed.
Despite some discrepancies in the evidence relating to the age of the girl, the trial court came to the conclusion that it was between 16 to 19 years.
It relied mainly on expert evidence of Doctors who had used the ossification test.
The Trial Court had also noticed the discrepancies between the prosecution version, as set out above by Kumari Seema in her evidence in Court.
and the story given out by her in the First lnformation Report where she had stated that she had joined the party of the accused at the crossing of Bijasan Road.
The earlier version suggested that the girl had herself gone to meet the party of the accused by appointment.
The consent of the girl was, however, immaterial in view of the finding of the Trial Court about the age of the girl.
The fact that she was taken to Mandow, where something happened at the tourist 's bungalow which she disapproved of, was corroborated by the evidence of Babulal Kamdar, and Kailash Sharma, in addition to the two police constables of Mandow out post.
The Trial Court which had the advantage, of watching the demeanour of the girl, had come to the conclusion that, although the girl may have tried to improve her version and pretend that she was unwilling to accompany Kamal Singh, who had come in a car for her according to the first version, yet, the charge under Sec.
366 I.P.C., was established against each of the three accused and the charge under Sec.
354 I.P.C. was established against Shiv Govind, appellant, and his companion Punam.
The three accused were, therefore, convicted under Sec. 366, and each was sentenced to one year 's rigorous imprisonment.
The two accused Shiv Govind and Punam were also convicted under Sec.
354 I.P.C., and sentenced to four months rigorous imprisonment, but the two sentences were ordered to run concurrently.
When the case came up in appeal to the High Court, a notice: of enhancement of the sentence under Sec.
366 I.P.C. was issued to each of the three appellants, and their sentences were enhanced, as indicated above, after the appellants had been heard.
It is only Shiv Govind who has appealed to this Court.
Shiv Govind had also applied under Sec.
561A. Criminal Procedure Code to the High Court, after the dismissal of his appeal and enhancement of the sentence, by the High Court, claiming the benefit of Sec. 6 and 11 of the Probation of Offender 's Act.
But this application was rejected by the learned Judge who had enhanced the sentence passed upon the appellant, although he 838 round that the report of the Probation Officer about the conduct of the accused while undergoing the sentence, which was sent far, was favourable to the appellant.
It appears from the two Judg ments given by the learned Judge who enhanced the sentence of the appellant and who subsequently dismissed the application Linder Sec.
561A Criminal Procedure Code also, that the view taken by him was that, having regard to the facts and circumstances and of the case and the offence committed by the appellant, the enhanced sentence was deserved by him.
We have, therefore, examined the Judgment of the High Court Linder appeal before us in order to discover the special reasons Which induced the learned High Court Judge to differ from the ( )pinion of the Trial Court about the appropriate sentence to be imposed upon the appellant.
The only reason given by the learned Judge for enhancing the sentence was that Kumari Seema had reposed confidence in Kamal Singh, whom she regarded as an Uncle, so that she could not expect foul play from him.
The learned Judge thought the girl 's trust and confidence in Kamal Singh explained why she did not protest when she was taken in the car and then made to get down at the tourist 's bungalow.
It seems, however, from the account of the occurrence given in the Judgment under appeal, that the learned Judge was shocked by the plight of Kumari Seema, due to the perfidy of Kamal Singh, and by.
a contemplation of the possible consequences to her if she had not behaved in a particularly.
brave and intelligent manner so as to escape from her predicament.
The learned Judge mentioned that the girl had risked her life to escape.
We, however, find that there was no suggestion in the evidence anywhere that any threat to the life of Kumari Seema was held out.
There was no evidence that the girl had seriously struggled to escape or had raised shouts for help which would have brought people around to her aid.
Nor was there any evidence that the accused tried to obstruct her or to chase her when she escaped from the tourist 's bungalow allegedly by resorting to a ruse.
The High Court was so impressed by the girl 's uncorroborated version of her own heroism, which did not tally with her first version in the First Information Report, that it overlooked the infirmities in the girl 's evidence discussed by the trial court.
We find the trial court 's view of the whole case to be, quite balanced and objective.
We do not think that the severer view of the High Court could be reasonably justified.
It seems clear to us that the High Court had overlooked the principles, laid down by this Court repeatedly, which should 839 govern the exercise of powers of the High Court to enhance sen tences Imposed by trial courts.
In Bed Raj vs The State of Uttar Pradesh.
this Court observed at page 588 589 "A question of a sentence is a matter of discretion and it is well settled that when discretion has been properly exercised along accepted judicial lines, an appellate court should not interfere to the detriment of an accused person except for very strong reasons which must be disclosed on the face of the judgment; See for example the observations in Dalip Singh vs State of Punjab , 156) and Nar Singh vs State of Uttar Pradesh [1955](1) S.C.R. 238, 2411.
In a matter of enhancement there should not be interference when the sentence passed imposes substantial punishment.
Interference is only called for when it is manifestly inadequate.
In our opinion, the lese principles have not been observed.
It is impossible to hold in the circumstances described that the Sessions Judge did not impose a subs tantial sentence, and no adequate reason has been assigned by the learned High Court Judges for considering the sentence manifestly inadequate.
In the circumstances.
bearing all the considerations of this case in mind, we are of opinion that the appeal (which is limited to the question of sentence) should be allowed and that the sentence imposed by the High Court should be set aside and that of the Sessions Court restored".
We think that what was laid down by this Court.
in Bed Raj 's case (Supra) is fully applicable to the case before us.
We may also mention the similar views expressed by this Court in.
Alamgir & A nr., vs The State of Bihar (2).
We may observe that decision of this Court in Nabi Bux and Ors.
vs The State of Madhya Pradesh(: '), is distinguishable from the case before us.
In that case the High Court had enhanced a sentence having regard to all the facts and circumstances justifying the enhancement.
In the case before us we find that the High Court had not noticed a number of facts duly considered by the trial Court so that the exercise of power of enhancement of the sentence under Sec.
366 I.P.C. could not be reasonably justified here.
Consequently, we allow this appeal by setting aside the order of enhancement of sentence by the High Court of Madhya Pradesh and restore the sentence of one year 's rigorous imprisonment (1) [1955] (2) S.C.R. p. 583.
(2) [1959] Supp.
(1) S.C.R. 464.
(3) ; 840 passed upon the appellant by the learned Sessions Judge for the offence under Sec.
366 I.P.C. of which the appellant was convict ed.
The concurrent sentence of four months rigorous imprisonment under Sec.
354 I.P.C., which was not interfered with by the High Court, is maintained.
We understand that the appellant has already undergone more than one year 's imprisonment awarded to him and that he is in jail as his application for bail was rejected.
If this is so, the appellant will be released forthwith unless wanted in some other case.
K.B.N. Appeal allowed.
| The High Court set aside an order of acquittal of the appellants on various charges and convicted them.
One of the items of evidence on which the High Court relied was the first information report.
Though it was not proved through its maker when be gave evidence in the trial court.
the High Court held it to be admissible under section 157 of the Evidence Act.
in appeal to this Court, HELD : (1) The High Court was wrong in holding that the First Information Report would be admissible under section 157 of the Evidence Act.
Under that section.
it could not be used as substantive evidence but only to corroborate its maker.
The appellants were also denied the opportunity of cross examination on the First Information Report.
[627 A D] (2) The High Court, however, was correct in setting aside the order of acquittal and convicting the appellants on the other evidence.
[1639 D G] In dealing with an appeal against acquittal the High Court can go into questions of law and fact and reach its own conclusion on evidence provided it pays due regard to the principles for such review.
These principles are giving due regard to, the views of the trial Judge as to the credibi lity of the witnesses, the presumption of innocence in favour of the accused, the right of the accused to any benefit of doubt and the slowness of an appellate court in disturbing the finding of fact arrived at by a Judge who had the advantage of seeing the witnesses.
The appellate court ill coming to its own conclusion should not only consider every matter oil record having a bearing on questions of fact and the reasons given by the trial court in support of the order of acquittal but should also express reasons for holding that the acquittal was not justified.
If two conclusions can be reached with a plausible appearance of reason the court should lean in favour of that which leads to acquittal and not to that which lead, to conviction.
But once the appellate court comes to the conclusion that the view of the trial court was unreasonable that itself would provide a reason for interference.
[629 H; 630 A E. 631 B D] In the present case, the High Court bid kept in view the rules and principles of appreciation of evidence in setting aside the order of quitting.
In such a case.
this Court would not ordinarily interfere with the order of conviction by the High Court in an appeal against an acquittal, or review the evidence.
[630 E; 631 B D] Harbans Singh and Anr.
vs State of Punjab, [1962] Supp. 1 S.C.R. 104, Senwat Singh & Ors.
vs State of Rajasthan, ; Nihal Singh & Ors.
vs State of Punjab, ; , State of Bombay vs Rusy Mistry, A.T.R. and Laxman Kalu Nikalje State of Maharashtra. , followed.
623 Khedu Mohton & Ors.
vs State of Bihar, ; and Sheo Swarup vs, King Emperor, 61 I.A. 398, referred to.
|
RISDICTION: Civil Appeal Nos. 154 & 155(N) of 1971.
From the Judgment and Order dated the 11th November, 1969 Civil of the Punjab & Haryana High Court in writ Nos. 1207 and 1607 of 1969 respectively.
Harbans Singh, I.S. Gujral, C.V. Subbarao and R.N. Poddar for the Appellants is both the appeals.
G.K. Arora for the respondents in C.A. 154/71.
T.S. Munjral and Mrs. Urmila Kapoor for the Respondent in CA 155/1971.
The Judgment of the Court was delivered by SEN, J.
These appeals on certificate are directed against the Judgment and orders of the Punjab High Court dated November 19,1969 allowing the writ petitions filed by the respondents and quashing the impugned notices of demand for recovery of the difference between the amount which they had agreed to pay under the terms of auction of a liquor vend and the amount realized on re auction of the vend as also the defaulted instalments of the licence fee payable in respect of a liquor vend issued under section 60 of the Punjab Excise Act 1914 ( 'Act ' for short).
Put very shortly, the essential facts are these.
On March 11, 1969, the Deputy Excise & Taxation Commissioner, Hissar held an 719 auction for grating the right to sell country liquor for Mandi Dabwali for the year 1969 70 at the Collectorate.
At the commencement of the auction, the Deputy Excise & Taxation Commissioner had read out the auction announcements and conditions of auction as required under r. 36(4) of the Punjab Liquor Licence Rules, 1956 ( 'Rules ' for short).
The respondents Messrs Lal Chand Bal Raj etc. offered the highest bill of Rs. 10,11,000 and their bid was provisionally accepted by the Deputy Excise & Taxation Commissioner and they were declared to be the highest bidder as required under r. 36(22) of the Rules.
Subsequently, the bid was accepted by the Excise & Taxation Commissioner exercising the powers of the Financial Commissioner on March 21, 1969 as required under r. 36(22) of the Rules.
The respondents however failed to deposit Rs. 50,550 as security amount as required under r. 36(22A) and thereby contravened condition No. 15(i) of the conditions of auction and r. 36(23) of the Rules.
They were accordingly served with a notice dated April 9, 1969 by the Deputy Excise & Taxation Commissioner requiring them to show cause why the licence for country liquor vend, Mandi Dabwali should not be put to re auction under r. 36(23A) of the Rules and the deficiency in price and all expenses of such re auction recovered from them in the manner laid down in section 60 of the Punjab Excise Act, 1914.
in response to the same, the respondents by their letter dated April 12, 1969 tried to wriggle out of their contractual obligations by saying that before the auction it was announced that no wine shop shall be opened within a radius of three miles of liquor vend, Mandi Dabwali, but across the border the State Government of Punjab had sanctioned the establishment of a Iiquor shop at village Killianwali which was hardly 2 1/2 miles from the State border and this would mean that there would be two country liquor shops one at Mandi Dabwali in the State of Haryana and the other at village Killianwali in the State of Punjab and this was in breach of condition No. 13(iii) read with r. 37(8B) of the Rules, as applicable to the State of Haryana.
Upon this basis, the respondents represented that before requiring them to deposit the security amount, they should be given an assurance that no other liquor shop would be opened.
Although in the show cause notice, the respondents were intimated that in case they desired to be heard in person, they should appear before the Deputy Excise & Taxation Commissioner at Chandigrah on April 14, 1969, but none of them turned up on 720 that date.
On the same day, the Deputy Excise & Taxation Commissioner rejected the representation of the respondents and directed re sale of the licence for retail vend of the country liquor shop at Mandi Dabwali for the year 1969 70 under r. 36(23) of the Rules.
The respondents have purposely kept back the reply that they received from the Deputy Excise & Taxation commissioner conveying the rejection of their representation which intimated to them that the licence for retail vend of country liquor shop at Mandi Dabwali would be re auctioned on April 23, 1969 at the Collectorate, Hissar.
By his letter dated April 15, 1969 addressed to all the Excise & Taxation Officers in the State, the Deputy Excise & Taxation commissioner forwarded the notice of re auction asking them to give wide publicity to the notice alongwith the announcements to be made at the time of re auction.
Copies of the circular letter and the notice of re auction were sent not only to the commissioner, Ambala and all the Deputy Commissioners in the State but also to the Chief Secretaries and the Excise Commissioners of different States and they were also requested to give wide publicity in their States regarding the re auction of the licence.
At the time of re auction held on April 23, 1969, there were as many as 52 bidders and ultimately the liquor vend, Mandi Dabwali was re sold at the highest bid of Rs. 6,65,000 for the remaining part of the financial year.
On May 8, 1969, the respondents were served with a notice of demand of Rs. 3,46,000 representing the loss on re sale.
The High Court by the judgement under appeal, quashed the notice of demand following the decision in Kanhiya Lal Bhatia & Co. vs State of Haryana & Ors.
The High Court following its decision in Kanhiya Lall 's case, supra, held that the State Government had no authority to demand the amounts for failure of which the vends were put to re auction on the ground that the licence fee levied was in the nature of excise duty.
Recently, this Court has in State of Haryana vs Jage Ram & Ors. reversed the decision of the High Court in Kanhiya Lal 's case, supra, and held that the amounts which the State Government had changed to the respondents were neither in the nature of a tax nor in the nature of an excise duty but were in the nature of a price which the State Government were entitled to charge as consideration for parting with its privilege in favour of the licensees.
That being so, the appeals must succeed on this short ground alone.
Normally, this would have entailed remitting the writ petitions to the High Court for a decision on merits but looking 721 to the fact that the demands raised were for the financial year 1969 70, we felt that no useful purpose would be served in remitting the matter to the High Court and heard the parties on merits.
Apart from the question of validity of the charge which is common to both the appeals, the questions raised in the two appeals are distinct and separate and they will have to be dealt with separately.
It is convenient at this stage to set out the relevant statutory provisions.
s.27 of the Punjab Excise Act, 1914 empowers the State Government to 'lease ' no such conditions and for such period as it may deem fit the right of selling by whole sale or retail any country liquor or intoxicating drug within any specified local area.
On said lease being granted the Collector, under sub s.(2) thereof, has to grant to the lessee a licence in the from of a lease.
S.34 of the Act provides inter alia that (1) Every licence granted under the Act shall be subject to payment of such fees, if any, as the Financial Commissioner may direct; and (2) The authority granting such licence may require the licensee to give such security for the observance of the terms of his licence, or to make such deposits by way of security as he may think fit.
s.58(1) of the Act confers power on the State Government, by notification, to make rules for the purpose of carrying out the provisions of the Act.
In particular and without prejudice to the generality of section 58(1), sub section
(2) thereof provides that the State Government may make rules with respect to matters enumerated therein.
Under cl.(f) the State Government may make rules regulating the manner of holding auctions of liquor shops.
S.59 provides that the Financial Commissioner may, by notification, make rules by cl.
(a) to regulate the manufacture, supply, storage or sale of any intoxicant, cl.(d) prescribing the scale of fees or the manner of fixing fees payable in respect of any such licence and by cl.(f) prescribing the authority by, the restrictions under, and the conditions on which, any licence may be granted.
The licences, in a large measure, owe their existence to the rules framed by the Financial Commissioner under S.59.
S.60 of the Act, insofar as material, reads: "60 (1) Recovery of dues The following moneys namely: (a) all excise revenue; (b) * * * * * * *. 722 (c) all amounts due to the Government by any person on account of any contract relating to the excise revenue; may be recovered from the person primarily liable to pay the same, or from his surety (if any), by distress and sale of his moveable property or by any other process for the recovery of arrears of land revenue due from land holders or from farmers of land or their sureties.
" The Punjab Liquor Licence Rules, 1956 framed by the Financial Commissioner in exercise of his powers under s.59 of the Act make detailed provisions regulating the manner in which a licence for the retail vend of country liquor shall be granted by public auction, and the conditions to which it shall be subject.
R.36(22A) of the Rule provides that a person to whom a country liquor shop has been sold shall deposit by way of security an amount equivalent to one twenty fourth of the amount of licence fee determined under r.36(16) within a period of seven days of the date of auction.
R.36(23)(2) provides that a person to whom country liquor shop is sold shall pay the amount of licence fee so calculated in 22 equal installments, each installment being payable on tho 10th and 26th of each month starting from the month of April.
In the event of failure to pay the instalment by the due date, his licence may be cancelled.
R.36(23A) interdicts that any person whose bid has been accepted at the auction fails to make the deposit of the amount of security equivalent to one twenty fourth of the total licence fee as required under r.36(22A), the Collector may resell the licence by public auction and deficiency in licence fee and all expenses for such resale shall be recoverable from the defaulting bidder in the manner laid down in s.60 of the Punjab Excise Act, 1914.
In Har Shanker & Ors.
vs The Deputy Excise & Taxation Commissioner & Ors., this Court held that the writ jurisdiction of the High Courts under Art.226 was not intended to facilitate avoidance of obligations voluntarily incurred.
It was observed that one of the important purpose of selling the exclusive right to vend liquor in wholesale or retail is to raise revenue.
The licence fee was a price for acquiring such privilege.
One who makes a bid for the grant of such privilege with a full knowledge of the terms and conditions attaching to the auction cannot be permitted to wriggle 723 out of the contractual obligations arising out of the acceptance of his bid.
Chandrachud, J. (as he then was interpreting the provisions of the Punjab Excise Act, 1914 aud of the Punjab Liquor Licence A Rules, 1956 and speaking for the Court, said: "The announcement of conditions governing the auction were in the nature of an invitation to an offer to .
those who were interested in the sale of country liquor.
The bids given in the auctions were offers made by the prospective vendors to the Government.
The Government 's acceptance of those bids was the acceptance of willing offers made to it.
On such acceptance, the contract between the bidders and the Government became concluded and a a binding agreement came into existence between them.
The powers of the Financial Commissioner to grant liquor licence by auction and to collect licence fees through the medium of auctions cannot by writ petitions be questioned , by those who, had their venture succeeded, would have relied upon those very powers to found a legal claim.
Reciprocal right and obligations arising out of contract do not depend for their enforceability upon whether a contracting party finds it prudent to abide by the terms of the contract.
By such a test no contract could ever have a binding force.
" To the same effect are the decisions of this Court in State of Haryana & Ors.
vs Jage Ram & Ors. and the State of Punjab vs M/s Dial Chand Gian Chand & Co. laying down that persons who offer their bids at an auction to vend country liquor with full knowledge of the terms and conditions attaching thereto, cannot be permitted to wriggle out of the contractual obligations arising out of and acceptance of their bids by a petition under article 226 of the Constitution.
The observations in Har Shankars case, supra, did not touch upon the question whether such a contract must be in compliance with article 299 (1) of the Constitution.
The question whether the process of licensing by public auction of liquor vend involves a contract at all or is merely the grant of a privilege and the bidding at a public auction is with a view merely to fix the price for the purchase of the privilege, has been engaging the 724 attention of the High Courts for quite some time.
In Smt.
Nanhibai vs The Exercise Commissioner, M. P. & Ors.
the Madhya Pradesh High Court held that the State Government has the exclusive privilege of manufacturing, selling and possessing intoxicants which it has power to lease for consideration under section 18 of the M.P. Excise Act, 1915 and that every auction of excise contract for sale of intoxicants is a leasing of the Government 's right of selling intoxicants.
P.V. Dixit, C.J. speaking for the Court made following observations on this point which are pertinent : "The principle that the State Government has exclusive right of manufacturing, selling or possessing intoxicants or , any country liquor intoxicating drug runs through sections 13 to 18 of the Act.
The important condition that must be satisfied before any licence can be granted to a person for manufacture or sale by any country liquor intoxicating drug is that the person must first obtain the privilege or the right of manufacturing or selling the intoxicating drug.
In every auction sale of a liquor shop at which liquor is sold in wholesale, or retail, there is a sale of the lease of the Government 's right of selling country liquor intoxicating drug.
On the acceptance of a bid of a person at an auction sale, contract for the demise of the Government 's interest is brought into existence and this is 'followed by the grant of a licence to the person whose bid has been accepted.
" These observations of the learned Chief Justice have since been approved of by a Full Bench of the High Court in Ram Rattan Gupta vs State of M.P.
The other two cases on the point which we must notice are: Ajodhya Prasad Shaw & Anr.
vs State of Orissa & Ors.
and M/s Shree Krishna Gyanoday Sugar Ltd. & Anr.
vs State of Bihar & , Anr. 725 In Ajodhya Prasad Shaw 's case, the Orissa High Court and in M/s. Shree Krishna Gyanoday 's case, the Patna High Court interpreting like provisions of the Bihar & Orissa Excise Act, 1915 held that where the State Government in exercise of its powers under section 22 of that Act grants exclusive privilege to any person on certain conditions under section 22 (1) and a licence is received by that person under section 22 (2), it cannot be contended that it amounts to a contract made in exercise of the executive power of the State within the meaning of article 299 (1) of the Constitution.
R.N. Misra, J. speaking for the Court in Ajodhya Prasad Shaw 's case tried to highlight the problem in these words: "Law is well settled and parties before us do not seek to canvass that this constitutional requirement is not mandatory.
In the field it covers it is a prerequisite to bring into existence a valid contract.
The question for examination in the present case is, however, different.
Is there a contract at all and in case it involves a contract is it one purported to be made in exercise of the executive power of the State Government is the question for examination" The learned Judge went on to say: "In case the result of our investigation is that it is not a contract in exercise of the executive power of the State in terms of the language used in the Article, it would follow that this constitutional requirement has no application.
I have already indicated that the settlement of the shop, the collection of the fee and the grant of the licence are all statutory acts by the prescribed authority.
The intention of the Constitution is not to extend the principles in article 299 (1) to cover all possible contracts.
This is why specific reference has been made to contracts "in exercise of the executive power".
It is not necessary for the present purpose to examine whether the licensing process involves a contractual agreement.
Possibly there is an element of contract in the settlement, but certainly it is not one entered into in the executive power of the State but is regulated by the statute or the rules made thereunder.
In the circumstances in the case.
Of a statutory licence even based upon a contract the requirements of this Article can not be invoked.
" 726 In M/s. Shree Krishna 's case, supra, N.P. Singh, J. speaking for the Court rightly observed that when the State Government in exercise of its powers under section 22 of the Act grants the exclusive privilege of manufacturing, or supplying or selling any intoxicant like liquor to an person on certain condition, there comes into existence a contract made in exercise of its statutory powers and such a contract does not amount to a contract made by the State in exercise of the executive powers.
There is a distinction between contracts which are executed in exercise of the executive powers and contracts which are statutory in nature.
Under article 299(1), three conditions have to be satisfied before a binding contract by the Union or the State in Exercise of the executive power comes into existence :(1) The contract must be expressed to be made by the President or the Governor, as the case may be.
(2) It must be executed in writing.
And (3) The execution thereof should be by such person and in such manner as the President or the Governor may direct or authorize.
There can be no doubt that a contract which has to be executed in accordance with Act.
299(1) is nullified and becomes void if the contract is not executed in conformity with provisions of article 299(1) and there is no question of estoppel or ratification in such cases.
Nor can there be any implied contract between the Government and another person: K.P. Choudhary vs State of M.P., Mulamchand vs State of M.P., State of M.P. vs Ratfan Lal and State of M.P. vs Firm Gobardhan Dass Kailash Nath.
It is well settled that article 289(1) applies to a contract made in exercise of the executive power of the Union or the State, but not to a contract made in exercise of statutory power, article 299(1) has no application to a case where a particular statutory authority as distinguished from the Union or the States enters into a contract which is statutory in nature.
Such a contract, even though it is for securing the interests of the Union or the States, is not a contract which has been entered into lay or of behalf of the Union or the State in exercise of its executive powers.
In respect of forest contracts which are dealt with by this Court in K.P. Choudhary 's, Mulamchand 's, Rattan Lal 's and Firm Gobardhan Dass 's cases, supra, 727 there are provisions in the and the Forest Contract Rules framed thereunder for entering into a formal deed between the forest contractor and the State Government to be executed and expressed in the name of the Governor in conformity with the requirements of Act.
299(1), whereas under the Punjab Excise Act, 1914; like some other State Excise Acts, once the bid offered by a person at an auction sale is accepted by the authority competent, a completed contract comes into existence and all that is required is the grant of a licence to the person whose bid has been accepted.
It is settled law that contracts made in exercise of statutory powers are not covered by article 299(1) and once this distinction is kept in view, it will be manifest that the principles laid down in K.P. Chowdhary ' Mulamchand 's, Rattan Lal 's and Firm Gobardhan Dass 's cases are not applicable to a statutory contract.
In such a case, the Collector acting as the Deputy Excise & Taxation Commissioner conducting the auction under r. 36(22) and the Excise Commissioner exercising the functions of the Financial Commissioner accepting the bid under r. 36(22A) although they undoubtedly act for and on behalf or the State Government for raising public revenue, they have the requisite authority to do so under the Act and the rules framed thereunder and therefore such a contract which comes into being on acceptance of the bid, is a statutory contract failing outside the purview of article 299(1) of the Constitution.
We are clearly of the opinion that in the case of a Statutory contract like the one under the Excise Act, the requirements of article 299(1) cannot be invoked.
In A. Damodaran & Anr.
vs State of Kerala & Ors, the Court interpreting s.28 of the Kerala Abkari Act, 1967 which was in pari materia with s.60 of the Punjab Excise Act, 1914 held that even if no formal deed had been executed as required under article 299(1), still the liability for payment of the balance of the licence amount due could be enforced by taking recourse to s.28 of the Act.
The Kerala High Court rejected the contention of the appellants by holding that the liability to satisfy the dues arising out.
Of a bid was enforceable under s.28 quite apart from any contractual liability and this view was upheld by this Court on the ground that the word 'grantee ' in s.28 has a wide connotation to mean a person who had been granted the privilege by acceptance of his bid.
It was further held that the statutory duties and liabili 728 ties arising on acceptance of the laid at a public auction of a liquor contract may be enforced in accordance with the statutory provisions and that it was not condition precedent for the recovery of an amount due under s.28 of the Act, that the amount due and recoverable should be under a formally drawn up and executed contract.
This is in recognition of the principle that the provisions of Art.299(1) of the Constitution are not attracted to the grant of such a privilege to vend liquor under the Act.
In Kishori Lal Minocha 's case, supra, there was reauction of a liquor vend on the highest bidder 's failure to deposit one sixth of the bid amount as security deposit and the question was whether the State was entitled to recovery in a suit the deficiency on reauction.
The decision in Minocha 's case is clearly distinguishable for two reasons: first, there was nothing to show that the bid had been accepted by the Excise Commissioner under r. 359(2) of the U.P. Excise Manual.
Further, r. 357 under which the excise authorities put the vend to reauction had not been published in the official gazette as required by s.77 of the U.P. Excise Act, 1910 and thus had no statutory force.
No such question arises in these cases as the liability that is sought to be enforced against the respondents by the impugned notices of demand is a statutory liability in terms of condition 15(1) of the conditions of auction read with r.36(23) of the Rules and the amount is recoverable from them in the manner laid down in s.60 of the Act.
The short question that falls for determination in these appeals is whether the State Government was entitled to realise the difference which the respondents had agreed to pay under the terms of auction of a liquor vend and the amount realised on reauction of the vend, as also the defaulted instalment of the licence fee payable in respect of a liquor vend.
The first of these questions arises in Civil Appeal No.154(N) of 1971 while the second in Civil Appeal No. 155(N) of 1971.
We will deal with them in that order.
Civil Appeal No. 154 (N) of 1971 There is no substance in the contention that the respondent were not served with a notice under r.36(3) of the Rules.
The date of reauction was fixed by the Excise & Taxation Commissioner under r.36(2).
On April 14, 1969, the Deputy Excise & Taxation Commissioner rejected the representation made by the respondents and directed resale of the licence for retail vend of country liquor shop, 729 Mandi Dabwali for the year 1969 70.
It is accepted before us that the Deputy Excise & Taxation Commissioner had conveyed to the respondents that their representation had been rejected and that the Iicence for retail vend for Mandi Dabwali shop would be reauctioned on April 23, 1969, at the Collectorate, Hissar.
The respondents have withheld the document and an adverse inference "must necessarily be drawn against them.
It is quite obvious that the respondents were duly given notice of re auction as under r.36(3).
It is evident from the return filed by the State Government that copies of circular letter dated April 15, 1969 by the Deputy Excise & Taxation Commissioner and the notice of re auction, of even date issued by him were vent not only to the Commissioner, Ambala but to all the Deputy Commissioners as well as to all the Excise & Taxation officers in the State but also to the Chief Secretaries and the Excise Commissioner of different State.
From this, it is quite apparent that wide publicity was given throughout the State of Haryana as well as in other State regarding the date and place of re auction as enjoined by r.36(3) of the Rules.
As already stated, there were as many as 52 bidders present at the time of re auction.
The decision in Jage Ram 's case supra is clearly distinguishable on facts.
There, the Court on a consideration of the material on record found that there was nos substantial compliance either in the letter or in spirit with the requirements of r.36(3) of the Rules.
Since the re auction in that case did not conform to the rules, the Court held that the defeating bidders could not be held liable to make good the difference between the amount which was payable by them and the amount which was fetched at the re auction.
The principle laid down in Jage Ram 's case, supra is clearly not attracted in the facts and circumstances of the present case.
The first contention regarding the invalidity of reauction held on April 23, 1969 based on r.36(3) of the Rules must therefore fail.
Equally futile is the contention that the respondents had withdrawn their bid and therefore they could not be mulcted for the difference between the amount which they were liable to pay and the amount realized by re sale of the vend.
This is not a case of the type reported in Union of India & ors.
vs M/S. Bhim Sen Walati Ram which laid down the well settled principle that an offer can always be withdrawn before it is finally accepted and that a conditional acceptance is not an acceptance in law.
In Bhim Sen Walati 730 Ram 's case, supra, the Court held that the contract of sale was not complete till the bid was confirmed by the Chief Commissioner and till such confirmation the person whose bid had been provisionally accepted was entitled to withdraw his bid and that when the bid was withdrawn before the confirmation of the Chief Commissioner, the bidder was not liable for damages on account of any breach of contact or for the shortfall on the re sale: It was observed: "It is not disputed that the Chief Commissioner has disapproved the bid offered by the respondent.
If the Chief Commissioner had granted sanction under 'cl.33 of exhibit D 23 the auction sale in favour of the respondent would have been a completed transaction and he would have been liable for any shortfall on the resale.
As the essential pre requisites of a completed sale are missing in this case there is no liability imposed on the respondent for payment of the deficiency in the price.
" It is urged on the strength of these observations that the respondents were entitled to withdraw their bid by declining to make the security deposit.
The contention cannot be accepted.
For onething, this was not a case where there was mere conditional acceptance of the highest bid of the respondents by the Deputy Excise & Taxation Commissioner at the time of the auction on March 1, 1969, but their kid was also accepted by the Excise & Taxation Commissioner on March 21, 1969 as required under r. 36(22A).
The respondents could not.
unilaterally by their letter dated April 12, 1969 rescind the contract on the pretext that the State Government of Punjab hail opened 2 new Iiquor shop at village Killianwali across the State border which was contrary to condition No. 13(iii) of the conditions of auction read with r. 37(8B) of the Rules.
Even though this may have been in breach of the inter State agreement between the State Governments of Punjab and Haryana, the opening of such a liquor vend by the State Government of Punjab at village Killianwali could not justify the respondents in not making the security deposit of Rs. 50,550.
It appears from the return filed by the State Government that although condition No. 13(iii) had been read out before the auction began as required under r. 36(4), there was no mention that there was an inter State agreement between the two State Governments and that 731 it was a condition of sale that the State Government of Punjab would not open a liquor vend within a radius of three miles from the State border.
Nor would this amount to a breach of the conditions on the part of the State Government of Haryana or furnish a ground absolving the respondents of their liability to pay the shortfall.
The second contention that the respondents had withdrawn their bid and were therefore not liable for the loss of re auction of liquor vend at Mandi Dabwali cannot be sustained.
In Har Shanker 's case, supra, this Court held that the writ jurisdiction of the High Courts under article 226 was not intended to facilitate avoidance of obligations voluntarily incurred.
It was observed that one of the important purposes of selling the exclusive ar right to vend liquor in wholesale or retail is to raise revenue.
The licence fee was a price for acquiring such privilege.
One who makes a bid for the grant of such privilege with full knowledge.
Of the terms and conditions attaching to the auction cannot be permitted to wriggle out of the contractual obligations arising out of the acceptance of his bid.
In dealing with the question, Chandrachud, J. said: . "The powers of the Financial Commissioner to grant liquor licences by auction and to collect licence fees through the medium of auctions cannot by writ petitions be questioned by those who held their venture succeeded, would have relied upon those very powers to found a legal claim.
Reciprocal rights and obligations arising out of contract do not depend for their enforceability upon whether a contracting party finds it prudent to abide by the terms of the contract.
By such a test no contract could even have a binding force.
" To the same effect are the decisions of this Court in State of Haryana & Ors.
vs Jage Ram & Ors. and the State of Punjab vs M/s Dial Chand & Gian Chand & Co. laying down that persons who offer their bids at an auction to vend country liquor with full knowledge of the terms and conditions attaching thereto, cannot be permitted to wriggle out of the contractual obligations arising out of the acceptance of their bids by a petition under article 226 of the Constitution.
732 Civil Appeal No. 155 (N) of 1971 At an auction for the licence of retail vend for Butana in the Rohtak district for the financial year 1968 69 held by the Deputy Excise & Taxation Commissioner on March 11, 1968 at the Collectorate, Rohtak, the respondents Messrs Ram Kishan Pritiam Singh & Co. Offered the highest bid of Rs. 1,40,000.
The Deputy Excise & Taxation Commissioner accepted their bid at the conclusion on the auction.
On the same day, the respondents deposited Rs. 5,811 equivalent to one twentieth of the licence fee representing the security amount and started operating the said licence w.e.f. April 1 1968.
It appears that they drew their supplies by making applications to the a Excise & Taxation Officer, Rohtak for the issuance of challans for deposits of still held duty in the treasury, and after crediting into the treasury a sum equivalent to the excise duty payable on the strength of permits issued by him.
Admittedly, the respondents worked the contract throughout the period without making any payment of Rs. 1,40,000 towards the licence fee which was payable in 23 fortnightly instalments.
The respondents on being served with a notice of demand for payment of Rs. 13,000 representing the first of such fortnightly installments filed a writ petition in the High Court and the High Court following its decision in Kanhiya Lal 's case, supra, struck down the notice of demand.
It is accepted at the bar that the respondents have not paid anything towards the licence fee of Rs. 1,40,000 due and payable by them.
Upon these facts, the Excise & Taxation Commissioner would have been justified in cancelling the licence in terms of r.36(23)(2) of the Rules which is in these terms : "A person to whom a country spirit shop is sold shall pay the annual licence fee in 23 equal instalments, each instalment being payable on the 10th and 26th of each month starting from the month of April.
In the event of failure to pay the instalment by the due date, his licence may be cancelled.
" There was a fundamental breach of an essential condition by the respondents.
In a commercial contract of this nature, for the performance of which a definite time has been fixed and the contract specifies the mode of payment i.e. specifies the dates on which The installments of the licence fee are to be paid, time is of the essence 733 of the contract.
R.36(23)(1) of the Rules specifically makes time of the essence.
It therefore follows that payment to the instalments on the due dates was a condition pre requisite to the performance of the contract, and that the failure of the respondents to make such payments relieved the State Government of their obligations.
The Excise & Taxation Commissioner would therefore have been justified if he had cancelled the licence under r. 36(23) and put the liquor vend to reauction for the remaining period of the financial year.
Instead of taking this drastic step of cancellation of contract, the Deputy Excise & Taxation Commissioner served the respondents with the impugned notice of demand for payment of the first fortnightly instalment of Rs. 13,000.
The respondents were bound to pay the defaulted instalment on the due date but without complying with the notice of demand moved the High Court under article 226 of the Constitution challenging the demand on the ground that the licence fee partakes of the nature on an excise duty.
As already stated, the High Court following its decision in Kanhiya Lal 's case struck down the notice of demand.
The result has been that the respondents enjoyed the privilege of retail vend of country liquor, Butana for the entire period without payments of any licence fee.
On merits, learned counsel appearing for the respondents had nothing to urge against the impugned notice of demand.
The result therefore is that the appeals succeed and arc allowed with costs throughout.
The judgment and, orders of the High Court dated November 11, 1969 quashing the impugned notice of demand served on the respondents are set aside and the writ petitions filed by the respondents are dismissed.
N.V.K. Appeals allowed.
| In exercise of the powers conferred by Section 36 of the Maharashtra Secondary and Higher Secondary Boards Act, 1965, the State Board has framed the Maharashtra Secondary and Higher Secondary Education Boards ' Regulations 1977.
These regulations were sanctioned by the State Government under sub section 3 of section 36 on 11th July, 1977 and came into force on 15th June, 1977.
These regulations were applied to the Secondary School Certificate examination and Higher Secondary Certificate examination held in October, 1977 and thereafter Regulation 104 refers to verification of marks obtained by a candidate in a subject.
Clause (1) thereof restricts verification to checking whether all the answers have been examined and that there has been no mistake in the totalling of marks for each question in that subject and transferring marks correctly on the first cover page of the answer book and whether the supplements attached to the answer book mentioned by the candidate are in tact.
Clause (1) also speaks of revaluation and prohibits revaluation of the answer books or supplements.
Clause (3) of the said regulation also speaks of right to claim revaluation by an examinee and is to the effect: "no candidate shall claim, or be entitled to revaluation of his answer or disclosure or inspection of the answer books or other documents as these are treated by the Divisional Board as most confidential.
A number of unsuccessful and disappointed candidates who had 30 appeared for the Higher Secondary Certificate and Secondary School Certificate public examinations conducted by the Divisional Boards functioning under the supervision and control of the Maharashtra State Board of Secondary and Higher Secondary Education filed a batch of 39 Writ Petitions in the High Court of Bombay challenging the validity of Clauses (1) and (3) of regulation 104 of the Maharashtra Secondary and Higher Secondary Education Boards Regulations 1977 and seeking the issuance of writs directing the Board to allow them disclosure and inspection of their answer books in the public examination, the results whereof had already been published and to conduct a revaluation of such of the answer papers as the petitioners may demand after the inspection.
The writ petitioners had based their challenges against the validity of clauses (1) and (3) of Regulation 104 on three main grounds: (1) The Impugned clauses were violative of the principles of natural justice; (2) Both clauses (1) and (3) were ultra vires and void on the ground of their being in excess of the regulation making, powers conferred on the Board by Section 36 of the Act; and (3) The impugned provisions contained in clauses (1) and (3) were highly unreasonable and since the regulations framed by the Board are in the nature of bye laws.
they are liable to be struck down on the ground of unreasonableness The High Court divided the Writ Petitions into two groups; the first group consisting of cases where the right of inspection alone was claimed and second group comprising of cases where the petitioners had claimed also a further right to demand a revaluation of the answer papers.
The High Court allowed the petitions by two separate judgments one in respect of the first group holding that clause (3) of regulation 104 which lays down that no candidate shall be entitled to disclosure or inspection of the answer books or other documents as these are to be treated as most confidential is ultra vires on the ground of its being in excess of the regulation making power of the Board and by another judgment in the second group holding that the provisions contained in clause (1) of regulation 104 that no revaluation of the answer books or supplements shall be done is ultra vires the regulation making power conferred by section 36 and is also illegal and void on the ground of its being manifestly unreasonable.
Aggrieved by these judgments rendered in the two groups of cases the appellant Board preferred these appeals after obtaining Special Leave of the Court.
Allowing the appeals, the Court ^ HELD: 1:1.
Regulation 104(3) of the Maharashtra Secondary and 31 Higher Secondary Board Regulations 1977 is valid.
The process of evaluation of answer papers or subsequent verification of marks under clause (3) of regulation 104 does not attract the principles of natural justice since no decision making process which brings about adverse civil consequences to the examinees is involved.
Non disclosure or disallowance of the right of inspection of the answer books as well as denial of the right to ask for a revaluation to examinees who are dissatisfied with the results do not visit them with adverse civil consequences.
There is no substance in the contention that every adverse verification involves a condemnation of the examination behind their back and hence.
constitutes a clear violation of principles of natural justice.[62E, 41D E, F G] 1:2.
The principles of natural justice cannot be extended beyond reasonable and rational limits and cannot be carried into such absurd lengths as to make it necessary that candidates who have taken a public examination should be allowed to participate in the process of evaluation of their performances or to verify the correctness of the evaluation made by the examiners by themselves conducting an inspection of the answer books and determining whether there has been a proper and fair valuation of the answers by the examiners.
[41H; 42A] Union of India vs M.L. Kapur, ; ; referred to.
The question whether a particular piece of delegated legislation whether a rule or regulation or other type of statutory instrument is in excess of the power of subordinate legislation conferred on the delegate has to be determined with reference only to the specific provisions contained in the relevant statute conferring the power to make the rule, regulation etc.
and also the object and purpose of the Act as can be gathered from the various provisions of the enactment.
[43 A B] 2:2.
The Court cannot substitute its own opinion for that of the legislature or its delegate as to what principle or policy would best serve the object and purposes of the Act and it cannot sit in judgment over the wisdom and effectiveness or otherwise of the policy laid down by the regulation making body and declare a regulation to be ultra vires merely on the ground that, in the view of the Court the impugned provisions will not help to serve the object and purpose of the Act.
So long as the body entrusted with the task of framing the rules or regulations acts within the scope of the authority conferred on it, in the sense that the rules or regulations made by it have a rational nexus with the object and purpose of the statute, the Court should not concern itself with the wisdom or efficatiousness of such rules or regulations.
It is exclusively within the province of the legislature and its delegate to determine as a matter of policy, how the provisions of the statute can best be implemented and what measures, 32 substantive as well as procedural would have to be incorporated in the rules or regulations for the efficacious achievement of the objects and purposes of the Act.
It is not for the Court to examine the merits or demerits of such a policy because its scrutiny has to be limited to the question as to whether the impugned regulations fall within the scope of the regulation making power conferred on the delegate by the statute.
[43 C F] 3:1.
The view taken by the High Court that clause (3) of the regulation 104 is ultra vires on the ground of its being in excess of the regulation making power conferred on the Board is not correct.
[45 B] 3.2.
Any drawbacks in the policy incorporated in a rule or regulation will not render it ultra vires and the Court cannot strike it down on the ground, that, in its opinion, it is not a wise or prudent, but is even a foolish one, and that it will not really serve to effectuate the purposes of the Act.
The legislature and its delegates are the sole repositories of the power to decide what policy should be pursued in relation to matters covered by the Act and there is no scope for interference by the Court unless the particular provision impugned before it can be said to suffer from any legal infirmity, in the sense of its being wholly beyond the scope of the regulation making power or its being inconsistent with any of the provisions of the parent enactment or in violation of any of the limitations imposed by the Constitution.
None of these vitiating factors are shown to exist in the present case.
[46E F] 3:3.
The provisions of sections 19 and 36 of the Act make it clear that a duty is cast on the State Board to formulate its policy as to how the examinations are to be conducted, how the valuation of the performances of the candidates is to be made and by what procedure there results are to be finalised, compiled and released it is perfectly within the competence of the Board, rather, it was its plain duty, to apply its mind and decide as a matter of policy relating to the conduct of the examination as to whether disclosure and inspection of the answer books should be allowed to the candidates, whether and to what extent verification of the result should be permitted after the results have been announced and whether any right to claim revaluation of the answer book should be recognised or provided for.
All these are undoubtedly matters which have an intimate nexus with the objects and purposes of the enactment and are, therefore, within the ambit of the general power to make regulations conferred by sub section 1 of section 36, and also within the scope of clauses (c), (f) and (g) of sub section 2 of the said section.
[44F H, 45 A B] 4:1.
Clause (3) or Regulation 104 is not in the nature of a bye law and it is not an unreasonable provision.
[46 H] 33 4:2.
While the power to make regulations for the purpose of carrying into effect the provisions of the Act, is conferred on the Board by section 36, section 38 confers a distinct power of making bye laws.
The legislature, while enacting sections 36 and 38 must be assumed to have been fully aware of the niceties of the legal position governing the distinction between rules/regulations properly so called and bye laws.
When the statute contains a clear indication that the distinct regulation making power conferred under section 36 was not intended as a power merely to frame byelaws, it is not open to the Court to ignore the same and treat the regulations made under section 36 as mere bye laws in order to bring them within the scope of justifiability by applying the test of reasonableness.
[47 E G] 4.3.
Regulations made by the Board under section 36 are in the nature of statutory rules and they have the full rigour and force of sub ordinate legislation made by a delegate duly empowered in that behalf by the legislature.
[49 D E] Sophy Kelly vs The State, 69 Bombay, L.R. 186 overruled.
The provisions contained in a statutory enactment or in rules/regulations framed thereunder have to be so construed as to be in harmony with each other and where under a specific section or rule a particular subject has received special treatment, such special provision will exclude the applicability of any general provision which might otherwise cover the said topic.
[52 B C] 5.2.
Regulation 102(2), if properly construed in the setting in which it occurs only confers a suo motu power on the Divisional Board to amend the result of the examination in respect of any candidate or candidates on its being found that such result has been affected by error, malpractice, fraud, improper conduct, etc.
The error referred to in the said provision has the context to be understood as being limited to an error rising in consequence of malpractice, fraud, improper conduct or other similar matter of whatsoever nature.
Clauses (1) and (3) of regulation 104 must be read together and not in isolation.
Clause (3) of regulation 104 contains is fact a mandate to the Divisional Boards to treat the answer books and documents as confidential and lays down that no candidate shall be entitled to claim disclosure or inspection of the said confidential books and documents.
Therefore, the High Court ought not to have invoked the doctrine of implied power and obligation, in the instant case, for the purpose of holding that because the right of verification has been conferred in clause (1) of regulation 104, there is an implied power in the examinees to demand disclosure and inspection and a corresponding implied obligation on the part of the Board to cause such a demand.
[52 C D, H; 53 A; C D] 34 5:3.
Unless it can be said that a bye law is manifestly unjust, capricious, inequitable or partial in i s operation, even a bye law cannot be struck down by a Court on the ground of unreasonableness merely because the Court thinks that it goes further than is necessary or that it does not incorporate certain provisions which, in the opinion of the Court, would have been fair and wholesome.
The responsible representative body entrusted with the power to make bye laws must ordinarily be presumed to know what is necessary, reasonable, just and fair.
The Court should be extremely reluctant to substitute its opinions and views as what is wise, prudent and proper in relation to academic matters in preference to those formulated by professional men possessing technical expertise and rich experience of actual day to day working of educational institutions and the departments controlling them.
The Court cannot make a pedantic and purely idealistic approach to the problems of this nature, isolated from the actual realities and grass root problems involved in the working of the system and unmindful of the consequences which would emanate, if a purely idealistic view as opposed to a pragmatic one were to be propounded The Court should also, as far as possible, avoid any decision or interpretation of a statutory provision, rule or bye law which would bring about the result of rendering the system unworkable in practice.
[53 F H; 55 A] Trustees of the Port of Madras vs Aminchand Pyarelal and ors. ; referred to.
Kruse vs Johnson [1898] 2 Q.B. and Slattery vs Naylor [1888] 3 A.C. 446 quoted with approval.
What constitutes fair play depends upon the facts and circumstances relating to each particular given situation.
If it is found that every possible precaution has been taken and all necessary safeguards provided to ensure that the answer books inclusive of supplements are kept in safe custody so as to eliminate the danger of their being tampered with and that the evaluation is done by the examiners by applying uniform standards with checks and cross checks at different stages and that measures for detection of malpractice, etc. have also been effectively adopted, in such cases, it will not be correct on the part of the Courts to strike down the provisions prohibiting revaluation on the ground that it violates the rules of fair play.
Further, the candidates have taken the examination with full awareness of the provisions contained in the regulations and in the declarations made by them in the form of application for admission to the examination they have solemnly stated that they fully agree to abide by the regulations issued by the Board.
[59 A C; 60 F G] 6:2.
That the University of Bombay and some other Universities have 35 made provisions permitting candidates to demand revaluation, has little relevance for the purpose of deciding about the legal validity of the impugned regulations framed by the Board.
In the public interest, the results of public examinations published should have some finality attached to them.
If inspection, verification, in the presence of the candidates and revaluation are to be allowed as of right it may lead to gross delays and indefinite uncertainly particularly in regard to the relative ranking etc of the candidates, besides leading to utter confusion on account of the enormity of the labour and time involved in the process.
[60 H; 61 A D]
|
Civil Appeal Nos.
2170 2172 of 1972 Appeals by Special Leave from the Judgment and Order dated 22 7 1971 of the Mysore High Court in T.R.C. Nos. 3, 4 and 5 of 1967.
B. B. Ahuja and Miss A. Subhashini for the Appellant.
section T. Desai, I. N. Shroff and H. section Parihar for the Respondents.
The Judgment of the Court was delivered by UNTWALIA J.
These are three appeals by special leave filed by the Commissioner of Wealth Tax, Mysore from the Judgment of the Mysore (now Karnataka) High Court.
The assessee is the Dowger Maharani of Gondal.
Her husband, His Highness Bhojjrajji Maharaja Saheb of Gondal, died intestate on 31.7.1952 leaving considerable moveable and immoveable properties.
Certain disputes and differences arose after his death between his two sons namely Maharaja Vikramsinghji and his younger brother Shivaraj Singhji in respect of the assets left by the late Maharaja Saheb.
The younger brother was contemplating legal proceedings against his elder brother.
Their mother intervened.
The idea of litigation, thereupon, was dropped because the assessee gave a letter dated 14.5.1953 to Shivaraj Singhji stating therein: "Your father had expressed in the presence of many people that he will give you rupees fifty lakhs.
To keep up his words and promise and also that I should get peace of mind I am writing to you that if your brother Vikramsinghji Maharaja of Gondal does not give you the full amount, then you 547 must get the balance of amount from me.
That is my sincere desire.
I will also press Vikram that the should give you the amount of Rs. fifty lakhs.
Vikram Singhji paid only Rs. 20,00,000/ to Shivaraj Singhji.
The latter, therefore, claimed the balance amount of Rs. 30,00,000/ from the assessee on the basis of her letter dated 14.5.1953.
On or about 12.9.1959, pursuant to her commitment made in the letter aforesaid, the assessee transferred War Stock valued at Rs. 11,00,000/ to Shivaraj Singhji and also agreed to hand over certain ornaments in full settlement of his claim.
The ornaments were however not given.
That led to disputes between the mother and the son but eventually they were also settled on 22.2.1962 which settlement was evidenced by a document setting out all the relevant facts of the history of the dispute.
By virtue of this settlement a sum of Rs. 10,00,000/ was paid by the assessee to Shivaraj Singhji.
The assessee 's wealth was assessed to wealth tax under the Wealth Tax Act, 1957 for the three assessment years in question viz. 1960 61, 1961 62 and 1962 63.
The corresponding valuation dates of the said assessment years are 31.12.1959, 31.12.1960 and 31.12.1961.
It would be noticed that the assessee, under the arrangement arrived at between the parties, became liable to pay the balance of the amount of Rs. 30,00,000/ to Shivaraj Singhji as vikramsinghji, out of the sum of Rs. 50,00,000/ mentioned in the letter dated 14.5.1953, paid only Rs. 20,00,000/ The assessee succeeded in wiping off her liability to the extent of Rs. 11,00,000/ on 12.9.1959 by transfer of War Stock.
The balance of the liability, i.e., Rs. 19,00,000/ remained due and continued to be due on all the three valuation dates aforesaid.
It could be wiped off by a further settlement only in February, 1962.
In respect of the three assessment years in question, however, a question arose as to whether while assessing the net wealth of the assessee within the meaning of clause (m) of section 2 of the Wealth Tax Act the said sum of Rs. 19,00,000/ was to be deducted.
The Wealth tax Tribunal held in favour of the assessee.
At the instance of the Revenue for all the three years a common question of law was referred to the High Court for its opinion.
The questions being in identical terms it would suffice to quote the question with respect to the assessment year 1960 61.
It reads as follows: "Whether on the facts and circumstances of the case, the sum of Rs. 19 lakhs could constitute a debt owed by the assessee and deductible under the Wealth Tax Act from the value of the total assets as on 31.12.1959?" 548 The High Court has answered the question in the affirmative, in favour of the assessee and against the department.
Hence this appeal.
Mr. Ahuja appearing in support of the appeal contended that by the letter dated 14.5.1953 no debt was created as the undertaking given by the assessee to her son agreeing to pay the deficit in respect of Rs. 50,00,000/ on his elder brother 's failure to pay any portion of the sum was an agreement without consideration and hence under section 25 of the Contract Act it was void and was not saved by any of the exceptions mentioned therein.
He, therefore, contended that it was not an enforceable liability on any of the valuation dates and could not be deducted from the valuation of the assessee 's wealth.
In our opinion the argument is not sound.
Taking the totality of the facts as found by the Tribunal and mentioned in the impugned judgment of the High Court it was a case of family settlement or family arrangement which is binding on the parties concerned.
The assessee agreed to purchase peace for the family, and to pay to her son the amount which fell short of Rs. 50,00,000/ if her elder son did not pay any portion thereof.
It is well established that such a consideration is a good consideration which brings, about an enforceable agreement between the parties.
Section 25 of the Contract Act does not hit this.
It may be further pointed out that even if it be held that the letter dated 14.5.1953 had not the effect of bringing about the family arrangement and any binding agreement between the parties, their subsequent conduct upto 12.9.1959 brought about a concluded family arrangement.
Vikramsinghji paid Rs. 20,00,000/ .
Out of the balance of Rs. 30,00,000/ the assessee discharged her liabilities to the extent of Rs. 11,00,000/ and reiterated her obligation to pay the balance of Rs. 19,00,000/ in the shape of ornaments.
That was not honoured.
Shivaraj Singhji had a right to enforce the family arrangement against his mother, as arrived at partly in writing and partly orally as evidenced by the conduct of the parties.
The assessee would have been bound to pay Rs. 19,00,000/ if a suit had been filed against her by Sivaraj Singhji as he had refrained going to the law court from against his brother on her bringing about the family arrangement.
Mr. Ahuja then submitted that at best the undertaking given by the assessee in her letter dated 14.5.1953 was a contingent contract within the meaning of section 31 of the Contract Act.
Even so, under section 32 such a contract becomes enforceable by law when future even contemplated in the contingent contract has happened.
In this case the cotingency was the liability of the mother to pay a certain sum of money 549 on the failure by her elder son to pay Rs. 50,00,000/ or any part there of.
This did happen sometime between 14.5.1953 and 12.9.1959.
In that view of the matter, if not earlier the liability of the mother became enforceable by law on the latter date.
Learned counsel for the appellant cited three decisions of this Court to support his argument viz. Kesoram Industries and Cotton Mills Ltd. vs Commissioner of Wealth Tax (Central) Calcutta;(1) Standard Mills Co. Ltd. vs Commissioner of Wealth Tax, Bombay(2) and Bombay Dyeing and Manufacturing Co. Ltd. vs Commissioner of Wealth Tax, Bombay City I(3).
None of them is quite apposite on the point at issue before us.
In the case of Kesoram Industries it was held that "debt owed" within the meaning of section 2(m) of the could be defined as the liability to pay in praesenti or in futuro an ascertainable sum of money.
It was held that a liability to pay income tax was a present liability though the tax became payable after it was quantified in accordance with ascertainable data.
Subba Rao J., as he then was, delivering the majority opinion said at page 780 : "The said decisions also accept the legal position that a liability depending upon a contingency is not a debt in praesenti or in futuro till the contingency happened.
But if there is a debt the fact that the amount is to be a scertained does not make it any the less a debt if the liability is certain and what remains is only the quantification of the amount.
In short, a debt owed within the meaning of section 2(m) of the can be defined as a liability to pay in praesenti or in futuro an ascertainable sum of money.
The other two decisions of this Court were concerned with the question as to whether the liability of the assessee to pay gratuity to its employees on determination of employment was a mere contingent liability which arose only when the employment of the employee was determined by death, incapacity, retirement or resignation and whether it could be deducted as a debt in computing the net wealth of the assessee.
The answer given was against the assessee.
In the present case we have held that the liability of the assessee was created by the family arrangement arrived at between the parties and even if it was a contingent liability the contingency did happen and the assessee became liable 550 to pay the amount as a debt before 12.9.1959, which is anterior to the relevant valuation dates.
The sum of Rs. 19,00,000/ was a subsisting debt on the said valuation dates.
For the reasons stated above, we hold that there is no merit in this appeal.
It is accordingly dismissed with costs.
N.K.A Appeal dismissed.
| Two joint stock companies entered into agreements with a former Princely State for the grant of agricultural land on payment of fair and equitable land revenue.
Later the two companies formed into a partnership firm.
On the merger of the State with the Union of India, the Assessing Authority under the U.P. Agricultural Income tax Act issued notices to the two companies to submit their returns of agricultural income, which the companies did.
In writ petitions filed by the companies challenging the assessment orders, the High Court accepted the contention that since the lands were neither assessed to land revenue nor were they assessed to any local rate or cess as required by section 2(a) of the Act, they were not assessable to agricultural income tax and remanded the cases to the Assessing Authority for determination of this question.
Before the Assessing Authority, on remand the companies raised for the first time the contention that since no notice had been issued to the firm of which they were partners, the assessment was invalid.
The Assessing Authority rejected this contention.
He also held that the lands satisfied the requirements of s.2(a).
In writ petitions filed by the two companies a single Judge of the High Court upheld the contention that the Assessing Authority committed an error of law in assessing the two partners without assessing the firm.
This view was affirmed by a Division Bench on appeal.
On further appeal to this Court it was contended that in the absence of a prohibition in the Act, the two companies could be validly assessed to tax without assessing the firm.
Allowing the appeal, ^ HELD: 1.
The Assessing Authority was not in error in assessing tax on the returns submitted by the two companies and therefore the argument that assessment of the companies, without assessing the firm, was not legal, is without substance.
[425 H 426 A] 2. "Person" defined in the section means an individual and includes a firm or a company.
[423 G] 3.
There is nothing in the Act prohibiting the Assessing Authority from proceeding against individuals forming a partnership.
Section 18 enables the authorities, while proceeding with assessment of a firm or a company, not to 420 determine the tax payable by the firm or the company but to proceed to determine the agricultural income of each member of the firm.
The provisions do not apply to a case where the returns were submitted by the partners and the assessment made on that basis.
The section would be applicable if assessment proceedings against a firm are stopped and the share of the individual is to be determined under the provisions of section 18.
[424 F] 4.
The well established position under the Income Tax Act (Central Act) with regard to assessment of firms is that where a firm has not made a return it is open to the department to assess a partner directly in respect of his share of the firm 's income without resorting to the machinery provided under the Act and without making an assessment on the firm, the only prohibition being against double taxation.
[424 H] C.I.T. vs Murlidhar Jhawar & Purna Ginning & Pressing Factory, SC; referred to.
Secondly, the plea that assessment proceedings ought to have been taken against the firm, was not taken by them in the first instance either before the Assessing Authority or before the High Court.
This plea cannot be allowed to be taken at a later stage.
The assessees submitted their returns on the basis of their respective incomes.
[425 F 426 A] 6.
The Assessing Authority has correctly come to the conclusion that the agreement between the parties provided for payment of land revenue.
[426 F G]
|
ivil Appeal No. 1160 of 1978 From the Judgment and Order dated 9.12.
1977 of the Calcutta High Court in Appeal from Appellate Decree No.782 of 1973 S.N. Kacker and Sukumar Ghosh for the Appellant.
Shankar Ghosh and D.K. Sinha and K.R. Nambiar for the Respondent.
The Judgment of the Court was delivered by DUTT, J.
The only question that is involved in this appeal by special leave is whether the High Court was justi fied in decreeing the suit for ejectment on the ground under clause (j) of section 13(1) of the West Bengal Premises Tenancy Act, 1956, hereinafter referred to as "the Act".
One of the grounds for ejectment is that contained in clause (j) of section 13(1) of the act and reads as follows: "section 13(1).
Notwithstanding anything to the contrary in any other law, no order or decree for the recovery of possession of any premises shall be made by any Court in favour of the landlord against a tenant except on one or more of the following grounds, namely: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1111 (j) Where the tenant has given notice to quit but has failed to deliver vacant possession of the premises to the landlord in accordance with such notice.
" It appears that while remitting by postal money order the rents for the months of November and December, 1968, the appellant stated in writing in the money order coupon "we shall vacate the premises within next 6/8 months.
" It is not disputed before us that the said statement was made in the money order coupon by the appellant 's brother under his specific instruction.
After the respondent had received the said money order coupon, he by his letter dated April 19, 1969 sent to the appellant by registered post, inter alia, wrote as follows: "I also take note of your notice to vacate the said premises within 6/8 months ' time.
I shall be obliged if you kindly let me know precisely the date on which you will vacate the said premises, so that I may arrange my occupation of the said premises accordingly." The said letter of the respondent was not replied to by the appellant.
Thereafter, on May 11, 1970 the respondent insti tuted a suit for ejectment on the ground that the appellant had failed to deliver vacant possession of the premises in accordance with the said statement in the money order coupon which was treated as the notice to quit.
In other words, the suit was instituted by the respondent on the ground of clause (j) of section 13(1) of the Act.
The appellant con tested the suit.
His plea was that it was never intended by him to vacate the premises in question, and that the said statement in the money order coupon was not made by him but by his brother without any authority from him in that be half.
The trial court dismissed the suit holding that the said statement in the money order coupon was neither written by the appellant nor by his authorised agent and, accordingly, it did not amount to a notice to quit within the meaning of clause (j) of section 13(1) of the Act.
On appeal by the respondent, the lower appellate court affirmed the finding of the trial court that the statement in the money order coupon did not constitute a notice to quit.
It was, however, found by the lower appellate court that the said statement in the money order coupon was made by the brother of the appellant under his specific instruction.
The appeal pre ferred by the respondent was, consequently, dismissed.
1112 The respondent filed a second appeal in the High Court.
The learned Single Judge of the High Court took the view that the said statement in the money order coupon constitut ed a valid notice to quit within the meaning of clause (j) of section 13(1) of the Act and as the appellant had failed to vacate the premises in accordance with the said notice to quit, the respondent 's suit for eviction should be decreed.
In that view of the matter, the learned Judge set aside the judgments and decrees of the Courts below dismissing the suit and decreed the respondent 's suit for eviction.
Hence this appeal by special leave.
The Act provides for the protection of tenants against eviction.
Under section 13(1), no order or decree for recov ery of possession of any premises shall be made by any Court in favour of the landlord against a tenant except on one or more of the grounds as mentioned thereunder.
One of the grounds of eviction is that contained in clause (j) of section 13(1) of the Act.
The tenant may relinquish the protection under the Act by giving a notice to quit.
On the failure of the tenant to vacate the premises in accordance with the notice to quit, the landlord would be entitled to a decree for ejectment.
The notice to quit, however, must not be vague and uncertain.
There must be a clear indication in the notice to quit of the tenant 's intention to vacate the premises.
It is however, urged by Mr. Kackar, learned Counsel appearing `n behalf of the appellant, that the notice to quit is vague and uncertain and the suit should have been dismissed on that ground.
In support of his contention, he has placed reliance upon a statement in "A Concise Law Dictionary" by Osborn at page 224 that a notice to quit must specify the correct date or time for the termination of tenancy.
The learned Counsel has also placed reliance upon a statement from Corpus Juris, Vol.
51 Landlord & Tenant paragraph 142 at 745, "It must, however be definite and unequivocal and unconditional.
" COunsel submits that in the instant case, the notice to quit does not mention any spe cific date or time of vacating the premises by the appel lant.
Instead, it suffers from uncertainty and vagueness as it states that the appellant proposes to vacate within next 6/8 months, that is to say, either within 6 months or within 8 months.
Our attention has been drawn by the learned Coun sel to the letter written by the respondent enquiring of the appellant as to the date when he would vacate.
It is submit ted that the respondent himself was not sure as to when the appellant would vacate the premises.
It is true that the notice does not specifically mention the date 1113 when the appellant would vacate the premises, but it was certain that the appellant 's stay in the premises would not be beyond eight months, that is to say, the appellant would vacate the premises positively after the expiry of eight months from the date of the notice.
All that is necessary is a clear intention to vacate and such intention will be apparent when it is stated in the notice to quit that the tenant will vacate on a particular date or after a certain period of time.
A tenant may say that he will vacate by a certain date and that will simply mean that he would vacate on or before that date.
Indeed, in Joseph vs Joseph, , the tenants agreed to give up possession "by July 31".
It was observed by Lord Denning M.R., "The commonsense meaning is that the tenants were to give up possession by July 31, 1960, but that, if they chose to give it up by an earlier date, the landlord would accept possession earlier, that is just the way in which this Court construed a notice to quit 'on or before ' a fixed date.
It was construed as meaning to quit on a fixed date, but gave the tenant the option of quitting earlier.
" In Matthewson vs Wrightman, , the notice to quit by the landlord to the tenant asked the tenant to quit possession on the 25th day of March or the 8th day of April next ensuing.
It was held to be a good notice.
In the instant case, the notice to quit reserved to the appellant an option of vacating the premises earlier than 8 months and that is apparent from the words "within next 6/8 months".
At the same time, as noticed already, the statement contains a clear intention of the appellant to vacate in any event after eight months from the date of the statement.
There is,.
therefore, no substance in the contention of the appellant that the notice to quit was vague and uncertain.
It is next urged by Mr. Kacker that the notice to quit referred to in clause (j) should conform to the provisions of section 106 of the Transfer of Property Act.
It is sub mitted that the expression "notice to quit" is a well known technical expression and whenever it is used in any statute relating to landlord and tenant, it would mean a notice under section 106 of the Transfer of Property Act.
COunsel submits that as the notice in this case does not comply with the requirement of the provision of section 106 of the Transfer of Property Act, it is defective and cannot be treated as a notice to quit within the meaning of clause (j) of section 13(1) of the Act read with section 106 of the Transfer of Property Act.
Clause (j) uses the expression "notice to quit" and does not lay down the particulars to be mentioned in such notice.
It does not also 1114 refer to the provision of section 106 of the Transfer of Property Act.
There can be no doubt that if the notice to quit as mentioned in clause (j).
refers to a notice under section 106 of the Transfer of Property Act, the present notice to quit with which we are concerned must be held to be bad.
We do not think that we are called upon to consider whether a notice to quit under clause (j) is really a notice as contemplated by section 106 of the Transfer of Property Act.
Even assuming that it is a notice under section 106 of the Transfer of Property Act and, accordingly, the instant notice to quit is bad, yet the respondent having accepted the notice to quit, it will not be open to the appellant to contend that it is invalid and cannot be relied upon by the respondent as a ground for eviction.
A notice to quit even if it is defective can be accepted by the landlord, and after such acceptance the tenant will be estopped from challenging the validity of the notice given by him.
Indeed, the question came up for consideration before this Court in the Calcutta Credit Corporation Ltd. & Anr., vs Happy Homes (P) Ltd., ; It has been held by this Court that a notice which does not comply with 'the requirements of section 106 of the Transfer of Property Act in that it does not expire with the end of the month of the tenancy, or the end of the year of the tenancy, as the case may be or of which the duration is shorter than the duration contemplated by section 106, may still be accepted by the party served with the notice and if that party accepts ' and acts upon it, the party serving the notice will be estopped from denying its validity.
It is, however, urged on behalf of the appellant that the respondent had not accepted the notice to quit.
This contention is also without any substance.
It has been earli er noticed that the respondent by his letter dated April 9, 1969 enquired of the appellant as to the date on which the appellant would vacate the premises so as to enable the respondent to arrange his occupation of the premises accord ingly.
If the respondent had not accepted the notice to quit, there was no necessity for him to enquire of the appellant as to the precise date of his vacating the prem ises.
Thus, the notice having been accepted by the respond ent, the appellant is precluded from challenging the validi ty thereof.
The High Court was, therefore, in our opinion, justified in decreeing the suit for eviction on the ground as contained in clause (j) of section 13(1) of the Act.
In the result, the judgment and decree of the High Court is affirmed and the appeal is dismissed.
There will, howev er, be no order as to costs.
1115 The appellant is, however, granted time to vacate the premises till the end of April, 1987 which will stand ex tended up to August 31, 1987 provided the appellant files within four weeks from the date an undertaking in writing to the effect that he will vacate and deliver up vacant and peaceful possession of the premises to the respondent on or before August 31, 1987.
The appellant shall also go on depositing in the trial court an amount calculated at the rate of rent, month by month, by fifteenth of the next month following that for which it is due.
In default of such deposit for any two months, the respondent will be at liber ty to execute the decree at once notwithstanding the time, be it the initial or the extended one, granted to the appel lant.
The respondent will be entitled to withdraw any amount that may be deposited by the appellant in terms of this judgment without furnishing any security.
P.S.S. Appeal dismissed.
| Clause (.i) of s.13(1) of the West Bengal Premises Tenancy Act, 1956 empowers the court to order recovery of possession of any premises in favour of the landlord where the tenant has given notice to quit but has failed to deliv er possession in accordance with such notice.
The appellant tenant while remitting monthly rent by postal money order stated in the coupon that they shall vacate the premises within the next 6/8 months.
This was taken note of by the respondent landlord in his subsequent letter.
When the tenant failed to deliver vacant possession of the premises the respondent filed a suit for ejectment under s.13( 1 )(j), which was contested by the tenant con tending that it was never intended by him to vacate the premises and that the said statement in the money order coupon was not made by him but by his brother without any authority from him.
The trial court dismissed the suit holding that the statement in the money order was neither written by the appellant nor by his authorised agent and accordingly it did not amount to a notice to quit within the provision of s.13(1)(j) of the Act.
The lower appellate court affirmed the finding of the trial court, but held that the said statement in the money order coupon was made by the brother of the appellant under his specific instruction.
Respondent 's second appeal was allowed by the High Court, which took the view that the statement in the money order coupon constituted a valid notice to quit within the meaning of section 13( I )(j).
In this appeal by special leave it was contended for the appellant that the notice to quit was vague and uncertain and as it did not comply 1109 with the provisions of section 106 of the Transfer of Property Act it was defective and could not be treated as a notice to quit within the meaning of cl.(j) ors.13(1) of the Act.
Dismissing the appeal, the Court, HELD: 1.
The High Court was justified in decreeing the suit for eviction on the ground contained in clause (.i) of section 13(1) of the West Bengal Premises Tenancy Act, 1956.
That clause reserves an option to the tenant to relinquish the protection under the Act by giving a notice to quit.
On failure of the tenant to vacate the premises in accordance with the notice to quit, the landlord would be entitled to a decree for ejectment.
[1114 ; 1112C D] 2.
The notice to quit must not be vague and uncertain.
There must be a clear indication in it of the tenant 's intention to vacate the premises.
Such an intention will be apparent when it is stated in the notice to quit that the tenant will vacate on a particular date or after a certain period of time.
When the tenant says that he will vacate by a certain date that will simply mean that he would vacate on or before that date.
[1112D; 1113B C] In the instant case, the notice to quit could not be said to be vague and uncertain.
Though it did not specifi cally mention the date when the appellant would vecate the premises, it was apparent from the statement "we shall vacate the premises within the next 6/8 months" that the appellant 's stay in the premises would not be beyond eight months.
It contains a clear intention to vacate the premises positively after the expiry of eight months from the date of the notice.
[1113C] Joseph vs Joseph, and Matthewson vs Wright man, , referred to.
The respondent had by his letter dated April 9, 1969 enquired of the appellant as to the date on which the appel lant would vacate the premises so as to enable the respond ent to arrange his occupation of the premises accordingly.
If the respondent had not accepted the notice to quit, there was no necessity for him to enquire of the appellant as to the precise date of his vacating the premises.
The notice having thus been accepted by the respondent, the appellant was precluded from challenging the validity thereof.
[1114E G] 4.1 A notice to quit even if it is defective can be accepted by the 1110 landlord, and after such acceptance the tenant will be estopped from challenging the validity of the notice given by him.
[1114C] 4.2.
Clause(j)of s.13(1) of the Act uses the expression "notice to quit" and does not lay down the particulars to be mentioned in such notice.
It does not also refer to the provision of section 106 of the Transfer of Property Act.
Even assuming that it is a notice under s.106 of the Transfer of Property Act and, accordingly the instant notice to quit was bad, yet the respondent having accepted the notice to quit, it was not open to the appellant to contend that it was invalid and could not be relied upon by the respondent as a ground for eviction.
[1113G; 1114A C] Calcutta Credit Corporation Ltd. & Anr.
vs Happy Homes (P) Ltd., , referred to.
|
ivil Appeal No. 1201 of 1990 From the Judgment and Order dated 5.6.87 of the Punjab and Haryana High Court in C.R. No. 556/87.
Mukul Mudgal for the Appellant.
S.S. Javali, Y.P. Rao and Raju Ramachandran for the Respondents.
The Judgment of the Court was delivered by K. JAGANNATHA SHETTY, J.
Special leave granted.
Food Corporation of India filed a suit for recovery of Rs.2 lacs against the appellant and respondents 2 to 7 on the basis of an agreement between the parties.
After service of notice, the appellant entered appearance on December 10, 1984.
On January 4, 1985, the appellant filed an application stating as follows: "That the photostat copy of the original agreement and other documents which have been produced by the plaintiff 355 in their evidence are not visible and clear, and it is very difficult for the defendants to inspect and give the written statement.
That it is very essential to get the original documents produced in the court which are in possession of the plain tiff so that the defendants may file the written statement.
It is, therefore, respectfully prayed that the plaintiff may kindly be ordered to produce the original agreement and other documents which has been filed with the plaint.
" On January 21, 1985, the appellant moved the Court under Section 34 of the for stay of the proceeding of the suit on the ground that there exists an arbitration clause in the suit agreement covering the matter in dispute.
The Food Corporation of India contended that the appellant had taken steps in the proceedings of the suit since an adjournment was taken for filing written statement.
It was however, admitted the existence of the arbitration agreement covering the matter in dispute in the suit.
The Trial Court accepted the request of the appellant and stayed the suit inter alia observing: ". .
This application did not contain any prayer for adjournment of the case for filing the written statement.
The prayer contained in this application was that the plain tiff be directed to produce the original agreement and other documents so that the defendants may file the written state ment . .
In the present case, the prayer of the defendants that the plaintiff be directed to file the original agreement and other documents in the court before they could file the written statement cannot be said to be a step in the pro ceedings because it was not a prayer for adjournment of the case for filing written statement.
" But the Additional District Judge, in the appeal pre ferred by the Food Corporation of India has reversed the order of the trial court.
He was of the view that a written request made by the defendants by their application dated January 4, 1985 for an adjournment to enable them to file the written statement was a step in the proceedings and the trial court was not justified in staying the suit.
Accord ingly, he accepted the 356 appeal and vacated the stay order and directed the trial court to proceed with the suit in accordance with law.
The High Court of Punjab and Haryana has dismissed the revision petition of the appellant.
The High Court has also observed that the defendants having moved the application dated January 4, 1985 for production of original documents and seeking an adjournment of the suit to enable them to file written statement would certainly be construed as a step taken in the proceedings.
Section 34 of the has received the consideration of this Court in State of Uttar Pradesh vs Janki Saran Kailash Chandra, [1974] 1 SCR 31, (ii) Food Corporation of India vs Yadav Engineer, ; and more recently in General Electric Co. vs Renusagar Power Co., ; It may be noted that the expression "a step in the proceeding" which would disentitle the de fendant from invoking section 34 of the is not every step taken by him in the suit.
It should be a step to abandon the right to have the suit stayed.
It should be a step in aid of the progress of the suit.
The step must have been consciously taken with a view to submit to the juris diction of the Court for the purpose of adjudicating the controversy on the merits.
In General Electric Co. 's case this Court after considering the previous decisions observed (at 155 56): . thus a step in the proceeding which would disentitle the defendant from invoking Section 34 of the should be a step in aid of the progress of the suit or submission to the jurisdiction of the court for the purpose of adjudication of the merits of the controversy in the suit.
The step must be such as to manifest the inten tion of the party unequivocally to abandon the right under the arbitration agreement and instead to opt to have the dispute resolved on merits in the suit.
The step must be such as to indicate an election or affirmation in favour of the suit in the place of the arbitration.
The election or affirmation may be by express choice or by necessary impli cation by acquiescence.
The broad and general right of a person to seek redressal of his grievances in a court of law is subject to the right of the parties to have the disputes settled by a forum of mutual choice.
Neither right is insub stantial nor the right can be allowed to be defeated by any manner of technicality.
The right to have the dispute adju dicated by a civil court cannot be allowed to be defeated by vague 357 or amorphouse mis called agreements to refer to 'arbitra tion '.
On the other hand, if the agreement to refer to arbitration is established, the right to have the dispute settled by arbitration cannot be allowed to be defeated on technical grounds.
" In the application filed by the defendants in this case, they only sought a direction to the plaintiff to produce the original agreement and other documents so that they may file written statement.
It was not stated that they would file the written statement.
They never took any other step sub mitting to the jurisdiction of the court to decide the case on merits.
The right to have the dispute settled by arbitra tion has been conferred by agreement of parties and that right should not be deprived of by technical pleas.
The Court must go into the circumstances and intention of the party in the step taken.
The Court must examine whether the party has abandoned his right under the agreement.
In the light of these principles and looking to the substance of the application dated January 4, 1985, we cannot form an opinion that the defendants have abandoned their right to have the suit stayed and took a step in the suit to file the written statement.
In the result the appeal is allowed in setting aside the order of the High Court and restoring the order of the High Court.
In the circumstances of the case, we make no order as to costs.
G.N. Appeal allowed.
| The appellant, a diploma holder, was, in 1964, appointed as Transport Officer (Class I Technical Grade, Group A), which post was later redesignated and merged with the post of Mechanical Engineer (Junior) in 1968.
The Geological Survey of India (Group 'A ' and Group 'B ' posts) Recruitment Rules, 1967, framed under Article 309 of the Constitution were brought into force in 1969.
The appellant was promoted as a Mechanical Engineer (Senior) in 1973 and his conditions of service were governed by the said Rules, which had been amended from time to time.
One such amendment made in 1984 prescribed that for promotion to the post of Director (M.E.), a degree in Engineering was a requisite qualifica tion.
The appellant challenged before the Central Adminis trative Tribunal, the validity of the said notification on the ground that it affected his chances of promotion or alternatively his right to be considered for promotion to the post of Director (M.E.).
It was contended that applying the amended Rule, in so far as the appellant was concerned, would amount to giving retrospective effect to the operation of the rule, and no retrospective rule could be framed under Article 309 of the Constitution.
The Tribunal rejected the contention and held that it was for the Government to pre scribe such qualifications as it considered fit, and the Tribunal could not interfere unless it was shown to be perverse.
Aggrieved against the Tribunal 's order, the appellant has preferred this appeal by special leave.
Dismissing the appeal, this Court, HELD: 1.
Mere chance of promotion is not condition of serv ice 445 and the fact that there was reduction in the chances of promotion did not tantamount to a change in the conditions of service.
A right to be considered for promotion is a term of service, but mere chances of promotion are not.
[448D] state of Maharashtra and Anr.
vs Chandrakant Anant Kulkarnt and Others, ; , relied on.
T.R. Kapur and Others vs State of Harvana and Others, [1986] (Suppl.) SCC 584, referred to. 2.
In the instant case, no retrospective effect has been given to the said amended rule.
It is not the case that the appellant has been reverted from the post which he occupies on the ground of lack of any qualification.
The only effect is that his chances of promotion to the higher post is adversely affected.
Alteration of rules of eligibility cannot be invalidated on the ground that an employee 's claim to be eligible for promotion is adversely affected.
This cannot be regarded as retrospective effect being given to the amendment of the rules carried out by the Notification and the challenge to the said notification on that ground must fail.
[448F G] 3.
The fact that for the higher post of Deputy Director General (Engineering Service), it is not necessary to hold a graduate degree is no reason why a degree requirement for the post of Director (Mechanical) should be regarded as unreasonable or bad in law.
It is for the Government to decide what qualification was required for promotion to the post of Director (M.E.) and, unless that requirement was totally irrelevant or unreasonable, it could not be said to be bad in law.
[419B C]
|
Appeal No. 375 of 1959.
Appeal from the Judgment and Order dated the 12th August, 1958, of the Assam High Court in First Appeal No. 11 of 1958.
L. K. Jha and Sukumar Ghose, for appellants Nos. 1 to 3.
G. section Pathak and Naunit Lal, for respondents Nos. 1 and 2. 1960.
October 27.
The Judgment of the Court was delivered by WANCHOO J.
This is an appeal on a certificate granted by the Assam High Court in an election matter.
An election was held in the double member constituency of Goalpara to the Assam Legislative Assembly.
Nomination papers were filed on the 19th January, 1957, by a number of persons including Anirara Basumatari (hereinafter called the appellant).
He was a candidate for the seat reserved for scheduled tribes.
The nomination paper of the appellant was rejected by the returning officer on the ground that he was disqualified under section 7(b) of the Representation of the People Act, No. XLIII of 1951, (hereinafter called the Act).
The polling took place on February 25,1957, and Khagendranath and H%kim Chandra Rabha were elected, the latter being a member of a scheduled tribe.
Thereupon an election petition was filed by an elector challenging the election of the two successful candidates on a number of grounds.
of these grounds, however, only two are now material, namely, (1) that the nomination paper of the appellant was wrongly rejected, and (2) that a corrupt practice was committed by the successful candidates inasmuch as voters were carried on mechanically propelled vehicles to the polling booths.
The election tribunal held on the, first point that the nomination 135 paper of the appellant had been improperly rejected.
On the second point it hold that the corrupt practice alleged had not been proved.
In the result, the election was set aside.
Thereupon there was an appeal by the two successful candidates to the High Court.
The High Court was of the view that the nomination paper of the appellant was properly rejected; further on the question of corrupt practice the High Court agreed with the conclusion of the tribunal.
In the result the appeal was allowed and the election petition was ordered to be dismissed.
There was then an application to the High Court for a certificate to appeal to this Court which was granted; and that is how the matter has come up before us.
The main contention on behalf of the appellant is that the High Court was wrong in coming to the conclusion that the nomination paper of the appellant was properly rejected under section 7(b) of the Act.
That provision lays down that a person shall be disqualified for being chosen as a member of either House of Parliament or of the Legislative Assembly or Legislative Council of a State if he is convicted by a court in India of any offence and sentenced to imprisonment for not less than two years, unless a period of five years, or such less period as the Election Commission may allow in any particular case, has elapsed since his release.
The appellant in this case was convicted under section 4(b) of the Explosive Substances Act No. VI of 1908, and sentenced to three years rigorous imprisonment on July 10, 1953.
The nomination paper in this case was filed in January 1957 and the election was held in February 1957 and therefore five years had not elapsed since his release.
But though the appellant was sentenced to three years ' rigorous imprisonment, his sentence was remitted by the Government of Assam on November 8, 1954, under section 401 of the Code of Criminal Procedure and he was released on November 14, 1954.
The contention of the appellant before the election tribunal was that in view of this remission his sentence in effect was reduced to a period of less than two years and therefore he could not be said to have incurred disqualification within the meaning of s.7(b).
This contention 136 was accepted by the tribunal and that is why it held that the nomination paper of the appellant was improperly rejected.
When the case came to be argued in the High Court on behalf of the successful candidates, two arguments were addressed in support of the plea that the nomination paper of the appellant was properly rejected.
In the first place, it was urged that in view of the provisions of Articles 72, 73, 161 and 162 of the Constitution read with section 401 of the Code of Criminal Procedure, the State Government had no authority to remit the sentence of the appellant; and secondly even if the remission was properly granted it would not affect the sentence imposed by the Court, though the appellant might not have had to undergo part of the sentence after the date of the remission order.
The High Court did not decide the question as to the power of the State Government to grant remission in this case as it had not full materials before it because the matter was not raised before the tribunal, though it was inclined to the view that the State Government might not have such power.
But the High Court was of the opinion that a remission of sentence did not have the same effect as a free pardon and did not have the effect of reducing the sentence passed on the appellant from three years to less than two years, even though the appellant might have remained in jail for less than two years because of the order of remission.
What section 7(b) lays down is that there should be a conviction by a court in India for any offence and a sentence of imprisonment for not less than two years in order that a person may be disqualified for being chosen as a member of either House of Parliament or of Legislative Assembly or of Legislative Council of a State.
In terms, therefore, the provision applies to the case of the appellant for he was convicted by a court in India and sentenced to imprisonment for more than two years.
Further the period of five years had not expired after his release.
The appellant had applied to the Election Commission for removing the disqualification but it had refused to do so.
The main question therefore that falls for consideration is 137 whether the order of remission has the effect of reducing the sentence in the same way in which an order of an appellate or revisional criminal court has the effect of reducing the sentence passed by the trial court to the extent indicated in the order of the appellate or revisional court.
Now it is not disputed that in England and India the effect of a pardon or what is sometimes called a free pardon is to clear the person from all infamy and from all consequences of the offence for which it is granted and from all statutory or other disqualifications following upon conviction.
It makes him, as it were, a new man: (See Halsbury 's Laws of England, Vol.
VII, Third Edition, p. 244, para 529).
But the same effect does not follow on a mere remission which stands on a different footing altogether.
In the first place, an order of remission does not wipe out the offence; it also does not wipe out the conviction.
All that it does is to have an effect on the execution of the sentence; though ordinarily a convicted person would have to serve out the full sentence imposed by a court, he need not do so with respect to that part of the sentence which has been ordered to be remitted.
An order of remission thus does not in any way interfere with the order of the court; it affects only the execution of the sentence passed by the court and frees the convicted person from his liability to undergo the full term of imprisonment inflicted by the court, though the order of conviction and sentence passed by the court still stands as it was.
The power to grant remission is executive power and cannot have the effect which the order of an appellate or revisional court would have of reducing the sentence passed by the trial court and substituting in its place the reduced sentence adjudged by the appellate or revisional court.
This distinction is well brought out in the following passage from Weater 's " Constitutional Law" on the effect of reprieves and pardons vis a vis the judgment passed by the court imposing punishment, at p. 176, para 134: " A reprieve is a temporary suspension of the 18 138 punishment fixed by law.
A pardon is the remission of such punishment.
Both are the exercise of executive functions and should be distinguished from the exercise of judicial power over sentences.
The judicial power and the executive power over sentences are readily distinguishable, ' observed Justice Sutherland, 1 To render a judgment is a judicial function.
To carry the judgment into effect is an executive function.
To out short a sentence by an act of clemency is an exercise of executive power which abridges the enforcement of the judgment but does not alter it qua judgment '.
" Though, therefore, the effect of an order of remission is to wipe out that part of the sentence of imprisonment which has not been served out and thus in practice to reduce the sentence to the period already undergone, in law the order of remission merely means that the rest of the sentence need not be undergone, leaving the order of conviction by the court and the sentence passed by it untouched.
In this view of the matter the order of remission passed, in this case though it had the effect that the appellant was re.
leased from jail before he had served the full sentence of three years ' imprisonment and had actually served only about sixteen months ' imprisonment, did not in any way affect the order of conviction and sentence passed by the court which remained as it was.
Therefore the terms of section 7(b) would be satisfied in the present case and the appellant being a person convicted and sentenced to three years ' rigorous imprisonment would be disqualified, as five years had not passed since his release and as the Election Commission had not removed his disqualification.
We may now refer to a number of cases on which reliance has been placed on behalf of the appellant.
In Venkatesh Yeshwant Deshpande vs Emperor (1), Bose, J. (as he then was), observed as follows at p. 530: " The effect of an order of remission is to wipe out the remitted portion of the sentence altogether and not merely to suspend its operation; suspension (1) A.I.R. 1938 Nag.
139 is separately provided for.
In fact, in the case of a pardon in England statutory and other disqualification following upon conviction are removed and the pardoned man is enabled to maintain an action against any person who afterwards defames him in respect of the offence for which he was convicted.
That may not apply in full here but the effect of an order of remission is certainly to entitle the prisoner to his freedom on a certain date.
" It is urged that if the effect of an order of remission is to wipe out the remitted portion of the sentence altogether it means that the sentence is reduced to the period already undergone and the order of remission has the same effect as an order of an appellate or revisional court reducing the sentence to the period already undergone.
That case, however, dealt with a different point altogether, namely, whether a remission having been granted and having taken effect it could be cancelled thereafter.
It was in that context that these observations were made.
Even so, the learned judge was careful to point out that there was a difference between a pardon and a remission and the effect of an order of remission is to entitle the prisoner to his freedom on a certain date.
That case is no authority for the view that the order of remission amounts to changing the sentence passed by a competent court and substituting therefor the sentence of imprisonment already undergone up to the date of release following the order of remission.
Reference was also made to a number of election cases in which the view which has been urged on behalf of the appellant seems to have been taken.
We may refer to only one of them, namely, Ganda Singh vs Sampuran Singh (1), which has specifically dealt with this point.
In that case an order was passed by the Maharaja of Nabha granting amnesty to all political prisoners detained or convicted under the Punjab Public Safety Act, 1947, as applied to Nabha State, and releasing them unconditionally.
The same order also provided for grant of remission to persons convicted for offences other than political offences on (1) 140 a certain scale.
The successful candidate in that case was sentenced to more than two years ' rigorous imprisonment under the Punjab Public Safety Act, as applied to Nabha State, and was thus a political prisoner.
He was therefore released before he had served two years imprisonment.
The main plank of the election petition in that case was that the successful candidate was disqualified under section 7(b) of the Act in view of his conviction and sentence and the election tribunal held that remission by government (executive authority) has the same effect as an order passed by a court of law in appeal or on revision and that under section 7 of the Act the court has to look to the amount of sentence imposed on a person and it made no difference whether the sentence was reduced by a court of law on appeal or by revision or by the powers of the government reserved for it under section 401 of the Code of Criminal Procedure, as, the effect in both cases was the same.
We are of opinion that this view is incorrect, though perhaps on the facts of that case the order of the tribunal was right for it seems that political prisoners had been granted a pardon by the Ruler of Nabha and not a mere remission under section 401 of the Code of Criminal Procedure.
We cannot agree that remission by government has the same effect as an order passed by a court of law in appeal or on revision.
It is true that under section 7(b) of the Act one has to look at the sentence imposed; but it must be a sentence imposed by a court.
Now where the sentence imposed by a trial court is varied by way of reduction by the appellate or revisional court, the final sentence is again imposed by a court; but where a sentence imposed by a court is remitted in part under section 401 of the Code of Criminal Procedure that has not the effect in law of reducing the sentence imposed by the court, though in effect the result may be that the convicted person suffers less imprisonment than that imposed by the court.
The order of remission affects the execution of the sentence imposed by the court but does not affect the sentence as such, which remains what it was in spite of the order of remission.
It is also well to remember that 141 section 7(b) speaks of the conviction and sentence passed by a court of law; it does not speak of the period of imprisonment actually suffered by the convicted person.
The other election cases to which our attention was drawn by the learned counsel for the appellant are similar and they are all in our opinion wrongly decided.
We are therefore of opinion that the High Court was right in the view that the nomination paper of the appellant was properly rejected.
The next contention on behalf of the appellants is that both the High Court and the tribunal were wrong in holding that a corrupt practice within the meaning of section 100(1)(b) read with section 123(5) had not been proved in this case.
The case of the appellant was that voters were carried by mechanically propelled vehicles to the polling booths by Birendra Kumar Nath who was in charge of the electioneering campaign on behalf of the Congress Party and Bholaram Sarkar who was president of the Primary Congress Committee of Dhupdhara.
The successful candidates were both contesting the election as nominees of the Congress Party and therefore these two persons who carried electors in mechanically propelled vehicles to the polling booths did so as agents of the successful candidates and with their consent.
The High Court as well as the election tribunal hold that though Birendra Kumar Nath and Bholaram Sarkar might be deemed to be the agents of the successful candidates for purposes of the election and though the hiring of mechanically propelled vehicles by the agents for conveyance of electors to polling booths had been proved, there was no proof that this was done with the consent, express or implied, of the successful candidates.
The High Court pointed out that consent, express or implied, of the candidates was necessary for purposes of section 100(1) (b) and was of the view that on the facts proved in this case such consent could not be inferred and the circumstances did not convincingly lead to an inference that the corrupt practice in question was committed with the knowledge and consent of the successful candidates.
In view of this concurrent finding of the High Court and the 142 tribunal on this question, namely, whether there was consent, express or implied, of the successful candidates to the commission of this corrupt practice, it is in our opinion idle for the appellant now to contend that there was consent express or implied, as required by section 100(1)(b).
The inference whether there was consent or not from the facts and circumstances proved is still an inference of fact from other facts and circumstances and cannot be a question of law as urged by learned counsel for the appellant.
Reference in this connection may be made to Meenakshi Mills, Madurai vs The Commissioner of Income tax, Madras(1), where it was held that a finding of fact, even when it is an inference from other facts found on evidence, is not a question of law and that such an inference can be a question of law only when the point for determination is a mixed question of law and fact.
In the present case the only question is whether the corrupt practice was committed with the consent of the candidates, whether express or implied, and the question whether such consent was given in the circumstances of this case is a question of fact and not a mixed question of law and fact and therefore the finding of the High Court as well as the tribunal that there was no consent, either express or implied, in our opinion, concludes the matter.
There is no force in this point either.
The appeal therefore fails and is hereby dismissed with costs.
Appeal dismissed.
| The United Provinces Agricultural Income tax Act, 1949, authorised imposition of a tax on agricultural income within the State, and the agricultural income tax and super tax were charged on the total agricultural income of the previous year of the assessee.
For the purposes of the Act the Collector and the Assistant Collector were declared to be the assessing authorities within their respective revenue jurisdiction and the expression " Collector " was to have the same meaning as in the United Provinces Land Revenue Act, 1901.
Under the rules framed by the government under section 44 of the Act an assessee having agricultural income in the jurisdiction of more than one assessing authority was to be assessed by the Collector of the district in which he permanently resided.
The State Government of Uttar Pradesh appointed Mr. K. C. Chaudhry under subS. 1 of section 14(A) of the United Provinces Land Revenue Act, 1901 to be the Additional Collector in District Bahraich and authorised him to exercise all the powers and perform all the duties of a Collector in all classes of cases ".
Claiming to exercise the 83 powers of a Collector under section 14 of the United Provinces Agricultural Income tax Act of 1949 he assessed the net agricultural income of the assessee who owned landed property in two districts, namely, Bahraich and Kheri in the State of Uttar Pradesh, at 12,81,110 10 0 and ordered him to pay Rs. 1,36,390 2 0 as agricultural income tax and super tax.
The validity of this order was challenged by the assessee in the High Court by an application under article 226 of the Constitution and the High Court quashed the order of the Additional Collector holding that he had no " extra territorial " jurisdiction which was exercised by the Collector as the assessing authority in cases where the property of the assessee was situate in several districts and as such the proceeding taken by him for assessing agricultural income tax was unauthorised.
After the judgment of the High Court was delivered the State Legislature amended the United Provinces Agricultural Income tax Act, 1949, by Act XIV of 1956, giving retrospective operation to the amending provisions.
The Amendment Act enacted that the assessment proceedings held by an Additional Collector who was invested with the powers of a Collector under Act III of 1901 should be deemed always to have been properly taken.
The State Government submitted before the High Court an application under section 11 of the amending Act for review of its judgment but it was dismiss ed.
On appeal by the State Government by special leave, Held, that the Additional Collector was competent to assess the liability of the assessee to pay agricultural income .tax and super tax under the United Provinces Agricultural Income tax Act, 1949.
A Court of appeal must give effect to the law as it stood at the time of hearing of the appeal if at any stage anterior to the hearing the law had been amended with retrospective effect conferring on an authority or tribunal from the order whereof the appeal is filed, jurisdiction which it originally lacked.
The power of the appellate court to deal with the appeal in accordance of the amended law is not affected by a provision for review as contained in section 11 of the Amending Act.
|
tition (Criminal) No. 30 of 1987.
(Under Article 32 of the Constitution of India).
Harjinder Singh for the petitioner.
R.S. Sodhi for the Respondent.
The Judgment of the Court was delivered by KANIA, J.
This is a petition under Article 32 of the Constitution of India for a writ of habeas corpus or any other appropriate writ or order quashing the order dated 3rd January, 1985 passed by the Special Secretary to the Government of Punjab for detention of the petitioner and praying for the release of the petitioner.
By our order dated 8th May, 1987, we had held that the writ petition succeeds for the reasons which we would give later.
We had also set aside the order of detention and directed the petitioner to be released.
We are now giving the reasons for the said order.
459 The facts necessary for disposal of the writ petition lie within a fairly narrow compass.
The petitioner was detained on 21st November, 1985 pursuant to an order of detention dated 3rd January, 1985 passed under Sub Sections 1 & 2 of section 3 of the National Security Act, 1985 signed by the Special Secretary to the Government of Punjab setting out that the President of India in exercise of the powers conferred by Sub Sections ( 1) & (2) of Section 3 of the National Security Act, 1985 was pleased to order that the petitioner should be detained.
The ground given in that order is that the petitioner is indulging in activities prejudicial to the defence of India and the security of the State.
On 17th April, 1985, the petitioner, when he was in jail, was served with an order passed under Section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Act (referred to hereinafter as COFEPOSA), dated 17th April, 1985, directing his detention.
The petitioner made a representation against his order of detention under COFEPOSA.
He was produced before the Advisory Board under that Act and pursuant to the recommendation of the Advisory Board, his detention Under COFEPOSA was revoked.
The petitioner was also produced before the same Board, being also the Advisory Board under the National Security Act.
The petitioner did not make any representation against his detention under that Act as, according to him, he was confused and believed that his detention was only under COFEPOSA.
It appears that the Advisory Board confirmed the order of his detention.
On 24th January, 1986, an order was passed by the Under Secretary to the Government of Punjab, Home Department setting out that the President of India in exercise of powers conferred on him under Sub Section ( 1) of Section 12 read with Section 14 A( 1) (2) (c) & (d) of the (No. 65 of 1980) as amended confirmed the aforesaid order of detention and was pleased to order that the petitioner would continue to be detained in the custody of the Inspector General of Prisons, Punjab for a period of two years from the date of his detention.
The petitioner made a representation dated 18th December, 1986 through his Advocate addressed to the President of India for revocation of his detention.
On 24th December, 1986 the petitioner made a representation to the Special Secretary to the Government of Punjab, Department of Home Affairs and Justice, against his detention.
In this representation the petitioner, inter alia, contended that his detention was invalid as vital facts and materials that should have influenced the minds of the declaring authority and the detaining authority had not been placed before them.
Both the representations made by the petitioner were rejected on 26th February, 1987.
According to the respondent, the representation made to the Special Secretary, Government of Punjab was 460 received on 14th January, 1987.
But, according to the petitioner, it was received by the Special Secretary on 30th December, 1986.
In support of this contention the detenu has produced an acknowledgement slip along with a copy of his representation.
We propose to proceed on the assumption that the representation was received by the Special Secretary on 14th January, 1987 because, even on that assumption, the petitioner, in our opinion, must succeed in the petition.
In the petition the petitioner has challenged the order of detention passed against him under the on various grounds including the ground that Section 14 A of the is void as violating the Constitution of India.
We propose to dispose of the petition only on one ground, namely, that there was inordinate delay in consideration of the representation made by the petitioner to the Government of Punjab through Special Secretary; and hence we do not propose to discuss the other grounds urged by the petitioner.
We may mention here that as far as representation made by the petitioner to the Central Government by his Advocate 's letter addressed to the President of India is concerned, we do not propose to enter into any controversy regarding that representation as the Union of India has not been joined as a party to the petition.
The contention of the petitioner, on the basis of which we propose to dispose of this petition, is that he made a representation to the Government of Punjab on 18th December, 1986.
That representation, as per admission of the Government of Punjab, was received on 14th January, 1987 and there was undue delay in disposing of that representation which was rejected on 26th February, 1987, as aforesaid.
According to the petitioner there is no justification for this delay and on account of this delay the rights of the petitioner under Article 22(5) of the Constitution of India have been violated and the continued detention of the petitioner is not valid in law.
Coming to the affidavit filed by Shri V.V. Chadha, Under Secretary to the Government of Punjab, in this connection, we may point out that, apart from saying that the representation made by the petitioner as aforesaid, was received on 14th January, 1987, no explanation whatever is given as to why it took over a monty and ten days to consider and dispose of that representation.
It has been repeatedly laid down that in a matter of detention, the representation made by the detenu should be disposed of with utmost expedition and failure to do so vitiates the order of detention, because it infringes the fundamental right given to every citizen under Article 22(5) of the Constitution of India.
In support of his arguments, learned counsel for the petitioner 461 drew our attention to the decision of this Court in Saleh Mohammed vs Union of India, where a delay of 22 days in considering the representation of the detenu was held to be inordinate and unreasonable.
It was held that this delay violated the rights of the petitioner under Article 22(5) of the Constitution of India and vitiated the detention order.
In that case the detention order was under COFEPOSA and the detenu was arrested on 21st January , 1980.
On 20th February, 1980 the detenu made a representation to the detaining authority through Superintendent of Jail.
On 25th February, 1980 he was produced before the Advisory Board.
On 10th March, 1980 his detention was confirmed by the State Government and on 26th March, 1980 his representation was rejected by the State Government.
In the affidavit filed by the respondent in that case it was contended that the representation of the detenu made on 20th February, 1980 was received in the Home Department on 14th March, 1980.
It has been pointed out by this Court in that case that: "Times out of number, this Court has emphasised that where the liberty of an individual is curtailed under a law of preventive detention, the representation, if any, made by him must be attended to, dealt with and considered with watchful care and reasonable promptitude lest the safeguards provided in Article 22(5) of the Constitution and the statute concerned should be stultified and rendered meaningless.
" It was held that the functionaries of the state were guilty of gross negligence in dealing with and disposing of the representation of the detenu.
The delay of about 22 days during which time the representation of the detenu remained unattended in the office of the Suprintendent of Jail or Inspector General of Prisons was to be held as inordinate.
In Harish Pahwa vs State of U.P. & ors.
, [19811 3 S.C.R. 276 it has been pointed out by this Court that it does not look with equanimity upon delays in considering the representations of detenus.
Where the liberty of a person is involved, it is the duty of the State to determine his representations with the utmost expedition and deal with it continuously until a final decision is taken and communicated to the detenu.
In that case the representation of the detenu was received by the State Government on 4th June, 1980.
The detention was under COFEPOSA.
Comments were called for from the Customs authorities on 6th June, 1980 and the comments were received on 13th June, 1980.
462 On 17th June.
1980, the State Government referred the representation A to its Law Department for is opinion which was furnished on 19th June, 1980.
The representation was rejected on 24th June, 1980.
The rejection was communicated to the jail authorities two days later.
The writ petition filed by the petitioner was dismissed by the High Court.
The aforesaid principles were reiterated by this Court on an appeal preferred by the detenu against the decision of the High Court.
It was held in that case that there was no explanation given by the Government as to why no action was taken on the representation of the detenu on 4th, 5th and 25th June, 1980 and what consideration was given by the Government to it from 13th June, 1980 to 16th June,1980.
On that ground it was held that there was inordinate delay in considering the representation of the detenu and the detention became bad in law.
In the light of these decisions in the present case it must be held that the delay in dealing with the representation of the petitioner, which was admittedly received by the Government on 14th January, 1987 and rejected as late as on 26th February, 1987, must be considered as inordinate delay in dealing with the representation.
No explanation is given in the counter affidavit as to why the representation could not have been dealt with and disposed of earlier, and hence it must be held that the order of detention of the petitioner is vitiated by reason of delay in dealing with his representation.
It was contended by the learned counsel for the respondent that the representation made by the detenu to the Special Secretary, Government of Punjab was invalid as the Advocate who sent the representation had no authority to make that representation.
It was submitted by him in the alternative that the delay in dealing with the representation was on account of the fact that it was made by a person claimed to be the Advocate of petitioner but whose authority was not checked.
In our view neither of these contentions can be upheld.
These contentions have not been taken up in the counter affidavit and cannot be urged merely at the hearing of the petition.
There is nothing in law which prevents a representation being made by an Advocate on behalf of the detenu.
If there was any difficulty on that ground, enquiries should have been made with the Advocate as to what was his authority to represent the detenu, and no such enquiry has been made in the present case.
Thus, in the present case, the fact that the representation was made by the Advocate does not explain the delay in dealing with that representation and cannot constitute any explanation for the delay in dealing with it.
463 lt was next sought to be contended by learned counsel for the respondent that the delay in dealing with the representation had caused no prejudice to the petitioner, because it admitted that he preferred a writ petition against his detention to the Punjab & Haryana High Court and that writ petition was dismissed by the High Court.
In our view this submission also cannot sustain order of detention.
It is true that the writ petition preferred by the petitioner to the Punjab and Haryana High Court was dismissed, but we are informed that a Special Leave Petition filed against that decision is pending in this Court.
Moreover at the time when the writ petition was dismissed, the petitioner had not made any representation to the State Government at all and hence the dismissal of his writ petition by the High Court cannot be regarded as any substitute for consideration of his representation by the State Government which, unlike the Court, might be entitled to go into the factual merits of the grounds forming the basis of detention order.
In support of his contention, learned counsel for the respondent sought to rely on the decision of this Court in Smt.
Asha Keshavrao Bhosale vs Union of India & Anr., ; in which case it was held that the delay of about two months in disposal of the representation made by the petitioner on behalf of the detenu to the Chief Minister against his order of detention did not vitiate the order of detention.
That case, however, is of no assistance to the respondent because it turns on its own facts.
A detailed representation was made in that case by the Secretary, Khed Taluka Maratha Seva Sangh which espoused the cause of the detenu and challenged the detention.
That representation was received on 29th November, 1984 in the Secretariat of the Chief Minister.
It was forwarded to the Home Department on 3rd December, 1984 and disposed of expeditiously, namely, on 12th December, 1984.
The rejection of that representation was communicated on 13th December, 1984.
The High Court, which dismissed the petition of the detenu had considered the contents of both the representations and held that the representation made by the petitioner was the second one and based yon the same grounds and delay in disposing of that representation did not prejudice the case of the detention.
That conclusion was confirmed by the Supreme Court.
The facts in this case are nowhere comparable to the facts of that case, and hence the principles laid down in that case have no application to the case before us.
It was for the aforesaid reasons that the order setting aside the order of detention was passed by us as stated earlier.
N.P.V. Petition allowed.
| The petitioner was detained by the Punjab Government pursuant to an order of detention passed under sub sections (1) and (2) of section 3 of the .
When in jail, he was served with an order passed under section 3(1) of the Conservation of Foreign Exchange and Prevention of Smuggling Act (COFEPOSA) directing his detention.
The petitioner made a representation against his order of detention under COFEPOSA.
He was produced before the Advisory Board.
Pursuant to Board 's recommendation, his detention was revoked.
He was also produced before the same Board, being also the Advisory Board under the .
He did not make any representation against his detention under the , believing that his detention was only under COFEPOSA.
The Board confirmed the detention order.
On January 24, 1986 an order passed under subsection (1) of section 12 read with section 14 A(1)(2)(c) and (d) of the , as amended, confirmed the aforesaid order of detention and the petitioner was directed to be continued to be detained for a period of 2 years from the date of his detention.
The petitioner made a representation dated December 18, 1986, through his Advocate, addressed to the President of India for the revocation of his detention.
On December 24, 1986, the petitioner made a representation to the Government of Punjab against his detention, con tending that his detention was invalid as vital facts and materials that should have influenced the minds of the declaring authority and the detaining authority had not been placed before them.
Both these 457 representations were rejected on 26.2.1987.
The petitioner challenged the order of detention on various grounds including the one that there was inordinate delay in dealing with his representation to the Punjab government.
It was contended that there was no justification for the undue delay in disposing of his representation, which had resulted in violation of his rights under Article 22(5) of the Constitution and that his continued detention was not valid in law.
It was contended on behalf of the respondent State that the representation was received on January 14, 1987, and it was invalid as the Advocate who sent it had no authority to make it and that the delay in dealing with it was on account of the fact that it was made by a person claiming to be an Advocate of the petitioner whose authority was not checked, and that the delay had caused no prejudice to the petitioner because he preferred a writ petition against his detention to the High Court which was dismissed.
This Court allowed the writ petition, set aside the order of detention, and directed release of the petitioner.
Giving reasons for its decision, this Court, ^ HELD: 1.1 Where the liberty of a person is involved, it is the duty of the State to determine his representation with utmost expedition and deal with it continuously until a final decision is taken and communicated to detenu.
Failure to do so vitiates the order of detention, because it infringes the fundamental right given to every citizen under Article 22(5) of the Constitution of India.
[461F G, 460H] In the instant case the delay in dealing with representation of the petitioner, which was admittedly received by the Government on January 14, 1987 and rejected as late as on February 26, 1987, must be considered as inordinate delay in dealing with the representation.
No explanation is given in the counter affidavit as to why the representation could not have been dealt with and disposed of earlier.
Hence, the order of detention is vitiated by reason of delay in dealing with his representation.
[462C E] Saleh Mohammad vs Union of India, and Harish Pahwa vs State of U.P. & Ors., ; , relied on.
458 1.2 There is nothing in law which prevents a representation being made by an Advocate on behalf of the detenu.
If there was any difficulty on that account, enquiry should have been made with the Advocate as to what was his authority to represent the detenu.
No such enquiry has been made in the present case.
Thus, the fact that the representation was made by the Advocate does not explain, and cannot constitute any explanation for the delay in dealing with that representation.
[462G H] 1.3 No doubt the writ petition preferred by the petitioner was dismissed but Special Leave Petition against that decision is pending in this Court.
Further, at that time, the petitioner had not made representation to the State Government at all.
Hence the dismissal of the writ petition by the High Court cannot be regarded as any substitute for consideration of his representation by the State Government which, unlike the Court, might be entitled to go into the factual merits of the grounds forming the basis of detention order.
[463B C] Smt.
Asha Keshavrao Bhosale vs Union of India & Anr., ; , distinguished.
|
minal Appeal No. 144 of 1962.
Appeal by special leave from the judgment and order dated May 10, 1962, of the Patna High Court in Criminal Appeal No. 339 of 1961.
B.K. P. Sinha and A. G. Ratnaparkhi, for the appellants.
S.P. Varma, P. D. Menon and, B. N. Sachthey, for the respondent.
December 6.
The judgment of the Court was delivered by AYYANGAR, J.
This appeal by special leave granted by us on September 7, 1962, raises for 747 consideration the proper construction of sections 6 and 11 of the (XX of 1958), hereinafter called the ,Act '.
The appellants are two brothers Ramji and Basist.
It was alleged that these two assaulted one Sidhnath (P.W. 2) who as a result suffered grievous injuries Basist, the younger brother was charged before the Assistant Sessions judge, Arrah, with the commission of an offence under section 307, Indian Penal Code, for the reason that the injury he inflicted was a bhala blow under circumstances ""that if by that act death had been caused he would have been guilty of murder", and as the injury actually sustained was grievous he was further charged with causing grievous hurt under section 326, Indian Penal Code.
The elder brother who too caused hurt to the victim was charged under section 324, Indian Penal Code.
The Assistant Sessions.
Judge held the prosecution case as alleged establish against both the accused.
It is now necessary to mention that according to the Sessions judge Ramji was 21 years old and Basist 19.
Section 6 of the Act enacts : "6.
(1) When any person under twenty one years of age is found guilty of having committed an offence punishable with imprisonment (but not with imprisonment for life), the Court by which the person is found guilty shall not sentence him to imprisonment unless it is satisfied that, having regard to the circums tances of the case including the nature of the offence and the character of the offender, would not be desirable to deal with him under section 3 or section 4, and if the Court passes any sentence of imprisonment on the offender, shall record its reasons for doing so.
(2) For the purpose of satisfying itself Whether it would not be desirable to deal under section 3 748 or section 4 with an offender referred to in subsection (1), the Court shall call for a report from the probation officer and consider the report, if any, and any other information available to it relating to the character and physical and mental condition of the offender.
" The terms of this section excluded the application of its provisions to Basist who was found guilty of an offence punishable with imprisonment for life (both sections 307 and 326, Indian Penal Code).
He accordingly sentenced Basist to undergo rigorous imprisonment for six years under section 307, Indian Penal Code, and to four 'years under section 326, Indian Penal Code, the sentences to run concurrently.
As regards Ramji, the elder brother, he considered it inappropriate to afford him the benefit of this provision and recorded his finding on this matter in these terms: "So far as accused Ramji is concerned I am not inclined to take recourse to the provisions of the , because the act of assault on the informant on the part of this accused is premeditated." He sentenced him to undergo rigorous imprisonment for two years under section 324, Indian Penal Code.
Both the accused filed an appeal to the High Court.
The learned Single judge who heard the appeal considered the evidence in the case and the circumstances in which the injury was inflicted and held that there was no intention on the part of Basist to cause grievous hurt to P.W. 2, with the result that as against him the ' conviction under section 307 as well as that under section 326, Indian Penal Code, were set aside and in their place he recorded a finding of guilty in respect of an offence under section 324, Indian Penal Code, for which he imposed a sentence of rigorous imprisonment for two years.
As against Ramji the conviction was maintained but being informed by 749 counsel that that accused had been suffering from tuberculosis the sentence of imprisonment was reduced from 2 years to 9 months.
It was urged before the High Court that the reasons assigned by the Assistant Sessions judge for refusing to apply the provisions of section 6 of the Act to accused Ramji were not proper.
This submission was, however, repelled since the learned judges considered the section inapplicable to that accused because, though he might have been "under 21 Years of age" on the date of the offence (October 17, 1960), "he was not a person under 21 years of age" on May 24, 1961, when the Sessions judge found him guilty and sentenced him to a term of imprisonment, holding that the crucial date on which the age had to be determined being not the date of the offence but the date on which as a result of a finding of guilty sentence had to be passed against the accused.
As regards Basist also, it was urged before the High Court that in view of the alteration in the finding recorded as regards his guilt, the beneficial provisions of section 6 of the Act became applicable to him, the learned judge holding that he could pass the same order as the trial court could have done because of the provisions contained in section 11 of the Act reading : "11.
(1) Notwithstanding anything contained in the Code or any other law, an order under this Act may be made by any Court empowered to try and sentence the offender to imprisonment and also by the High Court or any other Court when the case comes before it on appeal or in revision.
(2) Notwithstanding anything contained in the Code, where an order under section 3 or section 4 is made by any Court trying the offender (other than a High Court), an appeal shall lie to the 750 Court to which appeals ordinarily lie from the sentences of the former Court.
(3) In any case where any person under. twenty.
one years of age is found guilty of having committed an offence and the Court by which he is found guilty declines to deal with him under section 3 or section 4, and passes against him any sentence of imprisonment with or without fine from which no appeal lies or is preferred, then, notwithstanding anything contained in the Code or any othe r law, the Court to which appeals ordinarily lie from the sentences of the former Court may, either of its own motion or on an application made to it by the convicted person or the Probation officer, call for and examine the record of the case and pass such order thereon as it thinks fit.
(4) When an order has been made under section 3 or section 4 in respect of an offender, the Appellate Court or the High Court in the exercise of its power of revision may set aside such order and in ' lieu thereof pass sentence on such offender according to law Provided that the Appellate Court or the High Court in revision shall not inflict a greater punishment than might have been inflicted by the Court by which the offender was found guilty.
" The learned judge however, declined to do so observing: "No doubt, under the provisions of section 11 of the this Court is competent to make an order, but it is entirely discretionary for this Court to exercise the power conferred on it under section II.
In, view of the fact that the Court below has already dealt with 751 this matter, though not very satisfactorily, I do not consider it desirable to deal with the cases of these appellants under the provisions of the at this stage." and instead, passed the sentence of imprisonment as already mentioned.
It is the correctness of these orders refusing to apply the provisions of section 6 of the Act to the cases of the appellants that is raised for consideration in this appeal.
Taking first the case of Ramji , the elder brother, we entirely agree with the High Court in their construction of section 6.
The question of the age of the person is relevant not for the purpose of determining his guilt but only for the purpose of the punishment which he should suffer for the offence of which he has been found, on the evidence, guilty.
The object of the Act is to prevent the turning of youthful offenders into criminals by their association with hardened criminals of mature age within the walls of a prison.
The method adopted is to attempt their possible reformation instead of inflicting on them the normal punishment for their crime.
If this were borne in mind it would be clear that the age referred to by the opening words of section 6(1) should be that when the court is dealing with the offender that being the point of time when the court has to choose between the two alternatives which the Act in supersession of the normal penal law vests in it, viz., sentence the offender to imprisonment or to apply to him the provisions of section 6(1) of the Act.
As the High Court has found that Ramji was not a person under the age of 21 on May 24, 1961, when.
the learned Sessions judge found him guilty it is clear that section 6(1) of the Act has no application to him.
The position in regard to the second appellant Basist tands on an entirely different footing.
He was said to be of the age of 19 by the Sessions judge 752 which is apparently a reference to the time when the offence was committed.
If so, he would have been about 20 at the time when the Sessions judge found him guilty of offences under sections 307 and 326, Indian Penal Code, and possibly also below 21 at the time when the High Court altered his conviction into one under section 324, Indian Penal Code.
If by reason of his age, and the offence of which he was been found guilty the provisions of section 6(1) are not excluded, the question that has next to be considered is whether the learned judge had an absolute and unfettered discretion to pass or refuse an order under 'the Act by virtue of the terms of section 11 of the Act.
This would obviously turn on (1) whether or not section 6(1) was applicable to the High Court, and (2) the proper construction.
of the terms of section 11 which empowers appellate and revisional courts to pass orders under the Act.
It was urged by learned Counsel for the appellant that the High Court when it recorded a finding that Basist was guilty of an offence under section 324, Indian Penal Code, was squarely within the words "the court by which a person is found guilty" occurring in section 6(1) as it was only by that Court that for the first time the accused was found guilty of an offence which was not excluded by the opening words of that section.
Learned Counsel relied for this position on the judgment of High Court of Madras in Narayananwami Naidu vs Emperor (1) following a ,decision of the Allahabad High Court to a similar effect in Emperor vs Birch (2).
The question that arose in the first of the above cases related to the scope of the words "Court before whom he is con victed" occurring in section 562, Code of Criminal Procedure, as it originally stood.
The provision in section 562, Code of Criminal Procedure, is somewhat in pari materia with section 4 of the Act wherein a Person found guilty of having committed offences not punishable (1) Mad.
(2) All. 306.
753 with death or imprisonment for life may, instead of being sentenced to imprisonment, be released on entering into a bond.
In the Code as originally enacted which the decision referred to had to deal with, there was no express provision as regards the power of appellate courts to pass similar orders.
The accused in that case was tried and convicted by a magistrate under sg.
447 and 352, Indian Penal Code, and sentenced to undergo rigorous imprisonment for two weeks.
The accused filed an appeal and the Deputy Magistrate who heard it while affirming the conviction directed his release on his executing a bond applying to him the provisions contained in section 562, Code of Criminal Procedure.
The District judge considered that the Deputy Magistrate had exceeded his jurisdiction in making this order and referred the question to the High Court.
The learned judges rejected the reference observing that the words ""Court before whom he is convicted ' used in s.562 were not intended to limit the power of making orders under that section to the court of first instance.
It might be mentioned that the Code has since been amended by the addition of sub section
(2) which runs : "An order under this section may be made by an appellate court or by the High Court when exercising its powers of revision." so that it is no longer necessary for an appellate or revisional court to rely on any construction of the words ", 'the court by which the person is found guilty" for invoking or exercising its jurisdiction.
The position therefore comes to this the words referring to ""the court by which a per son is found guilty" are wide enough to include an appellate court, and particularly so where it is the appellate court alone which by reason of its finding on the guilt of the accused becomes for the first time vested with the power or the duty to act under the section.
754 Undoubtedly if section II were attracted to the case, then there would be no need for invoking the Jurisdiction of the High Court under section 6, and indeed in those circumstances the proper construction of section 6 itself would be to exclude an appellate or revisional court since a redundancy could not have been intended by the statute.
The first question would therefore be to ascertain whether the jurisdiction or powers envisaged by section 6(1) are within ' the scope of the jurisdiction conferred by section 11.
The power conferred on the High Court is to pass ""an order under the Act.
" One is thrown back on the Act for determining what these are.
They are: (1)Under section 3 a court might order the release of a person found guilty of an offence of the type specified in the section after due admonition.
(2)Under section 4 an order may be passed in circumstances set out in it releasing such person on entering into a bond with or without sureties or pass a supervision order.
(3)Orders which are consequential on orders under section 3 or section 4 like those for which provision is made by sections 5 & 9.
So far as section 6 is concerned it is, to say the least, doubtful whether it.
involves the " 'passing of an order", for the operative words are that the court finding a person guilty refrains from passing any sentence.
An injunction enacted by this Act against passing a sentence of imprisonment which the court under the normal law is empowered or enjoined to pass can hardly be termed ",passing an order" under the Act.
If this were correct, the result would be that on the reasoning which the High Courts of Madras and Allahabad adopted to construe the words in section 562, of the Code, the High Court, when hearing an appeal, would be subject to the provisions of section 6. 755 It is however possible that the words in section 11 (1) "" ',pass an order under the Act" are not to be construed so strictly and literally, but to be understood to mean "to exercise the powers or Jurisdiction conferred by the Act.
" This wider interpretation might perhaps be justified by the scope and object of this section.
Section 11 is to apply ""notwithstanding anything in the Code or any other law" to all courts empowered to sentence offenders to imprisonment.
TO read a beneficial provision of this universal type in a restricted sense, so as to confine the power of these courts to the exercise of the powers under sections 3 and 4 alone would not, in our opinion, be in accord with sound principles of statutory interpretation.
We are therefore inclined to hold that the Courts mentioned in section 11 be they trial courts or exercising appellate or revisional jurisdiction are thereby empowered to exercise the jurisdiction conferred on Courts not only under sections 3 and 4 and the consequential provisions but also under section 6.
Accepting therefore the interpretation of section 11 (1) which was urged by Counsel for the respondent, that the courts mentioned in it could pass orders under sections 3, 4 or 6, the question next to be considered relates to the incidents of that jurisdiction with regard to the amount and nature of discretion vested in these courts.
It was submitted on behalf of the appellant that the power conferred on the High Court and other courts by section 11 (1) was neither more nor less than those of the court under section 6 (1) and that the former were bound to exercise it, subject to the same conditions and limitations as are set out in the latter provision.
Stated in other words the interpretation suggested was that the terms of s.6 had, so to speak, to be read into the jurisdiction of the courts acting under section II (1).
On the other hand the contention urged by the respondent was that section II (1) had to be read on its own language and so read it conferred on 756 the courts mentioned in it, an absolute and unfettered discretion "to pass or not to pass an order under the Act" as they thought fit having regard to the circumstances of each case.
A considerable portion of the argument by the respondent was based on the import of the facultative verb "may" in the words " 'may be made" occurring in the operative part of the sub section as conferring a discretion and that as no limitations were placed ' by this or any other section on the exercise of this discretion, the same should be held to be unfettered and therefore capable of being exercised, no doubt, on judicial principles but not subject to any statutory limitations.
It might be mentioned that from the relevant passage of the judgment of the High Court which we have extracted, it would appear that the learned judge has proceeded on this interpretation of section 11.
Though the word "may" might connote merely an enabling or permissive power in the sense of the usual phrase ""it shall be lawful", it is also capable of being construed as referring to a compellable duty, particularly when it refers to a power conferred on a court or other judicial authority.
As observed in Maxwell on Statutes "Statutes which authorise persons to do acts for the benefit of others, or, as it is sometimes said, for the public good or the advancement of justice, have often given rise to controversy when conferring the authority in terms simply enabling and not mandatory.
In enacting that they 'may ' or 'shall ' if they think fit, or '&hall have power, ' or that, 'it shall be lawful ' for them to do such acts, a statute appears to use the language of mere permission but it has been so often decided as to have become an axiom that in such cases such expressions 757 may have to, say the least a compulsory force.
The fact that the power is conferred on a Court might militate against the literal interpretation of "may" suggested by the respondent.
This apart, the power conferred by section 11(1) is to pass " 'an order under the Act" and the question arises as to the precise import of these words, and in particular whether these words would not imply that the order to be passed would be subject to the same limitations or conditions as the orders under what might be termed the primary provisions of the Act.
Thus section 3 empowers a court to release certain offenders on probation of good conduct after due admonition, and it lays down certain tests as a guidance or the bases upon which that discretion is to be exercised : (1) that no previous conviction should have been proved against him, and (2) that the court by which the person is found guilty should be of the opinion that, having regard to the circumstances of the case including the nature of the offence and the character of the offender it is expedient so to do.
Similarly, section 4 empowers a court to release certain offenders on probation of good conduct, The criteria laid down there.
and the guidance set out is that the court by which the person is found guilty should be of opinion that, having regard to the circumstances of the case including the nature of the offence and the character of the offender, it is expedient to release him, on probation of good conduct, with a proviso that the power is not to be exercised unless the court were satisfied that the offender or his surety has :a fixed place of abode or regular occupation in the place over which the court exercises jurisdiction or in which the offender is likely to live during the period for which he enters into the bond.
Would it be a proper construction of section 11 (1) to hold that the High Court etc.
could pass orders in appeal or revision without reference to these standards, 758 tests or guidance which the statute has prescribed for the primary courts? We are clearly of the opinion that this is capable only of a negative answer and that the power conferred on appellate or other courts by section II (1) was of the same nature and characteristics and subject to the same criteria and limitations as that conferred on the courts under sections 3 & 4.
We are confirmed in this view by the terms of section 11(3).
If this were so it would not be possible to adopt a, different rule of interpretation when one came to consider the power under section 6.
It cannot, for instance, be suggested that the High Court could in its discretion exercise the power under section 6 in the case of a person who is above the age of 21, nor where a person is found guilty of an offence punishable with death or imprisonment for life.
These limitations on the exercise of the discretion have surely to be gathered only from the terms of section 6(1).
If section 6(1) applies so far to restrict the absolute and unfettered discretion implied by the word "may", it appears to us that logically the conclusion is inescapable that the entirety of section 6(1) applies to guide or condition the jurisdiction of the High Court under section 11(1).
We there.
fore reject the submission made to us on behalf of the respondent that an appellate court has an unfettered discretion in dealing with a case which comes before it under section 11 and that its discretion and powers are not to be governed by the terms of section 6(1).
The question next to be considered is the result of applying the terms of section 6(1) to a person in the position of Basist.
It was not disputed by learned counsel for the respondent that the learned Judge of the High Court failed to consider the case of this accused with reference to the terms of section 6 since he has proceeded on the basis that he had an unfettered discretion in the matter and which in the circumstances of the present case he was not inclined to exercise in favour of the accused.
The order of the High Court in so far as it relates to the second appellant 759 Basist must therefore be set aside and the High Court directed to exercise its discretion on the basis that it was judging the matter with reference to the criteria laid down in section 6.
We shall now proceed to consider one question which was mooted before us in regard to the crucial date for reckoning the age where an appellate court modifies the judgment of the trial judge, when section 6 becomes applicable to a person only on the decision of an appellate or a revisional court.
Is the age of the offender to be reckoned as at the date of the judgment of the trial judge or is it the date when the accused is, for the first time, in a position to claim the benefit of section 6.
We consider that on the terms of the section, on grounds of logic as well as on the theory that the order passed by an appellate court is the correct order which the trial court should have passed, the crucial date must be that upon which the trial court had to deal with the offender.
In this view as Basist was admittedly below 21 years of age at the time of the judgment of the Assistant Sessions judge, section 6 was not inapplicable to him even assuming he was above that age by the date of the order in appeal.
The appeal is accordingly allowed in part i.e., in regard to the second appellant Basist and is remanded to the High Court to consider the proper order to be passed in his case by applying the provisions of section 6 of the probation of offenders Act, 1958.
Appeal allowed in part.
| Where a person is induced to purchase shares at a certain price by fraud the measure of damages which he is entitled to recover from the seller is the difference between the price which he paid for the shares and the real price of the shares on the date on which the shares were purchased.
Ordinarily the market rate of the shares on the date when the fraud was practised would represent their real price in the absence of any other circumstance.
If, however, the market was vitiated or was in a state of flux or 790 panic in consequence of the very fact that was fraudulently concealed, then the real value of the shares has to be determined on a Consideration of a variety of circumstances, disclosed by the violence led by the parties.
A firm of sharebrokers sold 3,000 shares to the plaintiff who was a constituent of the firm, on the 5th April, 1937, at Rs. 77 and Rs. 77 4as, per share without disclosing to the plaintiff the fact that the shares were owned by one of the partners of the firm and also the fact that they had received telephonic information on that day from a member of the Stock Exchange that there was going to be a sharp decline in the price of the shares.
On the 6th April the Stock Exchange Association passed a resolution for closing the Exchange on the 8th and 9th April.
The plaintiff had to sell 2,000 shares through the defendants on the 20th April at Rs. 47 to Rs. 42 per share, and 1,000 shares on the 22nd April at Rs. 428as.
The High Court awarded the difference between the price paid by the plaintiff and the prices fetched on resale as damages.
On appeal, Held, that the prices received at the resale on the 20th and 22nd April could not represent the true value of the shares on the 5th April.
The real question for determination was what the market value would have been on the 5th April of these shares if all the buyers and sellers know that the Stock Exchange was to be closed on the 8th and 9th April.
Held also that the plaintiff was entitled to get interest on the amount awarded as damages from the 5th April till the date of suit on the principle that where money is obtained or retained by fraud a court of equity will order it to be returned with interest.
Johnson vs Rex ([1904] A.C. 817) referred to.
It is well settled that the decision of a case cannot be 'based on grounds outside the pleadings of the parties and that it is the case pleaded that has to be found.
Where the plaintiff based his claim for a certain sum of money on the ground that the defendants had sold certain shares belonging to him without his instructions, but he was not able to prove that the sale was not authorised by him: Held, reversing the decision of the High Court, that the plaintiff could not be given a decree for the sum claimed on the ground of failure of consideration, as he had not set up any such alternative claim in the plaint or even at a later stage when he sought to amend the plaint.
|
N: Criminal Appeal No. 234 of 1976.
Appeal by special leave from the judgment and order dated the 5th December, 1975 of the Andhra Pradesh High Court in Criminal Revision Case No. 816 of 1974 (Criminal Revision Petition No. 732 of 1974).
AND Criminal Appeal Nos. 315 and 316 of 1976.
Appeals by special leave from the judgment and order dated the 12th April, 1976 of the Andhra Pradesh High Court in Criminal Appeal Nos.
31 O & 311 of 1975.
P. Govindan Nair and A. Subba Rao for the Appellant in Crl.
A. No. 234/76.
M. N. Phadke, and B. Kanta Rao for the Appellant in Crl.
A. Nos.315 & 316 of 1976.
G. N. Rao for the Respondent in all the appeals.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
What is the effect of the declaration by the Supreme Court that the appointment of an Additional Sessions Judge was invalid on judgments pronounced by the Judge prior to such declaration is the question for consideration in these criminal appeals.
The question may seem to be short and simple but it cannot be answered without enquiry and research.
An answer, on first impression, may be 'a judgment by a judge who is not a judge is no judgment ' ' a simple, sophisticated answer.
But it appears 477 second thoughts are necessary.
What is to happen to titles settled, declarations made, rules issued, injunctions and decrees granted and even executed ? What is to happen to sentences imposed ? Are convicted offenders to be set at liberty and to be tried again '! Are acquitted accused to be arrested and tried again ? Public Policy is clearly involved.
And, in the tangled web of human affairs, law must recognise some consequences as relevant, not on grounds of pure logic but for reasons of practical necessity.
To clear the confusion and settle the chaos, judges have invented the de facto doctrine, which we shall presently examine.
de facto doctrine is thus a doctrine of necessity and public policy.
A. No. 234 of 1976 arises out of a proceeding under S.6A of the Essential Commodities Act, by which the District Revenue officer West Godavari, Andhra Pradesh, ordered the confiscation of Rs. 203.74 kgs.
Of paddy and Rs. 302.25 kgs. of rice.
The appellant, Gokaraju Rangaraju, preferred an appeal under section 6C of the Essential Commodities Act to the Court of Session, West Godavari.
The appeal was heard by Shri G. Anjappa, Additional Sessions Judge and was rejected.
The appellant preferred a Criminal Revision Petition before the High Court of Andhra Pradesh.
Criminal Appeal Nos. 315 and 316 of 1976 arise out of Sessions Case No. 12 of 1975 in the Court of Session, Guntur Division ' The case was heard and the judgment was pronounced by Shri Raman Raj Saxena, II Additional Sessions Judge, Guntur.
The convicted accused preferred appeals to the High Court of Andhra Pradesh.
By the time the Criminal Revision case filed by Gokaraju Rangaraju and the Criminal Appeals filed by the appellants in Crl.
Appeals Nos. 315 and 316 of 1976 came up for hearing before the High Court of Andhra Pradesh, this Court by its judgment dated 2nd September 1975 quashed the appointment of Shri G. Anjappa, Shri Raman Raj Saxena and two others as District Judges Grade II, on the ground that their appointment was in violation of the provisions of article 233 of the Constitution.
Thereupon a point was raised in the Criminal Revision case as well as in the Criminal Appeals that the judgments rendered by Shri Anjappa and Shri Raman Raj Saxena were void and required to be set aside.
The High Court overruled the point raised by the present appellants and held that though the appointment of Shri Anjappa and Shri Raman Raj Saxena as District Judges Gr.
II was invalid, yet they were not mere usurpers but had held office under lawful H authority and therefore, the judgments rendered by them were valid and could not be questioned in collateral proceedings.
The present 478 appeals have been preferred by special leave granted by this Court.
In Criminal Appeals Nos. 315 and 316 of 1976, however, the special leave granted by this Court was limited by the order granting leave to the question whether the judgments rendered by Sessions Judges were void where their appointment as Sessions Judges was subsequently declared illegal.
Shri Govindan Nayar learned counsel for the appellants in Crl.
A. No. 234 of 1976 and Shri Phadke, learned counsel for the appellants in Crl.
Appeals Nos. 315 & 316 of 1976, argued before us that the judgments rendered by Shri Anjappa and Shri Raman Raj Saxena were void as they were never duly appointed as District Judges.
It was urged that there was no need for them to question the appointment of Shri Anjappa or Shri Kaman Raj Saxena as their appointment had already been quashed by the Supreme Court.
It was said that the de facto doctrine was based on public policy and necessity and that in the present case neither public policy or necessity required that the judgments should not be set aside.
No inconvenience would be caused by ordering a rehearing of the appeals or a retrial of the accused.
It was also urged that the attack, if any, on the appointment of Shri Anjappa and Shri Raman Raj was not collateral attack.
It was submitted that a question of jurisdiction could be raised at any stage in a criminal case and a trial by a Sessions Judge who was appointed in violation of article 233 was not a trial by a Sessions Judge duly appointed to exercise jurisdiction in a Court of Session under section 9 of the Code of Criminal Procedure.
It was argued that the de facto doctrine was not an absolute doctrine.
It was subject to certain limitations.
One such limitation was that imposed by article 233 of the Constitution.
A person appointed as a District Judge contrary to the provisions of article 233 was no judge and his judgments were no judgments.
It was submitted that the 20th Amendment of the Constitution would be a surplusage if the de facto doctrine was to be applied to judgments rendered by persons appointed as District Judges contrary to the provisions of article 233 of the Constitution.
It was also suggested that the Fundamental Right of the appellants under article 21 of the Constitution was violated as their liberty was being taken away otherwise than in accordance with the procedure established by law.
We are unable to agree with the submissions of the learned counsel for the appellants.
The doctrine is now well established that "the acts of the officers de facto performed by them within the scope of their assumed official authority, in the interest of the public 479 or third persons and not for their own benefit, are generally as valid and binding, as if they were the acts of officers de jure" (Pulin Behari vs King Emperor).
As one of us had occasion to point out earlier "the doctrine is founded on good sense, sound policy and practical expedience.
It is aimed at the prevention of public and private mischief and the protection of public and private interest.
It avoids endless confusion and needless chaos.
An illegal appointment may be set aside and a proper appointment may be made, but the acts of those who hold office de facto are not so easily undone and may have lasting repercussions and confusing sequels if attempted to be undone.
Hence the de facto doctrine" (vide Immedisetti Ramkriashnaiah Sons vs State of Andhra Pradesh and Anr.
In Pulin Behari vs King Emperor, (Supra) Sir Ashutosh Mukerjee J. noticed that in England the de facto doctrine was recognised from the earliest times.
The first of the reported cases where the doctrine received judicial recognition was the case of Abbe of Fountaine decided in 1431.
Sir Ashutosh Mookerjee noticed that even by 1431 the de facto doctrine appeared to be quite well known and, after 1431, the doctrine was again and again reiterated by English Judges.
In Milward vs Thatcher, Buller J. said: "The question whether the judges below be properly judges or not.
can never be determined, it is sufficient if they be judges de facto.
Suppose a person were even criminally convicted in a Court of Record, and the Recorder of such Court were not duly elected, the conviction would still be good in law, he being the judge de facto".
In Seaddling vs Lorant, the question arose whether a rate for the relief of the poor was rendered invalid by the circumstance that some of the vestry men who made it were vestry men de facto and not de jure.
The Lord Chancellor observed as follows: With regard to the competency of the vestry men, who were vestry men de facto, but not vestry men de jure, to make the rate, your Lordships will see at once the impor 480 tance of that objection, when you consider how many public officers and persons there are who were charged with very important duties, and whose title to the office on the part of the public cannot be ascertained at the time.
You will at once see to what it would lead if the validity of their acts, when in such office, depended upon the propriety of their election.
It might tend, if doubts were cast upon them, to consequences of the most destructive kind.
It would create uncertainty with respect to the obedience to public officers and it might also lead to persons, instead of resorting to ordinary legal remedies to set right anything done by the officers, taking the law into their own hands".
Some interesting observations were made by the Court of Appeal in England in re James (An Insolvent).
Though the learned Judges constituting the Court of Appeal differed on the principal question that arose before them namely whether "the High Court of Rhodesia" was a British Court, there did not appear to be any difference of opinion on the question of the effect of the invalidity of the appointment of a judge on the judgments pronounced by him.
Lord Denning M. R., characteristically, said: "He sits in the seat of a judge.
He wears the robes of a judge.
He holds the office of a judge.
May be he was not validly appointed.
But, still, he holds the office.
It is the office that matters, not the incumbent . . so long as the man holds the office and exercises it duly and in accordance with law, his orders are not a nullity.
If they are erroneous they may be upset on appeal.
But if not erroneous they should be upheld".
Lord Denning then proceeded to refer to the State of Connecticut vs Carroll decided by the Supreme Court of Connecticut, Re Aldridge decided by the Court of Appeal in New Zealand and Norton vs Shelby County decided by the United States Supreme Court.
Observations made in the last case were extracted and they were: "Where an office exists under the law, it matters not how the appointment of the incumbent is made, so far as the validity of his acts are concerned.
It is enough that he is clothed with the insignia of the office, and exercises its powers and functions.
The official acts of such persons are recognised as valid on grounds of public policy, and for the protection of those having official business to transact." 481 Scarman LJ who differed from Lord Denning on the question whether the High Court of Rhodesia was a British Court appeared to approve the view of Lord Denning M. R. in regard to the de facto doctrine.
He said: "He (Lord Denning) invokes the doctrine of recognition of the de facto judge, and the doctrine of implied mandate or necessity.
I agree with much of the thinking that lies behind his judgment.
I do think that in an appropriate case our courts will recognise the validity of judicial acts, even though they be the acts of a judge not lawfully appointed or derive their authority from an unlawful government.
But it is a fallacy to conclude that, because in certain circumstances our Courts would recognise as valid the judicial acts of an unlawful court or a de facto judge, therefore, the Court thus recognised is a British Court".
The de facto doctrine has received judicial recognition in the United States of America also.
In State vs Gardner (Cases on Constitutional Law by Mc.
Gonvey and Howard Third Edition 102) the question arose whether the offer of a bribe to a City Commissioner whose appointment was unconstitutional was an offence.
Broadbury, J. said.
"We think that principle of public policy, declared by the English Courts three centuries ago, which gave validity to the official acts of persons who intruded themselves into an office to which they had not been legally appointed, is as applicable to the conditions now presented as they were to the conditions that then confronted the English Judiciary.
We are not required to find a name by which officers are to be known, who have acted under a statute that has subsequently been declared unconstitutional, though we think such officers might aptly be called de facto officers.
" In Norton vs Shelby Country, Field, J., observed as follows: "The doctrine which gives validity to acts of officers de facto whatever defects there may be in the legality of their appointment or election is founded upon considerations of policy and necessity, for the protection of the pub 482 lic and individuals whose interests may be affected thereby.
Offices are created for the benefit of the public, and private parties are not permitted to inquire into the title of persons clothed with the evidence of such offices and in apparent possession of their powers and functions.
For the good order and peace of society their authority is to be respected and obeyed until in some regular mode prescribed by law their title is investigated and determined.
It is manifest that endless confusion would result, if in every proceeding before such officers their title could be called in question.
" In Cooley 's 'Constitutional Limitations ', Eighth Edition, Volume II p. 1 355, it is said, "An officer de facto is one who by some colour or right is in possession of an office and for the time being performs its duties with public acquiescence, though having no right in fact.
His colour of right may come from an election or appointment made by some officer or body having colourable but no actual right to make it; or made in such disregard of legal requirements as to be ineffectual in law; or made to fill the place of an officer illegally re moved or made in favour of a party not having the legal qualifications; or it may come from public acquiescence in the qualifications; or it may come from public acquiescence in the officer holding without performing the precedent conditions, or holding over under claim of right after his legal right has been terminated; or possibly from public acquiescence alone when accompanied by such circumstances of official reputation as are calculated to induce people, without inquiry, to submit to or invoke official action on the supposition that the person claiming the office is what he assumes to be.
An intruder is one who attempts to perform the duties of an office without authority of law, and without the support of public acquiescence.
No one is under obligation to recognise or respect the acts of an intruder, and for all legal purposes they are absolutely void.
But for the sake of order and regularity, and to prevent confusion in the conduct of public business and in security of private rights, the acts of officers de facto are not suffered to be questioned because of the want of legal authority except by some direct proceeding instituted for 483 the purpose by the State or by some one claiming the office de jure, or except when the person himself attempts to build up some right, or claim some privilege or emolument, by reason of being the officer which he claims to be.
In all other cases the acts of an officer de facto are as valid and effectual, while he is suffered to retain the office, as though he were an officer by right, and the same legal consequences will flow from them for the protection of the public and of third parties.
There is an important principle, which finds concise expression in the legal maxim that the acts of officers de facto cannot be questioned collaterally.
" In Black on judgments it is said: "A person may be entitled to his designation although he is not a true and rightful incumbent of the office, yet he is no mere usurper but holds it under colour of lawful authority.
And there can be no question that judgments rendered and other acts performed by such a person who is ineligible to a judgeship but who has nevertheless been duly appointed, and who exercises the power and duties of the office is a de facto judge, and his acts are valid until he is properly removed.
" The de facto doctrine has been recognised by Indian Courts also.
In Pulin Behari vs King Emperor, Sir Ashutosh Mookerjee, J after tracing the history of the doctrine in England observed as follows: "The substance of the matter is that the de facto doctrine was introduced into the law as a matter of policy and necessity, to protect the interest of the public and the individual where these interests were involved in the official acts of persons exercising the duties of an office without being lawful officers.
The doctrine in fact is necessary to maintain the supremacy of the law and to preserve peace and order in the community at large.
Indeed, if any individual or body of individuals were permitted, at his or their pleasure, to collaterally challenge the authority of and to refuse obedience to the Government of the State and the numerous functionaries through whom it exercised its various 484 powers on the ground of irregular existence or defective title, insubordination and disorder of the worst kind would be encouraged.
For the good order and peace of society, their authority must be upheld until in some regular mode their title is directly investigated and determined.
" In P. section Menon vs State of Kerala and Ors. a Full Bench of the Kerala High Court consisting of P. Govindan Nair, K.K. Mathew and T.S. Krishnamoorthy Iyer, JJ said about the de facto doctrine: "This doctrine was engrafted as a matter of policy and necessity to protect the interest of the public and individual involved in the official acts of persons exercising the duty of an officer without actually being one in strict point of law.
But although these officers are not officers de jure they are by virtue of the particular circumstances, officers, in fact, whose acts, public policy requires should be considered valid".
In the judgment under appeal Kuppuswami and Muktadar, JJ observed: "Logically speaking if a person who has no authority to do so functions as a judge and disposes of a case the judgment rendered by him ought to be considered as void and illegal, but in view of the considerable inconvenience which would be caused to the public in holding as void judgments rendered by judges and other public officers whose title to the office may be found to be defective at a later date.
Courts in a number of countries have, from ancient times evolved a principle of law that under certain conditions, the acts of a judge or officer not legally competent may acquire validity".
A judge, de facto, therefore, is one who is not a mere intruder or usurper but one who holds office, under colour of lawful authority, though his appointment is defective and may later be found to be defective.
Whatever be the defect of his title to the office, judgments pronounced by him and acts done by him when he was clothed with the powers and functions of the office, albeit unlawfully, have the same efficacy as judgments pronounced and acts done by a Judge de 485 jure.
Such is the de facto doctrine, born of necessity and public policy to prevent needless confusion and endless mischief.
There is yet another rule also based on public policy.
The defective appointment of a de facto judge may be questioned directly in 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 titles cannot be permitted to bring in issue and litigate upon the title of a judge to his office.
Otherwise so 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.
To question a judge 's appointment in an appeal against the judgment is, of course, such a collateral attack.
We do not agree with the submission of the learned counsel that the de facto doctrine is subject to the limitation that the defect in the title of the judge to the office should not be one traceable to the violation of a constitutional provision.
The contravention of a constitutional provision may invalidate an appointment but we are not concerned with that.
We are concerned with the effect of the invalidation upon the acts done by the judge whose appointment has been invalidated.
The de facto doctrine saves such Acts.
The de facto doctrine is not a stranger to the Constitution or to the Parliament and the Legislatures of the States.
article 71(2) of the Constitution provides that acts done by the President or Vice President of India in the exercise and performance of the powers and duties of his office shall not be invalidated by reason of the election of a person as President or Vice President being declared void.
So also Sec.
107(2) of the Representation of the People Act 1951 (Act 43 of 1951) provides that acts and proceedings in which a person has participated as a Member of Parliament or a Member of the Legislature of a State shall not be invalidated by reason of the election of such person being declared to be void.
There are innumerable other Parliamentary and State Legislative enactments which are replete with such provisions.
The Twentieth Amendment of the Constitution is an instance where the de facto doctrine was applied by the Constituent body to remove any suspicion or taint of illegality, or invalidity that may be argued to have attached itself to judgment, decrees sentences or orders passed or made by certain District Judges appointed before 1966, otherwise than in accordance with the provision of article 233 and Art 235 of 486 the Constitution.
The Twentieth Amendment was the consequence of the decision of the Supreme Court in Chandra Mohan vs State of Uttar Pradesh and Ors., that appointments of District Judges made otherwise than in accordance with the provisions of articles 233 and 235 were invalid.
As such appointments had been made in many States, in order to preempt mushroom litigation springing up all over the country, it was apparently thought desirable that the precise position should be stated by the Constituent body by amending the Constitution.
Shri Phadke, learned counsel for the appellants, argued that the constituent body could not be imputed with the intention of making superfluous amendments to the Constitution.
Shri Phadke invited us to say that it was a necessary inference from the Twentieth Amendment of the Constitution that, but for the amendment, the judgments, decrees etc.
of the District Judges appointed otherwise than in accordance with the provisions of article 233 would be void.
We do not think that the inference suggested by Shri Phadke is a necessary inference.
It is true that as a general rule the Parliament may be presumed not to make superfluous legislation.
The presumption is not a strong presumption and statutes are full of provisions introduced because abundans cautela non nocet (there is no harm in being cautious).
When judicial pronouncements have already declared the law on the subject, the statutory reiteration of the law with reference to the particular cases does not lead to the necessary inference that the law declared by the judicial pronouncements was not thought to apply to the particular cases but may also lead to the inference that the statute making body was mindful of the real state of the law but was acting under the influence of excessive caution and so to silence the voices of doubting Thomases by declaring the law declared by judicial pronouncements to be applicable also to the particular cases.
In Chandra Mohan ' case (Supra) this Court held that appointments of District Judges made otherwise than in accordance with article 233 of the Constitution were invalid.
Such appointments had been made in Uttar Pradesh and a few other States.
Doubts had been cast upon the validity of the judgments, decrees etc.
pronounced by those District Judges and large litigation had cropped up.
It was to clear those doubts and not to alter the law that the Twentieth Amendment of the Constitution was made.
This is clear from the statement of objects and reasons appended to the Bill which was passed as Constitution (20th Amendment) Act.
The statement said: 487 "Appointments of District Judges in Uttar Pradesh and a few other States have been rendered invalid and illegal by a recent judgment of the Supreme Court on the ground that such appointments were not made in accordance with the provisions of article 233 of the Constitution.
As a result of these judgments, a serious situation has arisen because doubt has been thrown on the validity of the judgments, decrees, orders and sentences passed or made by these District Judges and a number of Writ Petitions and other cases have already been filed challenging their validity.
The functioning of the District Courts in Uttar Pradesh has practically come to a stand still.
It is, therefore, urgently necessary to validate the judgments, decrees, orders and sentences passed or made heretofore by all such District Judges in those States. " In our view, the de facto doctrine furnishes an answer to the submissions of Shri Phadke based on Sec.
9 Criminal Procedure Code and article 21 of the Constitution.
The judges who rejected the appeal in one case and convicted the accused in the other case were not mere usurpers or intruders but were persons who discharged the functions and duties of judges under colour of lawful authority.
We are concerned with the office that the judges purported to hold.
We are not concerned with the particular incumbents of the office.
So long as the office was validly created, it matters not that the incumbent was not validly appointed.
A person appointed as a Sessions Judge, Additional Sessions Judge or Assistant Sessions Judge, would be exercising jurisdiction in the Court of Session, and his judgments and orders would be those of the Court of Session.
They would continue to be valid as the judgments and orders, of the Court of Session, notwithstanding that his appointment to such Court might be declared invalid.
On that account alone, it can never be said that the procedure prescribed by law has not been followed.
It would be a different matter if the constitution of the Court itself is under challenge.
We are not concerned with such situation in the instant cases.
We, therefore, find no force in any of the submissions of the learned counsel.
Shri Govindan Nair attempted to argue that the confiscation was not justified on the merits.
We find no reason to interfere with 488 the concurrent findings of fact arrived at by the lower Courts.
Shri Phadke requested us to widen the scope of the appeals and to permit him to canvas the correctness of the convictions and sentences also.
We declined to do so.
All the appeals are dismissed.
P.B.R Appeals dismissed.
| The selection for the posts of Tehsildars in the State of U.P. was to be made by promotion from amongst various sources such as Naib Tehsildars, Peshkars of the Kumaon Division, Kanungos, Kanungo Inspectors or Instructors and Sadar Kanungos as per the procedure laid down in rules known as Uttar Pradesh Adheenasth Rajaswa Karyakari (Tehsildar) Sewa Niyamavali, 1966.
The procedure for selection is regulated by Rule 9 and under sub section (6) of this Rule a select list will be drawn in order of merit separately for substantive vacancies and temporary vacancies and officials will be offered officiating or temporary vacancies in the order in which their names have been arranged in the "select list" as and when the vacancies occur during the course of the year.
This "select list" will hold good only for one year or until such time a review is made at the following selections.
Subsequently, the State Government made the Uttar Pradesh Promotion by Selection in Consultation with Public Service Commission (Procedure) Rules, 1970, which governed various services, to be more specific 29 Uttar Pradesh services including the services of Tehsildars.
The purpose of these rules was to standardise the procedure for promotion and make it uniform in respect of such services.
The procedure laid down in the 1970 Rules for promotion as Tehsildars was not substantially different from that laid down in the Tehsildars Rules, 1966.
By a Notification No. 4214/196.
Appointment, 3 dated 4th July, 1972 two new rules were introduced, namely, Rules 7A and 7B, in the 1970 Rules.
As per these newly added rules candidates in the Select List made under the 1966 Rules were to be appointed against substantive vacancies in preference to any candidates selected in accordance with the provisions of the 1970 Rules and unless the candidates in the list were exhausted, other eligible candidates were not to be considered for promotion so that their chances of promotion would be deferred to an undated future.
461 The respondent who started his service as Kanungo in 1949, was promoted as Naib Tehsildar and in 1962 he was confirmed as such.
In 1963, he was appointed as Tehsildar in an officiating capacity.
In accordance with the ]966 Rules the Uttar Pradesh, Public Service Commission selected 148 persons for substantive appointment as Tehsildars and their names were shown in a list known as List A.
The Commission also selected 300 other persons for temporary or officiating appointment as Tehsildars during the coming years and their names figured in what was called List B.
The respondent was, however, not selected and his name could not be included in either of the aforesaid two lists because he had an adverse entry forming part of the remarks recorded on his work and conduct and had also been shown down below at serial 557 in the seniority list of Naib Tehsildars in the year 1966.
Though the adverse entry was expunged in the year 1969 and his seniority was also re fixed at serial number 216 on 6th October, 1970, since there was no selection after 1966, his name could not be included in either of the two lists even thereafter.
The respondent challenged the vires of Rules 7A and 7B by filing a petition under Article 226 of the Constitution in the High Court of Allahabad.
That petition was allowed in part and Rules 7A and 7B were declared ultra vires Articles 14 and 1 6 of the Constitution, in the impugned judgment.
Hence the appeal by special leave by the State.
Dismissing the appeal, the Court, ^ HELD: 1:1.
Rules 7A and 7B of the Uttar Pradesh Promotion by Selection in Consultation with Public Service Commission (Procedure) Rules, 1970, are ultra vires Articles 14 and 16 of the Constitution.
[466 E, 473 A B] 1:2.
The grievance of the respondent, namely, that he had a fundamental right of being considered for promotion when others similarly situated were so and that if he was not considered in a situation like that, he was discriminated against and was denied equality of opportunity is not only factually correct but well founded.
[467 B C] 2:1.
It is true that the rules regulating the conditions of service are within the executive power of the State or its legislative power under the proviso to Articles 309 of the Constitution, but even so, such rules have to be reasonable, fair and not grossly unjust if they are to survive the test of Articles 14 and 16 of the Constitution.
A rule, which contemplates that unless the list of 300 persons is exhausted no other person can be selected obviously, is unjust and it deprives other persons in the same situation of the opportunity of being considered for promotion.
[470 F H] 2:2.
The classification in this case cannot be said to be a reasonable classification based on the intelligible differentia having a nexus to the object sought to be achieved.
The only basis of grouping the 300 persons in one category is that they were included in the select list of 1966 and that they were officiating.
The respondent, in the instant case, could not be selected in the selection of 1966 on account of an adverse entry which was subsequently expunged.
His position in the seniority list was also corrected but because no selection took place after 1966.
The respondent could not be included in the list for no fault of his.
If there held 462 been a section and the list had been revised every year, as is the requirement of the rules, the respondent, and like him many others, would have been included in the list.
For example, some candidates who had not completed seven years could not be eligible for promotion and could not be included in the Select List of 1966 but after a lapse of time they became eligible and they might have been selected if selection had taken place.
But, the door for promotion had been foreclosed for the respondent and many others like him by Rules 7A and 7B for no fault of theirs.
The objection taken by the Public Service Commission and the letter of the Secretary or the Board of Revenue addressed to the Government indicating that it would take about 24 years to absorb 300 persons included in List B and, therefore, recommending that the list may not be enforced would point out unmistakably that the selection was unnecessarily postponed only to accommodate the 300 persons included in the Select List of 1966.
There is no rational basis for such a departure from the ordinary operation of the 1970 Rules which envisaged the preparation of a new list every year and for singing out one particular list for according preferential treatment to others in the similar situations [469 B F, 470 A C] State of Jammu and Kashmir vs Triloki Nath Khosa and others ; ; Ramesh Prasad Singh vs State of Bihar and others; , and Ganga Ram and others vs Union of India and others, , applied.
Reserve Bank of India vs C.S. Rajappan Nair and others, I.L.R. 1977 Kerala 398, approved.
In a case where the vires of certain rules were challenged as being violative of the Articles 14 and 16 of the Constitution, only State is a necessary party.
The other persons likely to be affected by the declaration of the rules as ultra vires are only proper parties.
[471 E F] 4.
A party cannot be permitted to take up a new plea in the appeal for the first time before this Court which was not taken before the High Court in writ petition.
[472 E F] General Manager, South Central Railway, Secundrabad an Anr.
vs A.V.R. Siddhanti and Ors., ; , followed.
B. Gopalaiah vs Government of Andhra Pradesh, A.I.R. and J.S. Sachdev and Ors.
vs Reserve Bank of India and Anr., I.L.R. (1973) II Delhi 392, approved.
|
Civil Appeal No. 2063 of 1970.
From the Judgment and Order dated 26 2 1970 of Punjab and Haryana High Court in L.P.A. No. 283/69.
O. P. Sharma and M. section Dhillon for the Appellant.
section K. Mehra, P. N. Puri, E. M. section Anam and M. K. Dua for Respondents Nos. 1 3.
K. J. John for Respondent No. 4.
The Judgment of the Court was delivered by BAHARUL ISLAM, J.
This appeal by the State of Punjab and two others, namely, the Collector, Rupar District and the Sub Divisional Officer (Civil cum Land Acquisition Collector, Rupar, is on a certificate granted by a Division Bench of the High Court of Punjab and Haryana in respect of its judgment in a Letters Patent Appeal holding the acquisition of the land in question to be bad in law on the grounds that the Food Corporation of India for which the Land in question was sought to be acquired was not a "Company" within the meaning of section 3(e) of the Land Acquisition Act that the land had also not been acquired for a public purpose and that the State could acquire the land under that Act only for a public purpose or for the purpose of a Company.
The material facts of the case may be stated thus: Nine biswas of the disputed land situated within the municipal area of Morinda in the District of Rupar was owned by respondent No. 1, Raja Ram, Respondents No. 2 and 3 are Raja Ram 's sons.
The State of Punjab issued a notification dated December 17, 1968 under section 4 read with section 17 of the Land Acquisition Act of 1894 (hereinafter called "the L.A. Act").
The notification related to 15 different plots of land including the land of the present acquisition proceedings.
The material portion of the notification is as follows: "Whereas it appears to the President of India that the land is likely to be needed by Government, at public expense, for a public purpose, namely, for the construction of godowns for storage of food grains at Morinda, it is hereby notified that the land in the locality described below is likely to be required for the above purpose. . . . . " "Further in exercise of the powers conferred by the said Act, the President of India is pleased to direct that the action under Section 17 shall be taken in this case on the 714 grounds of urgency and provisions of Section 5 (A) shall not apply in regard to this acquisition.
" On the same day another notification under Sections 6 and 7 read with Section 17(2)(c) of the L.A. Act was issued.
The material portion of this notification runs thus: "Whereas the President of India is satisfied that the land specified below is needed by Government at the public expense for a public purpose, namely, for the construction of godowns for storage of food grains at Morinda, it is hereby declared that the land described in the specification below is required for the aforesaid purpose.
This declaration is made under the provisions of Section 6 of the Land Acquisition Act, 1894. . . " 3.
Against the aforesaid notification a writ petition was filed by respondents No. 1 to 3.
The writ petition was heard by a single Judge of the High Court and was dismissed.
The learned Single Judge, inter alia, found that the provisions of Part VII of the L.A. Act relating to the acquisition of land for Companies were not applicable to the present case as the Food Corporation of India (hereinafter called the Corporation) was a department of Government and not a Company within the meaning of Section 3(e) of the L.A. Act although, undoubtedly, according to the learned Judge, there was no manner of doubt about the fact that the land in dispute was in fact being acquired for the Corporation and that the purpose for which the land had been acquired was a public purpose.
Against the aforesaid Order of the learned Single Judge a Letters Patent Appeal, being L.P.A. No. 1283 of 1969, was filed by respondents No. 1 to 3 before the Division Bench, that allowed the appeal and quashed the land acquisition proceedings as stated earlier.
With respect we find it difficult to agree with the learned division bench when it held that the Corporation was not a "Company" within the meaning of section 3(e) of the L.A. Act which runs thus: "3.
In this Act, unless there is something repugnant in the subject or context (e) the expression "Company" means a Company registered under the Indian Companies Act, 1882 or under the (English) Companies Act, 1862 to 1890 or incorporated by an Act of Parliament of the United Kingdom or by an Indian law or by Royal Charter or Letters Patent and includes a 715 society registered under the societies Registration Act, 1860, and a registered society within the meaning of the or any other law relating to co operative societies for the time being in force in any State.
" The section mentions in unmistakable terms that a company incorporated by an Indian law would be a 'Company ' for the purposes of the L.A. Act.
Now the corporation was admittedly created by section 3 of the Food Corporation Act, 1964 (hereinafter called the F.C. Act).
That section states : "3.
(1) With effect from such date as the Central Government may, by notification in the Official Gazette, specify in this behalf, the Central Government shall establish for the purposes of this Act a Corporation known as the Food Corporation of India.
(2) The Corporation shall be a body corporate with the name, aforesaid, having perpetual succession and a common seal with power, subject to the provisions of this Act, to acquire, hold and dispose of property and to contract, and may, by that name, sue and be sued.
" Sub section (2) which we need hardly say, is an Indian law, clothes the Corporation with the attributes of a company.
It cannot, therefore, be contended with any plausibility that the Corporation is not a 'Company ' within the meaning of the definition of that term appearing in clause (e) of section 3 of the L.A. Act.
Learned counsel for the appellant then urged that the Corporation is a Government department.
We are unable to accept this submission also.
A Government department has to be an organisation which is not only completely controlled and financed by the Government but has also no identity of its own.
The money earned by such a department goes to the exchequer of the Government and losses incurred by the department are losses of the Government.
The Corporation, on the other hand, is an autonomous body capable of acquiring, holding and disposing of property and having the power to contract.
It may also sue or be sued by its own name and the Government does not figure in any litigation to which it is a party.
It is true that its original share capital is provided by the Central Government (section 5 of the F.C. Act) and that 11 out of the 12 members of its Board of Directors are appointed by that Government (section 7 of the F.C. Act) but then these factors may at the most lead to the conclusion (about which we express no final opinion) that the Corporation is an agency or instrumentality of the Central Government.
In this connection we may cite 716 with advantage the following observations of this Court in Ramana Dayaram Shetty vs The International Authority of India and Ors. "A Corporation may be created in one of two ways.
It may be either established by statute or incorporated under a law such as the or the .
Where a corporation is wholly controlled by government not only in its policy making but also in carrying out the functions entrusted to it by the law establishing it or by the Charter of its incorporation, there can be no doubt that it would be an instrumentality or agency of Government.
But ordinarily where a corporation is established by statute, it is autonomous in its working subject only to a provision, often times made, that it shall be bound by any directions that may be issued from time to time by Government in respect of policy matters.
So also a Corporation incorporated under law is managed by a Board of Directors or committee of management in accordance with the provisions of the statute under which it is incorporated.
When does such a corporation become an instrumentality or agency of Government ? Is the holding of the entire share capital of the Corporation by Government enough or is it necessary that in addition, there should be a certain amount of direct control exercised by Government and, if so what should be the nature of such control? Should the functions which the Corporation is charged to carry out possess any particular characteristic or feature, or is the nature of the functions immaterial ? Now, one thing is clear that if the entire share capital of the Corporation is held by Government it would be a long way towards indicating that the Corporation is an instrumentality or agency of Government.
But, as is quite often the case the Corporation established by statute may have no share or shareholders in which case it would be a relevant factor to consider whether the administration is in the hands of a Board of Directors appointed by Government though this consideration also may not be determinative, because even where the directors are appointed by Government, they may be completely free from governmental control in the discharge of their functions.
" Even the conclusion, however, that the Corporation is an agency or instrumentality of the Central Government does not lead to the further inference that the Corporation is a Government department.
The reason is that the F.C. Act has given the Corporation an individuality apart 717 from that of the Government.
In any case the Corporation cannot be divested of its character as a 'Company ' within the meaning of the definition in clause (e) of section 3 of the L.A. Act, for it completely fulfils the requirements of that clause, as held by us above.
The Corporation being a 'Company ', compliance with the provisions of Chapter VII of the L.A. Act had to be made in order to lawfully acquire any land for its purpose.
It is not denied that such compliance is completely lacking in the present case.
As a result of the foregoing discussion it must be held that the land in dispute has not been acquired in accordance with law, although our reasons in that behalf are different from those forming the basis of impugned judgment.
This appeal is thus found to be without merit and is dismissed but with no order as to costs.
S.R. Appeal dismissed.
| In a petition under article 32 of the Constitution the petitioner detenu complained that though the grounds of detention were served on the detenu on the date of arrest (October 20, 1980) the materials and documents on which the order of detention was based were not supplied to him till November 5, 1980 and that his representation dated November 18, 1980 was disposed of nearly a month later (December 15, 1980) and that the failure on the part of the detaining authority to supply the requisite documents and materials and the unexplained delay in the disposal of the representation constituted violation of the safeguards contained in Art, 22(5) of the Constitution which vitiated the order of detention.
Allowing the petition, ^ HELD: It is well settled that the law of preventive detention has to satisfy a two fold test: (1) that the protection and the guarantee afforded under article 22(5) of the Constitution are complied with, and (2) that the procedure is just and reasonable.
[463G] Before an "effective representation" could be made by the detenu he must be supplied with the documents and materials which form the basis of the grounds of detention and unless this is done there could be no question of making any representation, much less an "effective representation" against the order of detention.
The documents and materials relied upon in the order of detention form an integral part of the grounds and must be supplied to the detenu pari passu the grounds of detention.
[461B] Smt.
Icchu Devi Choraria vs Union of India & Ors. ; and Smt.
Shalini Soni & Ors.
vs Union of India & Ors.
; referred to.
If procedure under article 21 has to be reasonable, fair and just, then the words 'effective representation ' appearing in article 22(5) must be construed so as to provide a real and meaningful opportunity to the detenu to explain his case to the detaining authority in his representation.
If the words 'effective representation ' are interpreted in an artificial or fanciful manner, then it would defeat the very object not only of article 22(5) but also of article 21 of the Constitution.
It is settled law that it is of the utmost importance that all the necessary safeguards laid down by the Constitution under article 21 or article 22(5) should be complied with fully and strictly and any departure from any of the safeguards would vitiate the order of detention.
[463E F] Maneka Gandhi vs Union of India [1978] 2 SCR 621 referred to.
460 In the instant case not only were the documents and materials not supplied to the detenu alongwith the order of detention but there had been an unexplained delay of about 25 days in disposing of the representation of the detenu.
[465B] [Despite repeated warnings by this Court the detaining authorities do not care to comply with the spirit and tenor of the safeguards contained in article 22(5) of the Constitution.
There should be no difficulty in keeping copies of the documents and materials referred to in the order of detention and supplying them to the detenu along with the order of detention.
This dereliction on the part of the detaining authorities results in the release of persons indulging in such anti national activities as smuggling though on merits the detentions in suitable cases may be justified.]
|
Appeal No. 101 of 1960.
Appeal by special leave from the Award dated 2nd March, 1959, of the Labour Court, Chotanagpur Division, Ranchi, in Misc.
Cases Nos. 73,76, 77, 79 82, 84 90 of 1958.
N. C. Chatterjee, A .
K. Dutt and B. P. Maheshwari for the appellants.
Sohrab D. Vimadalal, section N. Andley, J. B. Dadachanji, Rameshwar Nath and P. L. Vohra, for the respondents.
March 25.
The Judgment of the Court was delivered by DAS GUPTA, J.
When the management of an industry holds an enquiry into the charges against a workman for the purpose of deciding what action if any, should be taken against him, has the workman a right to be represented by a representative of his Union at the enquiry ? That is the principal question raised in this appeal.
The 14 appellants, all workmen in M/s. Tata Locomotive & Engineering Co., Ltd., Jamshedpur, were dismissed under the orders of the company 's management on the result of an enquiry held 408 against them.
As industrial disputes between these workmen and the company were at that time pending before the Industrial Tribunal, Bihar, the company filed applications purporting to be under section 33 of the Industrial Disputes Act praying for approval of the action taken by it against the workmen.
Workmen also filed applications under section 33A of the Industrial Disputes Act complaining of the action taken against them by the company.
The applications of the com pany under section 33 were however ultimately held to have become infructuous and the applications under section 33A were only considered and disposed of by the Labour Court.
The applications of these 14 appellants were however dismissed.
Against that order the appellants have preferred this appeal after having obtained special leave for the purpose.
The common contention urged on behalf of the appellants was that the enquiry on the results of which the orders of dismissal were based was not a proper and valid enquiry inasmuch as the workmen were not allowed to be represented at the enquiry by a representative of the Jamshedpur Union to which these workmen belonged.
It has been urged that fair play demands that at such an enquiry the workman concerned should have reasonable assistance for examination and cross examination of the witnesses and for seeing that proper records are made of the proceeding& It has been argued that a representative of the workmen 's Union is best suited to give such assistance and in the absence of such assistance the workman does not get a fair chance of making his case before the Enquiry Officer.
It appears that when on June 5, 1953, requests were made on behalf of the several workmen that they should be allowed to be represented by a representative of the Jamshedpur Mazdoor Union at the enquiry to conduct the same on workmen 's behalf, the management rejected this request but informed the workmen that they could, if they so desired, be represented by a co worker from the workmen 's own department at the enquiry.
, The question which arises therefore is whether this refusal of the workmen 's request to be represented at the 409 enquiry by a representative of their Union vitiated the enquiry.
Accustomed as we are to the practice in the courts of law to skilful handling of witnesses by lawyers specially trained in the art of examination and cross examination of witnesses, our first inclination is to think that a fair enquiry demands that the person accused of an act should have the assistance of some person, who even if not a lawyer may be expected to examine and cross examine witnesses with a fair amount of skill.
We have to remember however in the first place that these are not enquiries in a court of law.
It is necessary to remember also that in these enquiries, fairly simple questions of fact as to whether certain acts of misconduct were committed by a workman or not only fall to be considered, and straightforward questioning which a person of fair intelligence and knowledge of conditions prevailing in the industry will be able to do will ordinarily help to elicit the truth.
It may often happen that the accused workman will be best suited, and fully able to cross examine the witnesses who have spoken against him and to examine witnesses in his favour.
It is helpful to consider in this connection the fact that ordinarily in enquiries before domestic tribunals the person accused of any misconduct conducts his own case.
Rules have been framed by Government as regards the procedure to be followed in enquiries against their own employees.
No provision is made in these rules that the person against whom an enquiry is held may be represented by anybody else.
When the general practice adopted by domestic tribunals is that the person accused conducts his own case, we are unable to accept an argument that natural justice demands that in the case of enquiries into a chargesheet of misconduct against a workman he should be represented by a member of his Union.
Besides it is necessary to remember that if any enquiry is not other.
wise fair, the workman concerned can challenge its validity in an industrial dispute.
Our conclusion therefore is that a workman against whom an enquiry is being held by the management has no right to be represented at such enquiry by a 410 representative of his Union; though of course an employer in his discretion can and may allow his employee to avail himself of such assistance.
On behalf of the appellants, Charan Singh, Parmanand and K. Ganguli, it was urged that the orders of dismissal were bad inasmuch as they were based on a finding of guilt of misconduct not mentioned in the charge sheet.
Each of these appellants it appears, was accused in the charge sheet of four different acts of misconducts: 1.
Participating in an illegal strike; 2.
Leaving your appointed place of duty; 3.
Inciting other employees to strike work; 4.
Threatening and intimidating other workers.
The Enquiry Officer found each of them guilty of the first three charges.
He, however, recorded no findings as regards the fourth charge but instead found these workmen guilty of a misconduct not mentioned in the charge sheet, viz., " Behaving in a riotous and disorderly manner by shouting slogans on the shop floor ".
On behalf of the appellants it is urged that as it is not possible to ascertain as to how this finding of guilt as regards misconduct not mentioned in the charge sheet affected the decision of the manager, the order of dismissal must be set aside.
The record however discloses three cases in which the manager made orders of dismissal on a finding of guilt of only of the acts of misconduct alleged in these three charges, namely, (i) participating in an illegal strike; (ii) leaving the appointed place of duty; and (iii) inciting other employees to strike work.
There is no reason to think therefore that he would have discriminated in favour of these appellants, Charan Singh, parmanand and K. Ganguli.
The conclusion that Necessarily follows is that leaving out of account the misconduct not mentioned in the charge sheet, viz., "behaving in a riotous and disorderly manner by ' shouting slogans in the shop floor ", the manager would have made the order of dismissal.
The fact that this act of misconduct not mentioned in the charge sheet was also mentioned as one of the items on which the order of dismissal was based does not Therefore affect the validity of the order.
411 The charge sheet against section B. Nath accused him of four acts of misconduct: "1.
Participating in an illegal strike; 2.
Leaving your appointed place of duty; 3.
Inciting other employees to strike work; 4.
Threatening and intimidating other workers.
" The relevant portion of the order of dismissal is in these words: He has been found guilty of the following acts of misconduct: For entering the works when not on duty and inciting other employees to strike work.
He is therefore dismissed from the service of the company. ".
It is argued that as he has not been accused in the charge sheet " for entering the Works when not on duty " but this had been taken into consideration in deciding on his punishment the order is bad.
It has to be noticed however that " entering the Works when not on duty " is not a misconduct under the company 's standing orders.
It is quite clear that the statement in the dismissal order as regards " entering the Works when not on duty " was really intended to state the manner and occasion in which the misconduct of " inciting other employees to strike work " was committed.
The unnecessary and indeed slightly erroneous mention that he had been found guilty of "entering the Works when not on duty " does not justify the conclusion that this fact of ,entering the works when not on duty " played any part in the mind of the punishing authority in determining his punishment.
A statement in the dismissal order " that he has been found guilty of entering the Works when not on duty " as an act of misconduct is obviously erroneous.
The act of misconduct of which this appellant was found guilty was " inciting other employees to strike work " and that is the only misconduct which weighed with the punishing authority.
The contention that the mention in the dismissal order of " entering the Works when not on duty " as an act of misconduct of which he had 412 been found guilty, vitiates the order of dismissal cannot therefore be accepted.
On behalf of the appellant M .
R. Ghosh it was urged that the alleged misconduct of " deliberately preventing the man in charge of the Compressor in the repair shop from carrying out his duty" of which he is said to have been found guilty in the order of dismissal was not alleged in the charge sheet.
This is really a misreading of the charge sheet.
Against this appellant four acts of misconduct were alleged in the charge sheet : "1. Participation in an illegal strike; 2.
Inciting other employees in the other sections of the Auto Division to strike work; 3.
Leaving your appointed place of duty or work without permission ; 4.
Threatening and intimidating the other workers in the Repair Shop.
" The dismissal order after mentioning that he was found guilty of the first three charges further states that he was found guilty of the following acts of misconduct: "threatening and intimidating the workers in the Repair Shop and deliberately preventing the man in charge of the Compressor in the Repair Shop from carrying out his duty.
" The argument is that the charge as set out in the charge sheet does not mention this act of " deliberately preventing the man in charge of the Compressor in the Repair Shop from carrying out his duty.
" This is obviously erroneous.
The charge sheet after alleging the four acts of misconduct went on to give particulars of these charges.
As regards the fourth charge, viz., " threatening and intimidating the other workers in the Repair Shop " the particulars were in thesewords: "By threatening and intimidating others in the repair shop you stopped them from working and also you took the Compressor man by his hand and got the Compressor stopped.
" The statement in the dismissal order as regards his being quilty of deliberately preventing the man in charge of the Compressor in the Repair Shop from carrying out his duty " has in fact been mentioned in the charge sheet, though in slightly different words.
There is no substance therefore, in the contention that 413 the acts of misconduct on which the dismissal order was based included one not mentioned in the chargesheet.
The four acts of misconduct alleged in the chargesheet against Gurbux Singh were: 1.
Participating in an illegal strike; 2.
Leaving your appointed place of duty; 3.
Inciting other employees to strike work; 4.
Threatening and intimidating other workers.
The Enquiry Officer 's report found him guilty of the following acts: 1.
Participating in an illegal strike; 2.
Leaving his place of duty without permission; 3.
Inciting other employees to strike work and 4.
Threatening and intimidating Mr. Charan Singh to stop work.
The manager 's order on these is in these words: " I have gone through the findings of the Enquiry Officer as well as the proceedings of the Inquiry.
Though Mr. Gurubux Singh created a scene on the 11th June, 1958, and left the place of enquiry, still he was given a chance and the enquiry was held at a later date.
Having gone through the evidence recorded against him during the enquiry, I agree with the findings of the C. P. 0.
The charges being of a very serious nature, I order that he be dismissed from the services of the company with effect from the date of the charge sheet.
" The formal dismissal order that was drawn up on the basis of this finding and served on him after stating that he was found guilty of the first three charges stated that he was found guilty of threatening and intimidating Mr. Chakravarty, chargeman, who was compelled to stop work on 21 5 58.
On his behalf it has been urged that though the enquiry officer 's report says that he was guilty of " threatening and intimidating Charan Singh " the General Manager misled himself into thinking that he had threatened and intimidated Mr. Chakravarty, Chargeman.
There being no finding by the Enquiry Officer that Gurubux Singh was guilty of threatening and intimidating 53 414 Mr. Chakravarty, Chargeman, the General Manager was not entitled to take such a misconduct into consideration.
On an examination of the Enquiry Officer 's report it is however obvious that there is a clerical error in the concluding portion of the report in stating the finding as regards the fourth charge as " threatening and intimidating Charan Singh to stop work ".
Charan Singh was really one of the striking workers and there was no quest ion of intimidating him.
It is abundantly clear from the report that the case that was sought to be made as regards the fourth charge was that Chakravarty had been intimidated and that this allegation was found proved.
There could not have been and was not any allegation of Charan Singh being intimidated.
It is quite clear that the name of Charan Singh was accidentally mentioned in the concluding portion of the report instead of the correct name Chakravarty.
There is no justification for thinking that the General Manager who had gone through the evidence and report of the Enquiry Officer could possibly have been misled by this clerical mistake.
The relevant charge was threatening and intimidating other workers, whether Charan Singh or Chakravarty was intimidated would not be of any consequence ' In fact however the allegation against this appellant clearly was that Chakravarty had been intimidated by him.
The body of the report shows that that was what the Enquiry Officer found proved.
It is reasonable to think that that conclusion and not the wrong statement that Charan Singh was threatened and intimidated which was nobody 's case weighed with the General Manager in determining the punishment.
In our opinion, there is no substance in the contention urged on his behalf that the finding that Charan Singh was threatened and intimidated as an act of misconduct instead of Chakravarty was wrongly relied upon.
On behalf of the appellant section K. Dhanda it has been urged that in making the dismissal Manager wrongly thought that guilty of all the four acts of misconduct order the General he had been found which were against him in the charge sheet though in fact he was 415 found guilty only of three and the fourth charge was not proved.
The four acts of misconduct alleged in the charge sheet were : (1) Participation in an illegal strike; (2) Leaving his place of duty without permission; (3) Inciting other employees in the Paint Shop Propeller Shaft Section, Rear Axle Section and Press Section of the Auto Division to stop work; (4) Behaving in a riotous and disorderly manner and threatening and intimidating another coworker.
The formal order of dismissal that was drawn up stated that he had been found guilty of the following acts of misconduct: (1) Participating in an illegal strike; (2) Leaving his place of duty without permission; (3) Inciting other employees in the Paint Shop Propeller Shaft Section, Rear Axle Section and Press Section of the Auto Division ' to stop work.
(4) Threatening and intimidating another employee by name Mr. T. section N. Rao, T. No. 6610/60205/1, and stopping him from doing his work.
He is therefore dismissed from the service of the Company. . ".
The Enquiry Officer 's report states the conclusions reached by him thus: " From the statement of the witnesses, it has been conclusively proved that Mr. Dhanda: (1) participated in an illegal strike; (2) left his place of duty without permission; (3) incited other employees to stop work.
It can be said that the charge of threatening and intimidating has not been proved beyond doubt.
" If one looks at the formal order of dismissal only it seems that though the charge of threatening and intimidating other employees was not proved against him the order of dismissal was partially based on it.
If there was nothing else this might be a serious infirmity in the order.
We find however that the General Manager recorded his order on the formal Report itself in these words: 416 I have gone through the findings of the Enquiry Officer and the proceedings of the enquiry.
Even though the charge of threatening and intimidating other workers has not been proved against Mr. Dhanda the other charges are also of a serious nature.
In the circumstances, order that he be dismissed from the service of the company with effect from the date of the charge sheet.
" This was dated July 3, 1958, and the formal order also bears the same date.
Reading the two together it is quite clear that the General Manager in passing the order of dismissal proceeded on the basis that the charge of threatening and intimidating other employees had not been proved against Mr. Dhanda but a mistake crept into the formal order that was drawn up and among the acts of misconduct mentioned as those of which Dhanda had been found guilty and on which the dismissal order was based the fourth charge as regards threatening and intimidating other employees was also mentioned.
It is proper to hold that this was an accidents clerical mistake and that in fact the General Manager did not proceed on the wrong basis that Dhanda had been found guilty on this fourth charge also.
The mere fact that such a clerical error appears in the formal order does not affect the validity of the order in any way.
We have therefore come to the conclusion that the separate contentions pressed oil behalf of seven of the appellants that the Tribunals below did not consider certain infirmities in the order cannot also be sustained.
The appeal is accordingly dismissed, but in the circumstances we make no order as to costs.
Appeal dismissed.
| A workman against whom an enquiry is being held by the management has no right to be represented at such enquiry by a representative of his union, though the employer in his discretion, can and may allow him to be so represented.
In such enquiries fairly simple questions of fact as to whether certain acts of misconduct were committed by a workman or not fall to be considered and the workman is best suited to conduct the case.
Ordinarily, in enquiries before domestic tribunals a person accused of any misconduct conducts his own case and so it cannot be said that in any enquiry against a workman natural justice demands that he should be represented by a representative of his Union.
|
n No. 340 of 1972.
(Under article 32 of the Constitution of India).
P.H. Parekh and Miss Manju Jetlcy, for the petitioners in W.P. 340/72 excepting petitioner No. 59 and for petition ers in W.P. 1526/ 73.
Petitioner No. 59 in W.P. No. 340/72 in person.
Yogeshwar Prasad, S.K. Bagga, Mrs. section Bagga and Miss Yesh Bagga for the petitioner in W.P. No. 286/74.
Niren De, Attorney General in writ petition 340, Sardar Bahadur Saharya and Vishnu Bahadur Saharya, for respondents Nos. 1, 3, 4, 5 and 15 in W.P. 340/72 and respondents in all the W.Ps.
K.J. John for M/s. J. B. Dadachanji & Co. for R.R. 2, 6, 8, 10, and 12 in W.P. 340 & 1526 and R.R. 6, 8, 9, 11 and 12 in W,P. 286/74.
S.K. Mehta, K.R. Nagaraja and P.N. Puri for R.R. 13 178 in W.P. 1526/73.
The Judgment of the Court was delivered by RAY, C.J.
This Court on 29 August, 1974 appointed Shri Debabrata Mookerjee Chairman to convene, fix the date and hold the meeting of New Friends Cooperative House Build ing Society Ltd. referred to as the Society in accordance with the provisions of the Delhi Co operative Societies Act, 1972.
This meeting was direct 374 ed to be held for the purpose of electing the members of the New Managing Committee The Chairman was directed to look into each and every disputed question of membership.
The Chairman was further directed to decide whether the persons had been rightly or wrongly declared to be defaulters.
The order further directed that if the Chairman came to the conclusion that the person had been wrongly declared to be a defaulter, the Chairman would include him or her in the list of members.
The Chairman was also asked to give effect to all orders of this Court already made in regard to persons who were declared defaulters and who according to orders of this Court on payment of moneys are not and cannot be treat ed defaulters.
The Chairman was asked to go into cases where money had been sent and not accepted.
If the Chairman came to the conclusion that money had been wrongly not accepted, the Chairman would decide the same in accordance with Rules and Bye laws of the Society.
There are further details in the order dated 29 August, 1974.
In the order dated 29 August, 1974 Brij Mohan Malhotra was given liberty to adduce proof before the Chairman that the money was tendered Within time.
If the Chairman came to the conclusion that it was tendered in time, he would decide in accordance with Rules and Bye laws of the Society.
The Chairman was entitled to scrutinise whether any person had been either illegally brought in as a member or illegally removed, having regard to the rules, bye laws and regulations of the Society.
Inder Bir Kaur alleged that she had been illegally removed from membership.
The Chairman was directed to go into the question.
The order was made in two writ petitions No. 340 of 1972 and 1526 of 1973 and in a number of miscellaneous applica tions.
On 6 July, 1971 the Lt. Governor passed an award direct ing the Society to pay Rs.22 lakhs to the Delhi Administra tion.
On 9 July, 1971 the Lt Governor by a notification removed the elected Managing Committee and appointed a nominated ' Managing Committee under Rule 56 of the Rules made under the Bombay Cooperative Societies Act, 1925 here inafter referred to as the Bombay Act which applied to Delhi.
The term of the Managing Committee was for one year.
On 23 October, 1971 the nominated Managing Committee passed a resolution to make the award rule of the Court.
On 18 December, 1971 the nominated Managing Committee passed a resolution for having direct sub leases.
On 22 January, 1972 the nominated Managing Committee called for more funds.
On 5 July, 1972 the Lt. Governor issued second notification extending the term of the nominated Managing Committee by two years.
The Society was the subject matter of two writ peti tions.
287 members of the Society filed writ petition No. 340 of 1972 hereinafter referred to Raj Rani 's petition.
The members challenged 375 the vires of Rule 56 of the Society on the ground that the rule.was ultra rites section 71 of the Bombay Act and fur ther that the rule was bad on account of excessive delega tion.
The petitioners contended that action under Rule 56 could not.
be taken without complying with the provisions of section 46A of the Bombay Act which was applicable to.
Delhi at the relevant time.
The petitioners also challenged some notifications on the ground that the Lt. Governor having exercised his powers once could not extend the term, In short, it was said that the power of the Lt. Governor was exhausted.
The other challenges were that the notifications were not speaking order and were made malafide.
The broad challenge in the petition was against the extension of term of the Managing Committee.
On 29 August, 1972 Rule Nisi was issued.
On 30 April, 1973 the nominated Chairman of the Managing Committee issued a circular asking the members of the Socie ty to pay certain amount.
On 6 July, 1973 this Court restrained the Society and its Chairman from declaring any member a defaulter. 'On 13 August, 1973 this Court directed that all the interim orders passed in the writ petition should be confined to the petitioners in Raj Rani 's peti tion.
On 16 August, 1973 K.V. Johar filed a writ petition in a representative capacity under Order I Rule 8 of the Code of Civil Procedure.
This is writ petition No.
1526 of 1973 hereinafter referred to as Johar 's petition.
On 20 August, 1973 this Court issued Rule Nisi in Johar 's petition.
On 17 August, 1973 the nominated Managing Committee declared 321 members as defaulters.
This Court on 21 Sep tember, 1973 restrained the Society from taking any steps in pursuance of the resolution dated 17 August, 1973 against the petitioners and all other members of the Society.
On 29 November, 1973 respondent No. 6 filed an applica tion in Johar 's petition for vacating the stay order granted on 21 September, 1973.
An application for vacating the stay order granted on 6 July, 1973 in Raj Rani 's petition was not pursued.
This Court vacated the stay granted on 21 Septem ber, 1973 in Johar 's petition and granted a fortnight 's time to make the requisite payment.
On 6 January, 1974 the nominated Managing Committee declared 39 members as defaulters for non payment of dues, 42 members as defaulters for not submitting the affidavits.
This was one of the controversies which formed the subject mattter of the enquiry made by the Chairman.
On 25 January, 1974 the nominated Managing Committee decided to enrol 60 new members.
On 26 January, 1974 a confidential letter was addressed by respondent No. 6 to the Lt. Governor seeking his approval to the enrolment of 60 new members and allotment of plots to them.
On the same day, the Lt. Governor addressed a letter to respondent No. 6 giving his approval.
The enrolment of 8 1546SCI/76 376 new members on 25 January, 1974, the approval of the Lt. Governor on 26 January, 1974 and the allotment of plots to those 60 new members formed a big controversy which was also enquired into by the Chairman.
Two Civil Miscellaneous Petitions No. 1683 and 1072 of 1974 challenging the declaration of defaulters and the enrolment of new members were filed in this Court in February, 1974.
C.M.P.No.1683 of 1974 is in Raj Rani 's petition and C.M.P.No.
1072 of 1974 is in Johar 's petition.
This Court on 29 March, 1974 directed that all the papers including resolutions, original applications, original allotments should be produced in this Court on 4 April, 1974.
This Court also restrained the Managing Committee by an injunc tion from talking any steps in any manner.
On 4 April, 197 4 this Court passed directions in respect of persons who had made part payments within the time prescribed or even beyond the time prescribed not to be treated as defaulters.
This Court mentioned in its order that the allotment of plots to 60 new members who were characterised by the petitioners as very important persons appeared to have been made in undue haste and the persons in the Waiting list were not considered and that no notice was given to persons inviting application.
This Court directed that the said list of 60 new members had to await final adjudication by.
this Court.
This Court also directed that in case of 60 allot tees no further steps should be taken.
This Court directed that the case of 24 defaulters would be considered if it came to the conclusion that the allotment in favour of 60 new members would be treated as defaulters.
In the order dated 4 April, 1974 petitioners No. 60, 46, 216, 171 and 165 in Raj Rani 's petition who paid in part after due date were not to be treated as defaulters and they were given four weeks time to pay the balance.
It was said that if they failed to pay the balance within the time granted they would be treated as defaulters.
Petitioners No. 1,118, 43 and 287 in Raj Rani 's petition were stated to have paid in full but after the due date.
They were not to be treated as defaulters.
It was also said that if they had not paid the full amount, they were also given four weeks time for paying the balance,if any.
If they did not pay the balance within the time granted they would be treated as defaulters.
In Johar 's petition section Diwan, Virendra Singh, Dalip Singh and Hari Singh were stated to have made payments in part beyond time.
Iqbal Khanna and H. Bhatia were stated to have made payments in part within time.
They were all given four weeks time from the date of the order and in default of payment within the time they would be treated so defaulters.
Ten other persons in Raj Rani 's petition and 14 persons in Johar 's petition were said not to have paid within time.
A list of 31 sons was handed up to this Court by the petitioners.
These 31 persons were alleged to have been admitted as members and to have been allotted plots.
It was contended that this allotment is irregular.
These allotments were made on 26 January, 1974 to which reference has already been made.
It was 377 said that the list of 31 persons would await final adjudica tion.
Ten defaulters in Raj Rani 's petition and 14 de faulters in Johar 's petition aggregating 24 defaulters were to be considered at the time of final adjudication.
It was said that if the allotment in respect of 31 per , sons could not be allowed to stand then the cases of these 24 persons would be considered.
In this back ground on 29 August, 1974 when the two writ petitions filed by Raj Rani and K.V. Johar came up for heating this Court appointed Shri Debabrata Mookerjee as Chairman of the Society.
It may be stated here that some time in 1975 some one started a suit against the Chairman to stop the enquiry by him.
The matter was brought to the notice of this Court.
Some malicious and baseless allegations were made against the Chairman.
Under these circumstances this Court direct ed notice to the respondent who filed the suit to show cause why he should not be committed for contempt.
The Chairman was in the meantime asked to continue and he was directed to look into each and every matter as mentioned in the earlier orders.
The Chairman between 17 March, 1975 and 5 August, 1975 restored the membership of the alleged defaulters.
On 26 April, 1976 tentative voters list was published.
On 14 May, 1976 the Chairman informed the parties that election would be held on 29 August, 1976.
On 12 July, 1976 the Chairman informed the parties that the election would be held on 29 August, 1976 at Mavalankar Hall.
On 27 July, 1976 the Chairman declared that of the 60 new members who had been described as very important persons 21 did not have applications for membership and 38 were not legally admitted members and could not be included in the list.
The Chair man said that the allotment of plots in their favour could not be upheld.
On 28 July, 1976 the list of members was published.
On 17 August, 1976 there was scrutiny of the ballot papers.
On 24 August, 1976 11 persons out of the 60 persons who were enrolled members on 25 January, 1974 and allotted plots on 26 January, 1974 filed two Civil Miscellaneous praying for an order restraining the Chairman from holding the election on 29 August, 1976 These applications were held without serving any party to the proceedings contrary to the rules and practice of this Court.
On 25 August, 1976 coun sel for those petitioners mentioned the applications before the Court presided over by Khanna, J. asking that the applications filed might be heard.
It was also mentioned without informing the parties.
On 27 August, 1976 this Court further adjourned the applications.
On 29 August 1976 the meeting was held and voting took place at Mavalankar Hall.
On 23 September, 1976 the Chairman submitted his report and give copies to the parties.
On 15 October, 1976 11 persons who 378 had made the two applications for restraining of holding of the election filed an application for adjournment of the case for two months.
This Court cannot help observing two features.
One is that an attempt was made some time in the year 1975 to restrain the Chairman from proceeding with the enquiry by filing a suit against him and making baseless allegations.
It is only because this Court took immediate notice of the matter that the frivolous suit which had been filed in abuse of process of court was put an end to.
The second is that on the eve of the election another attempt was made to.
restrain the Chairman from holding the election.
These facts.
along with the attempt on the part of those 11 peti tioners to keep the matter adjourned for two months indicate the persistent attitude on the part of some of those persons to mark time for some oblique purposes.
In view of the importance of issues involved and the gravity of the situation where interest of ordinary citizens was sacrificed to meet the interest of persons of importance and influence that this Court took the aforesaid steps, in order to put an end to the litigation and the controversies, It was to be kept in the forefront that the Society is not yet the lessee of the Government in respect of the land which is to be allotted to the members.
In Volume II in Raj Rani 's petition No. 340 of 1972 appears the printed memorandum agreement to be entered into between the Society and the President of India in respect of land which will be allotted to the members of the Society, On 3 August, 1967 the Deputy Secretary, Delhi Administration wrote to the Secretary of the Society, inter alia, as follows: "I am desired to make it clear that the list of members submitted with your letter ' has been treated as final and no change in that list can be made without prior written permission of the Delhi Administration." The printed memorandum of agreement has three recitals.
One of the racitals is that whereas the Society has depos ited with the Chief Commissioner the sum of Rs.41, 62, 456.61 and has further agreed to deposit with the Chief Commissioner the additional sum or sums as hereinafter provided, being the amounts agreed to be paid by the Society to the President by way of premium for the grant to the Society of the lease hereinafter mentioned which amounts, pending the grant of the said lease, are to be a security to the President for due performance by the Society of the terms of the Agreement.
It is agreed between the parties, inter alia, as follows: 1.
The President hereby grants f0r a period of three years commencing from 13 February, 1973 a licence to the Society to enter upon the said land only for the purposes of making surveys and taking measurements and levels for preparing a lay out plan.
Upon the completion of the development of the land in accordance with the provisions contained herein and to the satisfaction of the Chief Commissioner and issue by him of a certificate to that effect 379 and provided that the other conditions of the Agreement have been duly observed, the President will, in .considera tion of the expenses incurred by the Society on the develop ment of the land and the payment of the premium and of the yearly rent as herein provided and of the covenants on the part of the Society to be;contained in the lease, grant to the Society and the Society ,shall accept a lease of such of the residential plots as may be determined by the Chief Commissioner in ,his absolute discretion.
XV(a).
After the execution and registration of the lease, the Society shall sub lease, within such time and on such premium and yearly rent as may be fixed by the President, one residential plot to each of its members who or whose wife/husband or any of his/her dependent relatives including unmarried children does not own, in full or in part, on the free hold or lease hold basis, ,any residential plot or house in the urban areas of Delhi, New Delhi or Delhi Can tonment and who may be approved by the Chief Commissioner.
Reference to the Agreement is necessary to show that the Society is not yet lessee of the Government in respect of the land.
This is a mere agreement for the grant to the Society of the lease.
The Government refused to grant lease.
Thereafter the matter was referred to the arbi tration of the Lt. Governor.
The Lt. Governor made an award directing the Society to pay Rs.22,45,742/ as the balance amount representing the cost of land.
In 1972 a supplementary agreement was made between the President of India and the Society.
One of the recitals in that agreement mentions that the Society has not completed the development of the land and the members of the Managing Committee resolved that the Lt. Governor of Delhi be re quested to allow the members to pay their individual dues to the Administration to evacute their sub teases.
This recital indicates that there was an attempt on the part of individual members to pay dues to the Society as well as to the Government.
It can, therefore, be seen that membership of the Society and the allotment of lands are different matters.
One of the main contentions before the Chairman was in regard to membership of 60 persons.
These 60 persons were admitted to membership on 25 January, 1974.
The Lt, Governor approved of their membership on 26 January, 1974.
The Chairman found that of these 60 persons 21 had at one time or another withdrawn their membership.
10 out of those 21 had either never applied or never paid the requi site membership fee.
The result, according to the Chair man, was that the cases of 39 persons were to be consid ered.
The Chairman noticed that "many of these 60 persons were highly placed Government officials and friends and relations of persons prominent in public life." Another allegation was that many of them happened "to be close relations or friends and members of the nominated Managing Committee.
" At the meeting held on 27 July, 1976 the Chairman re ferred to Rules 24 and 30 of the 1973 Delhi Cooperative Societies Rules.
These 380 rules were under the Delhi Co operative Societies Rules 1972 which replaced the Bombay Act 1925 in relation to the Union Territory.
These rules relate to conditions to be complied with for admission to membership.
Bye law 5 of the Society Bye laws was also referred to by the Chairman.
Broadly stated, Rule 24 requires a person to apply in writing in the form laid down by the Society for membership.
His application is to be approved by the Committee of the Society.
He has to fulfil other conditions laid down in the Act, the Rules and the Bye laws.
Rule 25 of the Delhi Co operative Societies Rules, 1973 provides toter alia that no person shall be eligible for admission as member of a co operative society, if in the case of membership of a housing society (1 ) he owns a residential house or a plot of land for the construction of a residential house in any of the approved or up approved colonies or other localities in the Union Territory of Delhi, in his own name or in the name of his spouse or any of his dependent children on lease hold or free hold basis; (2) he deals in purchase or sale of immovable property either as principal or as agent in the Union Territory of Delhi; or (3) he or his spouse or any of his dependent children is a member of any other housing society except otherwise permitted by the Registrar.
Rule 25(2) provides that if a member becomes or has already become subject to any disqualifications specified in sub rule (1), he shall be deemed to have ceased to be a member from the date when the disqualifications were incurred.
Rule 30 deals with the disposal of application for admission of members.
The rule provides that on receipt of an application for membership, the co operative society shall enter particulars of the application in the register of applications in the form mentioned therein.
The co opera tive society shall dispose of an application received for admission as member as early as possible and in no case later than the expiration of a period of one month from the date of receipt of the application by the Society.
In case of refusal to admit, such society shall communicate its decision together with reasons thereof.
The appeal to the Registrar lies against the order for refusal to admit a member.
An important feature in rule 30 is the date of receipt of application for membership because the applica tion is to be dealt with within one month.
Rule 30(4) provides that the person whose membership has been approved by the Managing Committee of a co operative society shall deposit the membership fee, and the amount of the qualify ing shares necessary to become a member, within 14 days of the passing of the resolution of the Managing Committee approving the membership of the person concerned.
Bye law 5, inter alia, provides that every person seek ing membership of the Society shah sign a declaration to the effect that he or his wife (she or her husband) or any of his/her dependents does not own a dwelling house or plot in Delhi and that he/she is not a member of any other coopera tive house building society.
381 Judged by these rules and considering the rival conten tions of the parties the Chairman found that of the 39 cases there was only one case of N.K. Mukherjee M. No. 1526 which fulfilled the requirements of the rules and the bye laws and the Chairman in his report declared him as having been validly accepted as member.
Out of those 39 persons 20 applications did not bear any date.
The date of an applica tion, the prescription of time for deposit of the membership fee and the amount of qualifying share and the filing of the requisite declaration arc formalities which could not be disregarded.
The Chairman rightly came to the conclusion that out of 39 persons except N.K. Mukherjee the other 38 were not legally admitted to the membership and, therefore, they could not be treated as members.
The Chairman in paragraphs 9 to 16 of the Report consid ered the cases of several persons who. had been declared defaulters.
He rightly came to the conclusion that 108 persons mentioned in Annexure 'C ' should be restored to membership.
The Chairman next considered whether there should be a waiting list.
A list of 102 persons described as the wait ing list was forwarded and endorsed by the officers of the Delhi Administration.
The Chairman came to the conclusion that of the 102 persons on the list, only a few prosecuted their claims before the Chairman and the rest appeared to him to be no more interested in the membership of the Socie ty.
In an annexure marked 'G ' the Chairman rightly included in the waiting list the names of such persons who could be considered.
The Chairman said that 38 persons whose membership was cancelled by him at the meeting held on 27 July, 1976 could apply afresh so that their applications could be considered.
The Chairman said that 24 persons made applications for membership.
The Chairman rightly said that it would be fair to leave the consideration of the applications of these 24 persons to the new Managing Committee and that their names should be kept in a waiting list.
The Chairman next found that the Society had received from 4 persons deposits towards the price of the land more than a decade ago but took no steps to return the moneys or to admit them to the benefit of membership.
Again, there were 4 other persons whose land had been acquired by the Delhi Administration.
There was an agreement which required the Society to offer membership to these persons upon their fulfilling the conditions of membership.
The Chairman found that those 4 persons whose land had been acquired had made applications.
The Chairman tightly came to the conclu sion that these 8 persons, namely 4 from whom moneys had been received and the other 4 whose land had been acquired should be accepted as members.
Out of 38 persons whose membership was cancelled by the Chairman on 27 July 11 applied to this Court in C.M.P. No. 2065 of 1976 for an order that admission of 124 members mentioned in 382 Annexure 'C ' to the petition is illegal and for further declaration of revocation of membership of 38 members as mentioned in Annexure 'B ' to the said petition.
These petitioners also asked for an order directing the Chairman not to proceed with the meeting of the Society and the holding of elections on 29 August, 1976.
These 11 persons also made applications C.M.Ps.
No. 8485 and 8486 for filing objections to the report of the Chair man.
They wanted two months to file objections.
It should be stated here that 11 applicants wanted to prevent the holding of the meeting and the election for the purpose of prolonging litigation.
This Court rightly did not prevent the holding of the meeting and the election.
The report of the Chairman shows that the meeting as well as the election was lawfully and validly held.
These 11 persons were given full opportunity to make their submissions by way of objection to the report.
Coun sel appeared and made their submissions.
These 11 persons submitted that no relief can be sought by the petitioners in the writ petitions against the Society and that Article 19 cannot now be invoked for the enforce ment of rights.
Their further submissions were these.
On 6 January, 1974 39 persons were declared defaulters by the Managing Committee for non compliance with the order of this Court passed on 11 December, 1973.
One of those 39 defaulters made an application to this Court on 9 February, 1974 for condonation of delay and for restoration of his membership.
The application was dismissed on 25 February, 1974.
On 4 April, 1974 this Court granted four weeks time to 15 persons out of the 39 declared defaulters and there fore the default of 24 persons was confirmed.
The Chairman re considered the cases of 24 defaulters including the one whose application was dismissed.
These 11 persons submitted that their membership and allotment should have been restored.
The Chairman was also in error in considering the cases of 8 persons because records were not available.
It is significant that out of 1100 members and the several parties to the writ petitions none has taken objec tion to the report of the Chairman.
The only persons who objected are out of the 24 persons those membership and allotment on 26 January, 1974 was cancelled.
These 24 per sons have however been put by the Chairman in a waiting list.
The membership as well as the allotment of plots to these 38 persons is rightly rejected by the Chairman.
The Chairman based his finding on facts of tabulated statements prepared in the presence of counsel and parties in open public hearings.
No challenge can be taken to the dates and facts.
The Chairman rightly found that even if the date of the eligibility certificate is taken as the effective date of application the position cannot be otherwise.
The Chairman rightly found that the records do not indicate that the payment was 383 made within 14 days of the date of resolution.
The Chairman rightly found that the requirement of payment is not proved and there has not been substantial compliance.
The conclu sion is correct and inescapable that the enrolment of 38 persons was not only rushed but was done with unseemly haste.
It also appears from the report of the Chairman that persons the waiting list were not considered before these 38 persons were enrolled as members.
Reference may be made to clause (7) of the Award of the Lt. Governor which was made the rule of Court.
The award is dated 6 July, 1971.
Clause (7) made it encumbent on the Society to act in ac cordance with the award.
There were some persons who were treated by the new Managing Committee as defaulters and these 38 persons were taken by the new Managing Committee unlawfully as members.
The Chairman in Annexure 'C ' restored 108 persons to membership.
These 108 persons had been declared defaulters by the nominated Managing Committee.
This Court by order dated 29 August, 1974 required the Chairman to look into each and every disputed question of membership and to decide as to whether a member has been rightly or wrongly declared a defaulter.
The nominated Managing Committee on 6 January, 1974 declared a number of persons to be defaulters.
The declara tion of defaulters could not have been made except by the General Body with a special majority and with the approval of the Registrar.
The nominated Managing Committee could not have functioned after 1 April, 1973 in view of the provisions of section 92 read with section 32 of the Delhi Co operative Societies Act, 1972.
In view of the award of the Lt. Governor dated 6 July, 1971 the Committee had there after no jurisdiction to declare any member a defaulter.
This Court by order dated 4 April, 1974 observed that the case of 24 defaulters would be considered if it transpired that the list of new allottees could not be allowed to stand.
The act of declaration of defaulters on 6 January, 1974 cannot be dissociated from the enrolment of new allottees on 25 and 26 January, 1974.
The report of the Chairman in restoring 108 alleged defaulters to membership is just and correct.
This Court by Order dated 29 August, 1974 required the Chairman to look into each and every disputed question of membership and to decide whether a person has been tightly or wrongly declared a defaulter.
The order further stated that if the Chairman came to the conclusion that the person has been declared to be a defaulter the Chairman will include him or her in the list of members.
The report of the Chairman is lucid and direct to the point.
The report noticed that there was widespread discontent as to the way in which the affairs of the Society were conducted.
The report said "Allegations of favouritism want of fairplay, mal administration, deliberate suppression of the rights of members were freely made against the nominated Managing Committee in 1971".
The Chairman noticed that there was "nothing to 384 choose between the old elected Committee which was super seded and the nominated Managing Committee which came to take its place".
Letters were hardly replied to.
En quiries were rarely attempted to.
Cheques were hardly ever cashed in time.
Sudden declarations of default were made without following the prescribed procedure laid down in the Act and the Rules.
The nominated Managing Committee issued a circular dated 30 April, 1973 demanding Rs.6 per sq. yard and threatened the members that in case they did not pay the said amount they would be declared defaulters.
This circular is not a notice within the meaning of the bye laws of the Society and declaration of defaulters on the basis of the circular is illegal and contrary to bye laws of the Society.
Further the said circular was despatched after the time for payment mentioned therein was over.
No opportunity was given tog member as required by the mended bye laws to show cause why his right to a plot would not be forefeited for non payment of deposit.
Figures of alleged dues were not mentioned in the circular in most of the case.
In view of the award of the Lt. Governor dated 6 July, 1971 the nominated Managing Committee could not declare, any member to be a defaulter.
Further the order of this Court dated 6 July, 1973 continued to be in force, in so far as the petitioners in Raj Rani 's petition are concerned.
The declaration of defaulters from amongst the petitioners in Raj Rani 's petition was unjustified.
The action of the Managing Committee declaring defaulters was in bad faith because they wanted to confer benefits on other persons under the guise of declaration of defaulters.
This Court in the order dated 4 April, 1974, observed that the cases of 24 defaulters would be considered if it transpired that the list of allottees on 26 January, 1974 could not be allowed to stand.
The Chairman has rightly dealt with the cases of 24 defaulters in view of his right conclusion that the allotments on 26 January; 1974 were bad.
The Chairman considered the cases of 42 persons who had been declared defaulters.
The Chairman rightly came to the conclusion that 30 persons had genuine grievances and he accepted them as members on their submitting fresh affida vits with a view to putting an end to all controversies whether they filed affidavits of not.
R was admitted before the Chairman that all these persons had field their affidavits originally while seeking membership.
The ques tion was whether they filed any fresh affidavits as required by the subsequent direction of the Delhi Development Author ity.
Some of the members contended before the Chairman that they filed amended affidavits.
Some members contended that in spite of their request to give the proforma of the amend ed affidavit the nominated Managing Committee did not give the proforma of the affidavit.
Under these circumstances the Chairman rightly accepted the contentions of 30 out of the 42 persons.
385 The Chairman rightly held that 4 persons whose money was lying with the Society should be made members.
The Chairman also rightly held that 4 persons whose lands had been ac quired by the Society should be accepted as members.
The Chairman in paragraph 37 of the report has indicated that the new Managing Committee should fix priorities in the order mentioned in sub paragraph (a) to (e).
These in sub paragraphs (a) to (b) belong to classes of members in whose favour there was specific allotment as early as the year 1957.
Due communication was made to them about the specific allotment of plots.
They were persons who had paid more than Rs.17,000.
They were declared defaulters for non payment of Rs.3000 or less by the nominated Managing Com mittee as late as the year 1974.
The Chairman rightly put persons in sub paragraphs (a) and (b) in order of priority.
Persons in sub paragraph (c) in paragraph 37 of the Chairman 's report comprise those who were declared default ers round about the year 1962 63.
The amounts paid by persons in sub paragraph (c) are less than the amounts paid by persons in sub paragraphs (a) and '(b).
There was no specific allotment of plots in favour of persons mentioned in sub paragraph (c).
Persons in sub paragraph (c) there fore cannot claim priority over persons in sub paragraphs (a) and (b).
In sub paragraph (c) only one person objected regarding priority.
The other 47 persons accepted their places in sub paragraph (c).
This also shows the justness of the report,.
Subject to the following directions, the report of Mr. D. Mookerjee dated 23 September, 1976 is accepted and con firmed.
The Managing Committee of the New Friends Co opera tive Society Ltd. (hereinafter called "the new Managing Committee") elected at the meeting held on 29 August, 1976 shall assume charge with effect from the date of this order.
The new Managing Committee shall send to all persons referred to in sub paragraphs (a) to (e)of paragraph 37 of Mr. Mookerjee 's report, through Mr. Mookerjee, a letter stating that membership fee and the amount of qualifying share necessary to become a member of the Society and also copies of this order as well as the appropriate forms of application for membership of the Society and of the affida vits to be sent by the applicants to the new Managing Com mittee within one month from the date of this order.
Each person referred to in sub paragraphs (a) to (e) of paragraph 37 shall, if he desires to have any plot allot ted to him, apply for membership of the Society.
All such applications for membership of the Society shall be sent to Mr. Mookerjee within 30 days.
from the date of receipt of the documents referred to in the next preceding paragraph hereof.
If any application is not received by Mr. Mooker jee within the said period, or if the affidavit referred to in the next preceding paragraph is not enclosed with the application, or if any application or affidavit be found by Mr. Mookerjee to be 386 not in compliance with the form of the application and the affidavit sent to the applicant, Mr. Mookerjee shah reject such application.
Such rejection by Mr. Mookerjee shall be final.
All applications for membership along with affida vits, found by Mr. Mookerjee to be in order, will be for warded by Mr. Mookerjee to the new Managing Committee upon the expiry of the said period of 30 days.
Mr. Mookerjee will make a list of the persons whose applications are so forwarded by him to the new Managing Committee.
The new Managing Committee shall convene a meeting of the Committee within 30 days from the receipt of the appli cations along with the affidavits sent by Mr. Mookerjee to the new Managing Committee as aforesaid and pass a resolu tion accepting all such applicants for membership as members of the Society.
The new Managing Committee shall convey to Mr. Moo kerjee its said resolution within 14 days of the passing of such resolution and shall send to Mr. Mookerjee at least as many copies of the resolution as the number of persons who are admitted as members of the Society by virtue of that resolution.
Mr. Mookerjee will thereafter send a copy of the said resolution to each of the applicants Who is admit ted as a member of the Society by virtue of the said resolu tion.
On receipt of the said communication from.
Mr. Mookerjee each person who has been admitted as member of the Society by virtue of the said resolution shall, within 14 days from the receipt of the communication from Mr. Mooker jee, pay to Mr. Mookerjee by Bank Draft (drawn in favour of "New Friends Co operative House Building Society Ltd.") an amount including the membership fee and the amount of quali fying share necessary to become a member of the Society.
Mr. Mookerjee will thereafter forward the Bank Drafts to the new Managing Committee.
Regarding the allotment of plots, the suggestions of Mr. Mookerjee contained in sub paragraphs (a) and (b) of paragraph 37 of his report will be given effect to by the new Managing Committee, subject to the availability of plots and subject also to each person referred to in the said two sub paragraphs and to whom any plot is allotted complying with the direction contained in the preceding paragraph 7 hereof and further subject to each such person paying his full share of the money payable to the Delhi Development Authority under the Supplementary Agreement entered into between the President of India and the Society on 1 Febru ary, 1972 by a Bank Draft drawn in favour of the Delhi Development Authority".
The allotment of plots among persons referred to in sub paragraphs (a)and (b) of paragraph 37 of Mr. Mookerjee 's report shall be in the order of priority mentioned there and already earmarked for them.
If plots which are already earmarked for persons in subparagraphs (a) and (b) are not available then there will be allotments to those persons by draw of lots first among those in sub 387 paragraph (c): and thereafter among those in sub pargraph (b).
Mr. Mookerjee will prepare a list of persons to whom plots are so allotted and send copies of,the list of the new.
Managing Committee and,the Delhi Development Authority and inform the persons to Whom, such allotments are made.
Each person referred to in the said.
sub paragraphs.
(a) and (b) of paragraph 37 and to whom any plot is allotted shall, within (b) days from the receipt of the communication from Mr. Mookerjee as referred to reparagraph 6 hereof, enquire from the Delhi Development Authority as to the sum payable by him to the Delhi Development Authority as afore said and upon receipt of the reply from the Delhi Develop ment Authority pay the sum to the latter by a Bank Draft within 15 days from the date of the receipt of the reply.
In default of such payment the allotment to him will stand cancelled.
In the event of any such cancellation allotment may be made to the next person if any, in this sub para graph.
Thereafter, if any plot or plots remain to be allotted the allotment or allotments shall strictly be in accordance with the order of priority laid down in paragraph 37 of Mr. Mookerjee 's report.
Such allotments shall be made by Mr. Mookerjee by means of draw of lots first among the persons referred to in sub paragraph (c) thereafter among those in sub paragraph (d) and thereafter among those in sub paragraph (e) of paragraph 37 of his report.
Mr. Moo kerjee will prepare a list of persons to whom the plots are so allotted and send copies of the list to the new Managing Committee and the Delhi Development Authority and inform the persons to whom such allotments are made.
Any person referred to in sub paragraphs (c), (d) and (e) of Mr. Moo kerjee 's report who is allotted any plot shall within 14 days from the receipt of the communication from Mr. Moo kerjee to the effect that a particular plot has been allot ted to him enquire from the Delhi Development Authority as to the sum payable by him to the Delhi Development Authority as aforesaid and upon receipt of the reply from the Delhi Development Authority pay the sum to the latter by a Bank Draft within 15 days from the date of the receipt of the reply.
In default of such payment the allotment to him will stand cancelled.
In the event of any such cancellation, allotment may be made to next person, if any, in that subparagraph.
Each allotment of plot, referred to in this order, shall be in accordance with the application of each appli cant for membership referred to in paragraph 3 hereof, that is to say, will not be entitled to any allotment of any land, the area whereof is different from the area mentioned in his application form.
If any person referred to in any of the sub para graphs of paragraph 37 of Mr. Mookerjee 's report has al ready paid any money to the Society and proves such payment to Mr. Mookerjee, the money so paid and proved shall be appropriated towards payment of the amounts mentioned in paragraphs No. 7, 8 mad 11 hereof.
388 14.
Upon allotment of land to any person mentioned in this Report each allottee shall pay to the Society a sum of Rs.1,000/ within one month from the date of such allotment as and by way of costs relating to these proceedings.
In default of payment of such sum, the allotment to such person shall stand cancelled.
In the event of any such default, the procedure laid down in paragraph 10 and 11 hereof shall be followed.
To sum up.
In the event of any lucia default the allotment may be made to the next person, if any, in the sub paragraph group of the defaulting persons and thereafter to next sub paragraph group of persons.
No lease shall be granted to any allottee until and unless all directions contained in this order are fully complied with by him.
The Society shall pay to Mr. Mookerjee a further sum of Rs.45,000/ as his remuneration for the work done by him so far.
The Society shall also pay Mr. Mookerjee a further stun of Rs.5,000/for the work to be done by him under this order and also such further sum or sums as he may intimate to the new Managing Committee as extra expenses, including remuneration for his staff, postage etc.
for the work to be done under this order.
Mr. Mookerjee 's Personal Assistant Mr. Jain will be paid Rs.300/ per month.
This order shall not apply to such members of the Socie ty who have already obtained leases from the President of India.
This order will govern only the affairs of this Society and will not be a precedent for the affairs of any other co operative society.
Some persons have deposited monies with the Registrar of this Court.
The Registrar may hand over the money to the Society.
Writ Petition No. 340 of 1972, 1526 of 1973 and 286 of 1974 and all proceedings in these writ petitions are dis posed of accordingly.
All parties will pay and bear their own costs.
P.H.P. Petitions allowed.
| The appellant.company sued Mr. & Mrs. Sequeira for recovery of certain amounts under two contracts of supply of iron ore.
The first contract was signed by Ramesh holder of a power of attorney of Sequeiras and the second contract was signed by Ramesh 's father as the agent of Ramesh.
Under the two contracts Sequeiras were supposed to supply and load iron ore and were liable to pay demurrage in case of delay in loading the ship and were entitled to receive certain despatch money if the loading was made earlier.
Sequeiras filed their counter claims.
The Court did 'not arrive at a definite conclusion about the quantity of ore supplied and left that to be determined in execution proceedings.
The court found that the first contract was binding between the appellant and Sequeiras as it had been ratified by Sequerias and acted upon by the appellant.
The court, however, held that the second contract was not 'binding on Sequeiras as Ramesh had a limited authority and, therefore, he could not constitute his father his attorney for the purposes of executing the second agreement.
The trial Court also found that the appellant had committed breaches of the contract but left the quantum of damages to be determined in execu tion proceedings.
The decree of the .trial Court was sub stantially confirmed in appeal by the Additional Judicial Commissioner.
HELD: 1.
The Judicial Commissioner erred in concentrat ing on only one dictionary meaning of.
the word "exploita tion" used in the power of attorney executed by Sequeiras m favour of Ramesh.
The court, while interpreting a power of attorney, has to construe the document as a .whole m the light of its purpose and surrounding circumstances and the transactions meant to be governed by it.
Practice and custom have also some bearing on the nature and effect of the power of attorney.
The purpose of the powers conferred on the power of attorney have to be ascertained having regard to the need which gave rise to the execution of the docu ment, the practice of the parties and the manner in which parties themselves understood the purpose of the document.
The powers.
which are absolutely necessary and incidental to the execution of the ascertained purposes of the general powers given must be necessarily implied.
Applying the above rules of interpretation the court came to the conclu sion that Ramesh had power to appoint an agent to execute the contract in question and therefore the second .contract was also binding on Sequeiras [454A B, 456A H] Bryant, Powls, and Bryant, Limited vs La Banque De Peuple etc.
@ 177 and 179 and Jonmenjoy Coondoo vs George ,Alder Watson, @ 912 approved.
O.A.P.R.M.A.R. Adaikappa Chettiar vs Thomas Cook & Son (Bankers) Ltd. , distinguished.
The implied powers cannot go beyond the scope of the general object tances do not derrogate from the width of the general power initially conferred of the power of attorney but must necessarily be subordinated to it Specific in to such a case ejusdem generis cannot be applied.
The mode of construing a document and the rules to be applied to extract its meaning correctly depends upon not only the nature and object but also upon the frame, provisions, and language of the documents.
In cases of uncertainty the rule embodied in proviso 2 to section 92 of the Evidence Act which is ap plicable to contracts can be invoked.
452 The ultimate decision of such a matter turns upon the prac tice and particular facts of each case.
[458D P] 3.
The findings arrived at by the Appellate Court that Sequeiras were prevented from performing their part of the contract, owing to the failure of the appellant to provide either sufficient lighting or enough winches to enable due performance of the contract, is unexceptionable.
The Judi cial Commissioner rightly concluded that the company had not discharged its own part of the contract so that it could not claim demurrage or damages.
[458 G H] The court partly allowed the appeal and remanded the matter back to the trial court for determining the liabili ties of the parties in the light of the judgment.
[459E F]
|
Appeals Nos.
480 to 487 of 1960.
Appeals by special leave from the judgment and order dated July 15, 1960, of the Allahabad High Court in Civil Misc.
Writ Nos.
1554, 1561, 1553, 1560, 1556, 1558, 1559 and 1557 of 1960.
N. C. Chatterjee, R. K. Garg, section C. Agarwal, D. P. Singh, K. K. Sinha, V. A. Seyid Muhamad and M. K. Ramamurthi, for the appellants (in C. As.
Nos. 480 and 481 of 60).
R. K. Garg, M. K. Ramamurthi, section C. Agarwal, D. P. Singh, V. A. Seyid Muhamad and K. K. Sinha, for the appellants (in C. As.
482 to 487 of 60).
G. N. Kunzru and I. N. Shroff, for the respondents.
January 10.
The Judgment of the Court was delivered by HIDAYATULLAH, J.
These are eight appeals against the judgment and " decree " of the High Court of Allahabad dated July 15, 1960, with special leave granted by this Court.
By the writ petitions, which failed before the High Court, the appellants had asked that Resolutions Nos. 90, 94 to 96 and 99 to 102 passed by the Executive Council of the Banaras Hindu University on May 15, 1960, terminating their services from June 1, 1960, be quashed.
The names of the appellants, the posts they held and the gist of the Resolutions passed against them have been set down below : Group I 1.
Dr. Akshaibar Lal: Reader in College of (C. A. No. 480 of 1960) Agriculture.
(Resolution No. 100 4months ' pay in lieu of notice) 2.
Dr. Gopal Tripathi Professor of Chemi (C. A. No. 482 of 1960) cal Engineering and Principal, College of Technology.
(Resolution No. 101 4months ' pay in lieu of notice) 389 3.
Pandit Ram Vyas Pandey : Reader and Head of (C. A. No. 486 of 1960) Department of Jyotish Sanskrit Maha vidyalaya.
(Resolution No. 99 under cls.
4 and 7 of the agreement dated March 26, 1931, and Ordinance No. 6 of the Ordinances of the University 6 months ' pay in lieu of notice) 4.
Dr. Gauri Shankar Tiwari : Lecturer in Chemis (C. A. No. 487 of 1960) (Resolution No. 102 4 months ' pay in lieu of notice) Group II 5.
Dr. Rain Deo Misra: Professor and Head (C. A. No. 481 of 1960) of Department of Botany, College of Science.
(Resolution No. 94 under cls.
4 and 7 of the agreement dated February 3, 1959, and Ordinance No. 6 of the Ordinances of the University 4 months ' pay in lieu of notice) 6.
Mr. Ganesh Prasad Singh: Lecturer in Physical (C. A. No. 483 of 1960) (Resolution No. 95 under cls.
4 and 7 of the agreement dated January 18, 1946, and Ordinance No. 6 of the Ordinances of the University 6 months ' pay in lieu of notice) 7.
Mr. Radhey Shyam Sharma: Lecturer, College of (C. A. No. 484 of 1960) Technology.
(Resolution No. 90 under cls.
4 and 9 of the agreement dated January 21, 1957, and Ordinance No. 6 of the Ordinances of the University 4 months ' pay in lieu of notice) 8.
Dr. Ram Yash Roy: Lecturer in Botany, (C. A. No. 485 of 1960) College of Science.
(Resolution No. 96 under cls.
4 and 7 of the agreement dated August 12, 1932, and Ordinance No. 6 of the Ordinances of the University 6 months ' pay in lieu of notice).
390 The cases of the appellants are very similar; but fall into two groups as indicated above.
The differences are not many, and some of them are indicated in the gist of the resolutions noted against their names.
Other differences will appear from the facts, which are given below.
The affairs of the Banaras Hindu University, for reasons with which we are not concerned, had been deteriorating, and a situation had arisen which required intervention immediately.
The President of India, in his capacity as Visitor and in exercise of the powers conferred by section 5(2) of the , appointed a Committee of Enquiry (known as the Mudaliar Committee) consisting of: 1.
Dr. A. L. Mudaliar (President) 2.
Mr. M. C. Mahajan 3.
Dr. P. Subbarayan 4.
Sucheta Kripalani 5.
Dr. Nairoji Wadia (Members) to enquire into and report, inter alia, on the general state of discipline in the University, keeping in view the disturbances in some of the Institutions of the University, and to suggest remedies and measures of reform for the betterment of academic life and efficient functioning of the University.
The Committee made a report suggesting that a " Screening Committee " should be appointed to review the appointments made to the teaching staff and the work of the teaching staff, and that action should be taken in the light of the findings of the Screening Committee.
On June 14, 1958, the President of India promulgated an Ordinance (IV of 1958) to amend the .
By section 8 of the Ordinance, the Statutes of the University were amended, and in place of Statute No. 30, another Statute was substituted, which set up a " Screening Committee ", consisting of (a) a person who is or has been a Judge of a High Court (Chairman), (b) the Vice Chancellor (Ex officio) and (c) a person having administrative or other experience in educational matters, to examine the cases of all persons holding teaching, administrative or other 391 posts in the University at the commencement of the Ordinance, in respect of whom there was reason to believe that their continuance in office would be detrimental to the interests of the University, and to forward its recommendations to the Executive Council to take such action as it may deem fit.
The Ordinance of the President was repealed by the Banaras Hindu University (Amendment) Act, 1958 (XXXIV of 1958), which re enacted Statute No. 30 as follows: " 30.
(1) If the Executive Council has reason to believe that the continuance in office of any person who on the 14th day of June, 1958, was holding any teaching, administrative or other post in the University would be detrimental to the interests of the University, it may, after recording briefly the grounds for such belief, refer the case of any such person, together with the connected papers, if any, in its possession, to the Solicitor General to the Government of India: Provided that, where an allegation of the nature referred to in this subsection relates to a member of the Executive Council who was holding any teaching, administrative or other post in the University on the said date, the Executive Council shall, without considering the allegation, refer the case of such person, together with a copy of the allegation, to the Solicitor General to the Government of India.
(2) If on any such reference the Solicitor General to the Government of India is of opinion that there is a prima facie case for inquiry, he shall refer the case of the person concerned to a Committee to be constituted for the purpose by the Central Government and known as the Reviewing Committee, which shall consist of the following persons, namely : (a) a person who is or has been a Judge of a High Court nominated by the Central Government who shall be the Chairman of the Committee; and (b) two persons nominated by the Central Government from among persons who have had administrative or other experience in educational matters, 392 (3) It shall be the duty of the Reviewing Committee to examine the case of every person referred to it by the Solicitor General; and the Reviewing Committee shall, after holding such inquiry into the case as it may think fit, and after giving to the person concerned an opportunity of being heard, if he so desires, forward its recommendations to the Executive Council.
(4) The meetings of the Reviewing Committee shall be convened by such person as may be appointed for this purpose by the Chairman.
(5) On receipt of the recommendations of the Reviewing Committee, the Executive Council shall take such action thereon as it may think fit: Provided that when the recommendations relate to any such person as is referred to in the proviso to sub section (1), such person shall not take part in any meeting of the Executive Council in which the recommendations are considered.
(6) Before taking any action against any person on the recommendations of the Reviewing Committee, the Executive Council shall give him a reason.
able opportunity of being heard.
" Under the powers granted by this Statute and after sundry procedure, the Solicitor General sent up the cases of the appellants (and some others, who are not before us) to the Reviewing Committee.
The appellants appeared before the Reviewing Committee and represented their cases.
Except in the case of Mr. Radhey Shyam Sharma (Civil Appeal No. 484 of 1960), whose case was kept pending because certain matters were sub judice, the Reviewing Committee sent its findings to the University.
These findings were considered in respect of the four appellants in Group I (above), and on February 13, 1960, the Executive Council passed Resolutions Nos. 436 to 439 calling upon them to show cause why their services be not terminated, in view of the findings of the Reviewing Committee that the continuance in office of those appellants was detrimental to the interests of the University, which the Executive Council had accepted.
These four appellants showed cause on March 5, 1960, No notices 393 were, however, sent to the four appellants in Group II above, and this is one distinguishing feature in the cases.
The four appellants (Group I) filed petitions under article 226 of the Constitution (W. Ps.
Nos. 712 to 715 of 1960) on March 9,1960, in the High Court of Allahabad for relief against the proposed action.
On the same day D. section Mathur, J. passed an ad interim order as follows: " The respondents Nos. 1 to 3 are directed until further orders, not to take any further proceedings against the petitioners.
" The Registrar of the University then applied to the High Court, and on April 25, 1960, Jagdish Sahai, J., made the following order: " In supersession of the interim order dated 9 3 1960, I order that the proceedings before respondent No. 2, Executive Council of Banaras Hindu University, arising out of the recommendations of the Reviewing Committee shall remain stayed.
" On May 15, 1960, the Executive Council of the University passed a number of Resolutions.
Resolution No. 89 took into consideration the explanations sent by the four appellants (Group 1) on March 5, 1960, and the order of the High Court, and it was resolved: ". . that the consideration of the above cases be postponed till after the writ petitions above mentioned are disposed of by the High Court.
" On the same day, however, Resolutions Nos.
99 to 102 were passed terminating the services of the four appellants (Group 1) from June 1, 1960, giving to them four or six months ' salary, in lieu of notice.
In the Resolution concerning Pandit Ram Vyas Pandey, there was a mention that the action was taken under cls.
4 and 7 of the agreement executed by him and Ordinance No. 6 of the Ordinances of the University.
In the remaining three cases, it was not stated under what exercise of power the action was taken.
Even earlier than the notice to show cause issued on February 13, 1960, explanations were called from Pandit Ram Vyas Pandey and Dr. Gopal Tripathi by Resolutions Nos. 278 and 281 dated September 9, 1959, and these explanations were ordered to be filed by Resolution No. 103 50 394 passed on the same day.
Four Resolutions were also passed terminating the services of the other appellants belonging to Group II.
It was after these Resolutions were communicated that the eight petitions were filed by the appellants in the High Court of Allahabad.
The High Court by a common judgment, which is under appeal, dismissed all the petitions with costs.
The case of the appellants, broadly stated, is that the Executive Council could not take recourse to the provisions of Ordinance No. 6 of the Ordinances of the University, having started action under Statute No. 30, that Ordinance No. 6 was subordinate to, Statute No. 30 and could not prevail where Statute No. 30 applied, that action against the four appellants in Group I was stayed by the High Court and Resolution No. 89, and that any action thereafter under the agreement or Ordinance No. 6 was incompetent.
The action of the Executive Council was characterised as mala fide and a fraud upon the University Act and Statute No. 30.
The High Court did not accept any of these contentions.
Before us, the same points have been urged again, and in reply, the University contends that the Executive Council could take action Under the terms of the agreements, where such agreements existed, or under Ordinance No. 6 or Statute No. 30 at its Option, and that where alternative remedies were provided by law, all or any.
of the remedies could be invoked.
Before we deal with these arguments, it is necessary to examine closely the powers of the Executive Council of the University, as they can be gathered from the , the Statutes and Ordinanaces framed under it.
The Act was passed in 1915 (XVI of 1915), but it was amended in 1930, 1951 and 1958.
Originally, the Act provided for the framing of Statutes and Regulations by the University ; but in 1951, the existing Regulations were deemed to be the first Ordinances under section 18(2) of the amended Act.
A further power to make Regulations was conferred by section 19.
Thereafter, there were Regulations in addition ,to the University Act, Statutes and Qrdinances, We 395 are not concerned with the Regulations, and no reference need be made to them except to say that they ranked below the Ordinances and had to be consistent, with the Act, the Statutes and the Ordinances.
In the Act, the word "Statute" was defined to ' mean " the Statutes for the time being in force ", and ' there was an analogous definition of the word " Ordinances ".
Section 17(2) of the Act enacted that " the first Statutes shall be those set out in Schedule I ".
The power to frame Statutes was conferred on the Executive Council by section 17(3), but was subject to the previous approval of the Visitor.
This sub section, as it was amended by section 4 of the Banaras Hindu University (Amendment) Act, 1958, read as follows: " The Executive Council may, from time to time, make new or additional Statutes or may amend or repeal the Statutes; but every new Statute or addition to the Statutes or any amendment or repeal of a Statute shall require the previous approval of the Visitor who may sanction, disallow or remit it for further consideration.
Section 4A of the Act invested the University with powers, and sub sections
(7) and (13) may be quoted here: " (7) to institute professorships, readerships, lectureships and other teaching posts required by the university and to appoint persons to such professorships, readerships, lectureships and other posts; (13) to create administrative, ministerial and other necessary posts and to make appointments thereto.
" Section 7 of the Act named the officers and authorities of the University, but power was reserved to the University to declare, by statutes, other officers and authorities of the University.
In addition to being an authority of the University, the Executive Council was appointed the executive body of the University.
Sub section (2) of section 10 of the Act laid down: " The Executive Council shall exercise such powers and perform such duties as may be vested in it by the Statutes.
" Section 17 of the Act provided how the statutes were to be framed and what they were to contain.
We 396 have already referred to the first Statutes of the Uni versity which were placed in Schedule of the Act and the power of the Executive Council to make new or additional Statutes or to amend or repeal existing Statutes subject to the prior approval of the Visitor.
Section 17 provided: " 17(1).
Subject to the provisions of this Act, the Statutes may provide for all or any of the following matters, namely: (c) the appointment, powers and duties of the officers of the University.
" From the above analysis, it is clear that the Act created the Executive Council as an authority and the executive body of the University; but its powers were conferred and its duties were created by the Statutes.
The source of power and duties in respect of the Executive Council was thus the Statutes under the authority of the Act.
Section 18 of the Act (as amended in 1951) provided: " 18(1).
Subject to the provisions of this Act and the Statutes, the Ordinances may provide for all or any of the following matters, namely: Ordinances: emoluments and terms and conditions of service of teachers of the University.
" The Ordinances were thus made subordinate to the Act and the Statutes, and could not go beyond them or derogate from them.
One more provision of the Act as amended in 1951 may be read here.
It is s.19A,which provided: " 19A. (1) Every salaried officer and teacher of the University shall be appointed under a written con.
tract, which shall be lodged with the University and a copy of which shall be furnished to the officer or teacher concerned.
(2) Any dispute arising out of a contract between the University and any of its officers or teachers shall, at the request of the officer or teacher concerned or at the instance of the University, be referred to a Tribunal of Arbitration consisting of one member appointed 397 by the Executive Council, one member nominated by the officer or teacher concerned and an umpire, appointed by the Visitor, and the decision of the Tribunal shall be final.
" The powers granted to the Executive Council by the Statutes may now be seen.
Statute No. 18 was amended in 1958, and is referred to as amended.
It laid down: " 18(1).
The Executive Council shall, subject to the control of the Visitor, have the management and administration of the whole revenue and property of the University and the conduct of all administrative affairs of the University.
(2) Subject to the provisions of the Act, the Statutes and the Ordinances, the Executive Council shall, in addition to all other powers vested in it, have the following powers, namely: (i) To appoint, from time to time,.
Principals of Colleges and institutions established by the University, and such Professors, Readers, Lecturers and other members of the teaching staff, as may be necessary, on the recommendation of Selection Committees constituted for the purpose (Proviso omitted) (ii) to appoint members of the administrative staff or to delegate the power of appointment to such authority or authorities, or officers as the Executive Council may, from time to time, by resolution, either generally or specially direct;. " The power of appointment was thus conferred by the Statutes on the Executive Council.
We now turn to the Ordinances, where the disciplinary rules are to be found.
On October 13, 1958, the Executive Council by Resolution No. 181 reconstituted the material Ordinance.
Chapter III in part I of the Banaras Hindu University Calendar (1958) contains the terms of appointment, grades, salary and conditions of service of teachers, officers and other employees of the University.
That Chapter is divided into many sections and sub sections.
Section 5 deals with teaching and administrative posts, and section 6, with the conditions 398 of service and terms of appointment.
Ordinance No. 2 in this section lays down: " The conditions of service of the staff shall be embodied in the Agreement Form of service.
Every employee shall on confirmation sign the agreement Form.
" Ordinance No. 6, before its amendment, read: " The Executive Council shall be entitled to terminate the engagement of an employee (i) on grounds of misconduct and (ii) physical unfitness for good cause and after calling for and considering his explanation and after giving four months ' notice in writing or payment of four months ' salary in lieu of notice.
The Ordinance was unhappily worded.
The expression "physical unfitness for good cause" hardly makes sense.
More difficulty arises by the use of the conjunction "and".
That word used for the first time in the Ordinance is obviously used disjunctively; but on the second and third time it is used conjunctively, introducing two conditions precedent.
So far, there is no dispute, though much bad drafting.
Dispute arises over the last use of the conjunction 'and" in the Ordinance.
The appellants contend that it must be read conjunctively as introducing a third condition precedent, while the University urges that it is a separate power of termination unconnected with the others.
The High Court was persuaded to read the clause as interpreted by the University and, in our opinion, rightly.
In 1958, the Executive Council re framed this Ordinance but surprisingly enough, without any better success.
The re enacted Ordinance, as printed in the amendment slip, read: " 6.
The Executive Council shall be entitled to terminate the engagement of an employee for (i) misconduct, or (ii) physical unfitness, or (iii) inefficiency, or (iv) breach on his part of one or more of the terms of his agreement with the University, after 399 calling for and considering his explanation in each of the cases mentioned above; or (v) after giving four months ' notice or payment ' of four months ' salary in lieu thereof.
The dispute this time arises from the careless use of the word "or".
The Ordinance mentions four reasons for termination of services, which are numbered (i) to (iv).
In each of those cases, there is the condition precedent that explanation must be called for and considered.
So far, the meaning is clear, even though the drafting is far from commendable.
Then follow a semi colon and "or" and number (v).
The word "or" does not seek to create an option between calling for and considering an explanation and a four months ' notice, etc.
The number (v) and the semi colon between " mentioned above " and " or " do not permit this reading.
The difficulty, however, does not end there.
If we read the fifth clause as connected independently with the opening words, we get this: " The Executive Council shall be entitled to terminate the engagement of an employee for . . . . . . . . . (v) after giving four months ' notice. . . which makes the word "for " superfluous in the sentence.
In our opinion, the sense of the Ordinance can be obtained by rearranging the matter thus: " 6.
The Executive Council shall be entitled to terminate the engagement of an employee for (i) misconduct, or (ii) physical unfitness, or (iii) inefficiency, or (iv) breach on his part of one or more of the terms of his agreement with the University, after calling for and considering his explanation in each of the cases mentioned above; or (v) after giving four months ' notice or payment of four months ' salary in lieu thereof " This means that, if action is taken under cls.
(i) to (iv), an opportunity of showing cause against the termination of the service must be given; but action can also be taken to terminate the service, without assigning a 400 cause, on four months ' notice or four months ' salary ,in lieu of notice.
The case of the University is that all these orders of termination of service were passed under the power granted by cl.
(v) of this Ordinance, modified by the terms of the agreements as they existed.
The result of this analysis shows that the power of the University to terminate the services of the incumbents was derived from (a) agreements, (b) Ordinances, and (c) Statute No. 30.
The agreements merely represented the general right of a master to terminate the services of incumbents, where they were subject to agreements, after reasonable notice, without giving any reason.
The Ordinances, in addition to preserving that right, gave power to terminate service for proved misconduct, inefficiency or physical unfitness.
These powers, unless used according to the stated conditions, were unexercisable, and in the case of a service which was protected against arbitrary action, being perma nent, could only be invoked in an appropriate instance.
In those cases which would fall within the categories of proved misconduct, inefficiency and physical unfitness, the University was required to take action in accordance with the Ordinance and the Rules.
This was the position before the new Statute No. 30 was added by Parliament.
This legislative measure was undertaken as the result of the sorry state of affairs of the University, and a special ground was required to be proved.
It was that the continuance of an incumbent was detrimental to the interests of the University.
The power to terminate the services of an incumbent on this ground was hedged in with appropriate safeguards, due to the struggle for power which it is said, had arisen in the University in the past; and though the Mudaliar Committee had suggested a Screening Committee to go into the cases of all teachers, Parliament thought it necessary that before any case reached the Screening Committee (renamed the Reviewing Committee) it should be scrutinised by the Solicitor General.
The procedure which the new Statute enacted, ensured fair play and proper scrutiny.
First, the Executive Council had to resolve that the continuance in office of any particular person 401 was detrimental to the interests of the University.
The reasons for such belief had to be recorded briefly, and the Resolution together with the connected papers had to be sent to the Solicitor General.
In the case of a teacher who was a member of the Executive Council, the Executive Council was not to consider the allegations but to send the papers to the Solicitor General.
The Solicitor General had to decide if there was a prima facie case for enquiry, and then he was to refer suitable cases to the Reviewing Committee.
The Reviewing Committee was then to enquire into the matter, and forward its recommendations to the Executive Council.
The Executive Council was thereafter required to proceed under cl.
(6), which was as follows: " Before taking any action against any person on the recommendations of the Reviewing Committee, the Executive Council shall give him a reasonable opportunity of being heard.
" The power of the Executive Council was conferred by cl. 5, which provided: " On receipt of the recommendations of the Reviewing Committee, the Executive Council shall take such action thereon as it may think fit.
" The procedure laid down in Statute No. 30 was followed by the University.
The cases of the appellants went before the Solicitor General and then before the Reviewing Committee.
In seven cases out of eight, ' the Reviewing Committee gave its opinion.
In four out of seven cases, a show cause notice was issued under cl. 6 but not in others; and the four appellants (Group 1) also showed cause.
They also obtained a stay from the High Court of Allahabad against action under Statute No. 30, and the Executive Council decided to postpone consideration of their cases.
But the Executive Council abandoned action under Statute No. 30, and proceeded to act under powers which, it thought, flowed from the agreements and the Ordinances, and terminated the services of the eight appellants, giving four or six months ' salary in lieu of notice.
51 402 In so far as the power of terminating services with.
out notice was concerned, the general power could not be invoked, when allegations of conduct detrimental to the interests of the University had already been made and scrutinised by the Solicitor General and the Reviewing Committee and the matter was pending before the Executive Council.
The powers granted by the Ordinances are expressly subject to the Statutes, and the Ordinances cannot prevail over the Statutes.
Statute No. 30 provided for special action in special circumstances.
The existence of the special circumstances is expressly admitted, inasmuch as the cases were referred to the Reviewing Committee.
The existence of the special circumstances and the special remedy excluded the right of the University to invoke its general powers, not to start with, but after the special procedure had been deliberately adopted and had commenced.
If the cases of these appellants had not been sent to the Solicitor General and the Reviewing Committee at all, other considerations might have arisen.
The question is whether after the special procedure was once invoked, it could be dropped in the middle and other powers exercised.
The University relies on three arguments in this connection.
It is first contended that the powers of the University were cumulative, and that the University could resort to any of the remedies open to it.
Reliance is placed in support of this argument on Shankar Sahai vs Din Dial (1) (observations of Mahmood, J., at p. 418), Om Prakash Gupta vs State of U. P. (2), The State of Madhya Pradesh vs Veereshwar Rao Agnihotry 3 ), Brockwell vs Bullock (1), Seward vs " Vera Cruz" (5) and Barker vs Edger (6).
It is not necessary to refer to these cases in detail.
It has been laid down recently by this Court that, where the law allows alternative remedies, one or the other or both can be invoked unless one remedy is expressly or by necessary implication excluded by the other (See State (1) All. 409.
(2) ; (3) ; , (4) (5) (6) [1898] A.C. 748 (P.C.), 403 of Kerala vs G. M. Francis and Co. (1)).
The question thus is whether there is anything expressly stated by law or clearly implied which would exclude powers under the agreements and the Ordinances, when action has been taken under the Statutes.
The University Act expressly makes the Ordinances subject to the Statutes, and in case of any clash between them, the Ordinances must be made to stand down.
Further, Statute No. 30 was enacted by Parliament to meet a special situation, and contained a code for dealing with certain special kinds of cases.
To that extent, the implication is not only one way, but is also clear.
The University could not, having started enquiries under Statute No. 30, abandon the enquiries in midcourse and pass on to something else.
This is illustrated by the contradictory Resolutions passed on the same day.
In the case of the four appellants belonging to Group I, action under Statute No. 30 was deferred till after the decision of the High Court.
But one is tempted to ask what possible further action was con templated when their services were terminated the same day.
It may be pointed out here that dropping of action under Statute No. 30 deprived the appellants of the right to show cause against what had been alleged against them or found by the Reviewing Committee.
The appellants characterised the whole action as lacking in bonafides.
The action can only be questioned if it is ultra vires ' and proof of alien or irrelevant motive is only an example of the ultra vires character of the action, as observed by Warrington, L.J., in the following passage: " My view then is that only case in which the Court can interfere with an act of a public body which is, on the face of it, regular and within its powers, is when it is proved to be in fact ultra vires, and that the references in the judgments in the several cases cited in argument to Lad faith, corruption, alien and irrelevant motives, collateral and indirect objects, and so forth, are merely intended when properly understood as examples of matters (1) ; 404 which if proved to exist might establish the ultra vires character of the action in question " (Short vs Poole Corporation (1).
We are not concerned so much with the motives, nor even with the justice of the action as with its legality, and, in our opinion, having invoked Statute No. 30 in the special circumstances and having gone on with that procedure, it was not possible to undo everything and rely upon other powers, which were not only subordinate but were clearly not available in those special circumstances which led, to action under Statute No. 30.
The next argument is that Statute No. 30 itself left liberty of action, inasmuch as el.
5 gave power to the Executive Council to act as it thought fit.
To begin with, it is wrong to think that the words conferring discretion are to be read in the abstract.
Those words have to be read within the four corners of Statute No. 30.
Tile words are permissive, no doubt, as to the choice of action, but are imperative in so far as they require some act completing the intent and purpose of the enquiry itself.
The words " shall take such action thereon as it may think fit " give liberty of action on the recommendations of the Reviewing Committee, but lay a duty to form an opinion.
The words do not give a discretion to take action outside the Statute.
Lastly, it is argued that the Executive Council as the appointing authority had the power also to dismiss, and reference is made to sections 4(7) and 4(13) of the Act and section 16 of the General Clauses Act.
None can deny that the University did possess such a power.
The question is whether it exercised it correctly under the Statutes and Ordinances.
We are quite clear that the Executive Council did not.
We may say here that we have not accepted the contention that the action of the Executive Council was based upon malice or any indirect or oblique motive.
The error was in thinking that there were cumulative or alternative powers, even after the adoption of the special procedure under Statute No. 30.
We are, therefore, of opinion that (1) , 91. 405 the impugned Resolutions were ultra vires and should be quashed.
In the result, the appeals are allowed.
Resolutions Nos. 90, 94 to 96 and 99 to 102 dated May 15, 1960, of the Executive Council of the Banaras Hindu University are quashed, and an appropriate writ or writs shall issue to the respondents to that effect.
The respondents shall pay the costs of these appeals, as also of the High Court.
Only one set of hearing fee here and in the High Court shall be allowed.
Appeals allowed.
| Under an agreement dated July 11, 1945, the appellants were appointed managing agents of the Coimbatore Spinning and Weaving Co. Ltd., for 20 years, and certain remuneration was provided for them including 10% commission on the net profits of the company due and payable yearly immediately after the accounts of the company were closed and commissions on purchases and capital expenditure of the company.
Prior to October 1, 1944, the appellants were the managing agents of the Coimbatore Mills Agency Ltd., who were the managing agents of the Coimbatore Spinning and Weaving Co. Ltd. The year of account of the appellants ended on March 31, of the company on June 30, and of the Agency Company on September 30.
For the assessment year 1945 46 the appellants submitted a return of their income which included the stipulated remuneration and commissions.
This return was accepted by the Income tax Officer, and Excess Profits Tax liability for the chargeable accounting period ending March 31, 1945, was also worked out on that basis.
A return of income was submitted by the appellants for the assessment year 1946 47 which included commission for the period 1 4 45 to 30 6 45 on purchases of cotton and stores and on capital expenditure.
The Tax Officer directed that the commission on purchases and capital expenditure be taken into account 272 for the year April 1, 1945, to March 31, 1946, and that the receipts be computed accordingly.
The assessment for 1945 46 was then reopened under section 34 of the Income tax Act under section 15 of the Excess Profits Tax Act and as a result of apportionment made by the application of r. 9 of Sch.
1 of the Excess Profits Tax Act, the liability of the appellants for Income tax and Excess Profits 'fax was revised and fresh assessments were made.
The orders of assessment were confirmed by the appellate authorities.
Held, that as in the instant case the chargeable accounting period for the assessment of Excess Profits Tax and the year of account of the company did not tally, by the assessment of income made on the assumption that they did tally, there had resulted under assessment and it was open to the Tax Officer to take action under section 15 of the Excess Profits Tax Act.
The Excess Profits Tax Officer acted properly in apportioning under r. 9 of Sch. 1 the commission received by the appellants.
Rule 9 of Sch. 1 of the Excess Profits Tax Act is enacted in general terms and it is applicable to all contracts which are intended to be operative for fixed periods.
If, for the performance of the entire contract, remuneration is payable at certain rates the profits earned out of that remuneration must be apportioned in the manner prescribed by 19 if the performance of the contact extends beyond the accounting period.
E. D. Sassoon & Co., Ltd. vs The Commissioner of Income tax, Bombay City; , , distinguished.
|
Civil Appeal No. 1203 of 1968.
From the order dated the 4 4 1967 of the Punjab and Haryana High Court in L.P.A. No. 104 of 1967.
O. P. Sharma, for the appellant.
H. K. Puri and M. C. Dhingra, for the respondent.
The Judgment of the Court was delivered by JASWANT SINGH, J.
This appeal by certificate of fitness granted by the Punjab and Haryana High Court is directed against the judgment dated April 4, 1967 of a Division Bench of that Court passed in Letters Patent Appeal No. 104 of 1967 whereby the judgment and order dated December 19, 1966 of Narula, J. (as he then was) in Civil Writ Petition No 298 of 1966 was affirmed.
361 It appears that the respondent joined the Punjab Education A Department (Class II) Service by direct recruitment as senior lecturer in 1933.
He was promoted to Punjab Education Service (Class l) on October 1, 1949.
He was given the selection grade with effect from February 15, 1956 and in due course rose to the position of Director of Public Instruction cum Secretary to the Government of Punjab, Education Department.
He proceeded on leave preparatory to retirement on March 18, 1958, on attaining the age of super annuation.
In June; 1961, he received a copy of letter No. 5137 ED I 60/9269 dated May 2, 1961 addressed by the Secretary to Government, Punjab, Education Department to the Director of Public Instruction, Punjab, Chandigarh, conveying the sanction of the Governor of Punjab to the grant to him i.e. the respondent of superannuation pension and death cun1 retirement gratuity of Rs. 417.02 np.
per mensem and Rs. 17,030.25 np in lump sum respectively under rules 5.27 and 6.13 of the Punjab Civil Service Rules, Vol.
II read with para 9(1) (a) of the New Pension Rules, 1951.
It was stated in the aforesaid letter that personal file of the respondent had been examined with reference to rule 6.4 of the Punjab Civil Service Rules, Vol.
II and Government were satisfied that his service record was not satisfactory and a cut of 10% had accordingly been made in the amount of pension and death cum retirement gratuity admissible to his.
On January, 28, 1962, the respondent submitted representations to the Chief Minister and Governor of Punjab against the aforesaid decision of the Government to apply 10% cut in his pension and death cum retirenment gratuity but the same proved abortive.
After the establishment of the Board set up to examine and remove the grievances in the matters of promotion and fixation of pension etc.
Of the Gazetted officers of the Government, the respondent addressed a representation to the said Board on September 14, 1964, against the.
aforesaid decision of the Government to apply a cut of l0% in his pension and gratuity.
On November l . 1965, the respondent received a copy of letter No. EDI 4(64) 65/22436 dated October 21, 1965, addressed by the Education Commissioner and Secretary to Government, Punjab, Education Department, to the Director of Public Instruction, Punjab, intimating that in supersession of the aforesaid letter dated May 2, 1961 of the Punjab Government, it had been decided to grant to the respondent a superannuation pension and death cum retirement gratuity of Rs. 440.18 np per mensem and Rs. 18,927.50 np in lump sum respectively under rules 5.27 and 6.13 of the Punjab Civil Service Rules, Vol.
II read with para 9(i) (a) of the New Pension Rules, 1951.
In para 3 of the letter, it was reiterated that a cut of 5% had been made in the pension admissible to the respondent as his service record which had been examined with reference to rule 6.4 of the Punjab Civil Service Rules, Vol.
II had not been satisfactory.
Aggrieved by this communication, the respondent filed in the Punjab and Haryana High Court at Chandigarh a petition under Articles 226 and 227 of the Constitution, being Civil Writ Petition No. 298 of 1966, challenging the aforesaid decision of the Punjab Government which was, as already stated, allowed by Narula, J. r(as he then was) by his judgment and order dated December 19, 1966, following the Full Bench Judgment of his Court dated October 362 25,1966,in Civil Writ Petition No. 504 of 1954 entitled Shri K. R. Erry, Retired.
Superintending Engineer, 45, Cecil Hotel, Simla vs
The State of Punjab(l).
Dissatisfied with this judgment and order, the appellants preferred a Letters Patent Appeal, being L. P. A. No. 104 of 1967 which did not meet with success.
Thereupon the appellants applied for a certificate under Article 133 of the Constitution which was granted to them.
This is how the matter is before us.
Although in the grounds of appeal, it has been urged by the appeIlants that the Full Bench decision of the High Court of Punjab and Haryana in K. R. Erry 's(l) case (supra) is not in accordance with law as superannuation pension is a bounty and is given only as an act of grace, that ground is no longer available to the appellants in view of the decision of this Court in Deokinandan Prasad vs The state of Bihar & Ors.
(2) where it was held that pension is not a bounty payable on the sweet will and pleasure of the Government and the right of a Government servant to receive it is property under Article 31(1) of the Constitution and the State cannot withhold the same by a mere executive order.
It was further held in that case that the claim to pension was also property under Article 19(1) (f) of the Constitution and was not saved by clause (S) thereof.
The learned counsel appearing for the appellants has, however, made a feeble attempt to urge that no opportunity to show cause was required to be given to the respondent before passing the order imposing the cut in his superannuation pension and death cum retirement gratuity under clauses (a) and (b) of rule 6.4 of the Punjab Civil Service Rules (Pension Rules), as the order was an administrative order and the case did not fall within the purview of Article 311 (2) of the Constitution.
It has been further contended by learned counsel for the appellants that it was the judgment of this Court in M. Narasimachar vs The State of Mysore(8), and not the judgment in State of Punjab vs The K. R. Erry & Sobhag Rai Mehta(4) which governed the present case.
We regret we are unable to accede to these contentions.
Though the impugned order imposing cut in pension and gratuity is not one of reduction in rank falling within the purview of Article 311 (2) yet there can be no doubt that it adversely affected the respondent and such an order could not have been passed without giving him a reasonable opportunity of making his defence.
Reference r in this connection may be made with advantage to the decision of this Court in K. R. Erry & Sobhag Rai Mehta 's case (supra) where after an exhaustive review of the case law bearing on the point, it was observed at page 413 as follows: "Where a body or authority is judicial or where it has to determine a matter involving rights judicially because of express or implied provision, the principle of natural justice audi alteram partem applies.
See: Province of Bombay, vs Kusaldas section Advani & Ors. ; (725), and Board of High School & Intermediate Education, U.P. (1) I.L.R. (1917) Punjab & Haryana 278.
(2) [1971] Supp.
S.C.R. 634.
(3) [1960] I S.C.R. 981: A.I.R. 1960 S.C. 247.
(4) ; 363 ALLahabad vs Ghanshyam Das Gupta & ors.
(1962) Suppl.
A (3) S.C.R. 36.] With the profiteration of administrative decisions in the welfare state it is now further recognised by Courts both in England and in this country, (especially after the decision of House of Lords in Ridge vs Baldwin ; that where a body or authority is characteristically administrative the principle of natural justice is also liable to be invoked if the decision of that body or authority affects, individual rights or interests, and having regard to the particular situation it would be unfair for the body or authority not to have allowed a reasonable opportunity to be heard.
See: State of orissa vs Dr. (Miss) Binapani Dei & Ors.
[1967) 2 S.C.R. 625 and In re H. K. (An lnfant) In the former case it was observed as follows: C "An order by the State to the prejudice of a person in derogation of his vested rights may be made only in accordance with the basic rules of justice and fairplay.
The deciding authority, it is true, is not in the position of a Judge called upon to decide an action between contesting parties, and strict compliance with the forms of judicial procedure may not be insisted upon.
He is however under a duty to give the person against whom an enquiry is held an opportunity to set up`his version or drefence and an opportunity to correct or to controvert any evidence in the possession of the authority which is sought to be relied upon to his prejudice.
For that purpose the person against whom an enquiry is held must be informed of the case he is called upon to meet and the evidence in support thereof.
The rule that a party to whose prejudice an order is intended to be passed is entitled to a hearing applied alike to judicial tribunals and bodies of persons invested with authority to adjudicate upon matters involving civil consequences.
It is one of the fundamental rules of our constitutional set up that every citizen is protected against exercise of arbitrary authority by the State or its officers.
Duty to act judicially would therefore arise from the very nature of the function intended to be performed.
It need not be shown to be super added.
If there is power to decide and determine to the prejudice of a person, duty to act judicially is implicit in the exercise of such power.
If the essentials of justice be ignored and an order to the prejudice of a person is made, the order is a nullity.
That is a basic concept of the rule of law and importance thereof transcends the significance of a decision in any particular case.
" These observations were made with reference to an authority which could be described as characteristically administrative.
At page 630 it was observed: "It is true that the order is administrative in character, but even an administrative order which involves civil 364 consequences as already stated, must be made consistently with the rules of natural justice after informing the first respondent of the case of the State, the evidenve in support thereof and after giving an opportunity to the first respondent of being heard and meeting or explaining the evidence." "This case and the English case in re H.K. (An Infant) were spcifically referred to with approval in a decision of the constitutional bench of this Court in A. K. Kraipak & Ors. etc.
vs Union of India & Ors.
[1970] l S.C.R. 457".
The decision of this Court in M. Narasimachar 's case (supra) on which strong reliance has been placed on behalf of the appellants is of no assistance to them as the point as to whether an opportunity to show cause was to be afforded to a Government servant before applying a cut in his pension in view of the principle of natural justice embodied in the well known maxim audi alteram partem was never urged or gone into in that case.
Furthemore as pointed out by Palekar, J. while speaking for the Court in K. R. Erry & Sobhag Rai Mehta 's case (supra) the question whether pension is a bounty or property did not arise in the former case.
The present case is, in our , opinion, fully covered by the judgment of this Court in K. R. Erry & Sobha Rai Mehta 's case (supra).
For the foregoing reasons we are of the view that the impugned judgments do not suffer from any illegality and were rightly rendered.
In the result the appeal fails and is hereby dismissed with costs.
P.B.R. Appeal dismissed.
| Under Article 246(2) and (3) of the Constitution, the Legis lature of a State has plenary powers to legislate with respect to matters enumerated in Lists II and III of the Seventh Schedule to the Constitution.
The legislative competence of the State Legisla 165 ture can only be circumscribed by express prohibition contained in the Constitution itself and unless there is any provision in the Constitution expressly prohibiting legislation on a subject either absolutely or conditionally, there is no fetter or limitation on the plenary powers which the State Legislature enjoys to legislate on the topics enumerated in Lists II and III of the Seventh Schedule to the Constitution.
In view of Article 246 of the Constitution, no curtailment of legislative competence can be spelt out of the terms of Clause 5 of the Letters of Guarantee given by the Dominion Government to the Rulers of "States" subsequent to the agreements of Merger, which guaranteed, inter alia, the continuance of Jagirs in the merged "States".
Indeed, Clause 5 of the Letters of Guarantee itself saved the legislative right of the State of Bombay subject to the limitation that enactments of the State shall not be discriminatory in nature.
Attacks on the validity of the said Act on the basis of the rights guaranteed by Articles 14, 19(1)(f), and 32(2) of the Constitution cannot be countenanced in view of Article 31 A(2)(a) of the Constitution, Article 363 (1) of the Constitution barred the jurisdiction of Courts in disputes arising out of any provision of the agreements of merger and the Letters of Guarantee.
Held, that Bombay Act XXXIX of 1954, the impugned Act, was intra vires the State Legislature.
Petitions Nos.
337 to 349, 365, 366, 481 and 690 of 1954 Dis.
missed.
Petition No. 364 of 1954 Adjourned.
Vajesingji vs Secretary of State (51 I.A. 357), Secretary of State vs Sardar Rustam (68 I.A. 109), State of Saraikella vs Union of India ; , Thakur Jagannath vs The United Provinces ([1943] F.C.R. 72), Thakur Jagannath vs The United Provinces ( , referred to.
|
Civil Appeals Nos.
3296 67 of 1984.
Appeals by special leave from the Judgment and Order dated the 23rd January, 1981 of the Bombay High Court in F.A. Nos.
35 of 1978 & 139 of 1973.
B. Kanta Rao and Vijay Phadke for the Appellants.
Abaul Khader and R.N. Poddar for the Respondent.
The Judgment of the Court was delivered by VENKATARAMIAN, J.
Shri Navakesari Prakashan Ltd. and Nav Samaj Ltd., Nagpur are the appellants in the above two appeals by special leave filed under Article 136 of the Constitution.
The appellants respectively are printers and publishers of newspapers known as 'Tarun Bharat ' and 'Nagpur Times '.
Their case is that their employees working for wages in the administrative and editorial sections of their respective concerns were not 'employees ' as defined in section 2 (9) of the (hereinafter referred to as 'the Act ') prior to November 19, 1976 on which date by a notification issued under section 1 (5) of the Act the Government of the State of Maharashtra made the Act applicable to the said employees also and that therefore they were not liable to make any contributions under the Act in respect of the employees up to that date.
They however admit their liability to make contributions during that period in respect of persons employed by them for wages in the printing presses belonging to them.
The dispute regarding the liability of the appellants to make contributions under the Act in respect of the members of the administrative and editorial staff arose on the Assistant Regional Director of the Employees ' State Insurance Corporation calling upon them by notice issued on October 1, 1975 to make contributions in respect of the said members also with effect from January 28, 1968 on which date the amended definition of the expression 'employee ', in section 2 (9) of the Act as per the Amending Act No. 44 of 1966 came into force.
After the above demands were made, the appellants filed 965 applications before the Employees ' Insurance Court, Nagpur under section 75 of the Act questioning their liability to make contributions in respect of their employees working in the administrative and editorial sections of their presses during the period between January 28, 1968 and November 19, 1976.
They, however, did not dispute their liability in respect of the period subsequent to November 19, 1976 on which date the notification was issued under section 1(5) of the Act by the Maharashtra State Government.
The applications were contested by the Employees ' State Insurance Corporation The Employees Insurance Court allowed the applications holding that until the notification under section (5) of the Act was issued by the State Government making the Act applicable to the establishments of the appellants viz the administrative and editorial sections of their presses, the employees working in those sections could not be considered as 'employees ' as defined by section 2(9) of the Act.
Aggrieved by the judgment of the Employees ' Insurance Court, the Employees ' State Insurance Corporation filed appeals before the High Court of Bombay under section 82 ' of the Act.
The High Court allowed the said appeals holding that the employees concerned came within the definition given in section 2 (9) of the Act and, therefore the appellants were liable to make contributions during the relevant period in respect of them also under the Act.
The appellants have filed these appeals against the judgment of the High Court.
Before dealing with the contentions raised by the appellants, it has to be stated that the members of the administrative staff and the editorial staff of each of the printing presses are employed by the management concerned for the purpose of carrying on the business of printing and publishing the newspaper brought out by it.
The correctness of this finding of fact recorded to the above effect by the High Court is not assailed before us.
The main contention of the appellants however is that since during the relevant period they had maintained a distinction between the factory sections of their printing presses and the establishment sections which included the administrative and editorial sections of their presses, the employees in the establishment sections could not be treated as employees to whom the Act was applicable until the notification issued under section 1 (5) of the Act expressly brought the said establishment sections also within the scope of the Act.
Section 2 (9) of the Act which defines the expression 'employee ' during the period in question read thus: 966 "2(9)" employee" means any person employed for wages in or in connection with the work of a factory or establishment to which this Act applies and (i) who is directly employed by the principal employer on any work of, or incidental or preliminary to or connected with the work of, the factory or establishment whether such work is done by the employee in the factory or establishment or elsewhere: or (ii) who is employed by or through an immediate employer on the premises of the factory or establishment or under the supervision of the principal employer or his agent on work which is ordinarily part of the work of the factory or establishment or which is preliminary to the work carried on in or incidental to the purpose of the factory or establishment; or (iii) whose service are temporarily lent or let on hire to the principal employer by the person with whom the person whose services are so lent or let on hire has entered into a contract of service; and includes any person employed for wages on any work connected with the administration of the factory or establishment or any part, department or branch thereof or with the purchase of law materials for, or the distribution or sale of the products of, the factory or establishment; but does not include (a) any member of the Indian naval, military or air forces, or.
(b) any person so employed whose wages excluding remuneration for overtime work exceed five hundred rupees a month: Provided that an employee whose wages excluding remuneration for overtime work exceed five hundred rupees a month at any time after and not before the beginning of the contribution period, shall continue to be an employee until the end of that period.
" The object of the Act is to provide for certain benefits to 967 employees in case of sickness, maternity and employment injury and to make provisions for certain other matters in relation thereto.
Section 1(4) of the Act provides that it shall apply, in the first instance, to all factories (including factories belonging to the Government) other than seasonal factories.
The expression 'factory ' is defined by section 2 (12) of the Act as any premises including the precincts thereof whereon twenty or more persons are employed or n were employed for wages on any day of the preceding twelve months and in any part of which a manufacturing process is being carried on with the aid of power or is ordinarily so carried on but does not include a mine subject to the operation of the or a railway running shed.
It is admitted, as mentioned earlier, that the printing presses owned by the managements where the newspapers are printed and published are factories and are governed by the Act.
Section 1 (5) of the Act, however, provides that the appropriate Government, in consultation with the Employees ' State Insurance Corporation and where the appropriate Government is a State Government with the approval of the Central Government after giving six months ' notice of its intention of so doing by notification in the official Gazette, extend the provisions of the Act or any of them, to any other establishment or class of establishments, industrial, commercial, agricultural or otherwise.
The expression 'establishment is not defined in the Act.
It may be any industrial, commercial, agricultural or any other establishment where employees are engaged in connection with the business of the establishment.
Section 38 of the Act provides that subject to the provisions of the Act, all employees in factories or establishments to which the Act applies shall be insured in the manner provided by the Act.
Section 39 of the Act states that the contribution payable under it shall comprise contribution payable by the employer and contribution payable by the employee.
The contributions have to be paid at the rates specified in the First Schedule to the Act except where the employees concerned are excluded from some of the benefits under the Act in which case the Corporation is authorised to fix the rates of the contributions.
Now reverting to section 2 (9) of the Act it is seen that the expression 'employee ' means any person employed for wages in a factory or any person employed for wages in connection with the work of a factory, it also means any person employed for wages in or in connection with the work of an establishment to which the 968 Act applies.
If it is held in these cases that the employees in the administrative or editorial sections of the printing presses are employed in connection with the work of the printing presses which are admittedly factories, then they have to be treated as employees under section 2 (9) of the Act even though no notification is issued under section 1 (5) of the Act making the Act applicable to those sections.
The fact that such a notification has been issued, either as a matter of abundant caution or on a wrong understanding of the true implication of the definition in section 2 (9), becomes irrelevant.
The members of the administrative and editorial staff of the appellants are no doubt not working in the printing presses.
But the question is whether they are not working in connection with the work of the printing presses which are factories under section 2 (12) of the Act.
In Royal Talkies, Aydraboe & Ors.
vs Employees State Insurance Corp. employees working in a canteen and at the cycle stand attached to a cinema theatre were held to be persons employed in connection with the work of the cinema theatre.
The Court, however, observed that merely being employed in connection with the work of a factory or of an establishment in itself did not entitle a person to be an employee but it must be proved that he was not only employed in connection with the work k of the establishment but also be shown to be employed in one or other of the three categories mentioned in section 2 (9) of the Act.
At this stage, two decisions of this Court are required to be considered.
In Hydrabad Asbsets Cement Products Ltd. vs The Employees Insurance Court & Anr the appellant company which had a factory at Sanatnagar where it was manufacturing asbestos sheets contained that the employes working in its zonal offices situated at various other places who were doing the work of canvassing for the sale of products manufactured by it at Sanatnagar were not employees within the definition of section 2 (9) of the Act as the zonal offices were establishments and not factories.
Negativing the above contention, this Court held that any person employed for wages in the zonal offices for the purpose of purchase of raw materials or distribution or sale of the products of the factory or for 969 administrative purposes of the factory was a person employed in connection with the worker of the factory and hence was an employee as defined by section 2 (9) of the Act.
The Court in reaching the conclusion also relied on the amendment of section 2 (9) of the Act by Act No. 44 of 1966 which provided that the expression 'employee ' included 'any person employed for wages on any work connected with the administration of the factory '.
When the present appeals are considered in the light of the above decisions, the members of the administrative staff and of the editorial staff in each of the printing presses in question have to be treated as employees under section 2(9) of the Act.
These persons are directly employed by the management concerned on work incidental or preliminary or connected with the work of the factory.
The work of the factory in each case being printing and publication of a newspaper, its work cannot be carried on without the assistance of the members of the editorial staff who are engaged in preparing the material for printing the newspaper and of the administrative staff which is needed for managing the affairs of the factory.
It is a matter of common knowledge that the members of the editorial staff work almost round the clock at the premises where the printing press is situated or at the precincts thereof.
Their principal job is to pick up and select from out of the mass of information which flows in to the press, messages which have news value, trim them and make them fit for communication through newspaper.
Even though they may not be actually engaged in operating the printing machines, their presence at the spot is essential right upto the moment the 'strike order ' is given for the printing of the newspaper.
There are cases where changes in the matter to be printed are effected even a few minutes before the process of printing is begun and cases where even after a few copies of newspaper are printed, they are withheld and destroyed on the last minute advice of a responsible members of the editorial staff are not unknown.
The editors, news editors, sub editors, reporters etc.
who constitute the editorial staff at the press are the collectively referred to as the gate keepers ' of news because they determine what should be published and what should not be published.
A printing press established for the purpose of publishing a newspaper cannot effectively function at all without the services of the members of the editorial staff being made available almost till the time the newspaper comes out of the printing machine.
They virtually constitute an integral part of the newspaper press and they are employed in connection with the work done at the printing press.
The members of the editorial staff clearly fall under clause (i) 970 of section 2(9) of the Act.
It is so even in the case of the administrative staff.
They fall under the clause containing the words includes any person employed for wages on any work connected with the administration of the 'factory '.
It may be stated here that even without the amendment made by Act No. 44 of 1966 this Court in Nagpur Electric Light & Power Co. Ltd. vs Regional Director Employees State Insurance Corporation etc had taken the view that the clerical staff etc.
of a factory whether they worked within the factory or outside its premises would be employees under section 2(9) of the Act as it stood before its amendment.
The argument that since a person mainly employed in a managerial or administrative capacity cannot be treated as a working journalist under section 2(9) of the Working Journalists (Conditions of Service) and Miscellaneous Provisions Act, 1955, the members employed in the administrative staff should not be treated as employees in a printing press is an extremely Jenuous argument and it is not worth probing further.
The effect of on Act cannot be controlled by the provisions of another Act unless the provisions in one have bearing on the provisions of the other.
No such provision is brought to our notice.
The contention that since the Act is not expressly made applicable to newspaper establishments by the Working Journalists (Conditions of Service) Miscellaneous Provisions Act, 1955 as it has made certain laws applicable by sections 3, 14 and 15 thereof, the Act should not be applied to the editorial staff has also no merit.
We are satisfied that section 2(9) of the Act clearly brings them within the scope of the Act.
On an examination of the provisions of the Act, we are of the view that the persons employed for wages in the administrative section and the editorial section of each of the printing presses in question are employees as defined in section 2(9) of the Act and the demand made by the Employees ' State Insurance Corporation is a justified one.
In the result the appeals fail and they are dismissed with costs.
| The appellants in the appeals were printers and publishers of newspapers.
The Assistant Regional Director of the Employee 's State Insurance Corporation issued a notice to the appellants on October 1, 1975 calling upon them to make contributions in respect of the administrative and editorial staff of the newspapers, with effect from January 28, 1968 on the ground that the aforesaid staff came within the definition of the expression 'employee ' in section 2(9) of the Employee ' a State Insurance Act 1948 as amended by the Amending Act No. 44 of 1966.
After the aforesaid demands were made, the appellants filed applications before the Employees ' State Insurance Court under section 75 of the Act questioning the liability to make contribution, in respect of the said employees during the period between January 28, 1968 and November 19, 1976.
They however did not dispute their liability in respect of the period subsequent to November 19.
1976 on which date the notification was issued under section 1 (5) by the State Government.
These applications were contested by the Employees ' State Insurance Corporation.
The Employees ' Insurance Court allowed the applications holding that until the notification under section 1(5) of the Act was issued by the State Government making the Act applicable to the establishments of the appellants viz the administrative and editorial sections of the presses, the said employees could not be considered as 'employees ' as defined by section 2(9) of the Act.
The Corporation thereupon filed appeals before the High Courts under section 32 of the Act, which were allowed, holding that the employees concerned came within the definition given in section 2(9) aud, therefore, the 963 appellants were liable to make contributions during the relevant period in respect of them also under the Act.
Dismissing the Appeals to this Court, ^ HELD: 1 An examination of the provisions of the indicates that the persons employed for wages in the administrative section and the editorial section of each of the printing presses are employees as defined in section 2(9) of the Act and the demand made by the Employees ' State Insurance Corporation is a justified one.
[970E] 2.
The object of the is to provide for certain benefits to employees in case of sickness, maternity and employment injury and to make provisions for certain other matters in relation thereto.
Section 1(4) of the Act provides that it shall apply in the first instance, to all factories (including factories belonging to the Government) other than seasonal factories.
Section 1(5) of the Act, however, provides that the appropriate Government, in consultation with the Employees ' State Insurance Corporation and where the appropriate Government is a State Government with the approval of the Central Government after giving six months ' notice of its intention of so doing by a notification in the official Gazette, extend the provisions of the Act or any of them to any other establishment or class of establishments, industrial, commercial, agricultural or otherwise.
The expression 'establishment ' however was not defined in the Act.
[967A E] 3.
Section 2(9) of the Act defines the expression 'employee ' to mean any person employed for wages in a factory or any person employed for wages in connection with the work of a factory.
It also means any person employed for wages in or in connection with the work of an establishment to which the Act applies.
[967H] In the instant cases, the members of the administrative staff and of the editorial staff in each of the printing presses have to be treated as employees under section 2(9).
They are directly employed by the management concerned on work incidental or preliminary or connected with the work of the factory.
The work of the factory in each case being printing and publication of a newspaper, its work cannot be carried on without the assistance of the members of the editorial staff who are engaged in preparing the material for printing the newspaper and of the administrative staff which is needed for managing the affairs of the factory.
[969C D] Hyderabad Asbestos Cement Products Ltd. vs The Employees Insurance Court and Anr., ; , Royal Tulkies, Hyderabad and Ors.
vs Employees State Insurance Corp., ; and Nagpur Electric Light and Power Co. Ltd. vs Regional Director Employees, State Insurance Corporation etc.
, , referred to.
The members of the editorial staff clearly fall under clause (i) of section 2(9) of the Act.
The administrative staff fall under the clause contain 964 ing the words 'includes any person employed for wages on any work connected with the administration of the factory '.
[969H; 970A] 5.
The effect of an Act cannot be controlled by the provisions of another Act unless the provisions in one have bearing on the provisions of the other.
[970D]
|
Appeal No. 343 of 1958.
Appeal by special leave from the judgment and order dated March 8, 1958, of the Madhya Pradesh High Court in First Appeal No. 141 of 1957, arising out of the judgment and order dated December 5, 1957, of the Election Tribunal, Jabalpur, in Election Petition Case No. I of 1957.
G. C. Mathur, for the appellant.
P. Rama Reddy and R., Mahalingier, for respondent No. 1. 1959.
April 9.
The Judgment of the Court was delivered by GAJENDRAGADIKAR, J.
This appeal by special leave arises out of an election petition filed by respondent I (No. 320 of 1957) before the Election Commission, New Delhi, in which he prayed that the appellant 's election to the Madhya Pradesh Legislative Assembly from Bargi constituency should be declared to be void and that it should be further declared that he had himself been duly elected from the said constituency.
The polling for the election in question was taken on March 9, 1957, and the result was declared on March 12, 1957.
Of the three candidates who had stood for election, the appellant secured 9308 votes, respondent 1, 8019 votes and the third candidate, respondent 2, 3210 votes.
The petition filed by respondent I was entrusted to the Election Tribunal, Jabalpur, for trial.
On October 12, 1957, the appellant filed before the Election Tribunal, an objection under section 90, sub section
(3) of the Representation of the People Act, 1951 (hereinafter called the Act), alleging that respondent 1 had not complied with the provisions of section 117 of the Act in regard to 529 the making of the deposit of the security for costs and praying that his election petition should be dismissed on that account under section 90, sub section
(3) of the Act.
Respondent I disputed these allegations and urged that there was no justification for dismissing his petition under section 90, sub section (3) of the Act.
By its order passed on December 5, 1957, the Election Tribunal held that the provisions of section 117 were mandatory and that they had not been complied with by respondent 1.
ID the result the application filed by the appellant was allowed, his objection was upheld and the election petition presented by respondent I was dismissed under section 90, sub section
(3) of the Act.
On December 27, 1957, respondent I preferred an appeal in the High Court of Madhya Pradesh at Jabalpur against the said order (Appeal No. 141 of 1957).
In the High Court a preliminary objection was urged on behalf of the appellant that the appeal preferred by respondent I was incompetent under section 116A of the Act.
This objection was overruled and the merits of the appeal were considered by the High Court.
On the merits the High Court held that respondent I had substantially complied with section 117 and so the order passed by the Election Tribunal dismissing the election petition filed by respondent I was set aside and the said petition was sent back to the Election Tribunal for disposal in accordance with law.
On February 22, 1958, the appellant applied to the High Court for a certificate of fitness but his application was dismissed.
Thereupon the appellant applied for, and obtained, special leave to appeal from this.
Court on April 14, 1958.
That is how this appeal has come to this Court.
The first point which calls for our decision in this appeal is whether the High Court was right in holding that the appeal preferred before it by respondent I was competent.
The appellant 's contention is that the impugned order was passed under section 90, sub section
(3) and no appeal is provided against such an order under section 116A.
Section 116A provides that an appeal shall lie from every order made by the tribunal under section 98 67 530 or section 99 to the High Court of the State in which the tribunal is constituted.
We are not concerned in the present appeal with section 99.
The case for respondent I is that in substance and in law the impugned order must be deemed to have been passed under section 98.
That is the view which the High Court has taken and we are satisfied that the High Court is right.
It is true that in terms and in form the order was passed under section 90 sub section
(3); and it is also true that the right to prefer on appeal is a creature of the statute and no appeal can be held to be competent unless it is shown that such a right flows from the relevant statutory provision itself, In order to decide whether or not an order passed under section 90, sub section
(3) can be regarded in law and in substance as an order passed under section 98, it would be relevant to consider the scope and effect of the provisions of the said two sections.
Section 98(a) provides that at the conclusion of the trial of an election petition the tribunal shall make an order dismissing the election petition.
There is no doubt that in the present case the Election Tribunal has dismissed the election, petition filed by respondent 1.
But the appellant 's contention is that this dismissal cannot be said to be under section 98(a) because the order dismissing the petition has not been passed at the conclusion of the trial of the election petition.
This argument is not well founded.
Section 90, subs.
(3) under which the impugned order purports to have been passed occurs in ch.
III of Pt.
VI which deals with the trial of election petitions.
In other words., section 90, sub section
(3) confers power on the tribunal to dismiss the election petition after the trial of the election petition has commenced.
The scheme of ch.
III clearly indicates that once an election petition is referred to an Election Tribunal for trial under section 86 the tribunal is possessed of the petition and all proceedings before it are proceedings in the trial of the said petition.
Section 85 shows that for failure to comply with the provisions of sections 819 82 and 117, the Election Commission is empowered to dismiss the election petition.
If the Election Commission exercises its jurisdiction and passes an order 531 dismissing any election petition, it may be said that the election petition never reached the stage of trial ; but once the petition has passed the scrutiny of the Election Commission under section 85 and it has been referred.
to the Election Tribunal for trial, any, further action taken by the parties or any order passed by the tribunal under the said petition would constitute a part of the trial of the said petition.
This question has been incidentally considered by this Court in Harish Chandra Bajpai vs Triloki Singh (1) while it was dealing with section 90, sub section
(2) of the Act; and it has been held that " the provisions of ch.
III read as a whole clearly show that I the trial is used as meaning the entire proceedings before the tribunal from the time the petition is transferred to it under section 86 until the pronouncement of the award ".
Therefore, there can be no doubt that the order passed under section 90, sub section
(3) is an order passed at the conclusion of the trial.
It is true that it is an order on a preliminary point of law raised by the appellant; but even so the decision of the preliminary issue is undoubtedly a part of the trial of the petition and it cannot be said that the order passed on such a preliminary point is not an order passed at the conclusion of the trial when it, in fact, concludes the trial.
Section 90, sub section
(3) provides that the tribunal shall dismiss an election petition which does not comply with the provisions of sections 81, 82 or 117 notwithstanding that it has not been dismissed by the Election Commission under section 85.
It would thus be clear that an objection raised against the competence of the election petition on the ground that the provisions of the aforesaid sections have not been complied with can be considered by the Election Commission suo motu under section 85 and if it is upheld the election petition can be dismissed without any further enquiry; but if the Election Commission does not dismiss the petition under section 85, then the same objection can be raised before the Election Tribunal by the respondent to the election petition ; and when it is so raised it assumes the character of a preliminary objection and (1) ; ,387.
532 is dealt with by the Election Tribunal as any preliminary objection would be dealt with by a civil court under the Code of Civil Procedure.
That being so, a preliminary objection has been tried and the decision on the preliminary objection being in favour of the respondent the election petition is dismissed.
Though the order of dismissal in form may be under section 90, subs.
(3), it is in substance and in law an order of dismissal passed at the conclusion of the trial and must be deemed to be an order under section 98(a).
That is the view which the Madhya Pradesh High Court has taken in Gulshar Ahmed vs Election Tribunal(1) and it was this decision which was followed by the High Court in the present proceedings.
In our opinion, therefore, the contention raised by the appellant that the appeal preferred by respondent I before the High Court was incompetent must be rejected.
The question of construing section 90 can be considered from another point of view.
It provides for the procedure before the tribunal and lays down that it is open to the tribunal to dismiss an election petition under section 90, sub section
(3); but this being a procedural provision is would not be unreasonable to hold that, when the actual order dismissing the petition is passed, it would be referable to the provisions of section 98(a).
The same conclusion would follow if we consider the provisions of sections 103, 106 and 107.
It cannot be suggested that the order passed by the tribunal dismissing the election petition for noncompliance of section 117 is not required to be communicated to the Election Commission under section 103 or transmitted by the Election Commission to the appropriate authority under section 106.
Similarly it cannot be said that such an order would not take effect as soon as it is pronounced by the tribunal under section 107.
It would thus be noticed that though the provisions of these sections are obviously applicable to an order dismissing the election petition on the ground of non compliance of section 117, in terms the said sections refer to orders passed under section 98 or section 99.
Therefore, we think it would be reasonable to hold that, where the tribunal dismisses an election petition by virtue of the provi (1) A.I.R. 1958 Madh.
Pra, 224.
533 sions contained in section 90, sub section
(3), the order of dismissal must be deemed to have been made under section 98.
Similarly section 99(1) (b) which empowers the tribunal to fix the total amount of costs payable and to specify the person by and to whom that shall be paid in terms refers to cases where an order is made under section 98.
It cannot be suggested that, where an order of dismissal is passed under section 90, sub section
(3), the tribunal cannot, make an appropriate order of costs.
This provision also indicates that the order passed under section 90, sub section
(3) is in law and in substance an order passed under section 98(a).
It is true that in cases where such ail order is passed section 99(1)(a) would not come into operation, but that can hardly affect the position that an order ' under section 90, sub section
(3) is nevertheless an order under section 98.
We would like to add that by Act 58 of 1958 an explanation has been added to section 90, sub section
(3) which clarifies the legislative intention on this point.
This explanation provides that an order of the tribunal dismissing an election petition under this sub section shall be deemed to be an order made under cl.
(a) of section 98.
After the enactment of this explanation there can be no doubt that ail order passed under section 90, sub section
(3) would be appealable under section 116 A of the Act.
That takes us to the second point raised by the appellant that the High Court was in error in holding that respondent I bad complied with the provisions of section 117 of the Act.
Section 117 provides that the petitioner shall enclose with the petition a Government Treasury Receipt showing that a deposit of Rs. 1,000/has been made by him either in a Government Treasury or in the Reserve Bank of India in favour of the Secretary to the Election Commission as security for costs of the petition.
In the present case, respondent 1 has deposited the requisite security, but it is urged that the security has not been deposited as required by section 117.
This is how the security deposit has been made 534 Under Amount.
By whom On what account.
rupees in brought.
words.
Rs. A. P. Shiv Prasad Security deposits for Rs. One 1,000 0 0.
Chanpuria.
Election Petition of Thous Bargi Assembly Con and and stituency No. 97 one D i s t t., Jabalpur, only.
Madhya Pr ad es h. Refundable by order of the Election Commission of India, New Delhi.
Total . 1000 0 0.
The argument is that the security has not been deposited in the name of the Secretary to the Election Commission as required by section 117 and it is deposited with the condition that it is refundable by the order of the Election Commission of India.
In other words, the only power which the Election Commission of India can exercise in respect of the security is to refund the amount to respondent I ; and it would not be competent to the Commission to direct the amount to be paid to the appellant even if the election petition filed by respondent I is dismissed with costs.
In our opinion, this objection is purely, technical.
It has recently been held by this Court in Kamaraj Nadar V. Kunju Thevar (1) that s.117 should not be strictly or technically construed and that wherever it is shown that there has been a substantial compliance with its requirements the tribunal should not dismiss the 'election petition under section 90, sub section (3) on technical grounds.
Indeed it is clear that the receipt with which this Court was concerned in the case of Kamaraj Nadar (1), was perhaps slightly more defective than the receipt in the present case.
The argument based on the use of the word " refundable " ignores the fact that the security in terms has been made in respect of the election petition in question and it has been duly credited as towards the account of the Election Commission.
Therefore, there can be no doubt that if an (1) A.I.R. 1958 S.C. 687.
535 occasion arises for the Election Commission to make an order about the payment of this amount to the successful party the use of the word "refundable" will cause no difficulty whatever.
We hold that the security has been made by, respondent.
1 as required by section 117 of the Act and would be at the disposal of the Election Commission in the present proceedings.
We would like to add that even section 117 has been subsequently amended by Act 58 of 1958 and the reference to the Secretary has been deleted.
The result is the appeal fails and must be dismissed with costs.
Appeal dismissed.
| The appellant had applied for recruitment as Examiner of Personnel in the Department of Civil Aviation, but was unsuccessful.
He challenged the qualifications detailed in the advertisement as being discriminatory and tailor made, with a view to exclude him.
He contended that while he would have qualified under the 1969 Rules framed under the proviso to Article 309, the rules were amended in 1978 and 1989 with a view to deprive him of his chance.
He submitted that the court should regulate the prescription of higher qualifications and strict standards for navigators and pilots in view of the frequent air accidents.
Dismissing the appeal, this Court, HELD: (1) In exercise of rule making power under Proviso to article 309, the President or authorised person is entitled to prescribe the method (of recruitment, educational and technical qualifications or conditions of service for appointment to an office or post under the State.
These rules being statutory cannot be impeached as being tailor made to suit specific individuals.
(777 B) B.s.
Vadera vs Union of India & Ors., ; ; General manager, Southern Railway vs Rangachari ; at 596; State of Mysore vs P.Narasing Rao [19681 1 SCR 407 at 411; State of J & K vs Triloki Nath Khosa AIR 1974SCI and Sate of Orissa vs
N.N.Swamy ; , para 18, followed.
(2) No motives can he attributed to the Legislature in making the law.
(777 C) 773 (3) The prescribed qualifications and the suitability of the applicant would be tested by the UPSC.
(777 C) (4) It is for the rule making authority or for the Legislature to regulate the method of recruitment, prescribe qualifications etc.
It is not for this court to trench into and prescribe qualifications, in particular where the matters are of a technical nature (777 F)
|
ition No. 57 of 1979.
K. Hingorani for the Petitioners.
U. P. Singh for the Respondent.
534 The Order of the Court was delivered by BHAGWATI, J.
This writ petition again comes up for hearing before us pursuant to the directions given by us on 26th February, 1979(1) and today three additional counter affidavits have been filed on behalf of the respondents: one by Mrinmaya Choudhri, Assistant Inspector General of Prisons: the other by Bageshwari Prasad Pande, Superintendent of the Patna Central Jail and the third by Pradip Kumar Ganguly, Superintendent of the Muzafferpur Central Jail.
Mrinmaya Choudhri has in his affidavit given particulars of the under trial prisoners in 48 jails in the State of Bihar in addition to the particulars of the undertrial prisoners in 17 jails already submitted on 26th February, 1979.
We directed the State of Bihar by our order dated 26th February, 1979 to file a revised chart showing a year wise break up of the under trial prisoners after making a division into two broad categories viz. minor offences and major offences but this direction has not yet been carried out by the State of Bihar.
Mrinmaya Choudhri has, however, assured us in his affidavit that several steps regarding the different directions given by the Court are being promptly implemented but due to shortage of time it has not been possible complete the same by 3rd March, 1979.
We direct that the State of Bihar will file within three weeks from to day a revised chart in regard to the under trial prisoners in all the 65 jails in a manner which would clearly show year wise as to what is the date from which each of them is in jail after making a broad division into two categories of minor offences and major offences.
We are glad to note that so far as women under 'protective custody ' are concerned, the State has assured us in the affidavit of Mrinmaya Choudhri that necessary steps for transferring women under "protective custody ' in jails to the institutions run by the welfare department have been taken and directions to that effect are issued by the Government.
We hope and trust that this direction given by us in our earlier order dated 26th February, 1979 will be carried out by Government and compliance report submitted to us within the prescribed time.
Though we directed the State of Bihar by our order dated 26th February, 1979 to intimate to the court by a proper affidavit to be filed on or before 3rd March, 1979 whether the under trial prisoners whose particulars were given in the counter affidavit filed on 26th February, 1979 were periodically produced before the Magistrates in compliance with the proviso to section 167(2), we find that the only averment made by Bageshwari Prasad Pande in his affidavit in response to this direction is that petitioners Nos. 1, 2, 3, 4, 5, 6, 7, 8, 9 and 17 confined in the Patna Central Jail prior to their release were 535 regularly produced before the courts "as and when required by the courts".
This averment does not at all constitute compliance with the direction given by us.
We would like to know from the State of Bihar in a proper affidavit to be filed within two weeks from today whether the under trial prisoners who were directed to be released by us on their personal bond were periodically produced before the Magistrates in compliance with requirement of the proviso to section 167(2).
We would suggest that the State should furnish to this Court the dates on which these under trial prisoners were remanded to judicial custody from time to time by the Magistrates, so that we can satisfy ourselves that the requirement of the proviso was complied with.
We also find an averment in the affidavit of Pradeep Kumar Ganguly that Petitioners Nos.
10, 11, 12, 13, 15, 16 and 18 who were previously confined in the Muzaffarpur Central Jail prior to their release were regularly produced before the Court "as and when required by the courts".
This averment, as we have pointed out, is wholly unsatisfactory and it does not inform the Court as to what were the dates on which these under trial prisoners were remanded from time to time by the Magistrates.
It is only if these particulas are furnished to us that we can satisfy ourselves in regard to compliance with the requirement of the proviso to section 167(2) and we would, therefore, direct the State of Bihar to furnish these particulars to us in an affidavit to be filed within two weeks from today.
We should also like to have the particulars in regard to the dates on which remand orders were made from time to time by the Magistrates in regard to under trial prisoners at items Nos. 4, 5, 6, 7, 8, 13, 21, 22, 24, 28, 29, 30, 43, 56, 69, 71, 72, 79, 85, 92, 96, 97, 101, 129, 133, 136 to 142, 165 to 167, 170 to 174, 177, 191, 199, 210, and 236 in the list of under trial prisoners in Ranchi Central Jail submitted on behalf of the respondents.
These under trial prisoners have been in jail for a period of over six to seven years and we would like to satisfy ourselves that the requirement of the proviso to section 167(2) was complied with in their case.
The affidavit giving these particulars should be filed by the State Government within three weeks from today.
There are quite a larg number of under trial prisoners who are languishing in jail for long periods of time and it is not possible for us to examine the individual cases of these under trial prisoners for the purpose of satisfying ourselves in regard to compliance with the proviso to section 167(2), but we woudl request the High Court of Patna to pick out a few names from the lists of under trial prisoners which have been filed before us by the State of Bihar on 26th February, 1979 and 5th March, 1979 and satisfy itself 536 whether these under trial prisoners have been periodically remanded from time to time by the Magistrates as required by the proviso to section 167(2).
We would direct the State of Bihar to furnish copies of these lists of under trial prisoners to the Chief Justice of the Patna High Court within ten days from today.
We find from the lists of under trial prisoners filed before us on behalf of the State of Bihar that the under trial prisoners whose names are set out in the chart filed by Mrs. Hingorani to day have been in jail for periods longer than the maximum term for which they could have been sentenced; if convicted.
This discloses a shocking state of affairs and betrays complete lack of concern for human values.
It exposes the callousness of our legal and judical system which can remain unmoved by such enormous misery and suffering resulting from totally unjustified deprivation of personal liberty.
It is indeed difficult for us to understand how the State Government could possibly remain oblivious to the continued incarceration of these under trial prisoners for years without even their trial having commenced.
The judiciary in the State of Bihar also cannot escape its share of blame because it could not have been unware of the fact that thousands of under trial prisoners are languishing in jail awaiting trial which never seems to commence.
We fail to see how the continued detention of these under trial prisoners mentioned in the list of Mrs. Hingorani can be justified when we find that they have already been in jai for a period longer than what they would have been sentenced to suffer, if convicted.
They have in fact some jail term to their credit.
We, therefore, direct that these under trial prisoners whose names and particulars are given in the list filed by Mrs. Hingorani should be released forthwith as continuance of their detention is clearly illegal and in violation of their fundametal right under Article 21 of the Constitution.
Then there are several under trial prisoners who are charged with offences which are bailable but who are still in jail presumably because no application for bail has been made on their behalf or being too poor they are unable to furnish bail.
It is not uncommon to find that under trial prisoners who are produced before the Magistrates are unaware of their right to obtain release on bail and on account of their poverty, they are unable to engage a lawyer who would apprise them of their right to apply for bail and help them to secure release on bail by making a proper application to the Magistrate in that behalf.
Sometimes the Magistrates also refuse to release the undertrial prisoners produced before them on their personal bond but insist on monetary bail with sureties, which by reason of their poverty 537 the under trial prisoners are unable to furnish and which, therefore, effectively shuts out for them any possibility of release from pretrial detention.
This unfortunate situation cries aloud for introduction of an adequate and comprehensive legal service programme, but so far, these cries do not seem to have evoked any response.
We do not think it is possible to reach the benefits of the legal process to the poor, to protect them against injustice and to secure to them their constitutional and statutory rights unless there is a nation wide legal service programme to provide free legal services to them.
It is now well settled, as a result of the decision of this Court in Maneka Gandhi vs Union of India(1) that when Article 21 provides that no person shall be deprived of his life or liberty except in accordance with the procedure established by law, it is not enough that there should be some semblance of procedure provided by law, but the procedure unnder which a person may be deprived of his life or liberty should be 'reasonable, fair and just '.
Now, a procedure which does not make available legal services to an accused person who is too poor to afford a lawyer and who would, therefore, have to go through the trial without legal assistance, cannot possibly be regarded as 'reasonable fair and just.
It is an essential indegredient of reasonable, fair and just procedure to a prisonel who is to seek his liberation through the court 's process that he should have legal services available to him.
This Court pointed out in M. H. Hoskot vs State of Maharashtra (2).:"Judicial justice, with procedural intricacies, legal submissions and critical examination of evidence, leans upon professional expertise; and a failure of equal justice under the law is on the cards where such supporteve skill is absent for one side.
Our judicature, moulded by Anglo American models and our judicial process, engineered by kindred legal technology, compel the collaboration of lawyer power for steering the wheels of equal justice under the law".
Free legal services to the poor and the needy is an essential element of any 'reasonable, fair and just ' procedure.
It is not necessary to quote authorative pronouncements by judges and jurists in support of the view that without the service of a lawyer an accused person would be denied 'reasonable, fair and just ' procedure.
Black, J., observed in Gidian vs Wainwright(3): "Not only those precedents but also reason and reffection require us to recognise that in our adversary system of criminal justice, any person haled into court, who is too poor to hire a lawyer cannot be assured a fair trial unless counsel is provided for him.
This seems to us to be an obvious 538 truth.
Governments, both State and Federal quite properly spend vast sums of money to establish machinery to try defendants accused of crime.
Lawyers to prosecute are every where deemed essential to protect the public 's interest in an orderly society.
Similarly, there are few defendants charged with crime who fail to hire the best lawyers they can get to prepare and present their defences.
That government hires lawyers to prosecute and defendants who have the money hire lawyers to defend are the strongest indications of the widespread belief that lawyers in criminal courts are necessties, not luxuries.
The right of one charged with crime to counsel may not be deemed fundamental and essential to fair trials in some countries, but is in ours.
From the very beginning, our state and national constitutions and laws have laid great emphasis on procedural and substantive safeguards designed to assure fair trials before impartial tribunals in which every defendant stands equal before the law.
This noble idea cannot be realised if the poor man charged with crime has to face his accusers without a lawyer to assist him.
" The philosophy of free legal service as an essential element of fair procedure is also to be found in the following passage from the judgment of Douglas, J. in Jon Richard Argersinger vs Raymond Hamlin(1) "The right to be heard would be, in many cases of little avail if it did not comprehend the right to be heard by counsel.
Even the intelligent and educated layman has small and sometimes no skill in the science of law, if charged with crime, he is incapable, generally of determining for himself whether the indictment is good or bad.
He is unfamiliar with the rules of evidence.
Left without the aid of counsel he may be put on trial without a proper charge and convicted upon incompetent evidence, or evidence irrelevant to the issue or otherwise inadmissible.
He lacks both the skill and knowledge adequately to prepare his defence, even though he has a perfect one.
He requires the guiding hand of counsel at every step in the proceedings against him.
Without it, though he be not guilty, he faces the danger of conviction because he does not know how to establish his innocence.
If that be true of men of intelligence, 539 how much more true is it of the ignorant and illiterate or those of feeble intellect.
The right of one charged with crime to counsel may not be deemed fundamental and essential to fair trials in some countries but it is in ours.
From the very beginning our state and national constitutions and laws have laid great emphasis on procedural and substantive safeguards designed to assure fair trials before impartial tribunals in which every defendant stands equal before the law.
This noble ideal cannot be realized if the poor man charged with crime has to face his accusers without a lawyer to assist him.
Both Powell and Gideon involved felonies.
But their rationale has relevance to any criminal trial, where an accused is deprived of his liberty.
x x x x x x The court should consider the probable sentence that will follow if a conviction is obtained.
The more serious the likely consequences, the greater is the probability that a lawyer should be appointed. .
The court should consider the individual factors peculiar to each case.
These, of course would be the most difficult to anticipate.
One relevant factor would be the competency of the individual defendent to present his own case.
(emphasis added)" We may also refer to Article 39A the fundamental constitutional directive which reads as follows: "39A. Equal justice and free legal aid: The State shall secure that the operation of the legal system promotes justice, on a basis of equal opportunity, and shall, in particular, provide free legal aid, by suitable legislation or schemes or in any other way, to ensure that opportunities for securing justice are not denied to any citizen by reason of economic or other disabilities.
(emphasis added)" This Article also emphasises that free legal service is an inalienable element of 'reasonable, fair and just ' procedure for without it a person suffering from economic or other disabilities would be deprived of the opportunity for securing justice.
The right to free legal services is, therefore, clearly an essential ingredient of 'reasonable, fair and just, procedure for a person accused of an offence and it must be held implicit in the guarantee of Article 21.
This is a constitutional right of every accused person who is unable to engage a lawyer and secure legal services on account of reasons such as poverty, indigence or incommunicado situation and the State is under a mandate to provide a lawyer to an accused person if the circumstances of the case and the 540 needs of justice so required, provided of course the accused person does not object to the provision of such lawyer.
We would, therefore, direct that on the next remand dates, when the under trial prisoners, charged with bailable offences, are produced before the Magistrates, the State Government should provide them a lawyer at its own cost for the purpose of making an application for bail, provided that no objection is raised to such lawyer on behalf of such under trial prisoners and if any application for bail is made, the Magistrates should dispose of the same in accordance with the broad outlines set out by us in our judgment dated 12th February, 1979.
The State Government will report to the High Court of Patna its compliance with this direction within a period of six weeks from today.
There are also various under trial prisoners who have been in jail for periods exceeding one half of the maximum punishment that could be awarded to them, if convicted, for the offences with which they are charged.
To take an example, Budhu Mahli, who is at item No. 1 in the list of undertrial prisoners in Ranchi Central Jail has been in jail since 21st November, 1972 for offences under Section 395 of the Indian Penal Code and Section 25 of the Indian Arms Act.
The maximum punishment for the offence under Section 395 of the Indian Penal Code is 10 years while that for the offence under Section 25 of the Indian Arms Act is much less.
Yet Budhu Mahli has been in jail as an under trial prisoner for over six years.
So also Jairam Manjhi, Somra Manjhi, Jugal Munda and Gulam Munda at Item Nos.
2 to 7 in the list of under trial prisoners confined in Ranchi Central Jail have been in jail as under trial prisoners from 21st February, 1974 that is, for a period of over five years for the offence under Section 395 of the Indian Penal Code which is punishable with a maximum term of imprisonment of ten years.
There are numerous other instances which can easily be gleaned from the lists of under trial prisoners filed on behalf of the State of Bihar, where the under trial prisoners have been in jail for more than half the maximum term of imprisonment for which they could be sentenced, if convicted.
There is no reason why these undetrial prisoners should be allowed to continue to languish in jail, merely because the State is not in a position to try them within a reasonable period of time.
It is possible that some of them, on trial may be acquitted of the offences charged against them and in that event, they would have spent several years in jail for offences which they are ultimately found not to have committed.
What faith would these people have in our system of administration of justice ? Would they not carry a sense of frustration and bitterness against a society which keeps them in jail for so many years for offences which they did not commit ? It is, therefore, absolutely essential that persons accused of offences 541 should be speedily tried, so that in cases where bail, in proper exercise of discretion, is refused, the accused persons have not to remain in jail longer than is absolutely necessary.
Since there are several undertrial prisoners who have been in jail for periods longer than half the maximum term of imprisonment for which they could if convicted, be sentenced, we would direct that on the next remand dates when they are produced before the Magistrates or the Sessions Courts, the State Government should provide them a lawyer at its own cost for the purpose of making an application for bail and opposing remand provided that no objection is raised to such lawyer on their behalf and if any application for bail is made, the Magistrates or the Sessions Courts, as the case may be should dispose of the same in accordance with the broad guidelines indicated by us in our judgment dated 12th February, 1979.
The State Government will comply with this direction as far as possible within a period of six weeks from today and submit report of compliance to the High Court of Patna.
We may also take this opportunity of impressing upon the Government of India as also the State Governments, the urgent necessity of introducing a dynamic and comprehensive legal service programme with a view to reaching justice to the common man.
Today, unfortunately, in our country the poor are priced out of the judicial system with the result that they are losing faith in the capacity of our legal system to bring about changes in their life conditions and to deliver justice to them.
The poor in their contract with the legal system have always been on the wrong side of the law.
They have always come across "law for the poor" rather than "law of the poor".
The law is regarded by them as something mysterious and forbidding always taking something away from them and not as a positive and constructive social device for changing the socio economic order and improving their life conditions by conferring rights and benefits on them.
The result is that the legal system has lost its credibility for the weaker sections of the community.
It is, therefore, necessary that we should inject equal justice into legality and that can be done only by dynamic and activist scheme of legal services.
We may remind the Government of the famous words of Mr. Justice Brennan "Nothing rankles more in the human heart than a brooding sense of injustice.
Illness we can put up with.
But injustice makes us want to pull things down.
When only the rich can enjoy the law, as a doubtful luxury, and the poor, who need it most, cannot have it because its expense puts it beyond their reach, the threat to the continued existence of free democracy is not imaginary but very real, because 542 democracy 's very life depends upon making the machinery of justice so effective that every citizen shall believe in an benefit by its impartiality and fairness." And also recall what was said by Leeman Abbot years ago in relation to affluent America.
"If ever a time shall come when in this city only the rich can enjoy law as a doubtful luxury, when the poor who need it most cannot have it, when only a golden key will unlock the door to the courtroom, the seeds of revolution will be sown, the fire brand of revolution will be lighted and put into the hands of men and they will almost be justified in the revolution which will follow.
" We would strongly recommend to the Government of India and the State Governments that it is high time that a comprehensive legal service programme is introduced in the country.
That is not only a mandate of equal justice implicit in Article 14 and right to life and liberty conferred by Article 21, but also the compulsion of the constitutional directive embodied in Article 39A.
We find from the counter affidavit filed on behalf of the respondents that no reasons have been given by the State Goverment as to why there has been such enormous delay in bringing the under trial prisoners to trial.
Speedy trial is, as held by us in our earlier judgment dated 26th February, 1979, an essential ingredient of 'reasonable, fair and just ' procedure guaranteed by Article 21 and it is the constitutional obligation of the State to device such a procedure as would ensure speedy trial to the accused.
The State cannot be permitted to deny the constitutional right of speedy trial to the accused on he ground that the State has no adequate financial resources to incur the necessary expenditure needed for improving the administrative and judicial apparatus with a view to ensuring speedy trial.
The State may have its financial constraints and its priorities in expenditure, but, as pointed out by the Court in Rhem vs Malclm(1): "The law does not permit any Government to deprive its citizens of constitutional rights on a plea of poverty".
It is also interesting to notice what Justice, then Judge, Blackmum said in Jackson vs Bishop(2): "Humane considerations and constitutional requirements are not, in this day, to be measured by dollar considerations. " 543 So also in Holt vs Sarver(1), affirmed in 442 F. Supp. 362, the Court, dealing with the obligation of the State to maintain a Penitentiary System which did not violate the Eighth Amendment aptly and eloquently said "Let there be no mistake in the matter; the obligation of the Respondents to eliminate existing unconstitutionalities does not depend upon what the Legislature may do, or upon what the Governor may do, or, indeed upon what Respondents may actually be able to accomplish.
If Arkansas is going to operate a Penitentiary System, it is going to have to be a system that is countenanced by the Constitution of the United States.
" The State cannot avoid its constitutional obligation to provide speedy trial to the accused by pleading financial or administrative inabiltiy.
The State is under a constitutional mandate to ensure speedy trial and whatever is necessary for this purpose has to be done by the State.
It is also the constitutional obligation of this Court as the guardian of the fundamental rights of the people, as a sentinel on the qui vive, to enforce the fundamental right of the accused to speedy trial by issuing the necessary directions to the State which may include taking of positive action, such as augmenting and strengthening the investigative machinery, setting up new courts, building new court houses, providing more staff and equipment to the courts, appointment of additional judges and other measures calculated to ensure speedy trial.
We find that in fact the courts in the United States have adopted this dynamic and consructive role so far as the prison reform is concerned by utilising the activist magnitude of the Eighth Amendment.
The courts have ordered substantial improvements to be made in a variety of archaic prisons and jails through decisions such as Hot vs Sarver (supra), Jones vs Wittenberg(2), Newman vs Alabama(3) and Gates vs Collier(4).
The Court in the last mentioned case asserted that it "has the duty of fashioning a decree that will require defendants to eliminate the conditions and practices at Parchman here in above found to be violative of the United State 's constitution" and in discharge of this duty gave various directions for improvement of the conditions of those confined in the State Penitentiary.
The powers of this Court in protection of the Constitutional rights are of the widest amplitude and we do not see why this 544 Court should not adopt a similar activist approach and issue to the State directions which may involve taking of positive action with a view to securing enforcement of the fundamental right to speedy trial.
But in order to enable the Court to discharge this constitutional obligation, it is necessary that the Court should have the requisite information bearing on the problem.
We, therefore, direct the State of Bihar to furnish to us within three weeks from today particulars as to the location of the courts of magistrates and courts of sessions in the State of Bihar together with the total number of cases pending in each of these courts as on 31st December, 1978 giving yearwise breakup of such pending cases and also explaining why it has not been possible to dispose of such of those cases as have been pending for more than six months.
We would appreciate if the High Court of Patna also furnishes the above particulars to us within three weeks from today since the High Court on its administrative side must be having records from which these particulars can be easily gathered.
We also direct the State of Bihar to furnish to us within three weeks from today particulars as to the number of cases where first information report have been lodged and the cases are pending investigation by the police in each sub division of the State as on 31st December, 1978 and where such cases have been pending investigation for more than six months, the State of Bihar will furnish broadly the reasons why there has been such delay in the investigative process.
The writ petition will now come up for hearing and final disposal on 4th April, 1979.
We have already issued notice to the Supreme Court Bar Association to appear and make its submissions on the issue arising in the writ petition since they are of great importance.
We hope and trust that the Supreme Court Bar Association will respond to the notice and appear to assist the Court at the hearing of the writ petition.
| At the resumed hearing of the petition for release of under trials in the State of Bihar.
^ HELD: (1) The procedure under which a person may be deprived of his life or liberty should be 'reasonable fair and just. ' Free legal services to the poor and the needy is an essential element of any 'reasonable fair and just 'procedure.
A prisoner who is to seek his liberation through the court 's process should have legal services available to him.
[537 C, D] Meneka Gandhi vs Union of India, [1978] 1 SCC 248; M.H. Hoskot vs State of Maharashtra, ; ; Gideon vs Wainwright; , ; 9 L. ed.
at 799; John Richard Argersinger vs Raymond Hamlin, ; 35 L. ed.
2d 530 at 535 36; referred to (2) Article 39A also emphasises that free legal service is an inalienable element of 'reasonable, fair and just 'procedure for without it a person suffering from economic or other disabilities would be deprived of the opportunity for securing justice.
The right to free legal service is therefore, clearly an essential ingredient of 'reasonable, fair and just ' procedure for a person accused of, an offence and it must be held implicit in the guarantee of article 21.
This is a constitutional right of every accused person who is unable to engage a lawyer and secure legal services, on account of reasons such as poverty, indigence or incommunicado situation and the State is under a mandate to provide a lawyer to an accused person if the circumstances of the case and the needs of justice so require, provided of course the accused person does not object to the provision of such lawyer.
[539 F 540 A] (3) The poor in their contact with the legal system have always been on the wrong side of the law.
They have always come across "law for the poor" rather than "law of the poor".
The law is regarded by them as something mysterious and forbidding always taking something away from them and not as a positive and constructive social device for changing the socio economic order and improving their life conditions by conferring rights and benefits on them.
The result is that the legal system has lost its credibility for the weaker sections of the community.
It is, therefore, necessary to inject equal justice into legality and that can be done only by a dynamic and activist scheme of legal services.
[541 E F] 533 4.
The urgent necessity of introducing a dpnamic and comprehensive legal services programme impressed upon the Government of India as also the State Governments.
That is not only a mandate of equal justice implicit in article 14 and right to life and liberty conferred by article 21 but also the compulsion of the constitutional directive embodies in article 39A. [542 D] 5.
The State cannot avoid its constitutional obligation to provide speedy trial to the accused by pleading financial or administrative inability.
The State is under a constitutional mandate to ensure speedy trial and whatever is necessary for this purpose has to be done by the State.
It is also the constitutional obligation of this Court, as the guardian of the fundamental rights of the people as a sentinel on the qui vive, to enforce the fundamental right of the accused to speedy trial by issuing the necessary directions to the State which may include taking of positive action, such as augmenting and strengthening the investigative machinery, setting up new courts, building new court houses, appointment of additional judges and other measures calculated to ensure speedy trial.
[543 D E] (6) The courts in the United States have adopted a dynamic and constructive role in regard to prison reform by utilising the activist magnitude of the Eighth Amendment.
The courts have ordered substantial improvements to be made in a variety of archaic prisons and jails through its decisions.
[543 F] Rhem vs Malclm, , Jackson vs Bishop, 571, Holl vs Sarver, ; ; Jones vs Wittenberg, ; Newman vs Alabama, ; Gates vs Collier, 349 F. Suppl. 881; referred to.
(7) The powers of this Court in protection of the Constitutional rights are of the widest amplitude and this Court should adopt an activist approach and issue to the State, directions which may involve taking of positive action with a view to securing enforcement of the fundamental right to speedy trial.
But in order to enable the court to discharge this constitutional obligation, it is necessary that the court should have the requisite information bearing on the problem.
[543 H 544 A] Directed that: (a) On the next remand dates when the under trials are produced before the Magistrates or the Sessions Courts the State Government should provide them a lawyer at its own cost for the purpose of making an application for bail and opposing remand provided that no objection is raised to such a lawyer on their behalf.
[540 B] (b) The State Government and High Court to furnish particulars as to the location of the courts of magistrates and courts of sessions in the State of Bihar together with the total number of cases pending in each of these courts as on 31st December, 1978 giving year wise break up of such pending cases and also explaining why it has not been possible to dispose of such of those cases as have been pending for more than six months.
[544 D]
|
Civil Appeal No. 1773 of 1971.
(From the Judgment and order dated 20 2 1970 of the Allahabad High Court in Civil Misc.
Writ Petition No. 2943/69) S.C. Manchanda and O.P. Rana, for the Appellants.
V.S. Desai, P.B. Agarwala and B.R. Agarwala, for the Respondents.
838 The Judgment of the Court was delivered by JASWANT SINGH, J.
This appeal by certificate which is directed against the judgment and order dated February 20, 1970, passed by the High Court of Judicature at Allahabad in writ petition No. 2943 of 1969 raises two interesting ques tions viz. ( 1 ) whether carbon paper is paper falling within the purview of the word 'paper ' as used in serial No. 2 of Notification Ng.
ST 3124/X 1012(4) 1964 dated July 1, 1966, issued by the Governor of Uttar Pradesh in exercise of the power vested in him under section 3 A of the U.P. Sales 'Fax Act, 1948 (U.P. Act No. XV of 1948) so as to be liable to sales tax at the point and at the rate specified in the Schedule to the Notification and (2) whether ribbon is an accessory or a part of the typewriter.
It appears that the respondent which is a company incor porated under the Indian Companies Act dealing in carbon paper, typewriter, ribbon, stepler machines and stepler pins, despatches the said goods from its head office at Bombay to its branch office at Kanpur wherefrom sales there of are effected in the State of Uttar Pradesh.
During the course of the assessment proceedings for the assessment year 1956 57, the respondent claimed that carbon paper not being paper falling within the ambit of Entry No. 2 of the Schedule to the aforesaid Notification but a specialised article used for copying purposes, its turnover had to be assessed at the rate of 2 per cent prescribed for unclassi fied goods and not at the rate of 6 paise per rupee i.e. 6% prescribed in the aforesaid Notification.
The respondent further claimed that ribbon being an accessory anti not a part of the typewriter, its turnover could not be subjected to sales tax at the rate of 10% prescribed inter alia for typewriters and parts thereof by Notification No. ST 1738/X I012 1963 dated June 1, 1963.
The Sales Tax Officer, (Section IV), Kanpur, did not accede to the conten tions of the respondent and holding that carbon paper re mained paper even after going through certain chemical processes and that ribbon was a part of the typewriter, taxed the turnover of carbon paper for the period commencing from July 1, 1966, to the end of March, 1967 at 6% and that of ribbon at 10%.
He, however, taxed the turnover of carbon paper for the period April 1, 1966 to June 30, 1966 at 2%.
The validity and correctness of this order in so far as it related to the levy of tax on carbon paper at 6% and ribbon at 10% was challenged by the respondent by means of the aforesaid writ petition before the High Court at Allahabad which by its aforesaid judgment and order allowed the same and quashed the levy.
Hence this appeal.
Appearing in support of the appeal, Mr. Manchanda has assailed the reasoning and approach of the High Court and has vehemently urged that carbon paper does not lose its character as paper even after being subjected to chemical processes and that ribbon is not an accessory but an essen tial part of the typewriter.
We have carefully considered the submission made by Mr. Manchanda but find ourselves unable to accept the same.
839 It is well settled that a word which is not defined in an enactment has to be understood in its popular and commer cial sense with reference to the context in which it occurs.
In Attorney General vs Winstanley (1), Lord Tenterden started as follows: "Now, when we look at the words of an Act of Parliament, which are not applied to any particular science or art, we are to construe them as they are understood in common language.
" In Grenfell vs Commissioners of Inland Revenue (2) Pollock, J, pointed out: "As to tile construction of the Stamp Act, I think it was very properly urged that the statute is not to be construed according to the strict or technical meaning of the language contained in it, but that it is to be construed in its popular sense, meaning, of course, by the words 'popular sense ' that sense which people conversant with the sub ject matter with which the statute is dealing would attribute to it." The word 'paper ' admittedly not having been defined either in the U.P. Sales Tax Act, 1948 or the Rules made thereunder, it has tO be understood according to the afore said well established canon of construction in the sense in which persons dealing in and using the article understand it.
It is, therefore, necessary to know what is paper as commonly or generally understood.
The said word which is derived from the name of reedy plant papyrus and grows abundantly along the Nile river in Egypt is explained in 'The Shorter Oxford English Dictionary (Volume 2) (Third Edition) as "a substance composed of fibres interlaced into a compact web, made from linen and cotton rags, straw, wood, certain grasses, etc., which are macrated into a pulp, dried and pressed; it is used for writing.
printing, or drawing on, for wrapping things in, for covering the interior of wails, etc.
" In 'Encyclopaedia Britannica ', (Volume 13), (15th Edition), 'paper ' has been defined as the basic material used for written communication and the dissemination of information.
" In the Unabridged Edition of "The Randon House Dicition ary of the English Language", the word 'paper ' has been defined as "a substance made from rags, straw wood ' or other fibrous material, usually in thin sheets, used to bear writing or printing or for wrapping things, decorating walls etc.
" From the above definitions, it is clear that in popular parlance, the word 'paper ' is understood as meaning a sub stance which is used for bearing, writing, or printing, or for packing, or for drawing on, or for decorating, or cover ing the walls.
Now carbon paper which is manu (1) [1831] 2 Dow & Clark 302=(1901) ; (2) at 248.
840 factured by coating the tissue paper with a thermo setting ink (made to a liquid consistency) based mainly on wax, non drying oils, pigments and dyes by means of a suitable coat ing roller and equalising rod and then passing it through chilled rolls cannot be used for the aforesaid purposes but is used.
according to 'The Randon House Dictionary of the English Language ' between two sheets of plain paper in order to reproduce on the lower sheet that which is written or typed on the upper sheet i.e. making replicas or carbon copies cannot properly be described as paper.
It will be well at this stage to refer to a few deci sions which confirm our view.
In Kilburn & Co. Ltd. vs Commissioner of Sales Tax U.P., Lucknow(I) a Bench of Allahabad High Court while examining the very same entry in the Notification with which we are concerned in the instant case and holding that "Ammonia paper and ferro paper used for obtaining prints and sketches of site plans are not paper us understood generally and, therefore, will not come within the expression 'paper other than hand made paper ' as used in Notification No. ST 3124/X 1012(4) dated 1st July, 1966, issued under section 3 A of the U.P. Sales Tax Act, 1948" observed : "The word 'paper ' has not been defined in the Act or the Rules, and, as such, it has to be given the meaning which it has in 'ordinary parlance.
Paper, as understood in common parlance, is the paper which is used for printing.
writing and packing purposes.
" In Sree Rama Trading Company vs State of Kerala(2) the High Court of Kerala after a good deal of research held that cellophane is not paper coming within entry 42 in the First Schedule to the Kerala General Sales Tax Act, 1963, as it stood at the time relevant to the year 1966 67.
In State of Orissa vs Gestetner Duplicators (P) Ltd.(3) the HIgh Court of Orissa held that stencil paper was not paper within the meaning of serial No. 7 A of the Schedule to the Notification issued by the State Government under the first proviso to section 5(1) 'of the Orissa Sales Tax Act, 1947 and that sale of stencil paper was, therefore, not taxable at the rate of 7 per cent but is exigible to tax at the rate of 5 per cent.
In Commissioner of Sates Tax, U.P, vs
S.N. Brothers(1) this Court while upholding the decision of the Allahabad High Court which held that 'food colours ' and 'syrup es sences ' arc .edible goods while 'dyes and colours and compo sitions thereof and 'scents and perfume ' did not seem prima facie to connote that they are edible goods observed: (1) 31 S.T.C. 625.
(2) 28 S.T.C. 469.
(3) 33 S.T.C. 333.
(4) 31 S.T.C. 302. 841 "The words 'dyes and.
colours ' used in entry No. 10 and the words: scents and perfumes ' used in entry No. 37 have to be construed in their own context and in the sense, as ordinarily understood and attribut ed to these words by people usually conver sant with and dealing in such goods.
Simi larly, the words "food colours" and "syrup essences", which are descriptive of the class of goods the sales of which are to be taxed under the Act, have to be construed in the sense in which they are popularly understood by those who deal in them and who purchase and use them.
" Bearing in mind the ratio of the above mentioned decisions, it is quite clear that the mere fact that the word 'paper ' forms part of the denomination of a specialised article is not decisive of the question whether the article is paper as generally understood. 'the word 'paper ' in the common parlance or in the comercial sense means paper which is used for printing, writing or packing pur poses.
We are, therefore, clear of opinion that Carbon paper is not paper as envisaged by entry 2 of the aforesaid Notification.
Regarding ribbon also to which the above mentioned rule construction equally applies, we have no manner of doubt that it an accessory and not a part of the typewriter (unlike spool) though it may not be possible to use the latter without the former.
Just as aviation petrol is not a part of the aero plane nor diesel is a part of a bus in the same way, ribbon is not a part of the type writer though it may not be possible to type out any matter without it.
The very same question with which we are here confronted came up for decision before the High Court of Mysore in State of Mysore vs Kores (India)Ltd.
(1) where it was held: "Whether a typewriter ribbon is a part of a typewriter is to be considered in the light of what is meant by a typewriter in the commer cial sense.
Typewriters are being sold in the market without the typewriter ribbons and therefore typewriter ribbon is not an essen tial part of a typewriter so as to attract tax as per entry 18 of the Second Schedule to the Mysore Sales Tax Act, 1957.
" For the foregoing reasons, we do not find any force in this appeal which is dismissed but in the circumstances of the case without any order as to costs.
M.R. Appeal dismissed (1) 26 S.T.C. 87.
| The respondent, an assistant teacher in the basic sec tion of the Colvin Taluqdar 's college, Lucknow, was suspend ed and then removed from service, by the managing committee of the college.
She flied a writ petition in the High Court challenging her dismissal order, contending that it violated the regulations framed under the (U.P.) Intermediate Educa tion Act, 1921.
The appellants contended that the col lege was running the basic Section independently and without any affiliation or grants from the Government or any local body, and that the said Act did not apply.
The Single Judge of the High Court dismissed the Writ petition as none of the opposite parties was a public au thority.
An appeal was allowed by a Division Bench of the High Court on the ground that the basic Section was an integral part of the college and was run by a Managing Committee constituted under the Intermediate Education Act.
Allowing the appeal the Court, HELD: The provisions of the Act relate to recognized institutions; recognition is by the Board for the purpose of preparing candidates for admission to the Board 's examina tion; Board means the Board of High School and lntermedi ate Education.
The basic section of a college cannot there fore be part of a recognised institution.
It is not correct to think that since Section 16A of the Act requires a college to have a committee of management, a managing committee that looks after the affairs of the basic section of the college must also be functioning as a statutory body discharging duties under the Act and governed by the regula tions framed thereunder.
An institution by extending its operation to fields beyond that covered by the Act cannot extend the ambit of the Act to include in its sweep, these new fields of education which are.
outside its scope.
[959 C G]
|
N: Criminal Appeal No. 194 of 1979.
From the Judgment and Order dated 4.7.1978 of the Andhra Pradesh High Court in Crl.
A. No. 576 of 1977.
K. Madhava Reddy, and G. Narasimhulu for the Appellants.
B. Parthasarthi for the Respondent.
The Judgment of the Court was delivered by FATHIMA BEEVI, J.
The appellants are Bollavaram Pedda Narsi Reddy (A 1), Bollavaram Chinna Narsi Reddy (A 2), Kavalakuntla Rama Subba Reddy (A 3), Duddula Venkata Subba Reddy (A 5) and Mala Prakasam (A 6) before this Court.
These appellants along with accused No. 4 Duddela Ramana Reddy, were tried for the 726 murder of one Chandrasekhara Reddy on the night of August 15, 1974.
The trial court acquitted all the accused.
On appeal by the State, the High Court convicted these appellants under sections 302 read with 149, I.P.C., and sentenced them to undergo imprisonment for life and also imposed short term imprisonment for minor offence to run concurrently.
Chandrasekhara Reddy, the deceased, and the accused were residents of village Jeereddy Kotharpallai.
In 1970, Accused No. 3 was elected as a Sarpanch of the village with active support of the deceased.
However, differences arose between them as they supported rival groups in the election in the neighbouring village.
10 days before the incident, the deceased is stated to have openly declared that he would get Accused 3 removed by moving a no confidence motion.
This according to the prosecution is the motive for the crime.
On the date of occurrence, Chandrasekhara Reddy met PW 1 (Guddeti Balaveera Reddy) and PW 2 (Donthireddi Subba Reddy) in the hotel of Subbamma (PW 8) in the neighbouring village Proddatur.
The deceased along with the two witnesses attended a cinema show at Anwar Talkies.
They came out of the theatre 10 minutes earlier around 9.30 P.M. and were walking along the road towards the bus stand.
When they reached near the old telephone exchange about 50 metres away from Anwar Talkies, there was an explosion of crackers.
The accused persons suddenly surrounded the deceased.
They were armed with daggers.
They attacked him after one of them pushing aside PW 1.
PW 1 fell on the barbed wire fence of the transformer and received scratches on his thigh.
The deceased was stabbed indiscriminately and simultaneously by all the assailants who retreated in two different directions and the deceased died on the spot instantaneously.
Besides PWs 1 and 2, who witnessed the occurrence, PW 3 Donthireddi Narayana Reddy, and PW 4 Poreddi Subba Reddy.
had also seen the attack.
These witnesses were passing along the road.
PW 5, Mekkamalla Balireddi, reached the scene attracted by the crowd and had seen the accused persons running away.
The street light besides the electric light at a petrol bunk and the light in the bunk on the side of the road were burning at the time of the occurrence.
The assailants had been identified by the witnesses in that light.
The assailants were strangers to the PWs 1 and 2 but A 2, 3 and 5 were known to PWs 3 and 4 and 5 who had also acquaintance with the deceased PW 5 informed PW 7 (Polagiri Siva Reddy), the brother of the deceased, about the occurrence, while PWs 3 and 4 left the place after seeing the deceased lying at the scene.
This in short is the prosecution case.
727 The Town Police Station is situated about two furlongs away from the place of occurrence.
PW 1 along with PW 2 went to the police station and lodged the first information report.
A crime ws registered against six unidentified persons.
PW 16 (Sri section Khasim Sab, Sub Inspector of Police), recorded the statement exhibit P 1.
The Circle Inspector visited the scene.
PW 2 was referred to the Medical Officer at 4 A.M.
The inquest on the dead body was held on the next morning.
The post mortem examination revealed that deceased had sustained 54 injuries all except one being incised wounds.
At the time of the inquest, the statements of PWs 2 and 7 were recorded.
PW 7 suspected the involvement of Accused 2, 3 and 5.
On 17.8.1974, the police dogs were pressed into service.
It is stated that the sniffer went to the village of the deceased and thereafter to the houses of Accused 2 and 3.
Statements of PWs 3, 4 and 5 were recorded on 18.8.1974.
Accused No. 6 was arrested on 25.9.1974.
A test identification parade was conducted by PW 9 (Sri G.V. Raghavaiah, Judicial Second Class Magistrate) on 31.10.1974.
A 6 was identified by PWs 1, 2, 3 and 4 at the parade as recorded in exhibit P 2 proceeding.
The other accused persons were arrested on 1.11.1974.
PW 10 (Sri D. Sreeramulu, Judicial Second Class Magistrate), conducted the test identification parade in which as per exhibit P 3 proceeding, PWs 1,and 2 identified accused 1, 2, 3 and 5.
The investigation was completed and the charge was laid against the six persons.
The learned sessions judge analysed the prosecution evidence meticulously and discarded the testimony of PWs 1 to 5.
He considered PWs 3, 4 and 5 as chance witnesses, found their conduct in not disclosing the involvement of the accused persons known to them until their statements were recorded on 18.8.1974 as suspicious and strange when they had acquaintance with the deceased.
PWs 3 and 4 when examined by PWs 9 and 10 for the purpose of test identification parade had given statement which vary with their earlier statement and their evidence before court was contradictory to their prior statements.
It was, doubtful whether they could have seen the occurrence or identified any of the assailants.
Their evidence was, therefore, rejected as untrustworthy.
The testimony of the two eye witnesses PWs 1 and 2 who claimed that they were in the company of the deceased at the time of the occurrence was also not accepted by the trial court for various reasons.
They were strangers to the accused persons.
Their evidence regarding the identification of the assailants as the accused did not impress the trial court which pointed out that the prosecution had no consistent case regarding the source of light at the scene that these witnesses even if present at the scene when the assailants mounted the 728 attack on the deceased could not have remained there to observe and memorize the features of the assailants and identify them after a long lapse of time.
PW 1 rushed to the police station in utter confusion even without his dhoti.
The witnesses were frightened and ran away.
In this situation in the meagre light available, they could not have identified the assailants as the accused.
The learned judge on a consideration of the medical evidence was also of the view that the occurrence could not have happened at the time mentioned by these witnesses and, said there were several suspicious features which render their version doubtful.
The learned judge also pointed out that the identification parade was perfunctory and was of no assistance to the prosecution.
The learned sessions judge analysed the entire evidence and considered it unsafe to accept the testimony of the two witnesses to record a conviction.
In that view of the matter, he acquitted all the accused persons.
The High Court considered the reasoning as perverse and on a reappraisal of the evidence, took a contrary view.
In the opinion of the High Court, PWs 1 to 4 are truthful witnesses and their evidence could be accepted.
In its view, there was no serious infirmity in the prosecution evidence.
Accordingly, the High Court accepted the testimony of PWs 1 and 2, corroborated by the evidence of test identification parade and the testimony of PWs 3 and 4 to find the appellants guilty.
Since accused No.4 was not identified by PWs 1 to 4, he was given the benefit of doubt and his acquittal was confirmed.
The learned counsel for the appellants has taken us through the entire evidence in the case.
The appeal is one under Section 2 of the .
It is, no doubt, open to this Court to re examine the evidence for the purpose of satisfying itself whether the High Court was justified in reversing the order of acquittal in the facts and circumstances of the case.
It is well settled proposition of law that in an appeal against acquittal, the Appellate Court is empowered to evaluate the evidence and arrive at its own conclusion.
It is equally settled law that where the view taken by the trial court or an appreciation of the evidence is also a plausible view, the Appellate Court shall be slow to interfere with it even when a different view is possible on a reappraisal of the evidence.
The learned counsel for the appellants pointed out that the High Court in reversing the order of acquittal in this case had departed from these established principles and had thus erred grievously in convicting the appellants.
It was submitted that the conviction recorded by the High Court essentially rests on the testimony of PWs 1 and 2.
When the 729 serious infirmities in the evidence of the other two eye witnesses PWs 3 and 4 had been brought to the notice of the High Court, it has eschewed that evidence and has placed reliance only on the testimony of PWs 1 and 2 in arriving at the conclusion that the appellants are guilty of the offence.
The appellants ' learned counsel, therefore, contended that if the view taken by the trial court on the testimony of PWs 1 and 2 cannot be characterised as perverse or wholly unreasonable, there is no justification for the High Court to accept that evidence as the basis of a conviction even if in its opinion the evidence of these two witnesses could have been relied on.
The main plank of the argument of the learned counsel is that the witnesses being strangers to the assailants when there are circumstances to show that they did not have the opportunity to identify the assailants, their evidence involving these appellants is not free from doubt and, therefore the trial court had taken the reasonable view that it is unsafe for the court to accept that evidence to convict the accused persons.
We see considerable force in the contention of the learned counsel for the appellants.
The evidence given by the witnesses before the court is the substantive evidence.
In a case where the witness is a stranger to the accused and he identifies the accused person before the court for the first time, the court will not ordinarily accept that identification as conclusive.
It is to lend assurance to the testimony of the witnesses that evidence in the form of an earlier identification is tendered.
If the accused persons are got identified by the witness soon after their arrest and such identification does not suffer from any infirmity that circumstance lends corroboration to the evidence given by the witness before the court.
But in a case where the evidence before the court is itself shaky, the identification before the magistrate would be of no assistance to the prosecution In the present case, the appellants are admittedly persons with whom the two witnesses had no previous acquaintance.
The occurrence happened on a dark night.
When the crime was committed during the hours of darkness and the assailants are utter strangers to the witnesses, the identification of the accused persons assumes great importance.
The prevailing light is a matter of crucial significance.
The necessity to have the suspects identified by the witnesses soonafter their arrest also arises.
According to the prosecution, the attack on the deceased was sudden and simultaneous and the assailants slipped away in no time.
Both PWs 1 and 2 had deposed that they were attracted by the explosion and when they turned back, the assailants surrounded the deceased and inflicted the stab injuries.
PW 1 was pushed aside.
730 He fell on the fence of the barbed wire of the transformer, received scratches.
His dhoti stuck to the wire.
He left it there and ran to the police station in utter confusion.
His P 1 does not disclose that PW 2 accompanied him, though PWs 1 and 2 stated before court that they went together.
The possibility of the companions of the deceased having been scattered and gone in different directions cannot be ruled out.
Even in Ex.
P 1 statement what PW 1 said is that six persons attacked the deceased; they were villagers; they were wearing dhoti and kurta.
One was about 45 years of age and of dark complexion, another was 30 years of age lean and yet another was also a lean person.
These may be the vague impression the witness had on seeing the assailants suddenly.
It is not however in evidence that the description given by PW 1 in exhibit p 1 fits in with the description of any one of the appellants.
When the magistrates recorded the statements of the witnesses, they could not give any characteristic feature of any one of the assailants.
The entire case depends on the identification of the appellants and the identification is founded solely on the test identification parades.
Therefore, in the absence of cogent evidence that PWs 1 and 2 by reason of the visibility of the light at the place of occurrence and proximity to the assailants had a clear vision of the action of each one of the accused persons in order that their features could get impressed in their mind to enable them to recollect the same and identify the assailants even after a long lapse of time, it would be hazardous to draw the inference that the appellants are the real assailants.
There is no whisper in exhibit P 1 that there was some source of light at the scene.
The omission cannot be ignored as insignificant.
When the Investigating Officer has visited the scene, he made reference to the street lights, petrol bunk light etc.
Whether the street lights and the petrol bunk/ light had been burning at the time of the occurence and the spot where the incidence happened was so located as to receive the light emanating from these sources are required to be made out by the prosecution.
When this significant fact is left out in the earliest record, the improvement in the course of the investigation and trial could be of no avail.
The fact that there had been no proof regarding the identity of the assailants until 18.8.1974 would suggest that even persons who collected at the scene in the course of the incidence or soon thereafter were not in a position to identify any one of the assailants.
Since the Investigating Officer arrived at the scene the same night and the inquest ws held in the next morning, it would have been possible for the investigating agency to collect information regarding the identity of the assailants earlier to 18.8.1974, if they had been really identified by any one of the witnesses examined in the case.
When no natural 731 light was available and the street light was at a distance it is unlikely that the eye witnesses by momentary glance of the assailants who surrounded the victim had a lasting impression and the chance of identifying the assailants without mistake.
The credibility of the evidence relating to the identification depends largely on the opportunity the witness had to observe the assailants when the crime was committed and memorize the impression.
This aspect of the matter had been stressed by the trial court in appreciating the evidence of PWs 1 and 2.
The High Court has ignored the inherent infirmity and failed to deal effectively with every important circumstance in the evidence which weighed with the trial court to disbelieve the prosecution case.
We have noticed that the magistrates in conducting the test identification parade have committed a grave error.
In the case of Accused No.6 PW 9 had mixed up along with PWs 1 and 2 a person, Gulati who knew the accused.
Similarly, in the identification of the other accused, PW 4 who claimed acquaintance with Accused Nos.2, 3 and 5 was mixed up with PWs 1 and 2.
When persons who have already known the accused persons to be identified are mixed up with the witnesses, the test identification is clearly vitiated and is futile.
Value of identification parade depends on the effectiveness and the precautions taken against the identifying witness having and opportunity of seeing the persons to be identified before they are paraded with others and also against the identifying witness being provided by the investigating authority with other unfair aid or assistance so as to facilitate the identification of the accused concerned.
Therefore, the evidence of the earlier identification in this case is unacceptable.
The testimony of PWs 1 and 2 before court is also unsafe to be acted upon.
Thus we do not consider that the view taken by the learned sessions judge on the whole was erroneous.
The overall view of the evidence taken by the learned sessions judge is reasonable and plausible, while it is true that some of the reasons given if taken individually do not appear to be substantial.
Even when two evenly balanced views of the evidence are possible one must necessarily concede the existence of a reasonable doubt.
Thus on a careful and anxious consideration of the evidence in the light of the reasoning adopted by the trial court as well as the High Court, we are of the opinion that the High Court was not justified in interfering with the order of acquittal when the identity and involvement of the appellants had not been established beyond reasonable doubt.
We accordingly allow the appeal, set aside the conviction and sentence and maintain the order of acquittal.
The bail bonds of the appellants shall stand cancelled.
TNA Appeal allowed 731 light was available and the street light was distance it is unlikely that the eye witnesses by monetary glance of the assailants who surrounded the victim had a lasting impression and the chance of identifying the assailants without mistake.
The credibility of the evidence relating to the identification depends largely on the opportunity the witness had to observe the assailants when the crime was committed and memorize the impression.
This aspect of the matter had been stressed by the trial court in appreciating the evidence of PWs 1 and 2.
The High Court has ignored the inherent infirmity and failed to deal effectively with the important circumstance in the evidence which weighted with the trial court to disbelieve the prosecution case.
We have noticed that the magistrates in conducting the test identification parade have committed a grave error.
In the case of Accused No. 6 PW 9 had mixed up along with PWs 1 and 2 a person, Gulati who knew the accused.
Similarly, in the identification of the other accused, PW 4 who claimed acquaintance with Accused Nos. 2, 3 and 5 was mixed up with PWs 1 and 2.
When persons who have already known the accused persons to be identified are mixed up with the witnesses, the test identification is clearly vitiated and is futile.
Value of identification parade depends on the the effectiveness and the precautions taken against the identifying witness having an opportunity of seeing the persons to be identified before they are paraded with others and also against the identifying witness being provided by the investigating authority with other unfair aid or assistance so as to facilitate the identification of the accused concerned.
Therefore, the evidence of the earlier identification in this case is unacceptable.
The testimony of PWs 1 and 2 before court is also unsafe to be acted upon.
Thus we do not consider that the view taken by the learned sessions judge on the whole was erroneous.
The overall view of the evidence taken by the learned sessions judge is reasonable and plausible, while it is true that some of the reasons given if taken individually do not appear to be substantial.
Even when two evenly balanced views of the evidence are possible one must necessarily concede the existence of a reasonable doubt.
Thus on a careful and anxious consideration of the evidence in the light of the reasoning adopted by the trial court as well as the High Court, we are of the opinion that the High Court was not justified in interfering with the order of acquittal when the identity and involvement of the appellants had not been established beyond reasonable doubt.
We accordingly allow the appeal, set aside the conviction and sentence and maintain the order or acquittal.
The bail bonds of the appellants shall stand cancelled.
TNA Appeal allowed.
| The appellants (A 1 to A 3 and A 5 6), along with Co accused (A 4), were prosecuted under sections 302/149 of the Indian Penal Code.
Test identification parades were conducted by the Magistrates in which A 6 was identified by PWs 1, 2, 3 and 4 and A 1, 2,3,and 5 were identified by PWs 1 and 2.
The trial court held that the identification parade was perfunctory and was of no assistance to the prosecution.
It also rejected the testimony of PWs 1 to 5 by holding that the evidence of PWs 3, 4, and 5 was untrust worthy and that it was unsafe to accept the testimony of other two eye witnesses, PWs 1 and 2 for recording a conviction.
Accordingly the trial court acquitted all the accused persons.
Against the order of acquittal, the State preferred an appeal before the High Court.
The High Court accepted the testimony of PWs 1 and 2, corroborated by the evidence of test identification parade and the testimony of PWs 3 and 4 to find the appellants guilty.
Accordingly the High Court reversed the order of acquittal and convicted the appellants.
Since A 4 was not identified by the PWs 1 to 4, he was given the benefit of doubt and the High Court confirmed his acquittal.
724 In appeal to this court under section 2 of the , it was contended on behalf of the appellants that PWs (1 and 2) were strangers to the assailants and in the circumstances of the case they did not have the opportunity to identify the assailants and consequently their testimony was not free from doubt; the trial court was right in rejecting the testimony of these witnesses but the High Court erred in reversing the order of acquittal and convicting the appellants by accepting the testimony of these witnesses.
Allowing the appeal and setting aside the order of conviction and sentence, this Court, HELD: 1.It is open to Supreme Court to re examine the evidence for the purpose of satisfying itself whether the High Court was justified in reversing the order of acquittal in the facts and circumstances of the case.
In an appeal against acquittal, the Appellate Court is empowered to evaluate the evidence and arrive at its own conclusion.
But where the view taken by the trial court on an appreciation of the evidence is also a plausible view, the Appellate Court shall be slow to interfere with it even when a different view is possible on a reappraisal of the evidence.
[728F G] 1.1 Even when two evenly balanced views of the evidence are possible one must necessarily concede the existence of a reasonable doubt.
[731F] 2.The evidence given by the witnesses before the Court is the substantive evidence.
In a case where the witness is a stranger to the accused and he identifies the accused person before the court for the first time, the court will not ordinarily accept that identification as conclusive.
It is to lend assurance to the testimony of the witnesses that evidence in the form of an earlier identification is tendered.
If the accused persons are got identified by the witness soon after their arrest and such identification does not suffer from any infirmity that circumstance lends corroboration to the evidence give by the witness before the Court.
But in a case where the evidence before the court is itself shaky, the identification before the magistrate would be of no assistance to the prosecution.
[729D E] 2.1 The credibility of the evidence relating to the identification depends largely on the opportunity the witness had to observe the assailants when the crime was committed and memorize the impression.
725 In the instant case at the scene of the crime when no natural light was available and the street light was at a distance it is unlikely that the eye witnesses by momentary glance of the assailants who surrounded the victim had a lasting impression and the chance of identifying the assailants without mistake.
Therefore the testimony of PWs 1 and 2 is unsafe to be acted upon.
The overall view of the evidence taken by the Trial Court is reasonable and plausible.
The High Court was not justified in interfering with the order of acquittal when the identity and involvement of the appellant was not established beyond reasonable doubt.[731A B, E F G, 730H] 3.
Value of identification parade depends on the effectiveness and the precautions taken against the identifying witness having an opportunity of seeing the persons to be identified before they are paraded with others and also against the identifying witness being provided by the investigating authority with other unfair aid or assistance so as to facilitate the identification of the accused concerned.
When persons who have already known the accused persons to be identified are mixed up with the witnesses the test identification is clearly vitiated and is futile.
In the instant case the magistrates in conducting the test identification parade have committed a grave error because in the case of Accused No. 6 he had mixed up along with PWs 1 and 2 a person known to the accused.
Similarly, in the identification of the other accused, PW 4 who claimed acquitance with Accused Nos. 2, 3 and 5 was mixed up with PWs 1 and 2.
[731C E]
|
Appeal No. 1864 of 1967.
Appeal under section 116 A of the Representation of the People Act, 1951 from the judgment and order dated August 21, 1967 of the Andhra Pradesh High Court in Election Petition No. 13 of 1967.
P. Ram Reddy and A.V.V. Nair, for the appellants.
681 D. Narsaraju, R.V. Pillai and A. Sitarama Reddy, for respondent No. 1 G. Narayana Rao, for respondent No. 2.
The Judgment of the Court was delivered by Mitter, J.
On April 6, 1967 the appellants before us, fled an Election Petition in the High Court of Andhra Pradesh challenging the election of the first respondent, B.N. Reddi, to the Andhra Pradesh Legislative Assembly from the Kollapur Constituency inter alia on the ground of corrupt practices committed by him, his election agent, polling agents and other workers mentioned in the schedule to the petition with his consent and praying for a declaration that the second respondent, K. Ranga Das, was duly elected from the said constituency.
The third respondent was another candidate who had contested the election but had fared very badly.
The first respondent secured 25,321 votes at the election overtopping the votes polled by the second respondent by approximately 1600.
The petitioners stated in paragraph 5 of the petition that one ' V.K. Reddi who had firfiled his nomination paper had been made to withdraw his Candidature by the first respondent on payment of an illegal gratification of a sum of Rs. 10,000/ .
This allegation was repeated in paragraph 10.
The first respondent was also charged with other corrupt practices m diverse other paragraphs of the petition.
The first respondent put in his written statement on 28th June, 1967; the second respondent put in his counter affidavit on June 26, 1967.
The issues were settled on July 24, 1967.
On August 4, 1967 the petitioners filed Application No. 161/1967 for impleading V.K. Reddi.
Thereafter they wanted to withdraw that application when the examination of witnesses had commenced.
On August 7, 1967 this application was dismissed.
On August 8, 1967 the first respondent 'filed Application No. 169/1967 praying for dismissal of the petition on the ground that although V.K. Reddi had been charged with corrupt practices he had not been impleaded as a party to the petition which was liable to be dismissed under the provisions of section 82(b) of the Representation of the People Act, 1951 (hereinafter referred to as the 'Act ') in compliance with section 86(1).
The election petitioners filed Application No. 187 of 1967 for withdrawing the allegations against V.K. Reddi, or, in the alternative, to implead him as a respondent.
They also filed Application No. 186/1967 for condoning the delay in seeking to implead V.K. Reddi in Application No. 187/1967.
The second respondent filed a number of applications of which it is necessary to take note of a few only.
Application No. 174/1967 was filed for condoning the delay in seeking to implead V.K. Reddi in Application No. 175/1967.
Application No. 175/1967 was for the purpose of 682 impleading V.K. Reddi as a party respondent to the election petition.
The learned trial Judge held that the allegations contained in election petition amounted to an imputation of corrupt practice to V.K. Reddi and although of the view that the prayer in Application No. 169/1967 for condonation of delay was allowable in suitable cases, he felt himself bound by the decision of Kumarayya, J. in Applications Nos.
150 155/1967 in Election Petition No. 11 of 1967 and dismissed the amendment application No 169/1967.
Before us a faint attempt was made to argue that the allegation against V.K. Reddi did not amount to a charge of corrupt practice but that it was the first respondent who was guilty of such a practice by making the payment of illegal gratification.
The argument has only to be set down to be rejected.
In paragraph 5 of the petition, the definite averment was that V.K. Reddi had been made to withdraw his candidature by the first respondent on payment of an illegal gratification of Rs. 10,000/ .
If the payment of Rs. 10,000/ amounts to an illegal gratification the taint attaches not only to the payer, the first respondent, but also to the payee,.
V. K. Reddi.
The second point urged was that the learned Chief Justice 's view in regard to the power of condonation of delay in impleading V.K. Reddi was correct and although he could not give effect to his own view because he felt himself bound by the decision of Kumarayya, J. we ought to accept the appeal and uphold his view.
This argument was developed as follows.
An election petition was in essence an application to the High Court for the purpose of the Indian and as such section 29(2) of the Act of 1963 was applicable to such petitions drawing in its chain the applicability of section 5 of the Act giving the court the power to admit the same if it was satisfied that the applicant had sufficient cause for not preferring the application within the prescribed period of limitation.
The Act as it now stands provides by section 80A that the court having jurisdiction to try an election petition shall be the High Court.
Under section 81 (1 ) "an election petition calling in question any election may be presented on one or more of the grounds specified in sub section
(1 ) of section 100 and section 101 to the High Court by any candidate at such election or any elector within forty five days, but not earlier than, the date of election of the returned candidate . " section 82 runs as follows : "A petitioner shall join as respondents to his petition 683 (a) where the petitioner, in addition to claiming a declaration that the election of all or any of the returned candidates is void, claims a further declaration that he himself or any other candidate has been duly elected, all the contesting candidates other than the petitioner, and where no such further declaration is claimed, all the returned candidates; and (b) any other candidate against whom allegations of any corrupt practice are made in the petition.
" Section 83 lays down inter alia that an election petition shall set forth full particulars of any corrupt practice that the petitioner alleges, including as full a statement as possible of the names of the parties alleged to have committed such corrupt practice and the date and place of the commission of such practice.
Section 86( 1 ) provides that: "The High Court shall dismiss an election petition which does not comply with the provisions of section 81, or section 82 or section 117.
" The last mentioned section relates to the giving of security for costs.
Sub section
(4) of section 86 gives any candidate not already a respondent, a right to be joined as one upon application to the High Court within fourteen days from the date of commencement of the trial and subject to any order as to security for costs which may be made.
Under sub section (5) "The High Court may, upon such terms as to.
costs and otherwise as it may deem fit, allow the particulars of any corrupt practice alleged in the petition to be amended or amplified in such manner as may in its opinion be necessary for ensuring a fair and effective trial of the petition, but shall not allow any amendment of the petition which will have the effect of introducing particulars of a corrupt practice not previously alleged in the petition.
" Sub sections
(6) and (7) aim at the speedy disposal of the election petitions.
Section 87 ( 1 ) provides that: "Subject to the provisions of this Act and of any rules made thereunder, every election petition shall be tried by the High Court, as nearly as may be, in accordance with the procedure applicable under the Code of Civil Procedure, 1908 to the trial of suits :" The proviso to the sub section gives the High Court discretion to refuse, for reasons to be recorded in writing, to examine any witness.
Sub section
(2) makes the provisions of the Indian Evidence 684 Act applicable in all respects to the trial of an election petition.
Section 98 shows the nature of the order to be made by the High Court at the conclusion of the trial of an election petition.
Section 99 makes it obligatory on the High Court while making an order under section 98 in cases where any charge is made in the petition of any corrupt practice having been committed at the election, to record a finding whether any corrupt practice has or has not been proved to have been committed at the election and the nature of that corrupt practice as also the names of all persons, if any, who have been proved at the trial to have been guilty of any corrupt practice and the nature of that practice.
There is.
a proviso to the section which lays down that a person who is not a party to the petition shall not be so named unless he has been given notice to appear before the High Court and to show cause to the contrary.
In case he does so, he is further given the right to.
cross examine any witness already examined by the High Court and to give evidence in his defence.
Entry 72 of List I of the Seventh Schedule vests in Parliament the exclusive power to make laws with respect to elections to Parliament, to the Legislatures of States and to the offices of President and Vice President as also the Election Commission.
Under article 329(b) lm15 "Notwithstanding anything in this Constitution (a) (b) no election to either House of Parliament or to the House of either House of the Legislature of a State shall be called in question except by an election petition presented to such authority and in such manner as may be provided for by or under any law made by the appropriate Legislature.
" In order to determine whether an election petition launched for the purpose of contesting the validity of an election is an application within the meaning of the Indian , it is necessary to examine the nature of the rights and liabilities involved therein and of the provisions of law which govern such determination.
The right of citizens to elect representatives of their choice either to the House of the People or to a Legislative Assembly of a State, the process of election beginning from the notification of general elections and the nomination of candidates, the general procedure at elections, taking of the poll and counting of votes and the publication of election results are all matters dealt with and covered by different provisions of the Act.
The right to elect is statutory and so are all the processes connected with the election.
There is no element of any common law right 685 in the process of election.
Part VI of the Act deals with disputes regarding election.
The second chapter of this Part shows how elections may be called in question, which courts have jurisdiction to try election petitions, how such a petition is to be presented, who are to be parties to the petition, what are to be the contents of the petition as also the relief which may be claimed by the petitioner.
The third chapter of this Part deals with the trial of election petitions.
The first section of this group makes it incumbent on the High Court to, dismiss an election petition straightaway if it does not comply with certain statutory requirements.
The next section is a guide to the procedure to be adopted by the High Court in the trial of an election petition.
This section does not equate an election petition with a suit but merely shows that subject to the provisions of the Act and.
of any rules made thereunder, the trial is to conform as nearly as possible to the trial of a suit under the Code of Civil Procedure.
This means that (a) the contestants have a right to file written statements, (b) both parties must disclose the documents on which they reply; (c) they must examine witnesses orally, if necessary, to substantiate the charges leveled or the defenses raised in the petition; and (d) the evidence to be adduced must comply with the requirements of the Indian Evidence Act.
There are however certain limitations as to the questions which may put to a witness contained in sections 94 and 95; the returned candidate has a right to recriminate under the provisions of section 97.
The High Court does not pass a decree as in the case of a suit but has to make an order in terms of section 98 which gives the nature of the orders to be made.
The High Court has to communicate the substance of its decision to the Election Commission and the Speaker or the Chairman as the case may be of the House of the People or of the State Legislature.
Chapter IV deals with withdrawal and abatement of election petitions.
Chapter IV A deals with appeals from the decisions of the High.
Court and Chapter V deals with costs and security for costs.
The above brief analysis is sufficient to show that the trial of an election petition is not the same thing as the trial of a suit.
As was pointed out by this Court in the case of Kamaraja Nadar vs Kunju Thevat(1), the provisions of the Act "go to show that an election contest is not an action at law or a suit in equity but is a purely statutory proceeding unknown to the common law . " The Court also emphasised on the peculiar character of an election petition by quoting from the observations of A. Sreenivasan vs Election Tribunal, Madras(2).
Reference was also made.
to the Tipperary case(3) where Morris, J. said: (1) at 596.
(2) 11 E.I. R. 278 at 293.
(3) 686 " . a petition is not a suit between two persons, but is a proceeding in which the constituency itself is the ' principal party interested.
" This aspect of an election petition was emphasised again in the ,case of Basappa vs Ayyappa(1) where it was held that the provisions of O. 23 r. 1 of the Code of Civil Procedure do not apply to election petitions and it would not be open to a petitioner to withdraw or abandon a part of his claim once an election petition was presented to the Election Commission.
Even though section 87 ( 1 ) of the Act lays down that the procedure applicable to the trial of an election petition shall be like that of the trial of a suit, the Act itself makes important provisions of the Code inapplicable to the trial of an election petition.
Under O. 6 r. 17 C.P.C. a court of law trying the suit has very wide powers in the matter of allowing amendments of pleadings and all amendments which will aid the court in disposing of the matters in dispute between the parties are as a rule allowed subject to the law of limitation.
But section 86(5) of the Act provides for restrictions on the power of the High Court to allow amendments.
The High Court is not to allow the amendment of a petition which will have the effect of introducing particulars of a corrupt practice not previously alleged in the petition.
With regard to the addition of parties which is possible in the case of a suit under the provisions of O. 1 r. 10 subject to the added party 's right to contend that the suit as against him was barred by limitation when he was irapleaded, no addition of parties is possible in the case of an election petition except under the provisions of sub section
(4 ) of section 86.
Section 82 shows who are necessary parties to an election petition which must be filed within 45 days from the date of election as laid down in section 81.
Under section 86(1) it is incumbent on the High Court to dismiss an election petition which does not comply with the provisions of section 81 or section 82.
Again the High Court must dismiss an election petition if security for costs be not given in terms of section 117 of the Act.
It is well settled that amendments to a petition in a civil proceeding and the addition of parties to such a proceeding are generally possible subject to the law of limitation.
But an election petition stands on a different footing.
The trial of such a petition and the powers of the court in respect thereof are all circumscribed by the Act.
The Indian of 1963 is an Act to consolidate and amend the law of limitation of suits and other proceedings and for purposes connected therewith.
The provisions of this Act will apply to all civil proceedings and some special criminal proceedings which can be taken in a court of law unless the application thereof has been excluded by any enact (1)[1959] S.C.R. 611.
687 ment: the extent of such application is governed by section 29(2) of the .
In our opinion however the cannot apply to proceedings like an election petition inasmuch as the Representation of the People Act is a complete and self contained code which does not admit of the introduction of the principles or the provisions of law contained in the Indian .
Before the recent amendment of the Representation of the People Act, election petitions had to be presented to the Election Commission and it was the Commission which was empowered under section 85 to dismiss the petition if the then provisions of section 81, section 83 and section 117 were not complied with.
It is only when the petition was not so dismissed that the Election Commission had to appoint an Election Tribunal for the trial of the petition.
Under section 85 the Commission had power to admit a petition presented after the prescribed period if it was satisfied that there was sufficient cause for the failure.
Section 90(4) of the Act of 1951 empowered the Tribunal to dismiss an election petition even if it had not been so dismissed by the Election Commission.
The Act as amended in 1966 gives the jurisdiction to try an election petition to the High Court of a State.
The provision for appeal in section 116 A was introduced in the Act for the first time in 1956 providing for an appeal from every order of the Tribunal under section 98 or section 99 to the High Court of the State in which the Tribunal was situate.
By sub section
(2) of section 116 A of the Act as amended in 1956 the High Court was, subject to the provisions of the Act, to have the same powers, jurisdiction and authority and was to follow the same procedure with respect to an appeal ' under this Chapter (Chapter IV A) as if the appeal were an appeal from an original decree passed by a court situate within the local limits of its civil appellate jurisdiction.
Sub section
(3) fixed the time limit for filing the appeal.
to a period of 30 days from the date of the order complained of.
The proviso to this sub section gave the High Court discretion to entertain an appeal after the expiry of the period of 30 days, if it was satisfied that the appellant had sufficient cause for not preferring the appeal within such period.
This section was amended again in 1966 and section 116 A( 1 ) now provides for an appeal from an order of the High Court under section 98 or section 99 to the Supreme Court on any question, whether of law or fact.
Sub section
(2 ) of the new section is on the same lines as the old sub section
(3) excepting that the Supreme Court has been substituted for the High Court and the High Court for the Tribunal in the old section.
While the Act of 1956 was in force this Court had to go into the question as to whether section 29(2) of the of 1908 would be applicable to an appeal preferred to the High Court 688 from an order of the Tribunal.
In Vidyacharan Shukla vs Khubchand Baghel (1) the main question before this.
Court was whether for the purpose of computing the period of 30 days prescribed under section 116 A(3) of the Act, the provisions, of section 12 of the could be invoked.
The High Court had proceeded on the basis that section 29(2) applied to the case of appeals under section 116 A of the Act and on that basis had held that the appeal was within time if it was 'computed after making the deductions permitted by section 12 of the .
There was a good deal of discussion in the case about the scope and extent of section 29(2).
We are no.t concerned with that in the present appeal.
According to the learned Chief Justice and Ayyangar, J. "even on the narrowest construction of the words 'different from those prescribed therefor in the first schedule ' occurring in the opening part of section 29(2), the exclusion of time provided for by article 12 of the would be permissible in computing the period of limitation for filing the appeal to the High Subba Rao, J. (as he then was) took the view that section 116 A did not provide an exhaustive and exclusive code of limitation and did not exclude the general provisions of the .
The majority view was that though the fight of appeal was conferred by section 116 A of the Act of 1951 it was still an appeal under the Code of Civil Procedure and to attract article 156 of the First Schedule to the , it was not necessary for an appeal to be an appeal under the Code of Civil Procedure in that the right to prefer the appeal should be conferred by the said Code.
In our view.
sub section
(2 ) of section 116 A empowered the High Court to treat an appeal under that section presented to it as if it were an appeal from an original decree passed by a court within the local limits of its civil appellate jurisdiction.
Consequently, the jurisdiction, powers and authority of the High Court would be the same as in an appeal from an original decree of a lower court.
In other words, in entertaining the appeal and disposing of it the High Court could exercise the same powers as were available to it in an appeal from a decree of a lower court.
To such an appeal the powers of the High Court under section 12 of the would necessarily 130 attracted, Mr. Ram Reddy attempted to press that decision to service in the appeal before us.
In our view, the situation now obtaining in an appeal to this Court from an order of the High Court is entirely different.
There is no section in the Act as it now stands which equates an order made by the High Court under section 98 or Is.
99 to a decree passed by a civil court subordinate to the High (1) ; 689 Court.
An appeal being a creature of a statute, the rights conferred on the appellant must be found within the four corners of the Act.
Sub section
(2) of the present section 116 A expressly gives this Court the discretion and authority to entertain an appeal after the expiry of the period of thirty days.
No right is however given to the High Court to entertain an election petition which does not comply with the provisions of section 81, section 82 or section 117.
It was argued that if a petition were to be thrown out merely because a necessary party had not been joined within the period of 45 days no enquiry into the corrupt practices alleged to have been committed at certain elections would be possible.
This is however a matter which can be set right only by the Legislature.
It is worthy of note that although the Act has been amended on several occasions, a provision like section 86(1) as it now stands has always been on the statute book but whereas in the Act of 1951 the discretion was given to the Election Commission to entertain a petition beyond the period fixed if it was satisfied as to the cause for delay no such saving clause is to be found now.
The legislature in its wisdom has made the observance of certain formalities and provisions obligatory and failure in that respect can only be visited with a dismissal of the petition.
It is to be noted however that even though the Indian does not apply to an election petition provisions like sections 9 and 10 of the providing for computation of time which are in pari materia with sections 12( 1 ) and 4 of the would apply to such a petition.
The last submission of counsel for the appellants was that the failure to implead V.K. Reddi did not make the election petition liable to dismissal under section 86 (1 ).
It was argued that after V.K. Reddi had withdrawn from contest he was no longer a candidate within the meaning of section 79(b) or 82(b) of the Act.
In our opinion, it is not open to him to argue that point in view of the decision of this Court in Hat Swarup vs Brij Bhushan(1).
It is to be noted that this decision does not stand by itself.
In Mohan Singh vs Bhanwarlal(2) an attempt was made to get the election petition dismissed in limine on the ground that one of the candidates at the election, namely, Himmat Singh, against whom allegations of corrupt practice were made in regard to withdrawal of his candidature was not joined as a respondent.
It was held by this Court that a mere offer to help in getting employment was not an offer of gratification within the meaning of section 123(1)(B) of the Act.
The Court however observed: "If therefore the petition contained any imputation of corrupt practice made against Himmat Singh, it could (1) ; (2) ; 690 not be regarded as properly constituted unless he was impleaded as a respondent, for, by the defmition of "candidate" in section 79(b), the expression "any other candidate" in section 82(b) must include a candidate who had withdrawn Iris candidature." (see at p. 18 ).
Reference may also be made to Amin Lal vs Hunna Mal(1).
It was however sought to be argued that section 99 enjoined upon the High Court to name all persons who had been proved at the trial to have been guilty of any corrupt practice and where such a person who not a party to the petition, he was not to be so named unless he had been given notice to appear before the High Court and asked to show cause why he should not be so named and if he chose to appear, he was to be given an opportunity of crossexamining any witness already examined by the High Court and of calling evidence in his own defence and of being heard.
This provision, to our mind, only enjoins upon the High Court to give an opportunity to a person sought to be held guilty of a corrupt practice if he was not a party to the petition, but it does not apply to a person who is a necessary party thereto.
An obvious case for the use of powers.
under section 99 would be that of an agent guilty of commission of a corrupt practice with the consent of the candidate.
Such a person would not be a necessary party to the petition but he must have an opportunity of showing cause and of being heard before the High Court can name him as guilty of a corrupt practice while making an order under section 98.
In our opinion, the appeal has no merits and must be dismissed with costs.
G.C. Appeal dismissed.
| The appellant creditor lent moneys to the first respondent on the guarantee of the second respondent.
, The appellant filed a suit against the respondents for recovery of the amount due.
and the suit was decreed.
While passing the decree, the Trial Court directed that the appellant would not be at liberty to enforce the decree against the second respondent ' until he had exhausted his remedies against the first respondent.
The appellant challenged this direction.
The High Court dismissed the appeal.
In appeal on certificate, this Court : HELD: The direction must be set aside.
In the absence of some special equity the surety has no right to restrain execution against him until the creditor has exhausted his remedies against the principal.
For making an order under O.XX r. 11 (1 ) of C.P.C. the court must give specific reasons.
The direction postponing payment of the amount decreed must be clear and specific.
The injunction upon the creditor not to proceed against the surety until the creditor has exhausted his remedies against the principal was of the vaguest character.
It was not stated how and when the creditor would exhaust his remedies against the principal.
[622 A, F G] It is the duty of the surety to pay the decretal amount.
On such payment he will be subrogated to the rights of the creditor under section 140 of the Indian Contract Act.
and he may then recover the amount from the principal.
The very object of the guarantee is defeated if the creditor is asked to postpone his remedies against the surety.
In the present case the creditor is banking company.
A guarantee is a collateral security usually taken by a banker.
The security will become useless if his rights against the surety can be so easily cut down.
The impugned direction cannot be justified under O.XX r. 11 (1).
Assuming that apart from O.XX r. 11(1) the Court had the inherent power under section 151 to direct postponement of the execution of the decree, the ends of justice did not require such postponement.
[623 A C] Lachhman ,Joharimal V. Bapu Khandu and Surety Tukaram Khandoji, (1869) 4 Bom.
High Court Reports, 241.
|
o. 115 of 1956, and Petition No. 132 of 1956.
Petitions under Article 32 of the Constitution of India for the enforcement of fundamental rights.
B. D. Sharma, for the petitioners.
C. K. Daphtary, Solicitor General of India, Porus A. Mehta and R. H. Dhebar, for the respondents, 651 1957.
February 13.
The Judgment of the Court was delivered by section K. DAS J.
These two petitions for the issue of appropriate writs restraining the respondents from prosecuting and trying the two petitioners 'on certain criminal charges in circumstances to be presently stated, raise the same question of law and have been heard together.
This judgment will govern them both.
Baij Nath Prasad Tripathi, petitioner in Petition No. 115 of 1956, was a Sub inspector of Police in the then State of Bhopal.
He was prosecuted in the Court of Shri B. K. Puranik, Special Judge, Bhopal, and convicted of offences under section 161, Indian Penal Code, and section 5 of the Prevention of Corruption Act, 1947.
He was sentenced to nine months ' rigorous imprisonment on each count.
He preferred an appeal against the conviction and sentences to the Judicial Commissioner of Bhopal.
The Judicial Commissioner held by his judGment dated March 7, 1956, that no sanction according to law had been given for the prosecution of the petitioner and the Special JudGe had no jurisdiction to take cognizance of the case; the trial was accordingly ab initio invalid and liable to be quashed.
He accordingly set aside the conviction and quashed the entire proceedings before the Special Judge.
He then observed: "The parties would thus be relegated to the position as if no legal charge sheet had been submitted against the appellant." On April 4, 1956, the Chief Commissioner of Bhopal passed an order under section 7(2) of the Criminal Law Amendment Act, 1952 (No. XLVI of 1952) that the petitioner shall be tried by Shri section N. Shri vastava, Special Judge, Bhopal, for certain offences under the Prevention of Corruption Act read with section 161, Indian Penal Code.
The case of the petitioner is that he cannot be prosecuted and tried again for the same offences under the aforesaid order of April 4, 1956.
Sudhakar Dube, petitioner in Petition No. 132 of.
1956, was also a Sub Inspector of Police in the then State of Bhopal.
He was also prosecuted in the Court of Shri B. K. Puranik, Special Judge, Bhopal, on a 84 652 charge of having accepted illegal gratification for showing official favour to one Panna Lal.
The learned Special Judge by an order dated January 10, 1956, came to the conclusion that no legal sanction for the prosecution of the petitioner had been given by the competent authority and the sanction given by the Inspector.
General of Police was not valid in law; he therefore held that the whole trial was null and void and he could not take cognizance of the offences in question.
Accordingly he quashed the proceedings.
On February 7, 1956, the Chief Secretary to the Government of Bhopal accorded fresh sanction for the prosecution of the petitioner for offences under section 161, Indian Penal Code, and section 5 of the Prevention of Corruption Act.
The petitioner then moved this Court for appropriate writs restraining the respondents from prosecuting and trying him for the offences stated in the fresh sanction aforesaid.
On behalf of both the petitioners the contention is that by reason of cl.
(2) of article 20 of the Constitution and section 403 of the Code of Criminal Procedure, the petitioners cannot now be tried 'for the offences in question.
It is necessary to read here some of the relevant sections bearing on the point at issue.
Section 6 of the Criminal Law Amendment Act, 1952 (prior to the amendment made in 1955), so far as is relevant for our purpose, is in these terms : "6.
(1) The State Government may, by notification in the Official Gazette, appoint as many special Judges as may be necessary for such area or areas as may be specified in the notification Co try the following offences, namely: (a) an offence punishable under section 161, section 165, or section 165 A of the Indian Penal Code (Act XLV of 1860), or sub section (2) of section 5 of the Prevention of Corruption Act, 1947 (II of 1947); (b) any conspiracy to commit or any attempt to commit or any abetment of any of the offences specified in clause (a" '.
Sub section (1) of section 7 of the same Act lays down: "7.
(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1898 (Act V of 1898) or in 655 any other law the offences specified in subsection (I of section 6 shall be triable by special Judges only".
The same section also states that when trying any case, a special Judge may also try any offence other than an offence specified in section 6 with which the accused may, under the Code of Criminal Procedure, 1898, be charged at the same trial.
It is not necessary for our purpose to read the other sections "of the Criminal Law Amendment Act, 1952.
We then go to the Prevention of Corruption Act, 1947, section 6 whereof is relevant for our purpose.
That section is in these terms: " 6.
(1) No Court shall, take cognizance of an offence punishable under section 16l or section 165 of the Indian Penal Code or under sub section (2) of section 5 of this Act, alleged to have been committed by a public servant except with the previous sanction,(a) in the case of a person who is employed in connection with the affairs of the Union and is not removable from his office save by or with the sanction of the Central Government. . [of the] Central Government; (b) in the case of a person who is employed in connection with the affairs of [a State] and is not removable from his office save by or with the sanction of the State Government. . . [of the] State Government; (c) in the case of any other person, of the authority competent to remove him from his office.
(2) Where for any reason whatsoever any doubt arises whether the previous sanction as required under sub section (1) should be given by the Central or State Government or any other authority, such sanction shall be given by that Government or authority which would have been competent to remove, the public servant from his office at the time when the offence was alleged to have been committed.
" It is under this section that sanction was necessary for the prosecution of the petitioners.
Clause (2) of article 20 of the Constitution, on which the petitioners rely, states: 654 "No person shall be prosecuted and punished for the same offence more than once.
" Section 403 (1) of the Code of Criminal Procedure, on which learned counsel for the petitioners has placed the greatest reliance, is in these terms: " A person who has once been tried by a Court of competent jurisdiction for ail offence and convicted or acquitted of such offence shall, while such conviction or acquittal remains in force, not be liable to be tried again for the same offence, nor on the same facts for any other offence for which a different charge from the one made against him might have been made under section 236, or for which he might have been convicted under section 237." Now, it is necessary to state that the point taken by learned counsel for the petitioners is really concluded by three decisions (a) one of the Privy Council,(b) another of the Federal Court and (c) the third of this Court itself.
The Privy Council decision is in Yusofalli Mulla vs The King (1); the Federal Court decision in Basdeo Agarwalla vs King Emperor (2) ; and the decision of this Court (not yet reported) was given in Budha Mal vs State of Delhi (3) on October 3, 1952.
The Privy Council decision is directly in point, and it was there held that the whole basis of section 403 (1) was that the first trial should have been before a Court competent to hear and determine the case and to record a verdict of conviction or acquittal; if the Court was not so competent, as for example where the required sanction for the prosecution was not obtained, it was irrelevant that it was competent to try other cases of the same class or indeed the case against the particular accused in different circumstances, for example if a sanction had been obtained.
So is the decision of this Court where the following observations were made with regard to the point in question: " Section 403, Criminal Procedure Code, applies to cases where the acquittal order has been made by a Court of competent jurisdiction but it does not bar (1) A.I.R. 1949 P.C. 264.
(2) (3) Criminal Appeal No. 17 Of 1952 decided on October 3, 1952.
655 a retrial of the accused in cases where such an order has been made by a court which had no jurisdiction to take cognizance of the case.
It is quite apparent on this record that in the absence of a valid sanction the trial of the appellant in the first instance was by: a magistrate who had no jurisdiction to try him.
" After the pronouncements made in the decisions referred to above, it is really unnecessary to embark on a further or fuller discussion of the point raised, except merely to state that we have heard learned counsel for the petitioners who made a vain attempt with a crusading pertinacity worthy of a better cause, to show that the Privy Council decision was wrong and the decision of this Court required reconsideration, and having heard learned counsel in full, we are of the view that the decisions referred to above state the legal position correctly.
It is clear beyond any doubt that el.
(2) of article 20 of the Constitution has no application in these two cases.
The petitioners are not being prosecuted and punished for the same offence more than once,, the earlier proceedings having been held to be null and void.
With regard to section 403, Code of Criminal Procedure, it is enough to state that the petitioners were not tried, in the earlier proceedings, by a Court of competent jurisdiction, nor is there any conviction or acquittal in force within the meaning of section 403.
(1) of the Code, to stand as a bar against their trial for the same offences.
Learned counsel for the petitioners invited our attention to sections 190, 191, 192, 529 and 530 of the Code of Criminal Procedure and submitted that in certain circumstances the Code drew a distinction between 'jurisdiction ' and I taking cognizance '.
The whole fabric of the argument of learned counsel was founded on this distinction.
Assuming, however, that in certain cases one Magistrate may take cognizance and another Magistrate may try an accused person, it is difficult to appreciate how any Court can try the petitioners of these cases in the absence of a sanction in view of the mandatory provisions of section 6 of the Prevention of Corruption Act, 1947.
If no Court can take cognizance of the offences in question without a legal sanction, it is obvious 666 that no Court can be said to be a Court of competent jurisdiction to try those offences and that any trial in the absence of such sanction must be null and void, and the sections of the Code on which learned counsel 1 for the petitioners relied have really No. bearing on the matter.
Section 530 of the Code is really against the contention of learned counsel, for it states, inter alia, that if any Magistrate not being empowered by law to try all offender, tries him, then the proceedings shall be void.
Section 529 (e) is merely an exception in the matter of taking cognizance of an offence under section 190, sub section
(1), cls.
(a) and (b); it has no bearing in a case where sanction is necessary and no sanction in accordance with law has been obtained.
As part of his arguments, learned counsel for the petitioners referred to certain observations made by Braund J. in a decision of the Allahabad High Court, Basdeo vs Emperor (1), where the learned Judge drew a distinction between 'taking cognizance ' and 'jurisdiction '.
The distinction was drawn in a case where a Magistrate duly empowered to commit cases to the Sessions Court committed ail accused person to the Court of Session in disregard of the provisions of section 254 of the Code of Criminal Procedure, and the question was whether the irregularity so committed rendered the Sessions Court incompetent to try the case.
The facts there were entirely different from the facts of the present cases and there was no occasion nor necessity for considering such mandatory provisions as are contained in section 6 of the Prevention of Corruption Act.
We do not think that the observations made in that case can be pressed in service in support of the argument of learned counsel for the petitioners in these cases, treating those observations as though they laid down any abstract propositions of law not dependent on the context of the facts in connection with which they were made.
Out of deference to learned counsel for the petitioners, we have indicated and considered very briefly the arguments advanced before us.
As we have said (1) A.I.R. T045 All.
657 before, the point is really concluded by decisions of the highest tribunal, decisions which correctly lay down the law.
The result therefore is that these petitions are devoid of all merit and must be dismissed.
Petitions dismissed.
| The petitioner who was detained under sec.
3(2) of the , was conveyed seven grounds of detention by the Detaining Authority.
The first two grounds related to the incidents that occurred more than 5 years and about 3 years respectively prior to the date of the order of detention.
The petitioner challenged the order of detention as vitiated on account of the grounds of detention being vague and stale.
Allowing the writ petition by majority, HELD: The order of detention is quashed.
(Per Chinnappa Reddy and Varadarajan, JJ.) It is not open to the Detaining Authority to pick up an old and stale incident and hold it as the basis of an order of detention under S 3(2) of the Act.
Nor it is open to the Detaining Authority to contend that it has been mentioned only to show that the detenu has a tendency to create problems resulting in disturbance to public order, for as a matter of fact it has been mentioned as a ground of detention.
[327 E F] Shalini Soni vs Union of India, ; ; Mehdi Mohamed Joudi vs State of Maharashtra, ; Taramati Chandulal vs State of Maharashtra AIR 1981 SC 871; and Shibban Lal Saksena vs The State of Uttar Pradesh, referred to.
In the instant case the first two incidents which are of 1978 and 1980 are mentioned as grounds of detention in the order dated 6 5 1983.
There can be no doubt that these grounds especially grounds No. 1 relating to an incident of 1978 are too remote and not proximate to the order of detention.
[327 D E] There is no provision in the similar to s.5A of the which says that where a person has been detained in pursuance of an order of detention under sub sec.
(1) of S.3 which has been 318 made on two or more grounds, such order of detention shall be deemed to have been made separately on each of such grounds and accordingly (a) such order shall not be deemed to be invalid or inoperative merely because one or some of the grounds is or are vague, non existent, non relevant, not connected or not proximately connected with such persons or invalid for any other reason, and it is not therefore possible to hold that the Government or officer making such order would have been satisfied as provided in sub sec.
(1) of s.3 with reference to the remaining ground or grounds and made the order of detention and (b) the Government or officer making the order of detention shall be deemed to have made the order of detention under the said sub sec.
(1) after being satisfied as provided in that sub section with reference to the remaining ground or grounds.
[327 F H; 328 A] In the present case, therefore, it cannot be postulated what view would have been taken by the Detaining Authority about the need to detain the petitioner under sec.
3(2) of the Act if he had not taken into account the stale and not proximate grounds 1 and 2 into consideration in arriving at the subjective satisfaction.
[328 A B] (Per Desai J.) When criminal activity of a person leads to such a drastic action as detention without trial, ordinarily a single stray incident may not unless contrary is shown be sufficient to invoke such drastic power of preventive detention.
In order to avoid the charge that a stray incident was seized upon to invoke such drastic power of preventive detention the authority charged with a duty to maintain public order of assure security of the State, may keep a close watch on the activities of the miscreant for some time and repeated indulgence into prejudicial activity may permit an inference that unless preventive detention is resorted to, it would not be possible to wean away such person from such prejudicial activity.
[319 G H; 320 A B] In the instant case therefore, when in 1983, an action was proposed to be taken under sub sec.
(2) of sec.
3, the Detaining Authority examined the history of the criminal activity of the detenu and took into account a continuous course of conduct which may permit an inference that unless interdicted by a detention order, such activity cannot be put to an end the power under sub sec.
(2) of sec.
3 is exercised.
[320 B C] If there is a big time lag between the last of the events leading to the detention order being made and the remote earlier event, the same cannot be treated as showing a continuity of criminal activity.
But if events in close proximity with each other are taken into account for drawing a permissible inference that these are not stray or spasmodic events but disclose a continuous prejudicial activity, the reference to earlier events cannot be styled as stale or remote which would vitiate the order of detention.
[320 D E] In the instant case if each event is examined in close proximity with each other, the events of 1978 and 1980 referred to in grounds Nos. 1 and 2 cannot be rejected as a stray or not proximate to the making of the detention order.
319 But they provide the genesis of the continuity of the prejudicial activity of the detenu and they appear to have been relied upon for that limited purpose.
[321 A B] Gora vs State of West Bengal, ; ; Smt.
Rekhaben Virendra Kapadia vs State of Gujarat and Ors.
,[1979] 2 S.C.C. 566; and Firrat Raza Khan vs State of Uttar Pradesh and Ors., , referred to.
|
N: Criminal Appeal No. 285 of 1983 Appeal by Special leave from the Judgment and order dated the 15th December, 1980 of the Karnataka High Court in Crl.
A. No. 590 of 1979.
M. Veerappa for the Appellant.
Vimal Bobde A.C, and P.R. Ramasish for the Respondent.
The Judgment of the Court was delivered by SEN, J.
This appeal by special leave is directed against a judgment of the Karnataka High Court dated December 15, 1980 affirming the order of acquittal passed by the Munsiff & Judicial Magistrate First Class, Krishnarajanagar dated July 10, 1979 acquitting the respondent of an offence punishable under sections 39 and 44 of the read with section 379 of Indian Penal Code.
The prosecution case in brief was as follows.
On August 25, 1976 at about 12 noon P.W. 1 Syed Ameer, Supervisor, Karnataka Electricity Board, went to the house of the respondent on a routine inspection to check the electric meter installed there.
He found the meter board at the entrance and though the meter was not recording consumption of electric energy, the lights and fans were on.
It appeared that the respondent had tampered with the main connection by fixing two switches to the wall of the house and by operating the 251 switches the lights and fans inside the house could be used without the meter recording any consumption.
Later in the day, he along A with the Assistant Engineer attached to the Karnataka Electricity Board, Krishnarajanagar and the Junior Engineer went to the house of the respondent and saw that there was theft of electric energy.
Accordingly, on the direction of the Assistant Engineer, P.W. 1 Syed Ameer lodged a report with the police exhibit P l.
After an investigation into the complaint, the Krishanrajanagar police filed a challan.
The prosecution led evidence of five witnesses including that of P.W. 1 Syed Ameer, Supervisor and P.W. 2 Bheemanna, Junior Engineer to substantiate the charge.
The learned trying Magistrate however acquitted the respondent of the offence with which he was charged under section 248 (1) of the Code of Criminal Procedure, 1973 on the ground that the prosecution had failed to establish that P.W. 1 Syed Ameer had been authorized to lodge a complaint.
On a reading of section SO the Act, he held that a Junior Engineer of the Electricity Board could lodge a complaint but not the Supervisor, and the mere presence of the Junior Engineer after detection of the theft, does not imply that the Supervisor had been authorised to lodge a complaint.
The High Court has upheld the order of acquittal passed by the learned trying Magistrate on the ground that the notification issued by the Karnataka Electricity Board authorizing Junior Engineers, Section officers and Supervisors to institute prosecutions in terms of section SO of the Act not having been published in the official Gazette, the Court could not take judicial notice of any such notification and it was for the prosecution to lead evidence in proof thereof to establish that P.W. 1 Syed Ameer was competent to lodge a complaint.
lt rejected a prayer of the learned public prosecutor to lead additional evidence in proof of the notification on the ground that would be tantamount to allowing the prosecution to fill up a lacuna in the case.
The decision of the appeal must turn on the construction of section SO of the Act which reads as follows: "50.
Institution of prosecutions No prosecution shall be instituted against any person for any offence against this Act or any rule, licence or order thereunder, except at the instance of the Government or an Electrical Inspector, or of a person aggrieved by the same." According to the plain English language, the ordinary meaning of the phrase "at the instance of" in the collocation of words "No 252 prosecution shall be instituted . except at the instance of" A must, in the context in which it appears, mean 'at the behest of, or, at the solicitation of '.
The word 'instance ' as a verb means "to urge, entreat urgently, importune".
The meaning of the phrase "at the instance of" as given in Random House Dictionary of the English Language at p. 690 is: 'at the urging or suggestion of '. 'Instance ' does not imply the same degree of obligation to obey as does 'command '.
That is also the legal sense in which the phrase "at the instance of" in section 50 of the Act has been understood.
It is clear upon the terms of section SO that it nowhere requires that the authorization should be by a notification published in the official Gazette.
The order of acquittal recorded by the learned Magistrate and as affirmed by the High Court proceeds on a construction of section SO of the Act which is wholly unwarranted and has resulted in manifest miscarriage of justice.
There can be no doubt that the prosecution had been launched "at the instance of ' ' the Electricity Board within the meaning of section SO of the Act.
The Karnataka Electricity Board which is a statutory body had issued a notification No. KEB/A5/ 6053/7374/SOL/401/72 dated April 18, 1974 which finds place in the Karnataka Electricity Board Manual, Vol. 1, 2nd edn.
at p. 80 which is to the following effect: Section 134 (4) (iv): Superintending Engineers, Executive Engineers, Assistant Engineers, Junior Engineers, Section officers and Supervisors are authorised to institute prosecutions or make complaints to the jurisdictional officers in charge of Police Stations, for instituting prosecutions when offences under any of the Sections 39, 41, 43 and 44 of the Electricity Act or Rule 56 read with Rule 138 of the Electricity Rules are committed or are reasonably believed to have been committed in their respective jurisdictions.
" The matter is no longer res integra.
In Ram Chander Prasad Sharma vs State of Bihar & Anr.(l) the Court observed: "It is true that Bhattacharya was not himself a "person aggrieved" and that the "person aggrieved" was 253 the P.E.S. Co. The P.E.S. Co. however.
is a body corporate and must act only through its directors or officers.
A Here we have the evidence of Ramaswami to the effect that he held a general power of attorney from the P.E.S. Co., and that he was specifically empowered thereunder to act on behalf of P.E.S. Co., in all legal proceedings.
The evidence shows that it was at his instance that Bhattacharya launched the first information report and, therefore, it would follow that the law was set in motion by the "person aggrieved".
" Interpreting the phrase "at the instance" in section SO of the Act, the Allahabad High Court in Vishwanath vs Emperor(l) stated: "If it had been the intention of the Legislature that no case should be instituted in Court except by the Electric Company itself or the other persons mentioned in section 50 of the Act, the Legislature would, we think have used the ordinary phrase "on the complaint of" and the section would have been on the lines that no Magistrate should take cognizance of any offence referred to in section SO of the Act, except upon the complaint of certain persons.
The phrase "at the instance of" means merely "at the solicitation of or at the request of".
" In that case the prosecution was in fact launched by the police at the behest of the electric supply company and the High Court held that there could be no doubt that the company desired that the accused should be prosecuted for the offences.
The officers of the company had discovered the theft and they had, as here, reported the matter to the police and asked the police to make an investigation, as in the instant case.
Upon these facts, the Allahabad High Court held that the prosecution had been launched at the instance of the electric supply company within the meaning of section SO of the Act.
That construction of section SO of the Act by the Allahabad High Court in Vishwanath 's case, supra, has throughout been followed.
We find that the Delhi High Court in State (Delhi Administration vs Dharam Pal(2) as well as the Karnataka High Court in State 254 of Karnataka vs Abdul Nabi(l) have taken the same view placing A emphasis on the circular issued by the General Manager laying down the procedure to be followed in launching prosecutions of theft of electricity which was in terms similar to the notification issued by the Karnataka Electricity Board.
It is unfortunate that the learned Judges of the Karnataka High Court should have disregarded their earlier judgment in Abdul Nabi 's case, (supra) more so, when one of them was a member to the earlier Bench.
After referring to the judgment of the Allahabad High Court in Vishwanath 's case (supra) as to the meaning of the phrase "at the instance of. ', the High Court had earlier observed in Abdul Nabi 's case, (supra): "Where, therefore, a person acting for and on behalf of the Board lodges a complaint with Police in respect of unlawful extraction of electric energy and the police in turn file a charge sheet, the prosecution must be regarded as instituted at the instance of the Board.
" In the instant case, the High Court refers to the concession of the learned Government Advocate that 'the notification had not been published in the official Gazette ' and observes: "In that view of the matter, it is plain that this Court cannot take judicial notice of existence of such notification and the facts contained in that notification.
The prosecution ought to have led in evidence on producing this notification to establish that P.W. I was legally authorized to prosecute within the meaning of section SO of the Act.
It has failed to do so.
" It appears that the High Court was obviously misled by the use of the word 'notification ' contained in the Manual.
The Karnataka Electricity Board is constituted under section 5 of the .
Under section 12 of that Act, the Electricity Board is a body corporate having perpetual succession and a common seal.
The Electricity Board therefore is an artificial person and depends on its officers and servants to carry out its powers, functions and duties.
The aforesaid notification is a general order issued by the Electricity Board in terms of section 50 of the Act authorizing the Superintending Engineers, Executive Engineers, Assistant Engineers, Junior Engineers, Section Officers and Supervisors to institute prosecutions or 255 make complaints to the police for instituting prosecutions offences under any of the Sections 39, 41, 43 and 44 of the Electricity Act or A Rule 56 read with Rule 138 of the Electricity Rules are committed or are reasonably believed to have been committed in their respective jurisdictions.
It was an internal matter for the Electricity Board and it is quite clear upon the terms of section SO that P.W. I Syed Ameer, Supervisor was authorized to lodge a complaint with the police.
The Electricity Board being a public authority, it was sufficient for the prosecution to have placed on record a copy of the Manual containing the relevant notification.
That was sufficient proof of the authorization requisite under section 50 of the .
It may not be out of place to mention that even if the requirement of section SO of the Act were that the authorization should have been by a notification published in the Official Gazette, that would hardly make a difference.
The phrase "by notification in the official Gazette" occurs in section 6(1) of the Criminal Law Amendment Act, 1952 and it is also occurred in.
section 16 of the Criminal Law Amendment Act, 1908 and section 22 of the Code of Criminal Procedure, 1908.
In Balkrishan Anant vs Emperor(1), Beaumont C.J. while dealing with section 16 of the Criminal Law Amendment Act, 1908 which empowered the local Government by notification in the official Gazette to declare an association unlawful on the grounds mentioned therein which are in effect that the association constitutes a danger to the public peace, observed: "The word used in section 16 is 'notification ' and not 'insertion '. 'Notification ' is defined in Webster 's Dictionary as "Act of notifying; act of making known; an intimation or notice; esp., act of giving official notice or information by words, by writing, or by other means;" so that the essence of notification is the giving of notice, and in my opinion, the words "by notification in the official Gazette" mean simply "by giving notice in the official Gazette.
" In the context of section 16 of the Criminal Law Amendment Act, 1908 the Court required a stricter proof that all the formalities requisite to the act of notifying or in other words, publishing the notification had actually been carried out.
That was because the law under 256 which it was issued trenched upon the rights and liberties of the citizens.
Finally, a few words on the merits.
On a consideration of the evidence adduced, the learned Munsiff came to the conclusion that the prosecution had established its case against the respondent beyond all reasonable doubt, but on a misconstruction of section SO of the Act, acquitted him under section 248(1) of the Code.
In maintaining the order of acquittal, the High Court confined its decision on its interpretation of section 50 of the Act and has not touched upon the merits We have gone through the evidence and we are satisfied that the evidence led by the prosecution is sufficient to raise an inference of guilt against the respondent.
This is not contested by learned counsel for the respondent, but he only pleads that a lenient view should be taken in regard to the punishment.
For these reasons, the appeal succeeds and is allowed.
The judgment of the High Court of Karnataka upholding the order of acquittal of the respondent is set aside and he is convicted of having committed an offence punishable under section 39 of the read with section 379 of the Indian Penal Code, 1860.
The learned standing counsel made it clear at the time of grant of special leave that the State Government was only desirous that the law on the point should be settled and it was not interested in the imposition of a punishment on the respondent.
In view of this, we do not impose any sentence on the respondent, having regard to the period of time that has elapsed.
We are thankful to Shri V. A. Bobde who appeared as amicus curiae for the assistance that he has rendered.
P.B.R. Appeal allowed.
| On a routine inspection a Supervisor of the State Electricity Board found that by tampering with the electric connection, the respondent was using switches, lights and fans inside the house without the meter recording any consumption.
On the direction of the Assistant Engineer he lodged a report against the respondent with the police alleging theft of electricity by him.
The trying Magistrate acquitted the respondent of the offence with which he was charged on the ground that section SO of the did not authorise the Supervisor to lodge a complaint.
The High Court upheld the Magistrate 's order holding that the notification issued by the Electricity Board authorizing, among others, supervisors to institute prosecutions in terms of section SO not having been published in the official Gazette, the Court could not take judicial notice of it and that the prosecution had failed to establish that the supervisor was competent to lodge the complaint.
Allowing the appeal, ^ HELD .
The order of acquittal recorded by the Magistrate as affirmed by the High Court proceeds on a construction of section 50 of the Act which is wholly unwarranted and has resulted in manifest miscarriage of justice.
Section 50 of the Act nowhere requires that the authorisation should be by a notification published in the official Gazette.
The prosecution had been launched `at the instance of the Electricity Board within the meaning of section 50 of the Act.
The meaning of the phrase 'at the instance of ' does not imply the same degree of obligation to obey as does 'command '.
That is also the legal sense in which the phrase has been understood in section SO of the Act: [252 B C Dl Ram Chander Prasad Sharma vs State of Bihar & Anr, referred to.
Vishwanath vs Emperor AIR 1936 All. 742; State (Dehli Administration) vs Dharm Pal ; State of Karnataka vs Abdul Nabi approved.
250 The High Court was misled by the use of the word 'notification ' contained in the manual.
The notification is a general order issued by the Board in terms of section 50 authorising certain of its officials to institute prosecutions or make complaints to the police for instituting prosecutions for offences under certain sections of the Act.
It was an internal matter for the Electricity Board.
It is quite clear upon the terms of section SO that the Supervisor was authorised to lodge a complaint with the police.
The Board, being a public authority, it was sufficient for the prosecution to have placed on record a copy of the manual containing the relevant notifications.
That was sufficient proof of the authorisation requisite under section 50 of the Act.
A C] Even if the requirement of section 50 was that the authorisation should have been by a notification published in the official Gazette that would have hardly made a difference.
[255 C D]
|
ivil Appeal Nos.
2255 56 of 1979.
From the Judgment and order dated 20.12.1978 of the Rajasthan High Court in Special Appeal Nos. 40 and 39 of 196.
V.M. Tarkunde, Tapas C. Ray, Chandmal Lodha, S.K. Jain, Dalveer Bhandari and Badridas Sharma for the appearing parties.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
These are appeals by special leave.
Two of them being Civil Appeals 2255 and 2256 of 1979 are by the Municipal Board of Abu Road.
The rest of the appeals are by assessees living within the municipal area of Sujangarh.
The common ques 586 tion involved in these appeals is as to whether the levy of octroi by different municipalities within the State of Rajasthan on varying basis some on weight of the material and others on the ad valorem basis of the price thereof at varying rates is valid in law.
l he High Court decided against the Abu Road municipality while a different bench of that Court in the cases of Sujangarh municipality decided in its favour on the same question.
Entry 52 of List II of Schedule VII read with Article 246(3) of the Constitution authorises the State Legislature to raise a tax on the entry of goods into a local area for consumption, use or sale.
The Rajasthan Municipalities Act, 1959 (hereinafter referred to as the Act) in Chapter VII makes provisions for imposition of taxes.
Section 104 deals with obligatory taxes while section 105 authorises imposition of other taxes.
As far as relevant, section 104 provides: "(1) Every Board shall levy, at such rate and from such date as the State Government may in each case direct by notification in the official gazette and in such manner as is laid down in this Act and as may be provided in the rules made by the State Government in this behalf, the following taxes, namely (i) . . . . . . (ii) an octroi on goods and animals brought within the limits of the municipality for consumption, use or sale therein; and (iii). . . . . . . . . . . (2) A direction under sub section (1) may provide for the levy of taxes at different rates in different municipalities having regard to their varying local conditions and needs, and on the same considerations and by a like direction, the State Government may, from time to time (i) vary uniformally or differently in relation to different municipalities, the rates of taxes levied, or ( (ii). . . . . . 587 Abu Road municipality prior to 1956 was a part of the State of Bombay and with effect from Ist November 1956, as a result of the States Reorganisation Act of 1956, became a part of the State of Rajasthan.
While within the State of Bombay the Abu Road municipality had prescribed octroi duty on cloth at the rate of 1.9 annas per cent ad valorem and the rate continued till it was varied after promulgation of the Rajasthan Municipalities Act of 1959.
The rates in cities like Jaipur were on the basis of weight.
Judicial notice can be taken of the fact that the areas which now constitute the State of Rajasthan prior to independence of India were independent States of different dimensions and the local conditions and needs of the people inhabiting those areas considerably varied.
There were 13 different Acts then in vogue governing the municipalities within that State.
The Rajasthan Municipalities Act was, therefore, introduced to consolidate and amend the law relating to municipalities in that State.
In February, 1962, the State Government by notification dated 13th February, 1962 issued under section 104 of the Act fixed the rate of octroi at 0.50 paise in place of 1.9 annas with effect from 15th February, 1962.
By notification dated 10th of April, 1964, published in the Gazette on 20th of August, 1964, the State Government in exercise of powers under section 104 of the Act revised the rates of octroi and so far as the municipal board of Abu Road was concerned, Item 62 of the Schedule provided the rate of 1 per cent ad valorem on cloth.
This led to the challenge before the High Court.
The leamed Single Judge who dealt with the writ petitions relied upon the provisions of section 104 of the Act as it then stood and came to hold that the provisions of section 104(1) of the Act were valid but the notification in respect of the municipal board of Abu Road relating to cloth was bad.
During the pendency of the appeals before the Division Bench of the High Court, sub section (2) of section 104 was added by section 12 of the Rajasthan Municipalities (Amendment) Act of 1978.
The Division Bench overlooked this amendment and reiterated the reasons of the learned Single Judge and dismissed the appeals by judgment dated 20th of December, 1978.
The state Government authorised levy of octroi on all types of cloth at the rate of one and a half per cent ad valorem in respect of Sujangarh Municipal Board by notification dated 3rd January,1976.
34 writ petitions were filed before the High court challenging the levy.
It was contended inter alia that there was unreasonable discrimination between the citizens and traders of cloth within Sujangarh Municipal area on the one hand and those of Jodhpur, Jaipur and other named towns on the other, as by authorising levy of octroi at different rates 588 and on different basis discrimination resulted.
Reliance was placed on the decision in the Abu Board municipal cases but the Single Judge as also the Division Bench did not entertain the challenge by relying upon the amended provision of section 104 of the Act.
That is how that group of appeals too has come before this Court by special leave.
There is no dispute as to exigibility of octroi.
Every municipality under the Act is a body corporate.
Section 7 of the Act provides for it.
People residing within each municipal area can be classified as one group different from those residing in any other municipality since octroi is to be levied by the municipality as provided in section 104(1) of the Act subject to the control regarding the rates of levy by the State Government.
The plea of discrimination on the basis of the rates prevalent in another municipality cannot be entertained.
The scheme in section 104 of the Act takes note of the position that local conditions and needs varied and accordingly both in the proviso to sub section ( I) as also in sub section (2) itself, emphasis on that feature has been put.
It is thus open to the State Government on the basis of local conditions and needs to prescribe different rates in relation to different municipalities in the matter of rates of taxes to be levied.
Varying duty of octroi is, therefore, not open to challenge.
The Division Bench while dealing with the appeals of Abu Road municipality should have taken note of the amendment of sub section (2) with retrospective effect.
In some of the municipalities the levy is on the value of the goods while in others it is on the basis of the weight.
Here again, the State Government seems to have applied its mind and has authorised charge of octroi on weight basis taking into consideration the special circumstances.
In bigger municipalities where there are wholesale markets particularly of cloth, a reduced rate of octroi has been prescribed to encourage larger import.
In smaller municipalities where the import is for direct consumption the levy is on ad valorem basis at a higher rate.
The State Government seems to have also taken into consideration that in smaller municipalities there is not much of demand for costly and fine clothes which have higher price while the position is otherwise in bigger municipal areas.
This appears to be the justification for adopting the weight basis in respect of larger municipalities and ad valorem basis for the smaller municipalities.
This again seems to be a legitimate basis and we do not think any valid objection is available against this differential treatment.
Law is well settled that if unequals are treated unequally there is no discrimination and Article 14 of the Constitution is not available to be invoked.
589 In view of what we have said above, the appeals preferred by A Municipal Board of Abu Road will have to succeed.
They are allowed.
Other group of appeals relating to Sujangarh Municipality have to be dismissed.
Parties are directed to bear their own costs throughout.
Before we part with the cases we would like to suggest that in the backdrop of a consolidating and uniform municipal legislation now operating in the field, the State Government may rationalise the rate structure prevalent in different municipal areas so that assessment of octroi would be convenient, a common method would be adopted and the challenge which is raised now and again though we have made it clear that it would be competent for the State Government to allow varying rates in different municipalities keeping the provisions in section l04 of the Act in view may be avoided.
H.L.C. Appeals allowed.
| % The University of Gujarat held election of 28 members of the Court of the University out of 42 members, as the election with regard to the 14 seats had been stayed by an order of the High Court.
The respondents teachers filed a writ petition in the High Court for setting aside the election of the 28 members and holding fresh election for all the seats.
The High Court set aside the election to the 28 seats and directed the holding of fresh election for all the 42 seats.
Aggrieved by the decision of the High Court in the writ petition, the appellant appealed to this Court.
Allowing the appeal, the Court, ^ HELD: The High Court committed an error in entertaining the writ petition and interfering with the election.
Election to the membership of the court of the University and the determination of the disputes relating thereto, are regulated by the provisions of the Gujarat University Act, 1949.
Under section 58 as substituted by the Gujarat Act 9 of 1983.
Under the provisions of the Act, if a dispute arises with regard inter alia to the election of any member of any authority or other body of the University, it shall be referred to the State Government, which shall decide the matter and the decision of the Government shall be final.
It is well settled that where a statute provides for an election and a machinery or forum to determine any dispute arising out of that election, the aggrieved person should pursue his remedy before the forum provided by the statute.
It is not permissible to invoke the jurisdiction of the High Court by a writ petition, by passing the machinery provided by the Act for the determination of the election dispute.
The remedy provided by the statute must be followed except where exceptional, extraordinary circumstances exist to justify the by passing of the alternative remedies.
In the present case, there existed no circumstance, justifying departure from this rule and the High Court was not right in entertaining the writ petition.
[902B; 903B C, G H; 904B] 900 K.K Shrivastava etc.
vs Bhupendra Kumar Jain & Ors., AIR 1977 SC 1703; Ramjibhai Ukabhai Parmar vs Manilal Purushottam Solanki & Anr., , referred to.
|
Civil Appeal No. 1969 of 1986 From the Judgment and order dated 26.9.1984 of the Delhi High Court in Civil Writ Petition No. 2329 of 1984.
Govinda Mukhoty, K.G. Bhagat and Mahabir Singh for the Appellant.
G.B. Pai, O.C. Mathur, Miss Meera Mathur, D.N. Mishra and section Sukumaran for the Respondents.
The Judgment of the Court was delivered by THAKKAR, J.
A CAT scan of this appeal reveals three problems, viz: I.
Whether a rule or regulation framed by a public sector undertaking which is an authority under the control of Government of India and is a 'State ' within the parameters 927 of Article 12 of the Constitution of India empowering the employer to terminate the services of an employee by giving notice of the prescribed period or payment of salary for the notice period in lieu of such notice is constitutional? II.
If it is unconstitutional, whether the employee whose services are terminated under the said rule or regulation is always and invariably entitled to reinstatement? Whether option to pay compensation in lieu of reinstatement can be given to the employer in fit cases? III.
What would be the appropriate amount to be reason ably awarded in lieu of reinstatement? These are the questions which call for answers in this appeal. ' Undisputed are the following facts, the same being incapable of being disputed: (1) The respondent Corporation (I.T.D.C.) is 'State ' within the parameters of Article 12 of the Constitution of India it being an instrumentality of the State as per the law enunciated by this Court in Central Inland Water Transport Corporation Limited & Anr.
vs Brojo Nath Ganguly and Anr.
and Central Inland Water Transport Corporation Limited & Anr.
vs Taran Kanti Sengupta & Anr., (2) Appellant was an employee of the Respondent Corporation holding the post of Manager of Hotel Ranjit, New Delhi, at the material time when his services were terminated by the impugned order.2 (3) Services of the Appellant were terminated in exercise of powers under Rule 31 (v) of the ITDC Conduct Discipline and Appeal Rules 1978, (ITDC rules) by 1.By Special Leave arising out of W.P. No. 2329 of 1984 dismissed by the High Court of Delhi summarily by its order dated 26.9.1984.
Annexure P 10, Memorandum No. P B(OP) 22 dated 18th September.
928 giving pay for 3 months in lieu of 3 months ' notice,3 under the said rule.
Rule 31 (v) of the I.T.D.C. Rules, the constitutional validity of which is questioned from the platform of Articles 14 and 16 (1) of the Constitution of India, provides: "31.
Termination of services: The services of an employee may be terminated by giving such notice or notice pay as may be prescribed in the contract of service in the following manner: i) X X X X ii) X X X X iii) X X X X iv) X X X X v) of an employee who has completed his probationary period and who has been confirmed or deemed to be confirmed by giving him 90 days ' notice or pay in lieu thereof.
" This rule cannot co exist with Articles 14 and 16 (1) of the Constitution of India.
The said rule must therefore die, so that the fundamental rights guaranteed by the aforesaid constitutional provisions remain alive.
For, otherwise, the guarantee enshrined in articles 14 and 16 of the constitution can be set at naught simply by framing a rule authorizing termination of an employee by merely giving a notice.
In order to uphold the validity of the rule in question it will have to be held that the tenure of service of a citizen who takes up employment with the 3.
Memorandum No. P B (OP) 22 dated 18th September, 1984.
"Please be advised that your services are no longer required hence stand terminated with immediate effect.
In accordance with rule No. 31(v) of ITDC Conduct, Discipline and Appeal Rule 1978, you are hereby paid three months pay in lieu of notice and a cheque No. 089988 dated 18.9.84 drawn on State Bank of India, New Delhi, representing a sum of Rs.7,950 (Rupees Seven Thousand Nine Hundred and Fifty only) is enclosed.
" 929 State will depend on the pleasure or whim of the competent authority unguided by any principle or policy.
And that the services of an employee can be terminated even though there is no rational ground for doing so, even arbitrarily or capriciously.
To uphold this right is to accord a "magna carta" to the authorities invested with these powers to practise uncontrolled discrimination at their pleasure and caprice on considerations not necessarily based on the welfare of the organisation but possibly based on personal likes and dislikes, personal preferences and prejudices.
An employee may be retained solely on the ground that he is a sycophant and indulges in flattery, whereas the services of one who is meritorious (but who is wanting in the art of sycophancy and temperamentally incapable of indulging in flattery) may be terminated.
The power may be exercised even on the unarticulated ground that the former belongs to the same religious faith or is the disciple of the same religious teacher or holds opinions congenial to him.
The power may be exercised depending on whether or not the concerned employee belongs to the same region, or to the same caste as that of the authority exercising the power, of course without saying so.
Such power may be exercised even in order to make way for another employee who is a favourite of the concerned authority.
Provincialism, casteism, nepotism, religious fanatism, and several other obnoxious factors may in that case freely operate on the mind of the competent authority in deciding whom to retain and whom to get rid of.
And these dangers are not imaginary ones.
They are very much real in organisations where there is a confluence of employees streaming in from different states.
Such a rule is capable of robbing an employee of his dignity, and making him a supine person whose destiny is at the mercy of the concerned authority (whom he must humour) notwithstanding the constitutional guarantee enshrined in Articles 14 and 16 of the Constitution of India.
To hold otherwise is to hold that the fundamental right embedded in Articles 14 and 16 (1) is a mere paper tiger and that it is so ethereal that it can be nullified or eschewed by a simple device of framing a rule which authorizes termination of the service of an employee by merely giving a notice of termination.
Under the circumstances the rule in question must be held to be unconstitutional and void.
This Court has struck down similar rules in similar situations.
In State Electricity Board vs D.B. Ghosh, [1985] 2 S.C.R. 1014, Chinnappa Reddy J. speaking for a three Judge Bench of this Court has observed.
that a (similar) regulation,4 authorizing the 4.
Regulation 34 of Regulations framed by West Bengal State Electricity Board reading the 930 termination of the services of a permanent employee, by serving three months ' notice or on payment of salary for the corresponding period in lieu thereof, was ex facie 'totally arbitrary ' and 'capable of vicious discrimination '.
And that it was a naked 'hire and fire ' rule and parallel of which was to be found only in the "Henary VIII clause" which deserved to be banised altogether from employer employee relationship.
The regulation thus offended Article 14 of the Constitution of India and deserved to be struck down on that account.
In Central Inland Water Transport Corporation Limited and Anr.
vs Brojo Nath Ganguly and Another AND Central Inland Water Transport Corporation Limited & Anr.
vs Tarun Kanti Sengupta and Anr.
(Supra) a Division Bench of this Court has struck down a similar rule5 in so far as it authorized termination of employment by serving a notice thereunder as being violative of article 14 of the Constitution of India, inter alia, in as much as it was capable of being selectively applied in a vicious manner by recourse to 'pick and choose ' formula.
There is, under the circumstances, no escape from the conclusion that Rule 31(v) of the aforesaid ITDC rules which provides for termination of the services of the employees of the respondent corporation simply by giving 90 days ' notice or by payment of salary for the notice period in lieu of such notice, deserves to be quashed.
As the occasion so demands, we feel constrained to place in focus and highlight an important dimension of the matter.
The impugned regulation is extremely wide in its coverage in the sense that it embraces the 'blue collar ' workmen, the 'white collar ' employees, as also the 'gold collar ' (managerial cadre) employees of the Undertaking.
In so far as the 'blue collar ' and 'white collar ' employees are concerned, the quashing does not pose any problem.
In so far as the 'gold collar ' (managerial cadre) employees are concerned, the consequence of quashing of the "34.
In case of a permanent employees, his services may be terminated by serving three months ' notice or on payment of salary for the corresponding period in lieu thereof.
Rule 9 (i) of (Service, Discipline and Appeal) Rules of 1979 of Central Inland Water Transport Corporation Ltd. reading: "9.
Termination of employment for Acts other than misdemeanour.
(i) The employment of a permanent employee shall be subject to termination on three months ' notice on either side.
The notice shall be in writing on either side.
The company may pay the equivalent of three months ' basic pay and dearness allowance, if any, in lieu of notice or may deduct a like amount when the employee has failed to give due notice.
" 931 regulation calls for some reflection.
In the private sector, the managerial cadre of employees is altogether excluded from the purview of the Industrial Disputes Act and similar labour legislations.
The private sector can cut the dead wood and can get rid of a managerial cadre employee in case he is considered to be wanting in performance or in integrity.
Not so the public sector under a rule similar to the impugned rule.
Public sector undertakings may under the circumstances be exposed to irreversible damage at the hands of a 'gold collar ' employee (belonging to a high managerial cadre) on account of the faulty policy decisions or on account of lack of efficiency or probity of such an employee.
The very existence of the undertaking may be endangered beyond recall.
Neither the capitalist world nor the communist world (where an employee has to face a death sentence if a charge of corruption is established) feels handicapped or helpless and countenances such a situation.
Not being able to perform as per expectation or failure to rise to the expectations or failure to measure up to the demands of the office is not misconduct.
Such an employee cannot thus be replaced at all.
If this situation were to be tolerated by an undertaking merely because it belongs to the public sector, it would be most unfortunate not only for the undertaking but also for the Nation.
The public sector is perched on the commanding heights of the National Economy.
Failure of the public sector might well wreck the National Economy.
On the other hand the success of the public sector means prosperity for the collective community (and not for an individual Industrial House).
The profits it makes in one unit can enable it to run a losing unit, as also to develop or expand the existing units, and start new units, so as to the generate more employment and produce more goods and services for the community.
The public sector need not therefore be encumbered with unnecessary shackles or made lame.
It is wondered whether such a situation can be remedied by enacting a regulation permitting the termination of the employment of employee belonging to higher managerial cadre, if the undertaking has reason to believe, that his performance is unsatisfactory or inadequate, or there is a bonafide suspicion about his integrity, these being factors which cannot be called into aid to subject him to a disciplinary proceeding.
If termination is made, under such a rule or regulation, perhaps it may not attract the vice of arbitrariness or discrimination condemned by Articles 14 and 16(1) of the Constitution of India, inasmuch as the factor operating in the case of such an employee will place him in a class by himself and the classification would have sufficient nexus with the object sought to be achieved.
Of course it is for the concerned authorities to tackle the sensitive problem after due deliberation.
We need say no more.
932 Time is now ripe to turn to the next question as to whether it is obligatory to direct reinstatement when the concerned regulation is found to be void.
In the sphere of employer employee relations in Public Sector Undertakings, to which Article 12 of the Constitution of India is attracted, it cannot be posited that reinstatement must invariably follow as a consequence of holding that an order of termination of service of an employee is void.
No doubt in regard to 'blue collar ' workmen and 'white collar ' employees other than those belonging to the managerial or similar high level cadre, reinstatement would be a rule, and compensation in lieu thereof a rare exception.
In so far as the high level managerial cadre is concerned, the matter deserves to be viewed from an altogether different perspective a larger perspective which must take into account the demands of National Interest and the resultant compulsion to ensure the success of the public sector in its competitive co existence with the private sector.
The public sector can never fulfil its life aim or successfully vie with the private sector if it is not managed by capable and efficient personnel with unimpeachable integrity and the requisite vision, who enjoy the fullest confidence of the 'policy makers ' of such undertakings.
Then and then only can the public sector undertaking achieve the goals of 1.
maximum production for the benefit of the community, 2.
social justice for workers, consumers and the people, and 3.
reasonable return on the public funds invested in the undertaking.
It is in public interest that such undertakings or their Board of Directors are not compelled and obliged to entrust their managements to personnel in whom, on reasonable grounds, they have no trust or faith and with whom they are in a bonafide manner unable to function harmoniously as a team working arm in arm with success in the aforesaid three dimensional sense as their common goal.
These factors have to be taken into account by the Court at the time of passing the consequential order, for the Court has full discretion in the matter of granting relief, and the Court can sculpture the relief to suit the needs of the matter at hand.
The Court, if satisfied that ends of justice so demand, can certainly direct that the employer shall have the option not to reinstate provided the employer pays reasonable compensation as indicated by the Court.
So far as the facts of this case are concerned, we are satisfied that 933 this is a fit case for granting compensation in lieu of reinstatement, instead of granting 'reinstatement '.
For, it cannot be said that the apprehension voiced by the respondent Corporation as regards the negative consequences of reinstatement is unreasonable.
We do not propose to pronounce on the validity or otherwise of the allegations and counter allegations made by the parties in their respective affidavits.
Suffice it to say that the relations between the parties appear to have been strained beyond the point of no return.
The Trade Union of the employees has lodged a strong protest and even held out a threat of strike, in the context of some acts of the Appellant.
Such unrest among the workmen is likely to have a prejudicial effect on the working of the undertaking which would prima facie be detrimental to the larger National interest, not to speak of detriment to the interest of concerned undertaking.
We are not impressed by the submission that the Union is virtually a 'company 's Union.
In any case such disputed questions of facts cannot be resolved in this forum.
We are prima facie satisfied that the apprehension is not ill founded.
What is more, reinstatement is perhaps not even in the interest of the appellant as he cannot give his best in the less than cordial atmosphere and it will also result in misery to him, let alone the other side.
Neither the undertaking nor the appellant can improve their image or performance, or, achieve success.
In fact it appears to us that both sides will be unhappy and miserable.
These are valid reasons for concluding that compensation in lieu of reinstatement, and not reinstatement, is warranted in the circumstances of the present case.
Counsel for the appellant having forcefully pressed the claim for reinstatement, has contended that in case the Court is disinclined to order reinstatement, the appellant ought to be awarded the full salary and allowances which would have accrued to him till the date of his superannuation which is more than 8 years away.
We think it would be unreasonable to award 8 years ' salary and allowances, as lump sum compensation in lieu of reinstatement.
We consider it unreasonable because: (i) To do so would tantamount to paying to the appellant EVERY MONTH 20% OVER AND ABOVE what he would have earned if he was continued in service WITHOUT DOING ANY WORK as the lump sum payment of 8 years ' salary invested at 15% interest (it being the current rate of interest) would yield a monthly recurring amount equivalent to his current monthly salary 'plus ' 20%; 934 (ii) To do so would be tantamount to paying to him his present salary etc.
plus 20% more every month not only till his date of retirement but till his death (if he lives longer) and also to his heirs thereafter, IN PERPETUITY.
(iii) Besides, the corpus of the lumpsum amount so paid as compensation would remain with him in tact.
Obvious it is, therefore, that the Court would be conferring a 'bonanza ' on him and not compensating him by accepting this formula.
The submission, accordingly, deserves to be repelled unhesitatingly.
In our considered opinion, compensation equivalent lo 3.33 years ' salary (including allowances as admissible) on the basis of the last pay and allowances drawn by the appellant would be a reasonable amount to award in lieu of reinstatement taking into account the following factors viz: 1.
The corpus if invested at the prevailing rate of interest (15%) will yield 50% of the annual salary and allowances.
In other words every year he will get 50% of what he would have earned by way of salary and allowances with four additional advantages: (i) He will be getting this amount without working.
(ii) He can work somewhere else and can earn annually whatever he is worth over and above, getting 50% of the salary he would have earned.
(iii) If he had been reinstated he would have earned the salary only upto the date of superannuation (upto 55, 58 or 60 as the case may be) unless he died earlier.
As against this 50% he would be getting annually he would get not only beyond the date of superannuation, for his & lifetime (if he lives longer), but even his heirs would get it in perpetuity after his demise.
(iv) The corpus of lump sum compensation would re main intact, in any event.
No doubt he will not have the advantage of further promotion, but 935 then what are his prospects, given the present relationship? Besides, the chances of promotion can be set off against the risk of a departmental disciplinary proceeding.
Factors (i), (ii), (iii) and (iv) are of such great significance that compensation on the basis of 50% of his annual salary and allowances is much more to his advantage.
We are thus satisfied that compensation in lieu of reinstatement on the aforesaid basis is more than reasonable.
therefore.
direct that: I The Respondent Corporation shall reinstate the appellant with full back wages (including usual allowances), or, at its option, II The Respondent Corporation shall pay to the appellant: (1) Salary including usual allowances for the period commencing from the date of termination of his service under the impugned order till the date of payment of compensation equivalent to 3.33 years ' salary including usual allowances to him.
(2) Provident Fund amount payable to the appellant and retirement benefits computed as on the date of payment as per clause 1 shall be paid to him within 3 months from the said date.
III The appellant shall vacate and make over possession of the premises provided to the appellant by the respondent company before the expiry of 3 months from the date of this order or within one month of the day on which payment under clause II is made, whichever is later.
IV Respondent shall pay the costs to the Appellant.
V Interim order shall stand vacated subject to the direction embodied in Clause III.
VI Since the amount is being paid in one lump sum, it is likely that the employer may take recourse to Section 192 of the Income tax Act, 1961 which provides that any person responsible for paying any income chargeable under the head 'Salaries ', shall, at the time of payment, deduct income tax on the amount payable at the average rate of 936 income computed on the basis of the rates in force for the financial year in which the payment is made, on the estimated income of the assessee under this head for that financial year.
If, therefore, the employer proceeds to deduct Income tax as provided by Section 192, we would like to make it abundantly clear that the appellant would be entitled to relief under Section 89 of the Income tax Act which provides that where by reason of any portion of asses see 's salary being paid in arrears or in advance by reason of his having received in any one financial year salary for more than 12 months or a payment which under the provisions of clause (3) of Section 17 is a profit in lieu of salary, his income is assessed at a higher rate than that it would otherwise have been assessed, the Income tax officer shall on an application made to him in this behalf grant such relief as may be prescribed.
The prescribed relief is set out in Rule 21 A of the Income tax Rules.
The appellant is entitled to relief under Section 89 because compensation herein awarded includes salary which has been in arrears as also the compensation in lieu of reinstatement and the relief should be given as provided by Section 89 of the Income tax Act read with Rule 21 A of the Income tax Rules.
The appellant is indisputably entitled to the same.
If any application is required to be made, the appellant may submit the same to the competent authority and the Corporation shall, through its Tax Consultant, assist the appellant for obtaining the relief.
The appeal is allowed.
The order of the High Court is set aside.
Order in the aforesaid terms is passed.
P.S.S. Appeal allowed.
| The petitinner company in W.P. No. 1685 of 1979 is manufacturing electrical goods for M/s. Bajaj Electricals Limited, the buyers.
As per agreement the goods are not at all sold .in the open market by the petitioner company.
After the manufactured goods are accepted by the buyers, the petitioner company applies the label of the brand name of the buyers, namely, 'BajaJ ' on the manufactured goods.
The right to sell these goods with the aforesaid brand name is solely and exclusively that of the buyers having regard to the fact that they alone are owners of the brand name.
Counsel for the petitioner in this writ petition con tended that the market value of the goods manufactured by the petitioner should be assessed at the price at which the goods are agreed to be sold under the agreement between the manufacturer and the buyers.
On the other hand, it was argued by counsel in behalf of the respondent Union of India that the excise duty must be levied an the basis of market value fetched by the sale of these goods by the buyers to their wholesalers.
Similar question of law arose in the other writ petitions.
Allowing the writ petitions, this Cart, HELD: 1.1.
Excise duty is payable on the market value ' fetched by the goods, in the wholesale market at the factory gate manufactured by the manufacturers.
It cannot he as sessed on the hams of the market value obtained by the buyers who also add to the value of the manufactured goods the value of their own property in the goodwill of the 'Brand name '.
[84F] 1.2.
Where a manufacturer who manufacture and sells his goods under his own brand name or under a bland name which he has acquired in use, the sale price fetched by sales effected by him under 83 such bland name in wholesale, will be the basis for computa tion of excise duty payable by him.
So also nothing said herein will come to the rescue of a brand name owner who himself is the manufacturer of goods or to sales effected favour of 'related ' persons as defined by the Central Ex cises and Salt Act, 1944.
[85A B] Union of India vs Cibatul Ltd., , Joint Secretary to the Government of India vs Food Speciali ties Ltd., 'and M/s. R.O. Industries vs Union of India & Ors., Civil Appeal No. 1496 of 1977 decided on 3.4.86, relied upon.
In the instant case, the price fetched by the goods manufactured by the petitioner company is the price Of*the electrical goods sans the brand name.
And that should be the market value for the purposes of assessing the excise duty payable by the petitioner company which manufactures the excisable goods.
The enhancement in the value the goods by reason of the application of the brand name is because of the augmentation attributable to the value of the goodwill of the brand name which does not belong to the manufacturer and which added market value does not accrue to the peti tioner company or go into its coffers.
It accrues to the buyers to whom the brand name belongs and to whom the fruits of the goodwill belong.
[89D E]
|
Special Leave Petition Nos.
16066.
16065 & 16451 of 1991.
From the Judgment and Order dated 28.8.1991,30.8.1991 & 9.10.1991 of the Punjab and Haryana High Court in C.W.P.Nos.
12644, 12485 and 14606 of 1991 respectively.
Kapil Sibal, Ranjit Kumar, J.D. Jain, Mrs. Kawaljit Kocher, Dr. Balram Gupta, Ms. Yasmin Tarapore, J. Lal Kai lash Vasdev, Ms Nandini Sawhney, R.K. Kapoor, A.A. Khan and Anil Verma for the appearing parties.
The following Order of the Court was delivered: In the Union Territory of Chandigarh, 5% of the seats are reserved in favour of sons/daughters/spouses of Mili tary/Para Military personnel.
Orders in this behalf are issued by the Administration in its memo dated 19th May, 1982 which were later modified in memo dated 6.9.1990.
In accordance with the said orders, Punjab Engineering College (a College run by the Chandigarh Administration and affili ated to Punjab University) reserved 15 seats in favour of sons/daughters/spouses of Military/ParaMilitary Personnel.
The College published a prospectus for the session 1991 92.
It contains inter alia the rules governing the admission of stu 326 dents to the said college.
So far as the reservation in favour of children and spouses of Military/Para Military Personnel is concerned, the rule, (printed at pages 23 and 24 of the Prospectus) reads as follows: "Sons/Daughters/Spouses of Military/Para military Personnel etc.
: 3 The Admission of the candidates against the reserved seats under this category will be made on the basis of merit list prepared according to the priorities given below in the descending order: 1.
Sons/Daughters/Spouses of defence personnel who are awardees of gallantry decorations of Paramvir/Mahavir/Vir Chakra in person or posthumously.
OR Sons/daughters/spouses of defence personnel and para military personnel like CRPF, BSF etc.
who are killed or are total incapacitated in action while in service and were wholly dependent on them.
Sons/daughters/spouses of defence person nel and para military personnel like CRPF/BSF etc.
who die while in service and were wholly dependent on them; 3.
Sons/daughters/spouses of defence per sonnel and para military personnel like CRPF/BSF incapacitated while in service and were wholly dependent on them; 4.
Sons/daughters/spouses of exservicemen (military and para military personnel like CRPF/BSF who are wholly dependent on them; 5.
Sons/daughters/spouses of serving de fence personnel and paramilitary personnel like CRPF/BSF who are wholly dependent on them: The candidates claiming admissions under the category 1 above are required to submit the photo copy of citation for the gallantry award, failing which the application will not be considered in this category, The candidates claiming admission under category I are required to submit a certificate from the respective Head quarters regarding death/total incapacitation in action while in service.
The candidates claiming admission under category 2 and 3 are required to submit a certificate from the respective Headquarters regarding death/total incapacitation.while in service.
327 The candidates claiming admission under category 4 are required to submit discharge certificate from sevice and certificate of dependence from the District Magistrate of the district concerned.
The candidates claiming admission under category 5 are required to submit the certificate of dependence from the unit in which parent/spouse is serving.
The candidates who apply for admission against this category will also be considered for admission against the seats allocated for Chandigarh/ General Pool to which they may belong as per their merit.
" A perusal of the rule shows that the five categories are mentioned in the order of priority in the descending order.
There is no allocation of seats as between these five cate gories.
It means that in the first instance, all the quali fied and eligible candidates falling in category 1 will be given admission and if any seats are left unfilled, quali fied candidates failing in category 2 will be admitted.
If there are any seats still left unfilled, qualified candi dates falling in category 3 will be given admission and so on.
In a given year, it may well happen that all the avail able seats reserved for children/spouses of defence person nel are taken away by the candidates in the first or first and second categories.
As a matter of fact, for the year 1990 91, only 6 candidates belonging to sub category 4 out of 90 candidates could be admitted and not the others and category 5 'went unprovided altogether.
It is stated that all candidates obtaining the specified minimum marks in the common entrance test were treated as qualified for being considered for admission.
S.L.P. 16066/91: The first respondent in the S.L.P. applied for admission to Punjab Engineering College under this quota.
He appeared in the common Entrance Test along with other applicants.
The College Authorities considered his case placing him in category 4 since his father was an Ex serviceman.
He could not, however, be given the admission because the 15 seats reserved for children and spouses of Military/ParaMilitary Personnel in this College were allo cated in the following manner: a.
There were three candidates falling in category 1 (i.e., children of Defence Person nel who are awardees of gallantry decoration, Paramvir Chakra/Mahavir Chakra, in person or posthumously).
All the three were given admis sion.
b. There were 5 candidates falling in catego ry 2.
They were admitted.
328 c. Only one candidate falling in category 3 appeared and was given the seat; d. There were 90 candidates failing in category 4.
But only 6 seats were available (nine seats having been taken away by sub categories a to c).
These six seats were allotted on the basis of inter se merit among the candidates failing in this category.
The first respondent being at a fairly lower position in this merit list could not be given the admission.
No seats were left for being allotted to candidates failing in category 5.
Finding that he has not been given admission in this Col lege, the first respondent filed a writ petition in the High Court of Punjab and Haryana being C.W.P. No.12644 of 1991.
His contention was that his father Major Kuldip Singh Malik was awarded Shaurya Chakra for acts of gallantry, that Shaurya Chakra is equivalent to Vir Chakra, in all respects and, therefore, his case ought to have been considered in category 1 and not in category 4.
He submitted that along with his application for admission he had enclosed a copy of the citation awarded by the President of India to his father showing that his father Major Kuldip Singh Malik was awarded Shaurya Chakra for displaying exemplary courage and leader ship in the course of his duties in the Mizo Hills.
He complained that two of the candidates admitted under catego ry 1 have received less marks than he.
The High Court has allowed the Writ Petition on the following reasoning: "According to Regulation 695 of the Defence Services Regulations relating to the Army, issued by the Ministry of Defence, Government of India, Shaurya Chakra is awardable for gallantry and comes after Ashoka Chakra and Kirti Chakra.
Further, according to Regulation 717, in order of precedence, this award of Shaurya Chakra is at number thirteen.
that is immediately below Vir Chakra and Param Vir Chakra is at number two and Maha Vir Chakra is at number seven.
Despite all this, the re spondents, while considering the candidature of the petitioner, did not grant him admission to the Bachelor of Engineering Course in the current session even though he was higher in academic merit as compared to respondent Nos. 3 and 4 who have been granted such admission.
In reply, the respondents have pleaded that no doubt the father of the petitioner was deco rated with Shaurya Chakra award in 329 1969, but it is gallantry award and is not strictly covered by the rules, regulations and the prospectus of the College, though it is admitted that both respondents Nos.3 and 4, who have been granted admission, were lower in merit than the petitioner, so far as the academic record is concerned.
After hearing the learned counsel for the parties, we find that the approach of the respondents in rejecting the candidature of the petitioner is neither legally correct nor just and fair.
However, as respondent Nos.3 and 4 who are lower in academic merit than the petitioner, happen to be the sons of the awardees of Vir Chakra and Maha Vir Chakra respectively, it would be unfair if the admis sion already granted to them by the Chandigarh Administration and the Punjab Engineering College, Chandigarh, is set aside.
Resultantly, we allow this petition and issue a direction to respondent Nos. 1 and 2 to admit the petitioner against the category of sons/daughters of awardees of gallantry deco rations, without disturbing the admission of respondents Nos.3 and 4.
In case no such seat is available for the petitioner, the respond ents shall create a seat for the purpose forthwith.
This shall also be deemed to be a direction to the Punjab University for accord ing necessary approval for the creation of the additional seat.
There shall be no order as to costs.
" The decision of the High Court was rendered on 28th August, 1991.
The present S.L.P. was filed in this court on 7th October, 1991.
In fact, it appears that having waited for one month and not having been admitted in the college in pursuance of the Judgment, the first respondent took pro ceedings for Contempt against the College Authorities.
The first respondent, was admitted in the college on 28th Octo ber, 1991.
It is now stated by his counsel that the first respondent has given up his seat in another college (Jamia Millia), on being admitted to this College.
The writ peti tion came up for final hearing before us on 15.11.1991.
We disposed of the SLPs on that day stating that reasons for our orders will be given today.
S.L.P. No. 16065/91 Respondents 1 and 2 in this S.L.P. also applied for admission to Punjab Engineering College as children of serving Defence Personnel.
They too appeared for the common Entrance Test along with other applicants.
Since the parents of the two respondents were serving Defence Personnel, their case was considered under category 5, As stated herein 330 before, no seats were left for being allocated to candidates falling in category 5.
Respondents I and 2 were, therefore, not given admission in this College whereupon they ap proached the Punjab and Haryana High Court by way of a writ petition being C.W.P. No. 12485 of 1991.
Their case was that the categorisation of Defence Personnel was unjust and unreasonable in as much as while the children and spouses of serving Defence Personnel are placed in category 5, children and spouses of Exserviceman are placed above them in catego ry 4.
According to the respondents.
children of serving Defence Personnel must be preferred over the children of Exservicemen.
In a short order, the High Court allowed the writ petition and directed 'that category 5 should be treated as category 4 and category 4 should be treated as category 5.
The Court directed that admissions for the current year (1991 1992) shall be made accordingly.
The order of High court is a short one and may be set out in its entirity: "After hearing the learned counsel for the parties and having gone through their plead ings, we are of the considered view that sub categories No. 1, 2 and 3 deserve to be re tained at their appropriate present places.
So far as sub categories No.4 and 5 i.e. relating to the sons, daughters and spouses of the exservice personnel ,as well as the sons, daughters and spouses of service Defence personnel are concerned, we find that the ends of justice would be adequately met and the object for which the reservation has been provided would be achieved if the sons, daugh ters and spouses of serving Defence personnel are placed at sub category No.4 i.e. above the category of Exservicemen.
This conclusion has been arrived at by us after considering the circumstances that the wards and spouses of serving Defence personnel are at a disadvan tage in the absence of their guardians serving at far off/distant places defending the coun try vis a vis who have retired from the mili tary and are now living with their wards.
Keeping these considerations in view, we dispose of this writ petition by issuing a direction to the respondent Union Territory Chandigarh and Principal, Punjab Engineering College, to go ahead with the admission of this reserved category.
Therefore, so far as such categories 1,2 and 3 are concerned, there shall not be any change.
However, we direct that so far as sub category No.4 is concerned, persons covered in this shall be considered at No. 5 and those covered in sub category 5 are concerned, shall be considered at No. 4.
The admission, which are going to be finalised tomorrow, shall not be made in accordance with these directions.
A copy of the order be supplied Dasti also to the learned counsel for the parties.
" 331 This order was made on 30th August, 1991 whereas the present SLP was filed in this Court on 7th October, 1991.
These respondents too took proceedings for contempt against the college for not implementing the direction of the High Court.
They were admitted on 28th October, 1991.
These respondents also say that on being admitted to this college they have given up their admission in other colleges.
This SLP was heard alongwith SLP.
No.16066 of 1991 on 15.11.91.
S.L.P. No. 16451 of 1991 This petition for Special Leave is directed against the order dated 9th October, 1991 passed by a Division Bench of the Punjab ,and Haryana High Court dismissing the writ petition filed by the petitioner.
The petitioner (writ petitioner) applied for admission to the Punjab Engineering College for the year 1991 92 under category 4 being the son of an Exserviceman.
By virtue of the directions given by the High Court in its order dated 30.8.1991 in C .W.P.
No. 12485 of 1991, category 4 became category 5 and category 5 became category 4 and admissions were being made on that basis.
The petitioner who fell in category 4 (,as per the prospectus of the College) and which was now converted to category 5 by virtue of the decision of the High Court aforesaid applied to the High Court to consider his case in category 4 itself and grant him admission.
His writ petition was dismissed by the High Court on 9th October, 1991 under a short order which reads thus: "Admissions are being done as per the direc tions issued in Civil Writ Petition No.12485 of 1991, decided by the Division Bench on August 30. 1991.
In view of the said decision, we do not find any merit in the contentions raised by the learned counsel for the peti tioner.
The Writ petitions dismissed.
A copy of this order be given dasti.
" The petitioner is in fact questioning the correctness of the directions given by the High Court in C.W.P.No.12485 of 1991 disposed of on August 30, 91.
Counsel for Chandigarh Administration and the College (petitioners in SLP 's 16066 and 16065 of 1991) contended that the High Court has exceeded its jurisdiction in grant ing the impugned directions.
He submitted that High Court, while exercising the writ jurisdiction conferred upon by Article 226 of the Constitution of India, does not sit as an Appellate Authority over the rule making authority nor can it re write the rules.
If the rule or any portion of it was found to be bad, the High Court could have struck it down and directed the rule making authority to re frame the 332 rule and make admissions on that basis but the High Court could not have either switched the categories or directed that Shaurya Chakra should be treated as equivalent to Vir Chakra By its directions, the High Court has completely upset the course of admissions under this reserved quota and has gravely affected the chances of candidates failing in category 4 by down grading them as category 5 without even hearing them.
These are good reasons for the categorisation done by the Administration which was adopted by the College.
He submitted that while Paramvir Chakra, Mahavir Chakra and Vir Chakra are awarded for gallantry in war, Ashok Chakra, Kirti Chakra and Shaurya Chakra are awarded for gallantry otherwise than in war.
Shaurya Chakra was awarded to the father of the first respondent in SLP.No.
16066 of 1991 for his gallant conduct in counter insurgency operations in Mizo Hills.
It was not a war.
He placed, before us, the true extract of order of precedence of awardees.
It reads thus: "TRUE EXTRACT OF ORDER OF PRECEDENCE OF AWARDS.
Order of Precedence of Awards The order of precedence of various awards is as follows: Bharat Ratna Param Vir Chakra Ashoka Chakra Padma Vibhushan Padma Bhushan Param Vishisht Seva Medal Maha Vir Chakra Kirti Chakra Padma Shri Sarvottam Jeevan Raksha Padak Ati Vishisht Seva Medal Vir Chakra Shaurya Chakra The President 's police and Fire Service Medal for gallantry.
Sena/Nao Sena/Vayu Sena Medal Vishisht Seva Medal The Police Medal for gallantry Uttam Jeevan Raksha Padak Wound Medal The General Service Medal 1947.
Samar Seva Star 1965 Poorvi Star Paschimi Star Raksha Medal 2965." 333 Counsel says that by its directions contained in the two orders impugned herein, the High Court has exercised a jurisdiction, which really did not belong to it.
We are inclined to agree with him.
Counsel for the petitioner in S.L.P.No.
16451 of 1991 supported the aforesaid arguments.
On the other hand, the counsel for respondents (writ petitioners in the High Court) in the first two SLPs.
sup iported the order of the High Court and submitted further that since the said respondents have given up their seats in other colleges and have been admitted in the Punjab Engi neering College any order throwing them out from the Punjab Engineering College, at this juncture would cause them irreparable prejudice.
They submitted that the Chandigarh Administration and the College authorities have been sleep ing over the matter until a contempt petition was filed and that they moved this Court only after they were summoned in the Contempt proceedings.
They should be held dis entitled to any relief on account of laches, submitted the counsel.
We are of the considered opinion that the orders of High Court are wholly unsustainable.
We shall consider both the directions separately.
Let us first consider SLP 16066 of 1991, arising from C.W.P. 12644/91.
The rule as framed by the Chandigarh Administration and as published by the College in its prospectus in the year 1991 92 placed in category I children and spouses of only those Defence Personnel who were awardees of gallantry decorations of Paramvir Chakra, Mahavir Chakra or Vir Chakra in person or posthumously.
It did not include Ashok Chakra, Kirti Chakra or Shaurya Chakra.
The validity of the rule was not expressly questioned before the High Court.
Assuming that it was so questioned and assuming that the High Court was satisfied that the rule was discriminatory and bad for the reason of not including Ashok Chakra etc., the only course open to it was to strike down the offending rule.
It could also have directed the authorities to reframe the rule and to make admissiions accordingly.
High Court however did not choose to do so.
It merely directed that since Shaurya Chakra is immediately below Vir Chakra in the order of precedence and since respondents 3 and 4 in the writ peti tion admitted under sub category I have obtained lesser marks than the writ petitioner, he should be given admission without disturbing the admission given to respondents 2 and 3 in that writ petition.
The entire reasoning of the High Court has been extracted by us herein above.
It shows that absolutely no reason is assigned for granting the said direction.
All that it says is that since Shaurya Chakra is also awardable for gallantry and is placed imme 334 diately below Vir Chakra, the writ petitioner should be granted admission.
If really the High Court was of the opinion that Shaurya Chakra is equivalent to Vir Chakra and should be treated on the same par as Vir Chakra then it should spelt out the position also of Ashok Chakra and Kirti Chakra.
which are above Shaurya Chakra.
According to the Rules notified children/spouses of Ashok Chakra, Kirti Chakra & Shaurya Chakra awardees did not fall under category 1 nor under categories 2 or 3.
They would fail under catego ry 4 or category 5, as the case may be, depending upon whether their parent/spouse was an ex service person or a serving person.
There may have been other candidates who are the children/spouses of Shaurya Chakra awardees and for that matter, Ashok chakra and Kirti Chakra awardees who may have obtained more marks than the writ petitioner (first respond ent in SLP 16066 of 1991) but who did not claim a seat under category 1 nor were considered as such.
They may not have stated the fact of their parent/spouse being a Ashok chakra/Kirli Chakra Shaurya Chakra awardee, nor filed the relevant citation, since it was not relevant as per the published Rules.
Had the proper course been followed, all of them could have applied properly and could have been consid ered.
By saying this we do not mean to say that the Rule is bad.
We do not mean to say so at all.
There may be good reasons for the Rule as published or there may not be.
That is not the issue.
What we are saying is that if the High Court was of the opinion that all the gallantry awar dees (including Ashok, Kirti and Shaurya Chakra) should be placed in category 1, it should have said so, struck down the category and, may be, directed reframing of rule and admissions made on that basis.
Coming to SLP 16065 of 1991, the position appears to been even worse.
Without assigning any reason the High Court has directed that category 4 should be made category 5 and category 5 should be made category 4.
In short, it has switched these two categories.
Again, we must say that if the High Court thought that this categorisation was discrim inatory and bad it ought to have struck down the categorisa tion to that extent and directed the authority to ' re frame the rule.
It would then have been open to the rule making authority either to merge these two categories or delete one or both of them, depending upon/he opinion they would have formed on a review of the situation.
We must make it clear again that we express no opinion on the question of validity or otherwise of the rule.
We are only saying that the High Court should not have indulged in the exercise of 'switch ing ' the categories, and that too without giving any reasons thereafter.
Thereby.
it has practicably assumed the rule of rulemaking authority, or.
at any rate, assumed the role of an Appellate Authority.
That is clearly not the function of the High Court acting under Article 226 of the Constitution of India.
Now, let us notice the implications and consequences of the said 'switching '.
335 By directing that category 4 should be treated as category 5 and conversely category 5 should be treated as category 4, the High Court has prejudicially affected the rights of candidates falling under category 4 without even hearing them.
It must be remembered that these categories are mentioned in the order of priority as emphasised herein before.
A rulemaking authority need not observe the rule of hearing, but the High Court exercising its judicial power cannot dispense with the requirement and that is precisely the grievance of the petitioner in S.L.P. 16451/91 arising from V.W.P. 14606 of 1991.
He was entitled to be considered under category 4 (as per the prospectus) whereas by virtue of the High Court 's order his category has become category 5, the result of which is that no seat may be left for his category, whereas the said category was entitled to some seats at least according to the Rules as framed and pub lished by the Administration and College.
Suffice is to say that the giving the said direction, while the admission were in progress, the situation has been confounded beyond re call.
Article 226 of the Constitution of India empowers the High Court to issue to any person or authority (including the government) directions, orders or writs including writs in the nature of Habeas Corpus, mandamus, Prohibition, quo warrants and certiorari, or any of them for the enforcement of any of the rights conferred by Part III and for any other purpose.
Though the Article itself does not contain any restric tive words, the Courts have, ever the years, evolved certain self constraints though, we are not bound by the procedural technicalities governing these high prorogative writs in English law.
As observed by a Constitution Bench in Bassappa vs Nagappa ; at 256: "In view of the express provisions in our Constitution we need not now look back to the early history or the procedural technicalities of these writs in English law, nor feel op pressed by any difference or change of opin ion, expressed in particular cases of English Judges.
We can make an order or issue a writ in the nature of certiorari in all appropriate cases and in appropriate manner, so long as we keep to the broad and fundamental princi ples that regulate the exercise of jurisdic tion in the matter of granting such writ in English law.
" While this is not the place to delve into or detail the self constraints to be observed by the Courts while exercis ing the jurisdiction under Article 226, one of them, which is relevant herein, is beyond dispute viz. while acting under Article 226, the High Court does not sit and/or act as an Appellate Authority over the orders/actions of the Subor dinate Authori 336 ties/Tribunals.
Its ' jurisdiction is supervisory in nature.
One of the main objectives of this jurisdiction is to keep the government and several other authorities and Tribunals within the bounds of their respective jurisdiction.
The High Court must ensure that while performing this function it does not overstep the well recognized bounds of its own jurisdiction.
Though we are satisfied that the orders and directions made by the High Court are totally unsupportable in law, the subsequent developments dissuade us from allowing these SLPs.
As stated above, the three respondents writ petition ers (first respondent in SLP.
16066/91 and respondents I and 2 in SLP.
16065/91) have been admitted into this college (Punjab Engineering College) on 28th October, 1991, where upon they have given up the seats which they had obtained in other colleges.
This statement of theirs is not disputed either by the Chandigarh Administration or the college authorities.
Depriving the said respondents of their admis sion in this college at this stage would result in grave and irreparable prejudice to them.
We think that the Administra tion and College authorities ought to have acted with more alacrity and approached this Court earlier than they did.
By the time, these SLPs were taken up by us and stay granted, the said respondents were already admitted into the College and, they say, they had given up their seats in the other colleges.
On this score alone, we decline to interfere with the orders in C.W .P. 12644/91 and 12485/91.
Now coming to SLP 16451 of 1991, the situation is this: By virtue of the orders of the High Court, three students who were not entitled to admission according to rules have been given admission against the three vacancies which had arisen since the finalization of the admissions.
The college authorities say that but for the orders of the High Court, these three vacancies would have gone to the first three candidates in the waiting list.
The petitioner in SLP 16451 of 1991 says that he is one such person in the waiting list and he would have obtained admission but for the admission given to the three candidates in pursuance of the High Court orders.
We do not know whether the petitioner 's case is true.
All the same, we think it appropriate to make the following direction: the college authorities shall create three more seats in the said course and admit the first three available students in the waiting list against those seats.
The Chandigarh Administration shall pass the neces sary orders in this behalf.
Action in terms of this direc tion shall be taken forthwith by the Chandigarh Administra tion and the college authorities.
Before we part with this case we wish to make an obser vation.
In matters of this nature where the High court directs students to be admitted in Educational Institutions.
it would be advisable if the High Court stays 337 the operation of its order for a period of about 3 to 4 weeks, if a request therefor is made by the Educational Institution or the State, as the case may be.
SLPs disposed of accordingly.
R.P. Petitions disposed of.
| Upon a notice given by 108 members of the 9th Lok Sabha of a Motion for presenting an Address to the President for the removal of a sitting Judge of the Supreme Court for the alleged misconduct committed by him while he was functioning as Chief Justice of a High Court, the Speaker of the Lok Sabha admitted the Motion and constituted a Committee con sisting of a sitting Judge of this Court, Chief Justice of a High Court and a distinguished jurist in terms of Section 3(2) of the .
Subsequently, the Lok Sabha was dissolved and its term came to an end.
On its understanding that the Motion as well as the decision of the Speaker thereon had lapsed consequent on the dissolution of the Lok Sabha, the Union government did not act in aid of the decision of the Speaker, and notify that the services of the two sitting Judges on the Committee would be treated as "actual service" within the meaning of Para 11(B)(i) of of the II Schedule to the Constitu tion.
Thereupon, a body called the Sub Committee on Judicial Accountability, claiming to be a Sub Committee constituted by an All India Convention on Judicial Accountability to carry forward the task of implementing the resolutions of the conventions, and the Supreme Court Bar Association, seeking to prosecute the matter in the larger public inter est and, in particular, in the interests of litigant public, filed two Writ Petitions before this Court.
Two prayers common to both the petitions were, first, that the Union of India be directed to take immediate steps to enable the Inquiry Committee to discharge its functions under the and, second, that during the pendency of the proceedings before the Committee the con cerned Judge should be restrained from performing judicial functions and from exercising Judicial powers.
It was contended on behalf of the petitioners that pending business lapsed on prorogation, and as a general practice the House was 4 usually prorogued before it was dissolved, but impeachment motions were sui generis in their nature and, therefore, they did not lapse; that the question whether a motion lapsed or not was a matter pertaining to the conduct of the business of the House of which the House was the sole and exclusive master; no aspect of the matter was justiciable before a Court and Houses of Parliament were privileged to be the exclusive arbiters of the legality of their proceed ings, that it would be highly inappropriate that the Speaker should issue notice to a Judge and call upon him to appear before him; that these proceedings could not be equated with disciplinary or penal proceedings and the Speaker would not decide anything against the Judge at that stage and would merely decide whether the matter would bear investigation; that the constitutional machinery for removal of a Judge was merely a political remedy for judicial misbehaviour and did not exclude the judicial remedy available to the litigants to ensure and enforce judicial integrity, that the right to move the Supreme Court to enforce fundamental rights was itself a fundamental right and that took within its sweep, as inhering in it, the right to an impartial judiciary with persons of impeccable integrity and character, without which the fundamental right to move the court itself becomes barren and hollow, that the court itself had the jurisdic tion nay a duty to ensure the integrity and impartiality of the members composing it and restrain any member who was found to lack in those essential qualities and attainments at which public confidence is built.
Another Writ Petition was filed by an individual by way of a counter to the second prayer in the Writ Petitions filed by the SubCommittee on Judicial Accountability and the Supreme Court Bar Association.
It was contended that till the Inquiry Committee actually found the concerned Judge guilty of charges, there should be no interdiction of his judicial functions and that if such a finding was recorded then thereafter till such time as the Motion for the presen tation of the Address for the removal of the Judge was disposed of by the Houses of Parliament which should not be delayed beyond 180 days the President may ask the Judge concerned to recuse from judicial functions.
Another Writ Petition was also filed by a practising Advocate challenging the constitutional validity of the as ultra vires Articles 100, 105, 118, 121 and 124(5) of the Constitution of India and seeking a declaration that the ' Motion presented by 108 Members of Parliament for the removal of the Judges 5 had lapsed with the dissolution of the Lok Sabha.
The peti tioner also sought the quashing of the decision of the Speaker admitting the Motion, on the ground of denial of opportunity of being heard to the concerned Judge before the admission of Motion and constitution of the Committee by Speaker.
A Transfer Petition was filed seeking the withdrawal by the Supreme Court to itself from the Delhi High Court the Writ Petition filed in the High Court, where reliefs were similar to those prayed for in the Writ Petition filed by the practising Advocate.
The Writ Petition was directed to be withdrawn to the Supreme Court and was heard along with other Writ Petitions.
1t was contended on behalf of the petitioners in these Writ Petitions that before taking a decision to admit the motion and constituting a Committee for investigation, it was incumbent upon the Speaker, as a minimum requirement of natural justice, to afford an opportunity to the Judge of being heard since such a decision had momentous consequences both to the Judge and to the judicial system as a whole and that any politically motivated steps to besmear a Judge would not merely affect the Judge himself but also the entire system of administration of justice and therefore it would greatly advance the objects and purposes of if the Judge concerned himself was given such a hearing; that the Speaker had acted contrary to Constitutional practice, that the manner in which he had admitted the motion smacked of malafides and since the Speaker had not entered appearance and denied the allega tions, he must be deemed to have admitted them; that having regard to the nature of the area the decision of the Court and its writ is to operate in, the Court should decline to exercise its jurisdiction, and that any decision rendered or any writ issued might, ultimately become futile and infruc tuous as the constitution of and investigation by the com mittee were not, nor intended to be, an end by themselves culminating in any independent legal consequence, but only a proceeding preliminary to and preceding the deliberations of the House on the motion for the presentation of an address to the President for the removal of a Judge, which was indisputably within the exclusive province of the Houses of Parliament over which courts exercised no control or juris diction.
On behalf of the Union of india it was contended that a combined reading of Articles 107, 108 and 109 would lead irresistibly to the conclusion that upon dissolution of the House, all bills would 6 lapse subject only to the exception stipulated in Article 108, that on first principle also it required to be accepted that no motion should survive upon the dissolution of the House unless stipulated otherwise under the Rules of proce dure and conduct of business; the doctrine of lapse was a necessary concomitant of the idea that each newly constitut ed House was a separate entity having a life of its own unless the business of the previous House was carried over by the force of statute or rules of procedure and that the question whether a motion lapsed or not was to be decided on the basis of the provisions of law guiding the matter and the House itself was not its final arbiter and the Court alone had jurisdiction to examine and pronounce on the law of the matter.
Disposing of the cases, this Court, HELD: By majority Per Ray.
J. (for himself, Venkatacha liah, Verma and Agrawal, J J) 1.1 Where there is a written Constitution which consti tutes the fundamental and in that sense a "higher law" and acts as a limitation upon the Legislature and other organs of the State as grantees under the Constitution, the usual incidents of parliamentary sovereignty do not obtain and the concept is one of 'limited Government '.
Judicial review is an incident of and flows from this concept of the fundamen tal and the higher law being the touchstone of the limits of the powers of the various organs of the State which derive power and authority under Constitution and that the judicial wing is the interpreter of the Constitution and, therefore, of the limits of authority of the different organs of the State.
In a federal set up, the judiciary becomes the guard ian of the Constitution.
The inter pretation of the Consti tution as a legal instrument and its obligation is the function of the Courts.
It is emphatically the province and duty of the judicial department to say what the law is.
[51 G H, 52A, D] 1.2 In interpreting the constitutional provisions con cerning the judiciary and its independence the Court should adopt a construction which strengthens the foundational features and the basic structure of the Constitution.
Rule of law is a basic feature of the Constitutional fabric and is an integral part of the constitutional structure.
Inde pendence of the judiciary is an essential attribute of Rule of law.
[31 D] 1.3 In construing the Constitutional provisions, the law and 7 procedure for removal of Judges in other countries afford a background and a comparative view.
The solution must, of course, be found within our own Constitutional Scheme.
But a comparative idea affords a proper perspective for the under standing and interpretation of the Constitutional Scheme.
[31 G H] Barringtons Case [1830]; Terrell vs Secretary of State for the Colonies and Another, , referred to.
Constituent Assembly Debates Vols.
I to VI @ pp 899,900 Vol.
VIII @ pp.
243 262, referred to.
Halsbury 's Laws of England, 4th Ed.
p 1108; She treet 'Judges on Trial ' (1976); pp.
404 405; Rodney Brazier 'Constitutional Texts ' (1990) pp.
606 607; Gall 'The Canadi an Legal System ' (1983); pp. 184 186, 189; Lane 's Commentary on The Australian Constitution (1986) p. 373; Mclelland 'Disciplining Australian Judges ' , at p. 403; Henry J. Abraham. ' The Judicial Process, 3rd Ed.
p. 45; Robert J. Janosik: Encyclopeadia of the American Judicial System, Vol II pp.
575 to 578; "The Impeachment of the Federal Judiciary" Wrisley Brown Harvard Law Review 1912 1913 684 at page 698; 'The Judicial Process in Comparative Perspective ' (Clarendon Press Oxford 1989 at page 73); (Erskine May 's "The Law, Privileges, Proceeding and Usage of Parliament" (Twenty first Edition London Butterworths 1989); M.N. Kaul and S.L. Shakdher in Practice and Procedure of Parliament", referred to.
2.1 It is not correct to say that the question whether a motion has lapsed or not was a matter pertaining to the conduct of the business of the House, of which the House was the sole and exclusive master, and that no aspect of the matter was justiciable before a Court.
[29 C ,53 G] 2.2 The question whether the motion has lapsed is a matter to be pronounced upon on the basis of the Constitu tion and the relevant rules.
[53 E] 2.3 On such interpretation of the Constitutional provi sions as well as the , the Courts retain jurisdiction to declare that a motion for removal of Judge does not lapse on dissolution of the House.
[53F G] Bradlaugh vs Gossett, [18841 , distinguished.
8 A.K. Gopalan vs The State of Madras, |; Special Reference Case; , , referred to.
Barton vs Taylor, , Rediffuson (Hong Kong) Ltd. vs Attorney General of Hong Kong, ; , referred to.
3.1 The constitutional process for removal of a Judge upto the point of admission of the motion, constitution of the Committee and the recording of findings by the Committee are not, strictly, proceedings in the Houses of Parliament.
The Speaker is a statutory authority under the Act.
Upto that point the matter cannot be said to remain outside the Court 's jurisdiction.
[66 E] 3.2 The scheme of Articles 124(4) and (5) is that the entire process of removal is in two parts the first part, under clause (5) from initiation to investigation and proof of misbehaviour or incapacity is covered by an enacted law, Parliament 's role being only legislative as in all the laws enacted by it, the second part under clause (4) is in Par liament and that process commences only on proof of misbeha viour or incapacity in accordance with the law enacted under clause (5).
Thus, the first part is entirely statutory, while the second part alone is the parliamentary process.
[61 D] 3.3 The context and setting in which clause (5) appears along with clause (4) in Article 124 indicate its nature and distinguish it from Articles 118, 119 and 121, all of which relate to procedure and conduct of business in Parliament.
[61 B C] 3.4 The validity of law enacted by the Parliament under clause (5) of Article 124 and the stage upto conclusion of the inquiry in accordance with that law, being governed entirely by statute, would be open to judicial review as the parliamentary process under Article 124(4) commences only after a finding is recorded that the alleged misbehaviour or incapacity is proved in the inquiry conducted in accordance with the law enacted under clause (5).
For this reason, the argument based on exclusivity of Parliament 's jurisdiction over the process and progress of inquiry under the and, consequently, exclusion of this Court 's jurisdiction in the matter at this stage does not arise.
[59 G H, 60 A] 4.1 Article 121 suggests that the bar on discussion in Parliament with respect to the conduct of any Judge is lifted 'upon a 9 motion for presenting an address to the President praying for the removal of a Judge as hereinafter provided '.
The words 'motion ' and 'as hereinafter provided ' are obvious references to the motion for the purpose of clause (4) of Article 124 which, in turn, imports the concept of "proved" misbehaviour or incapacity.
What lifts the bar under Article 121 is the 'proved ' misbehaviour or incapacity.
Clause (5) of Article 124 provides for an enactment of law for the purpose of investigation and proof of misconduct or incapac ity preceding the stage of motion for removal on the ground of 'proved ' misbehaviour or incapacity under clause (4).
[56 H, 57 A B] 4.2 An allegation of misbehaviour or incapacity of a Judge has to be made, investigated and found proved in accordance with the law enacted by the Parliament under Article 124 (5) without the Parliament being involved upto that stage; on the misbehaviour or incapacity of a Judge being found proved in the manner provided by that law a motion for presenting an address to the President for remov al of the Judge on that ground would be moved in each House under Article 124(4); on the motion being so moved after the proof of misbehaviour or incapacity and it being for pre senting an address to the President praying for removal of the Judge, the bar on discussion contained in Article 121 is lifted and discussion can take place in the Parliament with respect to the conduct of the Judge; and the further conse quences would ensue depending on the outcome of the motion in a House of Parliament.
If, however, the finding reached by the machinery provided in the enacted law is that the allegation is not proved, the matter ends and there is no occasion to move the motion in accordance with Article 124(4).
[57 G H, 58 A B] 4.3 Thus prior proof of misconduct in accordance with the law made under Article 124(5) is a condition precedent for the lifting of the bar under Article 121 against dis cussing the conduct of a Judge in the Parliament.
Article 124(4) really becomes meaningful only with a law made under Article 124(5), without which, the constitutional scheme and process for removal of a Judge remains inchoate.
[66 F] 4.4 The bar in Article 121 applies to discussion in Parliament but investigation and proof of misconduct or incapacity cannot exclude such discussion.
This indicates that the machinery for investigation and proof must neces sarily be outside Parliament and not within it.
In other words, proof which involves a discussion of the conduct of the Judge must be by a body which is outside the limita 10 tion of Article 121.
The policy appears to be that the entire stage upto proof of misbehaviour or incapacity, beginning with the initiation of investigation on the alle gation being made, is governed by the law enacted under Article 124(5) and in view of the restriction provided in Article 121, that machinery has to be outside the Parliament and not within it.
Parliament neither has any role to play till misconduct or incapacity is found proved nor has it any control over the machinery provided in the law enacted under Article 124(5).
Parliament comes in the picture only when a finding is reached by that machinery that the alleged misbe haviour or incapacity has been proved.
The enacted under article 124(5) itself indicates that the Parliament so understood the integrated scheme of Arti cles 121, 124(4) and 124(5).
The general scheme of the Act conforms to this view.
[58 H 59 A D] 4.5 It is not the law enacted under Article 124(5) which abridges or curtails the parliamentary process or exclusivi ty of its jurisdiction, but the Constitutional Scheme itself which by enacting clauses (4) and (5) simultaneously indi cated that the stage of clause (4) is reached and the proc ess thereunder commences only when the alleged misbehaviour or incapacity is proved in accordance with the law enacted under clause (5).
It is only then that the need for discuss ing a Judge 's conduct in the Parliament arises and, there fore, the bar under Article 121 is lifted.
[60 D E] 5.1 If the motion for presenting an address for removal is envisaged by Articles 121 and 124(4) 'on ground of proved misbehaviour or incapacity ', it presupposes that misbeha viour or incapacity has been proved earlier.
This is more so on account of the expression 'investigation and proof ' used in clause (5) with specific reference to clause (4), indi cating that 'investigation and proof ' of misbehaviour or incapacity is not within clause (4) but within clause (5).
Use of the expression 'same session ' in clause (4) without any reference to session in clause (5) also indicates that session of House has no significance for clause (5) i.e., 'investigation and proof ' which is to be entirely governed by the enacted law and not the parliamentary practice which may be altered by each Lok Sabha.
[61 F H] 5.2 The significance of the word 'proved ' before the expression 'misbehaviour or incapacity ' in clause (4) of Article 124 is also indicated when the provision is compared with Article 317 providing for removal of a member of the Public Service Commission.
The expression in clause (1) of Article 317 used for describing the ground 11 of removal is 'the ground of misbehaviour ' while in clause (4) of Article 124, it is, 'the ground of proved misbeha viour or incapacity '.
[62 A] 5.3 Use of the word 'may ' in clause (5) indicates that for the 'procedure for presentation of address ' it is an enabling provision and in the absence of the law, the gener al procedure or that resolved by the House may apply but the 'investigation and proof ' is to be governed by the enacted law.
The word 'may ' in clause (5) is no impediment to this view.
When a provision is intended to effectuate a right here it is to effectuate a constitutional protection to the Judges under Article 124(4) even a provision as in Arti cle 124(5) which may otherwise seem merely enabling becomes mandatory.
The exercise of the power is rendered obligatory.
The use of the word 'may ' does not necessarily indicate that the whole of clause (5) is an enabling provision leaving it to the Parliament to decide whether to enact a law even for the investigation and proof of the misbehaviour or incapaci ty or not.
[62 D, 62 G, 63 E F] State of Uttar Pradesh vs Joginder Singh, ; at 202; Punjab Sikh Regular Motor Service, Moudhapara vs The Regional Transport Authority, Raipur & Anr., ; , referred to.
Erederic Guilder ,Julius vs The Right Rev. The Lord Bishop of Oxford, ' the Rev. Thomas Tellusson Carter, at 244, referred to.
5.4 Similarly, use of word 'motion ' to indicate the process of investigation and proof in the , because the allegations have to be presented to the 'Speaker ' does not make it 'motion in the House ' not withstanding use of that expression in Section 6.
Otherwise, section 6 would not say that no further step is to be taken in case of a finding of 'not guilty '.
It only means that when the allegation is not proved, the Speaker need not commence the process under clause (4) which is started only in case it is proved.
The Speaker is, therefore, a statutory authority under the Act chosen because the further process is parliamentary and the authority to make such a complaint is given to Members of Parliament.
Moreover, the enactment under Article 124(5) cannot be a safe guide to determine the scope of Article 124(5).
[64 A C] 6.1 Article 124(5) does not operate in the same field as Article 118 relating to procedure and conduct of business in Parliament.
[61C] 12 6.2 Article 118 is a general provision conferring on each House of Parliament the power to make its rules of procedure.
These rules are not binding on the House and can be altered by the House at any time.
A breach of the rules amounts to an irregularity and is not subject to judicial review in view of Article 122.
[64 G] 6.3 Article 124(5) is in the nature of a special provi sion intended to regulate the procedure for removal of a Judge under Article 124(4), which is not a part of the normal business of the House but is in the nature of special business.
It covers the entire field relating to removal of a Judge.
Rules made under Article 118 have no application in this field.
[64 H, 65 A] 6.4 Article 124(5) has no comparison with Article 119.
Articles 118 and 119 operate in the same field viz., normal business of the House.
It was, therefore, necessary to specifically prescribe that the law made under Article 119 shall prevail over the rules of procedure made under Article 118.
Since Articles 118 and 124(5) operate in different fields; a provision like that contained in Article 119 was not necessary and even in the absence of such a provision, a law made under Article 124(5) will override the rules made under Article 118 and shall be binding on both the Houses of Parliament.
A violation of such a law would constitute illegality and could not be immune from judicial scrutiny under Article 122(1).
[65 B C] 7.1 Neither the doctrine that dissolution of a House passes a sponge over parliamentary slate nor the specific provisions contained in any rule or rules framed under Article 118 of the Constitution determine the effect of dissolution on the motion for removal of a Judge under Article 124, because Article 124(5) and the law made there under exclude the operation of Article 118 in this area.
[49 F] Purushothaman Nambudiri vs The State of Kerala, [1962] Suppl.
1 SCR 753, referred to.
7.2 The law envisaged in Article 124(5) is parliamentary law which is of higher quality and efficacy than rules made by the House for itself under Article 118.
Such a law can provide against the doctrine of lapse.
[50 H] 7.31n the constitutional area of removal of a Judge, the law made under Article 124(5) must be held to go a little further and to exclude the operation of the Rules under Article 118 and no ques 13 tion of repugnance could arise to the extent the field is covered by the law under Article 124(5).
[51 C] State of Punjab vs Sat Pal Dang & Ors, ; , relied on.
8.1 The reflects the consti tutional philosophy of both the judicial and political elements of the process of removal.
The ultimate authority remains with the Parliament in the sense that even if the Committee for investigation records a finding that the Judge is guilty of the charges, it is yet open to the Parliament to decide not to present an address to the President for removal.
But if the Committee records a finding that the Judge is not guilty then the political element in the proc ess of removal has no further option.
The law is, indeed, a civilised piece of legislation reconciling the concept of accountability of Judges and the values of judicial inde pendence.
The provisions of the do not foul with the constitutional scheme.
[65 B C, 64 C] 8.2 The Speaker, while admitting a motion and constitut ing a Committee to investigate the alleged grounds of misbe haviour or incapacity does not act as part of the House.
The House does not come into the picture at this stage.
The provisions of the are not uncon stitutional as abridging the powers and privileges of the House.
The is constitutional and is intra vires.
[66 G H] 9.1 The is law enacted under Article 124(5) which provides against doctrine of lapse.
9.2 The effect of sections 3(1) and (2) and 6(2) of the , is that the motion should be kept pending till the committee submits its report and if the committee finds the Judge guilty, the motion shall be taken up for consideration.
Only one motion is envisaged which will remain pending.
No words of limitation that the motion shall be kept pending subject to usual effect of dissolution of the House can or should be imported.
[50 G] 9.3 Section 3 of the Act applies to both the Houses of Parliament.
The words "shall keep the motion pending" cannot have two different meanings in the two different contexts.
It can only mean that the consideration of the motion shall be deferred till the report 14 of the Committee implying that till the happening of that event the motion will not lapse.
Therefore, such a motion does not lapse with the dissolution of the House of Parlia ment.
[51 D] 10.
At the stage of the provisions when the Speaker admits the motion under section 3 of the , a Judge is not, as a matter of right, entitled to a notice.
The scheme of the statute and the rules made there under by necessary implication, exclude such a right.
But that may not prevent the Speaker, if the facts and circum stances placed before him indicate that hearing the Judge himself might not be inappropriate, might do so.
But a decision to admit the motion and constitute a Committee for investigation without affording such an opportunity does not, by itself and for that reason alone, vitiate the deci sion.
[68 E G] 11.1 It is true that society is entitled to expect the highest and most exacting standards of propriety in judicial conduct, and any conduct which tends to impair public confi dence in the efficiency, integrity and impartiality of the court is indeed forbidden.
But, the proposition that, apart from the constitutional machinery for removal of a Judge, the judiciary itself has the jurisdiction and in appropriate cases a duty to enquire into the integrity of one of its members and restrain the Judge from exercising judicial functions is beset with grave risks.
The court would then indeed be acting as a tribunal for the removal of a Judge and is productive of more problems than it can hope to solve.
[69 C, 70 H] Sampath Kumar & Ors.
vs Union of India & Ors, , referred to.
Corpus Juris Secundum, (VoI.48A), referred to.
11.2 The relief of a direction to restrain the Judge from discharging judicial functions cannot be granted.
The entire Constitutional Scheme, including the provisions relating to the process of removal of a Judge are to be taken into account for the purpose of considering this aspect.
Since the Constitutional Scheme is that the Judge 's conduct cannot be discussed even in the Parliament which is given the substantive power of removal, till the alleged misconduct or incapacity is 'proved ' in accordance with the law enacted for this purpose, it is difficult to accept that any such discussion on the conduct of the Judge or any evaluation or inference as to its 15 merit is permissible according to law elsewhere except during investigation before the Inquiry Committee constitut ed under the statute for this purpose.
Therefore, it is difficult to accept that there can be any right in anyone running parallel with the Constitutional Scheme for this purpose contained in clauses (4) and (5) of Article 124 read with Article 121.
No authority can do what the Constitution by necessary implication forbids.
[71 B F] 11.3 The question of propriety is, however, different from that of legality.
Whether the Judge should continue to function during the intervening period is to be covered by the sense of propriety of the concerned Judge himself and the judicial tradition symbolised by the views of the Chief Justice of India.
It should be expected that the Judge would be guided in such a situation by the advice of the Chief Justice of India, as a matter of convention, unless he himself decided as an act of propriety to abstain from discharging judicial functions during the interregnum.
It is reasonable to assume that the framers of Constitution had assumed that a desirable convention would be followed by a Judge in that situation which would not require the exercise of a power of suspension.[It would also be reasonable to assume that the Chief Justice of India is expected to find a desirable solution in such a situation to avoid embarrass ment to the concerned Judge and to the Institution in a manner which is conducive to the independence of judiciary and should the Chief Justice of India be of the view that in the interests of the institution of judiciary it is desira ble for the Judge to abstain from judicial work till the final outcome under Article 124(4), he would advise the Judge accordingly, and the concerned Judge would ordinarily abide by the advice of the Chief Justice of India.
All this is, however, in the sphere of propriety and not a matter of legal authority to permit any court to issue any legal directive t? the Chief Justice of India for this purpose.
[71 G, 72 A, C E] 12.
Even on the allegations made in the petition and plea of malafides which require to be established on strong grounds no such case is made out.
A case of malafides cannot be made out merely on the ground of political affiliation of the Speaker either.
That may not be a sufficient ground in the present context.
At nil events, as the only statutory authority to deal with the matter, doctrine of statutory exceptions or necessity might be invoked.
[74 B C] 13.
The law as to standing to sue in public interest actions has 16 undergone a vast change over the years and liberal standards for determining locus standi are now recognised.
The present matter is of such nature and the constitutional issues of such nature and importance that it cannot be said that members of the Bar, and particularly, the Supreme Court Bar Association have no locus standi in the matter.
An elaborate re survey of the principles and precedents over again is unnecessary.
Suffice it to say that from any point view, the petitioners satisfy the legal requirements of the standing to sue.
[74 E F] S.P. Gupta & Ors.
vs Union of India & Ors. etc.
, [1982] 2 SCR 365, relied on.
Certain submissions advanced on the prayer seeking to re.strain the judge from functioning till the proceedings of the committee were concluded lacked as much in propriety as in dignity and courtesy with which the Judge is entitled.
While the members of the bar may claim to act in public interest, they have, at the same time, a duty of courtesy and particular care that in the event of the charges being found baseless or insufficient to establish any moral turpi tude, the Judge does not suffer irreparably in the very process.
The approach should not incur the criticism that it was calculated to expose an able and courteous Judge to public indignity even before the allegations were examined by the forum constitutionally competent to do so.
The level of the debate both in and outside the Court should have been more decorous and dignified.
Propriety required that even before the charges are proved in the only way in which it is permitted to be proved, the Judge should not be embarrassed.
The constitutional protection to Judges is not for their personal benefit; but is one of the means of protecting the judiciary and its independence and is, therefore, in the larger public interest.
Recourse to constitutional methods must be adhered to if the system were to survive.
[74 G, 75 A C] 15.1 The interpretation of the law declared by this Court that a motion under section 3(2) of the Judges (In quiry) Act, 1968, does not lapse upon the dissolution of the House is a binding declaration.
If the law is that the motion does not lapse, there can be no occasion for the House to say so at any time and it is erroneous to assume that the Houses of Parliament would act in violation of the law, since the interpretation of the law is within the exclusive power of the courts.
[76 E] 17 25.2 If the House is not required to ' consider this question since the parliamentary process can commence only after a finding of guilt being proved, the further question of a futile writ also does not arise.
The point that the House can decide even after a finding of guilt that it would not proceed to vote for removal of the Judge is not germane to the issue since that is permissible in the Constitutional Scheme itself under Article 124(4), irrespective of the fact whether Article 124(5) is a mere enabling provision or a constitutional limitation on the exercise of power under Article 124 (4).
[60 B C] 15.3 The Union Government has sought to interpret the legal position for purpose of guiding its own response to the situation and to regulate its actions on the Speaker 's decision.
That understanding of the law is unsound.
[76 G] 15.4 No specific writ of direction need issue to any authority.
Having regard to the nature of the subject matter and the purpose it is ultimately intended to serve, all that is necessary is to declare the legal and correct constitu tional position and leave the different organs of the State to consider matters falling within the orbit of their re spective jurisdiction and powers.
[76 H, 77 A] 15.5 In the circumstances, the question of Court de clining to exercise its jurisdiction on the ground that the Judgment rendered and Writ issued by it would become infruc tuous does not arise.
[31 A C, 77 A] Per Sharma, J. (dissenting); 1.1 On a close examination of the Constitution, it is clear that a special pattern has been adopted with respect to the removal of the members of the three organs of the State.
The Executive, the Legislature and the Judiciary at the highest level, and this plan having been consciously included in the Constitution, has to be kept in mind in construing its provisions.
The approach should be that when a question of removal of a member of any of the three wings at the highest level i.e. the President; the Members of the Parliament and the State Legislatures; and the Judges of the Supreme Court and the High Courts arises, it is left to an organ other than where the problem has arisen, to be decid ed.
Consistent with this pattern, Clause (4) of Article 124 in emphatic terms declares that a Judge of the Supreme Court or the High Court shall not be removed from his office except on a special majority of the Members of each House of Parliament.
Both the Executive and the Judiciary 18 are thus excluded in this process.
The scheme cannot be construed as lack of trust in the three organs of the State.
There are other relevant considerations to be taken into account while framing and adopting a written Constitution, which include the assurance to the people that the possibil ity of a subjective approach clouding the decision on an issue as sensitive as the one under consideration, has been as far eliminated as found practicable in the situation.
And where this is not possible at all, it cannot be helped, and has to be reconciled by application of the doctrine of necessity, which is not attracted in the instant case.
[81 F H, 82 D E,F G] A11 Party Hill Leaders Conference vs M.A. Sangma, ; at 411, referred to.
The Federalist: Hamilton, referred to.
1.2 There cannot be two opinions on the necessity of an independent and fearless judiciary in a democratic country like ours, but it does not lead to the further conclusion that the independence of judiciary will be under a threat, unless the matter of removal of Judges, even at the highest level, is not subjected to the ultimate control of Courts.
Great care was taken by the framers of the Constitution to this aspect and the matter was examined from every possible angle, before adopting the scheme as laid down.
So far as the district courts and subordinate courts are concerned, the control has been vested in the High Court, but when it came to the High Court and Supreme Court Judges, it was considered adequate for the maintenance of their independ ence to adopt and enact the Constitution as it is found now.
There is no reason to doubt the wisdom of the Constituent Assembly in entrusting the matter exclusively in the hands of the Parliament and there is no ground for suspicion that the Members of Parliament or their representatives, the Speaker and the Chairman, shall not be acting in the true spirit of the Constitutional provisions.
The mandate of the Constitution is binding on all.
[100 B E] 2.1 The exercise of power under clause (4) was not made conditional on the enactment of a law under clause (5), and the reason for inserting clause (5) in Article 124 was merely for elaborating the provisions.
Clause (4) does not state that the misbehaviour or the incapacity of the Judge will have to be proved only in accordance with a law to be passed by the Parliament under clause (5) Clause (4) would continue to serve the purpose as it does now, without any 19 amendment if clause (5) were to be removed from the Consti tution today.
There is no indication of any limitation on the power of the Parliament to decide the manner in which it will obtain a finding on misbehaviour or incapacity for further action to be taken by it.
Clause (5) merely enables the parliament to enact a law for this purpose, if it so chooses.
[88 E, 88 A, 89 A] 2.2 The word 'may ' has been sometimes understood in the imperative sense as 'shall ', but ordinarily it indicates a choice of action and not a command.
In the present context, there is no reason to assume that it has been used in its extraordinary meaning.
[88 F] 3.
The object of Article 121 is to prevent any discus sion in Parliament with respect to the conduct of a Judge of the Superior Courts, except when it cannot be avoided.
The Article, accordingly, prohibits such a discussion except upon a motion for presenting an address to the President for removal of a Judge.
[89 B] 4.1 The expression "motion" has not been defined in the .
The Lok Sabha Rules framed under Article 118 of the Constitution deal with "motions".
There are separate rules of procedures for conduct of business adopted by the Rajya Sabha.
Section 3(1) of the Act states that if a notice of "motion" is given for presenting an address to the President for the removal of a Judge, the Speaker or the Chairman, as the case may be, after consult ing such persons as he deems fit, as also such relevant materials which may be available to him either admit the "motion" or refuse to admit the same.
The manner in which this section refers to "motion" in the Act for the first time without a definition or introduction clearly indicates that it is referring to that "motion" which is ordinarily understood in the context of the two Houses of Parliament attracting their respective rules.
Section 3 does not speci fy as to how and to whom the notice of "motion" is to be addressed or handed over and it is not quite clear as to how the Speaker suddenly comes in the picture unless the Lok Sabha Rules are taken into account.
Therefore, the provi sions of the Act have to be read alongwith some of the Lok Sabha Rules.
Rules 185, 186 and 137 which are relevant for the purpose should be treated to be supplementary to the Act.
[90 D G, 91 B] 4.2 Sub section (2) of Section 3, which is of vital importance in the present context, says that if the "motion" referred to in subsection (1) is admitted, the Speaker "shall keep the motion pending" 20 and constitute a Committee for investigation into the alle gations.
191 C] 4.3 The situs where the "motion" is pending is almost conclusive on the issue whether the House is seized of it or not.
The Act does not leave any room for doubt that the "motion" remains pending in the House and not outside it.
This is corroborated by the language used in proviso to Section 3(2) which deals with cases where notices of "mo tion" under Section 3(1) are given on the same date in both Houses of Parliament.
It says that in such a situation, no Committee shall be constituted unless the "motion" has been "admitted in both Houses", and where such "motion" has been admitted "in both Houses", the Committee shall be constitut ed jointly by the Speaker and the Chairman.
It is not an inadvertent reference in the Act of the "motion" being pending in the House: the Act and the Rules made thereunder envisage and deal with a "motion" which is admitted in the House and remains pending there to be taken up again when the date is fixed by the Speaker on receipt of the report from the Committee.
The language throughout the Act has been consistently used on this premise and is not capable of being ignored or explained away.
[91 D, G H, 92 A, C D] 4.4 The scope of the Act and the Rules is limited to the investigation in pursuance of a "motion" admitted by the Speaker.
At the conclusion of the investigation the Commit tee has to send the report to the Speaker (or the Chairman as the case may be) along with a copy of the original Mo tion.
If the finding goes against the Judge, the Motion, the same original Motion, together with the report would be taken up for consideration by the House where the Motion is pending, and the address and the Motion would be put to vote together in each House of Parliament.
What the Act and the Rules contemplate is the original Motion to be taken up for consideration by the House, and if this Motion is held to have exhausted itself on admission by the Speaker nothing remains on which the Act would operate.
[92 E, G] 4.5 Thus, the concept of the original Motion being pending in the House, to be taken up for debate and vote on the receipt of the report of the Committee, is the life and soul of the Act, and if that Motion disappears nothing remains behind to attract the Act.
This idea runs through the entire Act and the Rules, and cannot be allowed to be replaced by a substitute.
The existence of a Motion pending in the House is a necessary condition for the application of 21 the Act.
Bereft of the same, the Act does not survive.
It is, therefore, not permissible to read the Act so as to mean that the House is not seised of the Motion and that it does not have anything to do with the inquiry pending before the Committee, until the report is received.
If clauses (4) and (5) of Article 124 are construed otherwise the Act will have to be struck down as ultra vires, or in any event, inopera tive and infructuous and, on this ground alone, the Writ Petitions are liable to be dismissed.
[92 H, 93 A B] 5.1 The mandate of the Constitution against discussion on the conduct of a Judge in the House is for everybody to respect, and it is the bounden duty of the Speaker to en force it.
He has to ensure that Article 121 is obeyed in terms and spirit.
The pendency of the motion in the House cannot be a ground to violate Article 121, and the apprehen sion that if the motion is held to be pending in the House, on its admission, the object of Article 121 would be defeat ed is misconceived.
[93 C, F] 5.2 The wider proposition that the House was seized of the matter so effectively as to entitle every member to demand a discussion in the House at any stage will not only violate Article 121, but also offend the provisions of the 1968 Act.
It is not correct to assume that if the right of the individual member to insist on immediate discussion is denied, the consequence will be to deprive the Parliament of the control of the motion.
The Speaker may consult other persons before admitting the motion, and while so doing he may consult the members of the House also, but without permitting a discussion in the House.
The consultation, which the Act permits, is private in nature, not amounting to a public discussion, while the object of Article 121 is to prevent a public debate.
It may also be open to the Speaker to consult the House on a legal issue which can be answered without reference to the conduct of Judge in ques tion, as for example, the issue involved in the instant case, whether on account of dissolution of the old House the Motion has lapsed and the Committee of Inquiry is defunct.
What is prohibited is not every matter relating to the removal of a Judge; the bar is confined to a discussion with respect to the conduct of a Judge in the discharge of his duties.
[95 E H, 96A] 5.3 There is no justification for interpreting such portion of the 1968 Act, which directed or declared the initial motion admitted by the Speaker to remain pending in the House, as creating legal fiction limited for the purpose of ensuring that the bar under Article 121 was not lifted prematurely.
[96 B] 22 East End Dwellings Co. Ltd. And Finsbury Borough Coun cil: , referred to.
5.4 A close reading of the entire Act indicates that the language therein was consciously chosen to make the House seized of the matter, and consequently it became necessary to include the provision directing the motion to remain pending for the purpose of preventing a premature discus sion.
The Act has, thus, very successfully respected both Articles 124 and 121 in their true spirit, by neatly harmo nising them.
[97 B] 5.5 Parliament is in control of the matter from the very beginning till the end.
By the introduction of the Speaker and the requirement of a large number of members of either House to initiate the matter, the House is brought in con trol of the proceeding through its representative, the Speaker or the Chairman.
The ground of proved misbehaviour or incapacity is necessary only for putting the matter to vote in the House under clause (4), and is not a condition precedent for initiating a proceeding and taking further steps in this regard. ]97 G H, 98 A] 5.6 It is a well established practice for a larger body to entrust investigations to a smaller body for obvious practical reasons, and such an exercise cannot be characte rised as indulging in abnegation of authority.
It could have asked a Parliamentary Committee to enquire into the allega tions or employed any other machinery for the purpose.
[98 D] 5.7 So long as the statute enables the House to maintain its control either directly or through the Speaker, the entrustment of the investigation does not amount to abdica tion of power.
It is a case where the Parliament has taken a decision to respect the verdict of the Committee in favour of the Judge, consistently with clause (4) and no fault can be found.
199 B] State of Uttar Pradesh vs Batuk Deo Pati Tripathi and Anr., , referred to.
5.8 The House, which is in control of the proceeding is entitled to take all necessary and relevant steps in the matter, except discussing the conduct of the Judge until the stage is reached and the bar under Article 121 is lifted.
If it is held that the Committee is an independent statutory body not subject to the control of the House 23 directly or through the Speaker, then the Act may be ren dered unworkable.
Besides, this would lower the dignity of the Chief Justice of India by providing a machinery consist ing of 5 or 4 Judges to sit in ,appeal over him.
If the Committee is held to be functioning under the supervision and control of the Parliament, with a view to aid it for the purpose of a proceeding pending in the House, it will be the Parliament which will be in control of the proceeding and not the Committee.
[99 E F, H] 6.1 When even after a verdict against the Judge is returned by the Committee, the Parliament, or for that matter any of the two Houses can refuse to vote in favour of the Motion for removal of a Judge, and the Court would not have any jurisdiction to interfere in the matter, it is not conceivable, that at the intermediate stage of investigation the Court has got the power to intervene.
This is because, if the control of the House continues on the proceeding throughout, which can be exercised through the Speaker, it cannot be presumed that the Court has a parallel jurisdic tion, which may result in issuance of contradictory direc tions.
Besides, the Court cannot be expected to pass orders in the nature of step in aid, where the final result is beyond its jurisdiction.
Any order passed or direction issued by this Court may result in merely an exercise in futility, and may cause a situation, embarrassing both for the highest judicial and legislative authorities of the country.
The Constitution cannot be attributed with such an intention.
[101 A C] 6.2 In the circumstances the courts, including this Court, do not have any jurisdiction to pass any order in relation to a proceeding for removal of a Judge of the superior courts.
[101 C] 7.
No opinion is expressed on the controversy whether the Motion lapsed or not on the dissolution of the earlier House, as the issue is for the Lok Sabha to decide.
[102 E] 8.
This Court cannot pass any order whether permanent or temporary on the prayer that the respondent No. 3, the concerned Judge, should not be allowed to exercise his judicial powers.
[102 F] 9.1 Although the powers of State have been distributed by the Constitution amongst the three limbs, i.e. the Legis lature, the Executive and the Judiciary, the doctrine of Separation of Powers has not been strictly adhered to and there is some overlapping of powers in the gray areas.
[80F G] 24 Smt.
Indira Gandhi vs Raj Narain, at p. 415, referred to.
9.2 Generally, questions involving adjudication of disputes are amenable to the jurisdiction of the courts, but there are exceptions, not only those covered by specific provisions of the Constitution in express terms, but others enjoying the immunity by necessary implication arising from established jurisprudential principles involved in the Constitutional scheme.
[81 C] 10.
It is permissible to take into consideration the entire historical background of the provisions of the Con stitution and the Act as aid to interpretation.
[84 C] Bengal Immunity Company vs The State of Bihar, at 632 & 633; B. Prabhakar Rao vs State of Andhra Pradesh, [1985] Suppl 2 SCR 573, referred to.
Heydon 's case: 76 E.R. 637; Eastman Photographic Materi al Company vs Comptroller General of Patents, LR. , referred to.
|
Appeals Nos. 262 to 265 of 1970.
Appeals by special leave from the judgment and order dated May 1, 1969 of the Allahabad High Court in Sales Tax Reference Nos. 249, 250, 251 and 571 of 1966 and Civil Appeals Nos. 266 and 267 of 1970.
Appeals by special leave from the judgment and order dated January 29, 1969 of the Allahabad High Court in Sales Tax Reference Nos. 604 and 603 of 1965.
H. R. Gokhale, Gobind Das, D. N. Mishra and B. P. Singh, for the appellant (in all the appeals).
C. B. Agarwala and 0.
P. Rana, for the respondent (in all the appeals).
732 The Judgment of the Court was delivered by Hegde, J.
These are connected appeals by special leave.
The only question raised in these appeals is whether 'Sarin Tooth Powder ' manufactured by M/s. Sarin Chemicals Laboratory is "cosmetic" or a "toilet requisite" as held by the High Court of Allahabad or it is an unspecified commodity liable to sales tax at all points of sale as held by the Additional Judge (Revisions) Sales Tax, Agra.
The contention of M/s. Sarin Chemical Laboratory who is the appellant in all the appeals is that the turn over relating to the sales of tooth powder is liable to be taxed at the rate of 3 pies per rupee under section 3 of the U.P. Sales Tax Act (to be hereinafter referred to as the Act) whereas Commissioner of Sales Tax, U.P. contends that the said turn over is liable to be taxed at single point under section 3(A) of that Act read with Entry 6 of the notification No. 905/X dated March 31, 1956.
The High Court has accepted the contention of the Commissioner.
In these appeals the assessee challenges the conclusion reached by the High Court and supports the view taken by the Additional Judge (Revisions) Sales Tax, Agra, who held that the tooth powder is an unspecified commodity liable to tax under section 3 of the Act.
Neither the expression 'cosmetic ' nor 'toilet requisite ' has been defined in the Act.
The dictionary meaning of the expression 'cosmetic ' (see Webster 's international Dictionary) is "A preparation to beautify or alter appearance of the body or for cleansing, coloring, conditioning or protecting skin, 'hair, nails, eyes or teeth".
The same dictionary gives the meaning of the expression "toilet" thus : 'an act or process of dressing, especially formerly of dressing hair and now usually cleansing and grooming of one 's person".
The word "toiletry" is explained in the said dictionary as meaning "an article or preparation used in making one 's toilet such as soap, lotion, cosmetic, tooth paste, shaving cream, cologne etc.
According to the dictionary meaning tooth powder is regarded both as an item of cosmetic and toilet: but as observed by this Court in Bamavatar Budhaiprasad vs The Asstt.
Sales Tax Officer, Akola and another(1), the names of articles, the sales and purchases of which are liable to be taxed given in a statute unless defined in the statute must be construed not in a technical sense but as understood in common parlance.
Therein this Court was called ' upon to consider whether 'betel leaves ' could be considered as 'vegetable ' under item No. 6 of Schedule II of the C. P. Berar Sales Tax Act, 1947.
In that case this Court observed that the word 'vegetable ' had not been defined in the Act and being a word of every day use, (1) 12, section T. C. 286; 733 it must be construed in a popular sense, meaning "that sense which people conversant with the, subject in matter with which statute is dealing would attribute to it.
" Applying that test this Court ruled that betel leaves cannot be considered as 'vegetable '.
In common parlance a tooth powder is considered as a toilet.
That meaning ,accords with the dictionary meaning, as well.
The question whether tooth powder can be considered as a toilet came up before the Madras High Court in V. P. Sanasundara Mudaliar vs State of Madras( ') and before the Bombay High Court in Commissioner of Sales Tax vs Vicco Laboratories(2).
Both the courts took the view that the tooth powder is a toilet.
The same view has been taken by the Allahabad High Court.
We are in agreement with that view In the result these appeals fail and they are dismissed with costs hearing fee one set.
Y.P. Appeals dismissed.
(1) 14.
section T. C. 943.
(2) 22.
section T. C. 169.
| Seven persons including S (the appellant) and T were tried together, five under section 396 I.P.C. and the appellant and T under section 396 read with section 109 I.P.C. The prosecution case depended only on circumstantial evidence and mainly on the testimony of two witnesses.
The trial court convicted six accused, including the appellant and acquitted one.
On appeal to the High Court by the convicted persons additional evidence was recorded and section and T were also reexamined as accused for explaining the prosecution evidence.
In the High Court prosecution relied on the following five circumstances against S and T : 1.
Bitter enmity between G and C on the one side and S and T who were fast friends on the other; 2.
The nature of the incident suggests that the primary object of the culprits was to commit the murder of G and C and having failed to kill C his property was looted as incidental venture; 3.
On the evening preceding the night of dacoity S and T were seen in the company of five or six persons including the accused Gajju armed with kanthas, ballas and lathis, 4.
S, who was inimical to G and C, raised false alarm at the time of dacoity to show false sympathy; and 5.
On the following morning after dacoity S lodged F.I.R. by way of Peshabadi for putting the police on wrong track.
The appeal was dismissed by the High Court.
According to both the courts below S and T were, not amongst the dacoits.
They were only stated to have assembled at the time of the dacoity.
S is a first cousin of G and C, two victims of the dacoity.
G was killed during the course of the dacoity.
On appeal by special leave in the Supreme Court counsel for the respondent State contended that it should not interfere with the conclusions of the two courts below holding the appellant guilty.
Disagreeing with this contention.
HELD: This Court undoubtedly does not normally proceed to review and reappraise for itself the evidence in criminal cases when hearing appeals under article 136.
But when the judgment under appeal has resulted in grave miscarriage of justice by some misapprehension or mistake in the reading of evidence or by ignoring material evidence then this Court is not only empowered but is expected to interfere to promote the cause 827 of justice.
Article 136 is worded in very wide terms and the power conferred by it is not hedged in by any technical hurdles.
This over riding and exceptional power has been vested in this Court to be exercised sparingly and only in furtherance of the cause of justice.
In the present case which depends only on circumstantial evidence.
the courts below have completely ignored the warning given by this Court in Hanumant vs The State of Madhya Pradesh [1952 S.C.R. 1091] against the danger of conjectures and suspicions taking the place of proof.
Evidence on basic or primary facts has of course to be approached in the ordinary practical way but the conclusions in the case of circumstantial evidence must necessarily point only to the guilt of the accused excluding any reasonable possibility of innocence.
[832 B].
After considering the evidence on the record, HELD : None of the five circumstances were established on the record; nor could they be considered either singly or collectively to be sufficiently cogent to bring home to the appellant abetment of the offence charged beyond the possibility of reasonable doubt.
The evidence in the case did not satisfy the test required in cases founded on circumstantial evidence.
The appeal was allowed.
|
iminal Appeal No. 50 of 1962.
Appeal by special leave from the judgment and order dated September 12, 1961, of the Allahabad High Court (Lucknow Bench) at Lucknow in Criminal Appeal No. 494 of 1961.
Nuruddin Ahmed, for the appellant.
G.C. Mathur and 0.
P. Lal, for the respondent.
May 3.
The Judgment of the Court was delivered by S.R. DAS, J.
The learned Sessions Judge of Rae Bareli tried the appellant Prabhu on a charge of murdering his own uncle and found him guilty of the offence and sentenced him to death.
There were an appeal to the High Court and the usual reference for confirmation of the sentence of death.
The High Court dealt with the appeal and reference by one judgment.
It accepted the reference,, dismissed the appeal and confirmed the conviction and sentence.
The appellant then asked for and obtained special leave of this Court to appeal from the judgment and order of the High Court.
The present appeal has come to us in pursuance of the leave granted by this Court.
Shortly stated the case against the appellant was this.
Bhagwan Ahir, step brother of the appellants father Budhai, was a resident of 883 village Bandi in the district of Rae Bareli, The appellant and his father Budhai lived in another village called Gulariya at a distance of about two or three miles from Bandi.
Bhagwan had about four bighas of pasture land and seven bighas of cultivated land.
He had no male issue, He had several daughters who were all married and resided at the places of their respective husbands.
Bhagwan was old, near about 80 years of age according to the evidence of Marka, and had no male member in the family to help him with his cultivation.
Budhai, it appears, did not reside in village Gulariya all the year round, but was engaged in some job at Burdwan in Bengal.
Some four years before the date on, which Bhagwan was said to have been murdered the appellant and his mother came to reside with Bhagwan.
The idea was that the appellant would be able to help Bhagwan with his cultivation.
The appellant did not, however, render much assistance to Bhagwan and the prosecution case, was that after about a year of their stay, Bhagwan turned them out of the house.
The appellant and his mother then went back to village Gulariya.
The prosecution case further was that about a month and a half before the murder of Bhagwan the appellant and his father came to Bhagwan and the appellants father asked Bhagwan to transfer some of his land to the appellant.
Bhagwan said that he had already kept the appellant with him for a year and had found that he was of no assistance.
He, therefore, refused to give any land to the appellant.
Bhagwan, it appears, had some granddaughters and one of them called Kumari Sarju aged about five years was staying with him.
Bhagwan said that he would give his lands to his grand daughter Sarju.
On the night between March 19 and 20 , 1961, Bhagwan was sleeping in front of his house on 884 cot with his grand daughter.
One Naiku (P.W. 1) was sleeping at a short distance from Bhagwan 's house.
Naiku was a neighbour of Bhagwan.
At about midnight Naiku 'heard some noise and called out to Bhagwan.
There was no response.
Naiku then heard the sound of shoes as though somebody was running away from the place.
Naiku called out certain other persons and went near the place where Bhagwan was lying on his cot.
It was found that Bhagwan bad a large number of injuries on the head and neck, most of the injuries being of 'an incised nature.
Bhagwan was already dead.
The little girl Sarju though stained with blood which flowed from the body of Bhagwan was not herself injured.
She was soundly sleeping on the cot and was not awake when Bhagwan was killed.
Naiku gave an information to the police station of what he had heard and seen, the distance of the police station being about eight miles from village Bandi.
The information which Naiku gave did not disclose the name of any accused person because Naiku had not seen who had killed Bhagwan.
On the information given by Naiku the local police started investigation and when the dead body of Bhagwan was brought back to the village after the postmortem examination for cremation, the appellant, it is stated, came to one Brij lal (P. W. 2) of village Bandi.
This was on the third day after the murder.
The appellant made certain enquiries from Brij lal which roused the latter 's suspicion.
The Sub Inspector of Police was then in the village and he was informed of the presence of the appellant.
The appellant was then interrogated and the case of the prosecution was that the appellant made certain statements and produced from his house a kulhari, a shirt and a dhoti.
These were found to be blood stained and subsequent examination by the Chemical 885 Analyst and the Serologist disclosed that they were stained with human blood, This recovery of the blood stained kulhari (axe) and the blood stained shirt and dhoti was made, according to the prosecution case, on March 22, 1961, in the presence of two witnesses, Lal Bahadur Singh and Wali Mohammad, It would appear from what we have stated above that the case against the appellant rested on the evidence relating to motive furnished by what happened, about a month and half before the occurrence when the appellant and his father asked for some land from the deceased, and the recovery of the.
blood stained.
axe and blood stained shirt and dhoti from the house of 'the appellant.
The appellant denied that he and his father had asked for any lands from the deceased a month and a half prior to the occurrence.
The appellant also denied that he had produced any blood stained axe or blood stained shirt and dhoti from his house, or had handed them over to the Sub Inspector of Police.
He denied that the clothes or the axe belonged to him.
His defence was that be was living with his father in Burdwan and came back to the village on March 21,1961.
He said that the case against him was brought out of enmity.
Learned counsel for the appellant has taken us through the evidence in the case and has submitted that apart from raising some suspicion against the appellant and his father, the evidence given by the prosecution does not establish beyond any reasonable doubt that the appellant was the murderer.
He has further submitted that certain statements alleged to have been made by appellant to the Sub Inspector of Police in connection with the recovery of the blood stained axe and blood stained shirt and dhoti were inadmissible and the courts below were wrong in relying on 886 them.
He has contended that if those statements are excluded from consideration, than the evidence which remains is insufficient to support the conviction of the appellant, We think that these contentions are correct and must be upheld.
There can be no doubt that Bhagwan was murdered on the night in question.
The postmortem examination disclosed that he had sustained as many as thirteen injuries, eleven of which were incised on different parts of the body.
The injuries inflicted on the head and face had out through skull bones and the doctor who held the postmortem examination was of the opinion that Bhagwan had died as a result of fractures of the skull bones and hemorrhage and shock.
There can, therefore, be no doubt that Bhagan was murdered.
It is equally clear that nobody saw who ' killed Bhagwan.
The evidence of Naiku (P.W.1) shows clearly enough that neither he nor other persons whom he called saw the appellant.
The grand child who was sleeping with Bhagwan was also fast asleep and did not even awake when the injuries were inflicted on Bhagwan.
Bhagwan might or might not have raised shouts when the injuries were caused to him.
The evidence of Naiku does not disclose that he heard any other sound excepting the sound of movement of steps of a person wearing shoes.
We are satisfied that the evidence as to motive is satisfactory, Both Naiku (P.W.1) and Brij Lal (P.W.2) have stated about the motive.
The appellant and his mother stayed with Bhagwan about four years ago in order to render assistance to Bhagwan in his cultivation.
The appellant did not, however, do any work and was turned out.
This is proved by the evidence of Naiku and Brij Lal.
The evidence of the aforesaid two witnesses also establishes that the appellant and his father came to Bhagwan about a month and a half before the occurrence and asked for some land.
Bhagwan refused to give any land to the appellant.
We 887 think that this motive has been established even though it would influence both the appellant and his father.
The main difficulty in the case is that the evidence regarding the recovery of blood stained axe and blood stained.
shirt and dhoti is not very satisfactory and the courts below were wrong in admitting certain statements alleged to have been made by the appellant in connection with that recovery.
According to the recovery memo the two witnesses who were present when the aforesaid articles were produced by the appellant were Lal Bahadur Singh and Wali Mohamad.
Lal Bahadur Singh was examined as prosecution witness No. 4.
He did give evidence about the production of blood stained articles from his house by the appellant.
The witness said that the appellant produced the articles from a tub on the eastern side of the house.
The witness did not however, say that the appellant made any statements relating to the recovery.
Wali Mohammad was not examined at all.
One other witness Dodi Baksh Singh was examined as prosecution witness No. 3.
This witness said that a little before the recovery the Sub Inspector of Police took the appellant into custody and interrogated him ; then the a appellant gave out that the axe with which the murder had been committed and his blood stained shirt and dhoti were in the house and the appellant was prepared to produce them.
These statements to which Dobi Baksh (P.W.3) deposed were not admissible in evidence.
They were incriminating statements made to a police officer and were hit by ss.25 and 26 of the Indian Evidence Act.
The statement that the axe was one with which the murder had been committed was not a statement which led to any discovery within the meaning of s.27 of the Evidence Act.
Nor was the alleged statement of the appellant that the blood stained shirt and dhoti belonged to him was 888 a statement which led to any discovery within the meaning of s.27.
Section 27 provides that when any fact is deposed to and discovered in consequence of information received from a person accused of any offence, in the custody of a police officer, so much of such information,.whether it amounts to a confession or not, as, relates distinctly to the fact thereby discovery may be proved.
In Pulukuri Kotayya vs King Emperor (1) the Privy Council considered the true interpretation of s.27 and said : "It is fallacious to treat the 'fact discove red ' within the section as equivalent to the object produced ; the fact discovered embraces the place from which the object is produced and the knowledge of the accused as to this, and the information given must relate distinc tly to this fact.
Information as to past user, or the past history, of the object produced is not related to its discovery in the setting in which it is discovered.
Information supplied by a person in custody that 'I will produce a knife concealed in the roof of my house ' does not lead to the discovery of a knife ; knives were discovered many years ago.
It leads to the discovery of the fact that a knife is concealed in the house of the informant to his knowledge, and if the knife is proved to have been used in the commission of the offence, the fact discovered is very relevant.
But if to the statement the words be added 'with which I stabbed A. ', these words are inadmissible since they do not relate to the discovery of the knife in the house of the informant." (p.77) We are, therefore, of the opinion that the courts below were wrong in admitting in evidence the alleged statement of the appellant that the axe had been used to commit murder or the statement that the blood (1) (1947) L.R. 74 I.A 65. 889 stained shirt and dhoti were his.
If these statements are excluded and we think that they must be excluded, then the only evidence which remains is that the appellant produced from the house a blood stained axe and some blood stained clothes.
The prosecution gave no evidence to establish whether the axe belonged to the appellant or the blood stained clothes were his.
Therefore, the question before us is this.
Is the production of the blood stained axe and clothes read in the light of the evidence regarding motive sufficient to lead to the conclusion that the appellant must be the murderer ? It is well settled that circumstantial evidence must be much as to lead to a conclusion which on any reasonable hypothesis in consistent only with the guilt of the accused person and not with his innocence.
The motive alleged in this case would operate not only on the appellant but on his father as well.
From the mere production of the blood stained articles by the appellant one cannot come to the conclusion that the appellant committed the murder.
Even if somebody else had committed the murder and the blood stained articles had been kept in the house, the appellant might produce the blood stained articles when interrogated by the Sub Inspector of Police.
It cannot be said that the fact of production is consistent only with the guilt of the appellant and inconstant with his innocence.
We are of the opinion that the chain of circumstantial evidence is not complete in this case and the prosecution has unfortunately left missing links, probably because the prosecution adopted the shortout of ascribing certain statements to the appellant which were clearly inadmissible.
Learned counsel for the respondent has submitted to us that in State of U. P. vs Deoman Upadhyaya (1) this Court accepted as sufficient evidence (i) ; 890 the production of a blood stained weapon.
We are unable to agree.
The circumstantial chain in that case did not depend merely on the production of the gandasa, but on other circumstance as well.
The Court held in that case that the circumstantial chain was complete and the decision did not proceed merely on the production of a blood stained weapon.
For the reasons given above we would allow the appeal and set aside the conviction and sentence passed against the appellant.
The appellant must now be released forthwith.
Appeal allowed.
| The dispute between the respondents and the appellants regarding ministries and line jobbers was referred to the Tribunal regarding the increase and standardisation of wages and regarding the designation of workmen doing the work of fancy jobbers and their pay.
The appellant contended that an earlier award of 1951 had not been terminated and that the reference was incompetent.
The Tribunal directed standardisation on the basis of the Bombay Scheme.
The Tribunal 717 acceded to the claim regarding fancy jobbers.
Finally the Tribunal directed that "whereever the said existing wages are higher than those fixed under the Bombay Standardisation Scheme, they shall remain and shall not be lowered" and that regarding operatives who were designated differently from Bombay list, they should be paid what those described by any other name but doing identical work were being paid in Bom bay and that the adjustment of anomalies that might arise in this matter should be decided by A Committee consisting of the representatives of the Management and the Union.
Held, that the agreement following the earlier award %as not a settlement within the meaning of section 19(2) of the Industrial Disputes Act and the reference was Competent.
Held, further, that the Tribunal ought to have considered the applicability of the Bombay Standardisation Scheme to the condition in Delhi by examining evidence and that the Tribunal ought not to have shut out evidence in respect of the working of the Bombay Standardisation Scheme in Delhi and that the Tribunal had not considered the matter carefully and made such modifications as might be necessary.
The Tribunal ought not to have delegated the determination and adjustment of the anomalies in applying the Bombay standardisation scheme to a joint committee by it should have considered and determined those matters itself.
Held, further, that in the event of standardisation it may be necessary if justice demanded it to give some measure of protection to such individual workmen as were getting higher wages than what they would get under standardisation scheme.
But the matter will have to be considered by the Tribunal subject to three conditions: viz., (1) there can be no further rise in wages of those protected by the operation of the standardisation of scheme, (2) if there is an incremental scales fixed by the standardisation scheme and the protected workmen are getting between the minimum and the maximum but are not entitled thereto according to the length of their service, future increments should be adjusted till the protected workmen find their proper place in the scale according to the length of service, and (3) the category of protected workmen should in due course exhaust by the termination of service of such workmen by retirement or otherwise.
Held, that the direction of the Tribunal could be read to mean the protection of existing higher wages generally rather than the higher wages of particular workmen and such a thing was not consistent with the principles of standardisation 718
|
ivil Appeal No. 859(NM) of 1988.
From the Judgment and Order dated 12.1.1987 in the High Court of Delhi at New Delhi in C.W. No. 355 of 1985.
A. Subba Rao, P. Parmeshwaran and Mrs. Sushma Suri for the Petitioners.
M. Chandrasekharan, N.M. Popli and V.J. Francis for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is an appeal by special leave from the judgment and order of ,the High Court.
of Delhi dated 12th January, 1988.
The respondent company manufactured wireless receiving sets, tape recorders, tape players which were assessable under Tariff Items ' 1026 33A and 37AA of the Central Excise Tariff and it had filed classification list and price lists in respect of the said goods.
On verification of the said lists, it was found that goods were unbranded and on investigation it was alleged to have come to the notice of the Department that the respond ent company was engaged in the manufacture Of wireless receiving sets and tape recorders in the brand name of "Bush".
From the documents filed by the respondent, accord ing to the appellants, it was revealed that the respondent manufactured their entire products in the brand name of "Bush" from the very beginning and were selling the same exclusively to M/s Bush India Limited or its authorised wholesale dealers only.
This fact was nowhere mentioned by the respondent in its price list or its classification lists and this, according to the appellants, amounted to wilful suppression of facts with the intention to evade payment of central excise duty.
Certain enquiries were made and to safeguard the interest of revenue the respondent was re quested time and again to observe the provisions of rule 9B of the Central Excise Rules, 1944 and execute B 13 surety bond.
However, it is stated that respondent evaded the execution of the said bond which was, according to the appellants, done deliberately.
Thereafter, on 4th January, 1985, a Show Cause Notice was issued for the period 1st April, 1983 to 30th November, 1984 requiring the respondent to show cause as to why M/s Bush India Limited should not be treated as a related person and a favoured buyer of the respondent company for the purpose of determination of wholesale cash price and as to why the concessional rate of duty under notification No. 358/77 CE should not be denied to the respondent and as to why the differential duty in respect of the goods cleared during the period should not be recovered.
While the adjudication on the basis of the Show Cause Notice was pending, the respondent company was again requested to execute the surety bond in July, 1984.
Respond ent company thereafter filed a writ petition in the High Court of Delhi under Article 226 of the Constitution praying for quashing of the Show Cause Notice and the communication dated 11th July, 1984 and for mandamus to allow it to clear the goods on the basis of the price at which the goods were sold by it allowing the benefit of the relevant notifica tion.
The High Court by the order dated 12th January, 1987 held that the value of the goods manufactured by the re spondent company was the price charged by it from M/s Bush India Ltd. and not the market value at which M/s Bush India Ltd. sold the goods to its wholesalers.
In the premises, it was held that there was no misdeclaration of the value and the Show Cause Notices were quashed.
In passing the impugned order, the High Court followed its decision in C.W. 197/85.
It is, therefore, necessary to refer to the said decision of the High Court.
The said decision challenged 1027 the notice dated 31st December, 1984 and a demand notice of the same date.
It was contended on behalf of the petitioner in that case, who is the respondent in the instant appeal that the said respondent merely manufacture the aforesaid items for Bush India and after manufacturing those, it sells those to M/s Bush India Ltd. It was contended that for the purpose of finding out the price for payment of excise duty, only the price which was charged by the respondent from Bush India Limited could be taken into account and the price at which M/s Bush India Ltd. further sold those goods in the market was not the price which was to be taken for the excise duty.
It was contended that Bush India Ltd. was not a related person of the respondent within the meaning of Section 4(4)(c) of the Central Excises & Salt Act, 1944 (hereinafter referred to as 'the Act ') and reliance was placed on the decision of this Court in Union of India vs Bombay Tyre International, ; On the merits of the case, reliance was also placed on certain decisions of this Court as well as the decision of the Delhi High Court.
The High Court found that the case of the respondent was directly covered by all these decisions.
In the prem ises, the High Court quashed the said Show Cause Notices and the demand notice.
The question, therefore, is whether the High Court was right in the view it took.
Unfortunately, in the instant case, apart from the facts recorded hereinbefore, there is no other fact.
Learned Counsel appearing for the revenue, Shri A. Subba Rao con tended before us that the High Court was in error in not realising that in the facts and the circumstances of this case, it was an arranged affair and really M/s Bush India Ltd. was a related person and as such the price charged from it could not represent the correct assessable value for the purpose of excise duty.
As noted hereinbefore, the events in this case happened from 1985 onwards.
In the premises, the amended provisions of Section 4 of the Act, as amended by the Amendment Act of 1973, would be applicable.
Section 3 of the said Act enjoins that there shall be levied and collected in such manner as might be prescribed duties of excise on all excisable goods other than salt which are produced and manufactured in India.
Section 4(1)(a) of the Act provides: "4.
(1) Where under this Act, the duty of excise is chargeable on any excisable goods with reference to value, such value shall, subject to the other provisions of this sec tion, be deemed to be (a) the normal price thereof, that is to 1028 say, the price at which such goods are ordi narily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal, where the buyer is not a related person and the price is the sole consideration for the sale: Provided that (i) where, in accordance with the normal practice of the wholesale 'trade in such goods, such goods are sold by the asses see at different prices to different classes of buyers (not being related persons) each such price shall, subject to the existence of the other circumstances specified in clause (a), be deemed to be the normal price of such goods in relation to each class of buyers ;" Proviso (iii) to section 4(1)(a) of the Act enjoins that: "where the assessee so arranges that the goods are generally not sold by him in the course of wholesale trade except to or through a related person, the normal price of the goods sold by the assessee to or through such related person shall be deemed to be the price at which they are ordinarily sold by the related person in the course of wholesale trade at the time of removal, to dealers (not being related per sons) or where such goods are not sold to such dealers, to dealers (being related persons) who sell such goods in retail.
" According to clause (c) of sub section (4) of section 4 of the Act, "related person" means a person who is so asso ciated with the assessee that they have interest, directly or indirectly, in the business of each other and includes a holding company, a subsidiary company, a relative and a distributor of the assessee, and any sub distributor of such distributor.
The Explanation to Section 4(4)(c) further provides that in this clause "holding company", "subsidiary company" and "relative" have the same meanings as in the ( 1 of 1956).
It is in this context that the validity or otherwise of the High Court 's view has to be judged.
In Union of India vs Bombay Tyre International, (supra), this Court had to examine this question.
This Court examined the scheme of Section 4(1)(a) before the Amendment Act, 1973 and also the position after the amendment.
It was contended in that case before this Court that the definition of the expression "related person" was 1029 arbitrary and it included within its ambit a distributor of the assessee.
This Court however held that in the definition of "related person" being a relative and a distributor could be legitimately read down and its validity upheld.
The definition of related person should be so read, this court emphasised, that the words "a relative and a distributor of the assessee" should be understood to mean a distributor who was a relative of the assessee.
The Explanation to section 4(4)(c) provides that the expression "relative" has the same meaning as in the .
The definition of "related person", as being "a person who is so associated with the assessee that they have interest, directly or indirectly, in the business of each other and includes a holding company, a subsidiary company . . ", shows a sufficiently restricted basis for employing the legal fic tion.
This Court reiterated that it is well settled that in a suitable case the court could lift the corporate veil where the companies share the relationship of a holding company and a subsidiary company and also to pay regard to the economic realities behind the legal facade.
The true position, it was explained by the aforesaid decision, under the said Act is the price at which the excisable goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of remov al as defined in sub section (4)(b) of section 4 of the Act is the basis for determination of excisable value provided, of course, the buyer is not a related person within the meaning of sub section (4)(c) of section 4 and the price is the sole consideration for the sale.
This aspect was further examined by this Court in Union of India & Ors.
vs Atic Industries Ltd., ; This Court referred to the decision of Bombay Tyre International (supra) and also referred to the first part of the definition of "related person" in clause (c) of section 4(4) which defines "related person" to mean "a person who is so associated with the assessee that they have interest directly or indirectly in the business of each other".
It was not enough, it was held, that the person alleged to be a related person had an inter est, direct or indirect in the business of the assessee.
To attract the applicability of the first part of the defini tion, the assessee and, the person alleged to be a related person must have interest direct or indirect in the business of each other.
Each of them must have a direct or indirect interest in the business of the other.
The quality and degree of interest which each has in the business of the other may be different; the interest of one in the business of the other may be direct while the interest of the latter in the business of the former may be indirect.
That would not make any difference so long as each has got some inter est, direct or indirect in the business of the other.
In that case, this Court found that Atul Products Ltd. has interest in the business of M/s Atic Industries Ltd. since it held 50% of 1030 the share capital of that assessee and had interest as shareholder in the business carried on by the assessee.
But this Court was of the view that it could not be said that the assessee, a limited company, had any interest, direct or indirect in the business carried on by one of its sharehold ers, namely, Atul Products Ltd., even though the sharehold ing of such shareholder might be 50%.
Secondly, it was noted that Atul Products Ltd. was a wholesale buyer of the dyes manufactured by the assessee but even then, since the trans actions between them were as principal to principal, it was difficult to appreciate how the assessee could be said by virtue of that circumstances to have any interest, direct or indirect, in the business of Atul Products Ltd. The asses see, it was observed, was not concerned whether Atul Products sold or did not sell the dyes purchased by it from the assessee nor was it concerned whether Atul Products Ltd. sold such dyes at a profit or at a loss.
In those circum stances, the first part of the definition of related persons in clause (c) of sub section (4) of section 4 of the amended Act was, therefore, clearly not satisfied both in relation to Atul Products Ltd. as also in relation to Crescent Dves and Chemicals Ltd., a subsidiary company of Atic Industries Ltd., and neither of them could be said to be a "related person" vis a vis the assessee within the meaning of the definition of that term in clause (c) of sub section (4) of section 4 of the amended Act.
In those circumstances, the assessable value, it was held, of the dyes manufactured by the assessee could not be determined with reference to the selling price charged by Atul Products Ltd. and Crescent Dyes and Chemicals Ltd. to their purchasers but must be determined on the basis of the wholesale case price charged by the assessee to Atul Products Ltd. and Crescent Dyes and Chemicals Ltd. In that case, the assessee at all material times sold the large bulk of dyes manufactured by it in wholesale to Atul Products and Imperial Chemical Industries (India) Pvt. Ltd. which subsequently came to be known as Crescent Dyes & Chemicals Ltd. at a uniform price applicable alike to both these wholesale buyers and these wholesale buyers sold these dyes to dealers and consumers at a higher price which inter alia included the expenses incurred by them as also their profit.
It was noted that the transac tions between the assessee .on the one hand and Atul Products Ltd. and Crescent Dyes and Chemicals Ltd. on the other were as principal to principal and the wholesale price charged by the assessee to Atul Products Ltd. and Crescent Dyes and Chemicals was the sole consideration for the sale and no extra commercial consideration entered in the deter mination of such price.
For appreciating how the wholesale price could be the basis of the determination of the assess able value, a reference may be made to the decision of this Court in Union of India & Ors.
vs Cibatul Limited, [1985] Supp.
3 SCR 95.
In 1031 that case, the respondent Cibatul Ltd. entered into two agreements with Ciba Geigy of India Ltd. for manufacturing resins by the seller.
The joint manufacturing programme indicated that the resins were to be manufactured in accord ance with the restrictions and specifications constituting the buyer 's standard and supplied at prices to be agreed upon from time to time.
The buyer was entitled to test a sample of each batch of the goods and after its approval the goods were to be released for sale to the buyer.
The products were to bear certain trademarks being the property of the foreign company Ciba Geigy of Basle.
Tripartite agreements were also executed between the buyer, the seller and the foreign company, recognising the buyer as the regis tered or licensed user of the trade marks, authorising the seller to affix the trade marks on the products manufactured "as an agent for and on behalf of the buyer and not of his own account" and the right of the buyer being reserved to revoke the authority given to the seller to affix the trade marks.
The respondent in that case filed declaration for the purposes of levy of excise under the said Act show ing the wholesale prices of different classes .of goods sold by it during the period May, 1972 to May, 1975.
The declara tion included the wholesale prices of the different resins manufactured under the two aforesaid agreements.
The Assist ant Collector of Custom revised those prices upwards on the basis that the wholesale price should be the price for which the buyer sold the product in the market.
According to the Assistant Collector the buyer was the manufacturer of goods and not the seller.
The Collector of Central Excise allowed the appeals of the respondent and accepted the plea that the wholesale price disclosed by the seller was the proper basis for determining the excise duty.
The Appellate orders were, however, revised by the Central Govt.
under sub section (2) of section 36 of the Act and the orders made by the Assistant Collector were restored.
According to the Central Govt.
the buyer was the person engaged in the production of the goods and the seller merely manufactured them on behalf of.the buyer and that under the agreements the seller was required to affix the trade marks of the buyer on the manufactured goods and that indicated that the goods belonged to the buyer.
There is a ring of similarity between the facts of that case and the facts of the instant appeal before us.
The orders of the Central Govt.
were challenged under Article 226 of the Constitution.
The High Court held that the goods were manufactured by the seller as its own goods, and there fore, the wholesale price charged by the seller must form the true basis for the levy of excise duty.
On appeal.
this Court held that the High Court was right in concluding that the wholesale price of the goods manufactured by the seller was the wholesale price at which it sold those goods to the buyer, and it was 1032 not the wholesale price at which the buyer sold those goods to others.
The relevant provisions of the agreements and the other material on the record showed that the manufacturing programme was drawn up jointly by the buyer and the seller and not merely by the buyer, and that the buyer was obliged to purchase the manufactured product from the seller only if it conformed to the buyer 's standard.
For this purpose, the buyer was entitled to test a sample of each batch of the manufactured product and it was only on approval by him that the product was released for sale by the seller to the buyer.
It was apparent that the seller could not be said to manufacture the goods in those facts, it was held, on behalf of the buyer.
It was further found that it was clear from the record that the trade marks of the buyer were to be affixed on those goods only which were found to conform to the specifications or standard stipulated by the buyer.
All goods not approved by the buyer could not bear those trade marks and were disposed of by the sellers without the advan tage of those trade marks.
This question was again examined by this Court in Joint Secretary to.the Govt.
of India & Ors.
vs Food Specialities Ltd., [1985] Supp.
3 SCR 165.
There the respondent used to manufacture certain goods for sale in India by M/s Nestle 's Products India Ltd. (for short Nestle 's) under certain trade marks in respect of which the latter was registered as the sole registered user in India.
The goods were supplied to Nestle 's at wholesale price on rail at Moga or free on lorry at factory.
The respondent disputed the value of the goods determined by the excise authorities for the purpose of the levy under the said Act and ultimately the respondent filed writ petitions in the High Court.
The High Court allowed the writ petitions holding that the value of the trade marks could not form a component of the value of the goods for the purpose of assessment of excise duty.
In appeal to this Court, the appellant contended that the value of the goods sold by the respondent to Nestle 's should, for the purpose of levy of excise duty, include the value of the trade marks under which the goods were sold in the market and that the value of such trade marks should be added to the wholesale price for which the goods were sold by the respondent to Nestle 'section Dismissing the appeal, it was held that the value of Nestle 's trade marks could not be added to the wholesale price charged by the respondent to Nestle 's for the purpose of computing the value of the goods manufactured by the respondent in the assessment to excise duty.
In that case, it was held that what were sold and supplied by the respond ent were goods manufactured by it with the trade marks affixed to them and it was the wholesale cash price of goods that must determine the value for the purpose of assessment of excise duty.
It 1033 was immaterial that the trade marks belonged to Nestle 'section What was material was that Nestle 's had authorised the respondent to affix the trade marks on the goods manufac tured by it and it was the goods with the trade marks af fixed to them that were sold by the respondent to Nestle 'section There could, therefore, be no doubt, it was held, that the wholesale price at which the goods with the trade marks affixed to them were sold by the respondent to Nestle 's as stipulated under the agreements would be the value of the goods for the purpose of excise duty.
That was the price at which the respondent sold the goods to Nestle 's in the course of wholesale trade.
Similarly in the instant case, it appears that the brand name "Bush" was affixed to the goods produced by the re spondent.
In M/s Sidhosons and Others vs Union of India and others, [1987] 1 SCC 25, it was held that the excise duty was payable on the market value fetched by the goods, in the wholesale market at the factory gate manufactured by the manufacturers, i.e., the price charged by the manufacturers to the buyer under the agreement.
It could not be assessed on the basis of the market value obtained by the buyers who also add to the value of the manufactured goods the value of their own property in the goodwill of the 'brand name '.
In view of the facts that have emerged in this case, the High Court came to the conclusion that the market value of the goods of the respondent herein was the price charged from M/s Bush India Ltd. and not the market value at which price M/s Bush India Ltd. sold to its whole sellers for the purpose of payment of excise duty.
The High Court, there fore, quashed the Show Cause Notice and the Demand Notice.
Shri A. Subba Rao on behalf of the Revenue tried to contend before us that the facts of this case revealed that it was a device to under charge.
The respondent herein was brought in to divide the sale price of M/s Bush India Ltd. to be the basis of the assessable value.
It is true that the facts of this case do warrant a great deal of suspicion.
But it is not possible to hold otherwise than what has been held by the High Court in this case.
It is true, as Shri Rao drew our attention, that even though the Corporation might be a legal personality distinct from its members, the Court is entitled to lift the mask of corporate entity if the concep tion is used for tax evasion, or to circumvent tax obliga tion or to perpetrate a fraud.
In this connection, reference may be made to the observations of this Court in Juggi Lal Kamlapat vs Commissioner of Income tax, U.P., In the background of the facts 1034 found we, however, need not get ourselves bogged with the controversy as to judicial approach to tax avoidance devices as tax pointed out in McDowell and Co. Ltd. vs Commercial Tax Officer, , where this Court tried to discourage colourable devices.
It is true that tax planning may be legitimate provided it is within the framework of the law.
Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by dubious methods.
It is the obligation of every citizen to pay the taxes honestly without resorting to subterfuges.
It is also true that in order to create,the atmosphere of tax compliance, taxes must be reasonably collected and when collected, should be utilised in proper expenditure and not wasted.
(See the observations in Commissioner of Wealth Tax vs Arvind Narottam; , , It is not necessary, in the facts of this case to notice the change in the trend of judicial approach in England: (Sherdeley vs Sherdeley, While it is true, as observed by Chinnappa Reddy, J. in McDowell and Co. Ltd. vs Commercial Tax Offi cer, (supra) too much to expect the legislature to intervene and take care of every device and scheme to avoid taxation and it is up to the court sometimes to take stock to deter mine the nature of the new and sophisticated legal devices to avoid tax and to expose the devices for what they really are and to refuse to give judicial ' benediction, it is necessary to remember as observed by Lord Reid in Greenberg vs IRC, that one must find out the true nature of the transaction.
It is unsafe to make bad laws out of hard facts and one should avoid subverting the rule of law.
Unfortunately, in the instant case, facts have not been found with such an approach by the lower authori ties and the High Court had no alternative on the facts as found but to quash the Show Cause and the Demand Notices.
In that view of the matter, the appeal fails and is accordingly dismissed.
But there will be no order as to costs.
We dismiss this appeal with reluctance.
Our reluc tance is not to be ascribed to any hesitation to accept the inference flowing from the facts found but reluctance is due to the fact that the facts were not properly found.
T.N.A. Appeal dismissed.
| The respondent company was engaged in the manufacture of wireless receiving sets, tape recorders, tape players.
These products were assessable under Tariff Items 33A and 37AA of the Central Excise Tariff.
In the classification list and price lists filed by the respondentassessee company these goods were shown as unbranded goods.
Subsequentiy it was found that the respondent assessee company was manufacturing their products in the brand name of "Bush" and were selling the same exclusively to M/s Bush India Ltd. or its autho rised wholesale dealers only.
The appellants Revenue alleged that there was wilful suppression of facts by the respondent company with intention to evade excise duty because this fact was not mentioned by the company in the price list or classification list, filed.
A show Cause Notice was issued requiring the respondent company to show cause as to why, (i) M/s Bush India Limited should not be treated as .a 'related person ' and a favoured buyer of the respondent company for the purpose of determi nation of wholesale cash price, (ii) the concessional rate of duty under notification No. 358/77 CE should 1024 not be denied to the respondent and, (iii) the differential duty in respect of the goods cleared should not be recov ered.
Instead of executing the surety bond the respondent assessee company filed a writ petition in the High Court praying for quashing of the Show Cause Notice and for a mandamus to allow it to clear the goods on the basis of the price at which the goods were sold by it to Bush India Limited allowing the benefit of the relevant notification.
The High Court following its earlier decision held that for the purpose of payment of excise duty the market value of the goods of the respondent assessee company was the price charged by it from M/s Bush India Ltd., and not the market value at which price M/s Bush India Ltd. sold the goods.
It further held that there was no misdeclaration of the value by the assessee company, and it accordingly quashed the Show Cause Notice and the Demand Notice for recovery.
In this appeal by the Revenue it was contended that in the facts and circumstances of the case the High Court committed an error in not realising that M/s Bush India Ltd. was a related person and as such the price charged by the respondent company from M/s Bush India could not represent the correct assessable value for the purpose of excise duty.
Dismissing the appeal, HELD: 1.
Tax planning may be legitimate provided it is within the ' framework of the law.
But colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by dubious methods.
It is the obligation of every citizen to pay the taxes honestly without resorting to subterfuges.
In order to create the atmosphere of tax com pliance, taxes must be reasonably collected and when col lected, should be utilised in proper expenditure and not wasted.
It is too much to expect the legislature to inter vene and take care of every device and scheme to avoid taxation and it is up to the court sometimes to take stock to determine the nature of the new sophisticated legal devices to avoid tax and to expose the devices for what they really are and to refuse to give judicial benediction.
[1034A B, D] 2.
One must find out the true nature of the transaction.
Even though the corporation might be a legal personality distinct from its members, the court is entitled to lift the mask of corporate entity if the conception is used for tax evasion, or to circumvent tax obligation perpetrate a fraud.
[1034E, 1033G] 1025 3.
It is unsafe to make bad laws out of hard facts and one should avoid subverting the rule of law.
In the instant case, facts have not been found with such an approach by the lower authorities, and the High Court had no alternative on the facts as found but to quash the Show Cause and Demand Notices.
It appears that the brand name "Bush" was affixed to the goods produced by the respondent.
For the purpose of excise duty, the market value of such goods was the price charged from M/s Bush India Ltd. and not the market value at which price M/s Bush India sold the same.
[1034E, 1033C, E] Juggi Lal Kamlapat vs Commissioner of Income tax, U.P., ; Mc Dowell and Co. Ltd. vs Commercial Tax Officer, ; Commissioner of Wealth Tax vs Arvind Narottam, ; Sherdeley vs Sherdeley, and Greenberg vs IRC.
referred to.
Union of India vs Bombay Tyre International, ; ; Union of India & Ors., vs Atic Industries Ltd., ; ; Union of India & Ors.
vs Cibatul Limited, [1985] Supp.
3 SCR 95; Joint Secretary to the Government of India & Ors.
vs Food Specialities Ltd., [1985] Supp.
3 SCR 165 and M/s Sidhosons & Ors.
vs Union of India & Ors, [1987] 1 SCC 25 relied on.
|
Civil Appeal No. 1689 Of 1974 From the Judgment and Order dated 31st August, 1972 of the Madras High Court in Appeal No. 357 of 1965.
B.B. Ahuja and Ms. A. Subhashini for the Appellant.
A.T.M. Sampath and P.N. Ramalingam for the Respondents.
The Judgment of the Court was delivered by 177 PATHAK, J.
This appeal by special leave arises out of a suit instituted by the appellant for a declaration that a sale deed of immoveable properties and the transfer of moveables belonging to the respondent limited company in favour of the respondent firm are invalid, inoperative and not binding on the appellant and other creditors of the respondent limited company.
A suit was instituted by the Union of India, the appellant before us, alleging that the Krishna Oil Mills and Industries Ltd., a public limited company registered under the Indian Companies Act, 1913 was carrying on business in the manufacture and sale of tin cans and aerated water.
It entered into a partnership in September 1952 with Rajeswari and Co., which was carrying on business in the pressing of cotton bales.
Under the partnership agreement Rajeswari & Co. was to install a cotton baling press in the buildings of the Company and the business would be carried on under the name Rajapalayam Cotton Pressing Factory, with the profits being divided between the Company and Rajeswari & Co. in the ratio of 7 to 9 respectively.
This was replaced by another agreement in 1954, but the business was carried on in the same name and the profits divided in the same shares.
It was alleged that the Company incurred losses in its own business year after year and from 1954 the only income derived by it flowed from the shares held by it in the partnership business.
It was alleged that the Company had in fact ceased to carry on its own business, but in computing the income of the Company from the assessment year 1956 57 to the assessment year 1959 60 the losses suffered during the previous years from the Company 's own business were allowed to be carried forward and set off against its share of income from the partnership Firm.
Subsequently the Income tax authorities decided to reopen the assessment proceedings under section 34 of the Indian Income tax Act, 1922 and, it is said, this was communicated to the Company.
The processing of the case took time and the notices under section 34 were issued for the different assessment years on March 6, 1961 and March 7, 1961.
It was alleged that meanwhile, the Company, having come to know of the proposed re opening of its income tax assessments, began to dispose of its moveable and immoveable assets with a view to defeat the claim of the Union of India and to place the properties beyond the reach of the creditors of the company.
The assets of the company were transferred in favour of Rajeswari & Co. and the sale proceeds were employed for paying off the debts due to various creditors who, it is said, included also the close relations and friends of the Directors of the Company.
In the result, there was nothing left for paying off the tax arrears of the Company.
178 The suit was resisted by the Company, which in its written statement, admitted that it was working at a loss for some years and was obliged to replace its original business of seed crushing and oil extraction by a more modest business activity, and in its circumstances it entered into a partnership with Rajeswari & Co. for carrying on the business of pressing cotton bales.
It denied that when disposing of its assets it was aware of the intention of the income tax authorities to reopen its assessments.
It pleaded that because of action threatened by the Registrar of Joint Stock Companies in 1959 it was compelled to consider its position and to decide in a General Body meeting in June 1960 to dispose of the assets of the company.
It was also stated that the partnership agreement of 1954 between the Company and Rajeswari & Co. stipulated that Rajeswari & Co., should have first preference if the Company proposed to sell its assets.
The right of pre emption was pressed by Rajeswari & Co. and, therefore, a resolution was passed in February 1961 at another Extraordinary Meeting of the Company to sell the lands and buildings at a valuation to be fixed by expert opinion.
It was asserted that the assets were sold to Rajeswari & Co. and the sale proceeds were distributed to the creditors so that all the creditors were paid off.
Rajeswari & Co. also filed a written statement in opposition to the suit and besides asserting that it had installed cotton bale presses in the buildings of the Company pursuant to the partnership agreement between them it denied any fraudulent intent in purchasing the assets of the Company.
It asserted that it acted in good faith and paid value for the properties.
The trial court decreed the suit on Appril 27, 1965.
Rejeswari & Co. appealed to the High Court of Madras, and the High Court allowed the appeal, set aside the trial court decree and dismissed the suit.
The High Court held in substance that the Union of India had failed to satisfy the provisions of section 53 of the inasmuch as the evidence showed that the Company had utilised the sale proceeds arising upon the transfer of its assets in paying off all its other creditors, and that even if the Company had done so in order to avoid payment of its income tax dues no relief could be granted to the Union of India.
In this appeal it is urged for the Union of India that the transfer of assets was effected in favour of a person who was not a creditor, that the assets had been under valued and that there was evidence to show 179 that the benefit of the sale proceeds was enjoyed by the Directors of the Company who were also partners of Rajeswari & Co. Section 53 of the provides that every transfer of immoveable property made with intent to defeat or delay the creditors of the transferor shall be voidable at the option of any creditor so defeated or delayed.
A long line of cases has held that the preference by a debtor of one creditor over the others is not ipso facto deemed fraudulent, and reference may be made to Musahar Sahu and Another vs Hakim Lal and Another, L.R. 43 Indian Appeals 104 where the Judicial Committee of the Privy Council quoted Palles C.B., who said in In re Moroney , 62: "The right of the creditors, taken as a whole, is that all the property of the debtor should be applied in payment of demands of them or some of them, without any portion of it being parted with without consideration or reserved or retained by the debtor to their prejudice.
Now it follows from this that security given by a debtor to one creditor upon a portion of or upon all his property (although the effect of it, or even the interest of the debtor in making it, may be to defeat an expected execution of another creditor) is not a fraud within the statute; because notwithstanding such an act, the entire property remains available for the creditors or some or one of them, and as the statute gives no right to rateable distribution, the right of the creditors by such act is not invaded or affected.
" The Judicial Committee explained that "the transfer which defeats or delays creditors is not an instrument which prefers one creditor to another; but an instrument which removes property from the creditors to the benefit of the debtor.
The debtor must not retain a benefit for himself.
He may pay one creditor and leave another unpaid: Middleton vs Pollock. , 108.
So soon as it is found that the transfer here impeached was made for adequate consideration in satisfaction of genuine debts, and without reservation of any benefit to the debtor, it follows that no ground for impeaching it lies in the fact that the plaintiff who also was a creditor was a loser by payment being made to this preferred creditor there being in the case no question of bankruptcy.
" This proposition of law was re affirmed by the Judicial Committee subsequently in MA PWA MAY and another vs S.R.M.M.A Chettyar Firm, 56 Indian Appeals 379.
180 It seems clear that it is open to a debtor to prefer one or more creditors over the others in the payment of his debts, and so long as he retains no benefit in the property the mere circumstance that some creditors stand paid while others remain unpaid does not attract the provisions of section 53 of the .
It is not disputed that the debts satisfied by payment of the sale proceeds are genuine.
A faint attempt was made to show that some of the debts discharged were owed to persons who were also Directors of the Company.
There is no findings by the High Court in support of that contention.
It was also urged that the consideration which passed for the sale of the assets was inadequate and that the assets had been undervalued.
Here again there is no finding to support the submission.
The questions raised are questions of fact, and this Court will not permit such questions to be raised unless there is material evidence which has been ignored by the High Court or the finding reached by the Court is perverse.
A point was sought to be made by learned counsel for the appellant that the transfer of the assets was effected in favour of Rajeswari & Co. which was not one of the creditors.
It has been found by the High Court that the sale was effected for the purpose of discharging the debts payable by the Company.
Once it is also found that the consideration was not inadequate it is immaterial, as the High Court has observed, that the transfer was effected in favour of a person who was not a creditor.
It has been clearly found that the sale proceeds were employed for paying off the creditors of the Company.
It appears that in consequence of the impugned transfer effected by the Company the appellant has been unable to recover a sum of Rs.28,240 assessed as income tax in October 1961.
It rested its suit on section 53 of the .
Having regard to the findings rendered by the High Court on the consideration of material on the record and upon an interpretation of section 53 which that provision has uniformly received this appeal cannot be sustained.
The appeal fails and is dismissed with costs.
P.S.S. Appeal dismissed.
| A public limited company, working at a loss, having come to know of the proposal of the Department to reopen its income tax assessments for the previous years, disposed of its assets to the respondent firm, with which it had a partnership business, and employed the proceeds in paying off the debts due to various creditors, with the result that nothing was left for paying off the tax arrears of the company.
A suit under section 53 of the was instituted by the Union of India appellant for a declaration that the sale deed in favour of the respondent firm was invalid, inoperative and not binding on the appellant and other creditors of the transferor company and alleging fraudulent intent to defeat legitimate claims, which was decreed by the trial court.
The High Court, however, allowed the appeal holding that the appellant had failed to satisfy the provisions of section 53 inasmuch as the evidence showed that the company had utilised the proceeds arising upon the transfer of its assets in paying off all its other creditors, and that even if the company had done so in order to avoid payment of its income tax dues no relief could be granted to the appellant.
In this appeal by special leave it was urged for the appellant that the transfer was effected in favour of a person who was not a creditor, that the assets had been undervalued and that there was evidence to show that the benefit of the sale proceeds was enjoyed by the directors 176 of the company, who were also partners of the respondent firm.
Dismissing the appeal, the court, ^ HELD: It is open to a debtor to prefer one or more creditors over the others in the payment of his debts, and so long as he retains no benefit in the property the mere circumstance that some creditors stand paid while others remain unpaid, does not attract the provision of section 53 of the .
[180A B] Musahar Sahu and Another vs Hakim Lal and another, L.R. 43 Indian Appeals 104, In re Moroney, , 62, Middleton vs Pollock, , 108 and MA PWA MAY and another vs S.R.M.M.A. Chettyar Firm, 56 Indian Appeals 379, referred to.
In the instant case, there was no finding by the High Court in support of the contention that some of the debts discharged were owed to persons who were also directors of the company or that the consideration which passed for the sale of the assets was inadequate and that the assets had been undervalued.
This Court will not permit such questions of fact to be raised unless there is material evidence which has been ignored by the High Court or the finding reached by the Court is perverse.
[180B C] It has been found by the High Court that the sale was effected for the purpose of discharging genuine debts payable by the company and that the sale proceeds were really employed for paying off the creditors of the company.
Once it was also found that the consideration was not inadequate, it was immaterial that the transfer was effected in favour of a person who was not a creditor.
[180D E]
|
ivil Appeals Nos.
3510 3511 of 19822.
PG NO 981 From the Judgment and Order dated 23.9.1982 and I8/ 19.10.1982 of the Madhya Pradesh High Court in Misce.
W.P. NO.
888/81 and Review M.C.C.No. 352 of 1982.
D. Gupta, M.C. Bhandare, O.P. Khaitan, Anil Bhatnagar, Krishan Kumar, Dhruv Agarwal and Mrs. Kiran Choudhary for the Appellants.
S.N. Kacker, M.L. Jaiswal, Vivek Gambhir and S.K. Gambhir for the Respondents.
The Judgment of the Court was delivered by SHARMA, J.
The dispute in these appeals is in regard to the additional demand of electric charges made by the respondent No. 1 on the appellant No. 1 for energy consumed.
By a writ application filed before the Madhya Pradesh High Court the appellant challenged the demand of Rs. 1,86,97,880.97 for the period 12.11.1979 to 30.6.1981.
Except for granting a minor relief as indicate in paragraph 45 of its judgment, the High Court dismissed the writ application.
The writ petitioner appellants have impugned the judgment before this Court by special leave.
The appellant No. 1 Jiyajeerao Cotton Mills Ltd. hereinafter referred to as the Company which runs a textile mill in Gwalior, entered into an agreement dated 27.10.1971 with the respondent No. 1 Madhya Pradesh Electricity Board in short the Board a licensee under the hereinafter referred to as the 1918 Act for supply of electricity in accordance with the terms and conditions mentioned therein.
The quantity of electricity to be supplied varied from time to time under supplementary agreements and the Board had to supply 2,500 K.W. on A.T. basis with effect from 1.11.1973.
Since 1975 the Board is not able to generate sufficient electricity to meet the full demand of the consumers and with a view to ease the situation two orders were issued by the States of Madhya Pradesh under section 22B of the called as the Madhya Pradesh Electricity Supply and Consumption Regulation Order, 1975 and the Madhya Pradesh Electricity Generation, Control and Consumption Order.
The learned counsel for the parties have in their arguments referred to these orders as Regulation Order and Generation Order respectively.
By the Regulation Order , the consumers were asked to reduce their consumption in accordance with the provisions therein.
It was further provided that without prejudice to the Board 's power to disconnect the supply in PG NO 982 the event of any violation thereof, the consumer will have to pay the charges at penal rates for the excess energy consumed.
The Generation Order said that if a consumer had an alternative source of generating power from his own generating set (described as captive power by the parties) it may be required to generate electricity to the maximum extent technically feasible and the supply by the Board would be reduced to that extent.
The Order in Clause 3 provided for assessment of the generating capacity of the captive power of the consumer.
The contract demand under the agreement was directed to remain reduced accordingly.
Sub clause (iii) of Proviso to Clause 3 said, that if in certain contingencies, there was reduction in the generation of electricity by the consumer, the Board would try to make good the deficit against an appropriate charge for it.
An arbitration clause with respect to any dispute was included in the 6th paragraph of the Order as its last term.
Both the Orders came into force with effect from the 7th of April, 1975.
The Divisional Engineer, Gwalior informed the appellant Company by the letter dated 17.5.1975 (marked as Annexure `B ', page 121, Vol.
II of the paper book) that its additional generation capacity technically feasible by its own generating sets had been assessed at 2,700 K.W.
In view of the contract under which the Board was to supply 2,500 K.W. with effect from 1.11.11973,, the Company was directed to generate additional electricity to that extent, thus reducing the demand on the Board to nil.
After several letters passed between the parties, which will be dealt with at some length later, another letter dated 10.10.1975 (marked as Annexure `O ', page 136, Vol.
II of the paper book) was sent to the Company issuing a fresh direction for generating additional electricity to the extent of 2,500 K.W. with effect from 31.10.1975.
It appears that the Board did not bill the appellant Company for any additional energy supplied at the penal rate for the next several years.
According to its case the Company invoked the provisions of Proviso (iii) to Clause 3 of the Generation Order pleading emergency.
arising from time to time, covered by the Proviso, and was supplied additional energy accordingly.
The Company was under a duty to place its difficulties before the Board and obtain permission before drawing additional energy under this provision of emergency supply.
It appears that after 11.11.1979 additional power was drawn by the appellant without the Board 's prior approval and a letter Annexure `T ' dated 5.8.1980 was ultimately sent to the Company explaining the situation and telling it that the supply availed by it with effect from 12.11.1979 would be billed at the penal PG NO 983 rate.
In the meantime two additional contracts were executed by the parties; the first one on 11.7.1979 (Annexure `C ') for supplying additional 800 K.W., and the second one dated 26.2.1980 (Annexure `D ' for additional 190 K.W.
Thus the total demand under the agreements added to 3,490 K.W.
The Board by its letter Annexure `U ' dated 13.10.1980 reiterated its stand taken under Annexure `T ' intimating the appellant the maximum amount of electricity it was entitled to consume at the normal rate.
The letter further added that no additional power would be allowed as emergency supply to the Company even during the period of overhauling of the generating sets as was done earlier under Proviso (iii) to Clause 3 of the Generation Order.
The matter was debated for some time and ultimately the additional demand for the period 12.11.1979 to 30.9.1980 amounting to Rs.94,41,745.60 was served on the appellant Company by the letter Annexure `X ' dated 15.1.1981.
The further bills were also sent on the same basis.
On 5.8.1981 the application under Article 226 of the Constitution was filed before the Madhya Pradesh High Court challenging Annexure `H ', `O ', `T ' and `U '.
The main case of the petitioner appellant was rejected by the High Court, but marginal reliefs with respect to the Board 's demands for the period 12.11.1979 to 25.2.1980 and from 26.2.1980 to 31.7.1980 were allowed on the basis of errors in calculation.
The High Court also pointed out that under the terms of the Generation Order the Board was under a duty to consider and allow the additional emergency supply when conditions arose making the Proviso (iii) to Clause 3 applicable and the Board could not refuse to do so as was observed in some of its letters.
Subject to these minor modifications the writ application was dismissed by the judgment dated 23.9.1982.
The Company thereafter filed an application for review, which was dismissed by a speaking order of 19.10.1982.
The present appeals have been filed by special leave against these two judgments.
The appeals have been argued at considerable length by Mr Dipankar Gupta on behalf of the appellant and Mr. S.N. Kacker representing the respondents with great ingenuity and resourcefulness.
Mr. Gupta appearing in support of the appeals, however did not press some of the points urged on behalf of the appellant in the High Court and relied upon some new grounds.
therefore do not consider it necessary to deal with all the points disposed of in the High Court judgments except making reference to some of them while dealing with the points urged before us.
PG NO 984 7.
It will be necessary to examine the relevant portions of the Regulation and Generation Orders (Annexures `E ' and G ') before considering the arguments of the learned counsel.
They were both issued on 4.4.1975 by the State Government of Madhya Pradesh under section 22B of the 1910 Act, which reads as follows: "22.
B(1) If the State Government is of opinion that it is necessary or expedient so to do, for maintaining the supply and securing the equitable distribution of energy, it may by order provide for regulating the supply, distribution, consumption or use thereof.
(2) Without prejudice to the generality of the powers conferred by sub section (1) an order made thereunder may direct the licensee not to comply, except with the permission of the State Government with (i) The provisions of any contract, agreement or requisition whether made before or after the commencement of the Indian Electricity (Amendment) Act, 1959,for or the supply (other than the resumption of supply) or an increase in the supply of energy to any person, or (ii) any requisition for the resumption of supply of energy to a consumer after a period of six months, from the date of its discontinuance, or (iii) any requisition for the resumption of supply of energy made within six months of its continuance , where the requisitioning consumer was not himself the consumer of the supply the time of its discontinuance.
" Clauses 3 and 4(i) of the Regulation Order (Annexure`E ') have been refer,red to by the learned counsel for the parties repeatedly and they are quoted below: "3.(1).
No consumer receiving supply electrical energy from the Board and consuming or using electrical energy for any of the categories specified in column (2) of PART (of Schedule VII shall consume or use during any month or day electrical energy in excess of that specified in PG NO 985 respective entry in column (3) of the said Schedule; (2) (a).
If at any time during the month, on inspection of the meter reader or any other person authorised by the Divisional Engineer/Assistant Engineer of the Board having jurisdiction, the consumer is found to have already reached or exceeded the quantity of electricity indicated in column (3) of Part A of Schedule VII the Divisional Engineer/Assistant Engineer of the Board, having jurisdiction over the area where the consumer 's premises is situated, may by an order in writing require the consumer not to utilise electrical energy for the rest of the month and such order shall be complied with by the consumer forth with.
Appeal shall, however, lie with the Deputy Chief Engineer of the Board having jurisdiction whose decisions thereon shall be final.
(b) Any H.T. consumer who makes default in complying with the directions contained in sub clause (1) and item (a) of this sub clause shall be warned in the first instance in writing by the Divisional Engineer/Assistant Engineer of the Board having jurisdiction over the area where the consumer 's premises is situated and if the default continues, the said Divisional Engineer/Assistant Engineer shall after reasonably satisfying himself disconnect power supply altogether to such consumer and supply shall not be resumed without orders of the Deputy Chief Engineer of the Board having jurisdiction." "4.
Without prejudice to the Board 's powers to disconnect supply in the event of violation of Clause 3 above the Board shall bill the electricity consumed or used in excess of the monthly limit specified in column (3) of the Schedule VII at the penal rates as mentioned below: (i) All H.T. consumers as specified in Schedules I, II, III and IV Four times of normal tariff (both in respect of demand charges and energy charges) includ ing fuel cost adjustment charges.
" The expressions "average monthly consumption", average demand" and "average daily consumption" have been defined in Clause 2 of Annexure `E ' by taking January, February and March 1975 as the base period.
The VIIth Schedule mentioned PG NO 986 in Clause 3 above has not been included in the paper books with reference to which arguments have been addressed but a copy thereof was filed during the hearing and accepted as a correct copy by the both sides.
This Regulation Order was substituted by another Order and later by still a third Order, amending the penal rate and the Schedules to the Order.
However, the learned counsel for the parties stated that except for change in the penal rate and the figures in the Schedules, the Order has remained the same all through, and it is not necessary, therefore, to refer to the other Orders.
So far as the Generation Order is concerned, it requires such consumers, who have their private generating sets, to generate electrIcity to the maximum extent technically feasible in the following terms: "3.
Any consumer who is receiving electrical energy from the Board and also has an alternative source of generation of power by his own generation set may be required by the respective Divisional Engineer of the Board having jurisdiction to generate electricity from his set (or sets) to the maximum extent technically feasible in the opinion of the Divisional Engineer and the Board 's supply of electrical energy to such consumer shall be reduced to the extent of additional generation assessed as feasible by the Divisional Engineer; Provided that (i) Before assessing the additional generation feasible and directing the consumer accordingly, the Divisional Engineer shall consult the local Manager or Engineer in charge of the set; (ii) The Board shall, during the period such a direction is in force, reduce the contract demand of the consumer to a corresponding extent and (iii) if due to an emergency outage, which in the opinion of the Divisional Engineer of the Board having jurisdiction is not due to any negligence or failure of those responsible for maintaining and running the set.
there is reduction is additional generation, or if in the opinion PG NO 987 of the Divisional Engineer, the set has to be taken out for maintenance during the period of such emergency or maintenance outage the Board shall try its best to make good the reduction to the consumer, levying an appropriate charge for it.
" Its 6th Clause directed any dispute between the consumer and the Officer acting under Clauses 3 and 4 to be referred to the Electrical Adviser and Chief Electrical Inspector to the State Government, for his decision.
While Regulation Order was meant for general application to all consumers, the Generation Order was confined only to such consumers who were having captive power source.
It is also manifest that such a consumer was under a duty to generate additional electricity only when the maximum technically feasible capacity of the generating set or sets of the consumer was assessed under Proviso (i) to Clause 3 and was followed by a direction to that effect.
The main argument of the learned counsel for the appellant has been that none of the two assessments and directions contained in Annexures `H ' and `O ' was sustainable in law on the grounds that (a) in making the assessment of the technically feasible maximum capacity, relevant factors were not considered.
and irrelevant and extraneous matters were taken into account; (b) the requisite opinion was not arrived at and the assessment was not made by the authority empowered to do so; and (c) the participation of the appellate authority in process of ' assessment, completely vitiated it in law.
Mr. Gupta argued that instead of examining the point on its merit.
the High Court erroneously brushed it aside on the plea of waiver and acquiescence.
Relying on a number of letters sent by the appellant to the respondent Board it was urged that the appellant Company was protesting against the impugned directions issued by the Board and it is not right to shut it out on the technical ground of estoppel.
Mr. Kacker, on the other hand interpreted the High Court 's judgment differently.
According to him none of the points raised by the Company was rejected without examining the merits.
He strongly relied on some of the letters referred to in the argument of the Company itself as also a few other letters in support of his submission that they furnished PG NO 988 unimpeachable evidence including admissions on the part of the appellant Company proving that the assessment of the maximum feasible capacity of the appellant 's captive power sets was duly made in accordance with the Generation Order and in pursuance thereof the required direction was issued which was acted upon by the parties for a number of years.
The Company not only took steps to generate the additional energy as was required of it, it also took advantage of the provisions of Proviso (iii) to Clause 3 of the Generation Order and benefitted by it from time to time.
For appreciating the argument of the learned counsel for the appellant it is necessary to examine some of the Orders and letters issued in March and April 1975.
As has been mentioned earlier.
the two Government Orders were issued on 4.4.
It appears that the matter was being discussed by the different authorities of the State Government and the Electricity Board since before this date and advisability to require the consumers having captive power to generate as much energy as was technically feasible was under consideration for some time.
The question as to their capacity in this regard, naturally assumed importance and some steps for assessing the same were taken a few days before the Orders actually came into effect.
On 28.3.1975 a letter sent from the Board to Sri H.K. Aggarwal the Electrical Adviser and Chief Electrical Inspector to the State Government (Annexure `R 1 ') referred to a telephonic talk in connection with the assessment of the generating capacity of the captive power set.
It was mentioned "that it would be necessary to make a realistic assessment in respect of each of the consumers" by keeping in mind the suggested factors.
The letter further said that with that object the Board had constituted a Committee consisting of Sri Aggarwal himself.
the Superintending Engineer of the concerned Circle of the Board and the Divisional Engineer (Generation), Jabalpur of the Board as Members.
The appellant Company is mentioned as one of the 17 consumers in this category.
Along with his letter dated the 3rd of May 1975 Sri Aggarwal sent the report as desired.
It has been contended on behalf of the appellant that the Generation Order authorised the Divisional Engineer of the Board to assess the additional feasible capacity of the captive power source and any other person or authority or Committee could not usurp this jurisdiction.
The impugned letter Annexure `H ' issued by the Divisional Engineer has been characterised as illegal on the ground that it was based upon the assessment by the Committee headed by Sri H.K. Aggarwal and not by the Divisional Engineer.
the learned counsel proceeded to say that immediately after receipt of the intimation by the Board, the Company protested on 21.5.1975.
The Board 's reply dated 2.6.1975 has been relied PG NO 989 upon as showing that the direction was issued on the basis of the assessment of the Committee and not of the Divisional Engineer.
It was also pointed out that Electrical Adviser and Chief Electrical Inspector to the State Government (the then incumbent being Sri H.K. Aggarwal) was the appellate authority under Clause 6 of the Generation Order and could not, therefore, take part in the original assessment proceeding.
The reply of the Board is that the Committee no doubt inspected the generating sets and discussed the matter with the consumers, and thus collected relevant data for the purpose of assessment of the capacity, but the Divisional Engineer while relying on the material collected, did not mechanically accept the conclusion of the Committee.
He (the Divisional Engineer) applied his mind before issuing the Order Annexure `H '.
Mr. Kacker further said that the matter did not rest there.
After taking into account the objection raised by the Company the Divisional Engineer took up the matter afresh and applied his mind independently.
Ultimately he came to a similar conclusion as is evident by the second direction as contained in Annexure `O ' dated 10.10.1975.
The argument of Mr. Kacker appears to be well founded.
On receipt of the letter Annexure `H ' dated 17.5.1975 whereby the Divisional Engineer directed the Company to generate 2,500 K.W. of electricity by its own generating sets, the appellant Company protested by its letter dated 21.5.1975 (at page 195 of the Paper Book Vol.
Mr. Gupta strenuously relied on this letter which stated that the Company failed to understand as to how its additional generating capacity had been assessed at 2,700 K.W.
It will be necessary to discuss this letter in some detail later in the judgment while dealing with another point as Mr. Kacker also has relied on certain statements made therein.
At this stage, however, we should like to point out that the appellant did not challenge the assessment on the ground that it was not made by the authority mentioned in the Generation Order; and in the last paragraph the request made was for "review".
The next document referred to by the learned counsel for the appellant is the letter dated 30.5.1975 (page 305 of the Paper Book Vol.
II), wherein the Company stated that: "as desired by the Board, we have started generating about 2,000 K.W. additional power at our generating station tonnes daily for this additional generation." PG NO 990 Finally a request was made in the letter to the Superintending Engineer of the Board to recommend the appellant 's case for allotment of additional wagons for transport of coal.
Instead of advancing the appellant 's case, the letter shows that the assessment and the direction mentioned in Annexure `H ' were accepted by the Company and steps were taken to implement the same.
Chronologically proceeding, the letter dated 2.6.1975 (Annexure `I ' at page 122 of the Paper Book Vol.
II) was relied on by Mr. Gupta as proving the fact that the assessment of additional generating capacity had been done by the Committee mentioned in the letter dated 28.3.1975 (supra) and not by the Divisional Engineer as required by the Generation Order.
The learned counsel far the parties next placed before us the letters dated 3.6.1975 (document No. 3 at page 302 of the Paper Book Vol.
II) and dated 4.6.1975 (document No. 1, at page 300 of the Paper Book Vol.
II), another letter of the same date (Annexure `J ' at page 123 of the Paper Book Vol.
II) and then dated 8.8.1975 (Annexure `K ' at page 132 of the Paper Book Vol. II) and 1().10.1975 (Annexure `O ' at page 136 of the Paper Book Vol.
The argument of Mr. Kacker has been that the Divisional Engineer applied his mind independently to the question of assessment of the capacity of the appellant 's generating sets, and while so doing took in consideration the factual data collected by the Committee mentioned in the letter of 28.3.1975.
It was pointed out that all the three persons constituting the Committee were very highly placed officers and there could not be any legitimate objection if the Divisional Engineer referred to the data collected by them in presence of the Company 's Officers after personally verifying them.
Even a judicial tribunal or a regular court is allowed to rely upon evidence collected by an enquiry officer or commissioner.
The learned counsel heavily relied on the letter dated 3.6.1975 from the Divisional Engineer to the Superintending Engineer (document No. 3).
On behalf of the appellant it was said that the Company had no knowledge of this letter in 1975.
We do not think that this is a correct stand.
The letter mentions an inspection of ' the Company 's power House by the Divisional Engineer and the materials supplied by the Company to him.
The details with respect to the boilers of the Company and the other figures mentioned therein correctness whereof is not challenged by the appellant, fully establish that the inspection was made in presence of and the figures were collected with the assistance of the officers of the appellant Company and the conclusion regarding the assessment was reached after taking into account the case of the Company.
It has been argued on behalf of the Board before us that the method adopted by the Divisional Engineer as disclosed by this letter (document No. 3) was different PG NO 991 from that followed by the Committee, as a result of which there was some difference in their final result.
On the basis of his independent assessment the Divisional Engineer issued another instruction as contained in Annexure 'O ' dated 10.10.1975 (at page 136 of the Paper Book Vol.
II), mentioned earlier.
This second direction which was effective from 31.10.1975 naturally superseded the earlier one under Annexure `H '.
The Board 's impugned demand does not relate to any period before 31.10.1975 and, therefore, it is immaterial if the direction in Annexure 'H ' is completely ignored on account of its supersession by Annexure 'O ' or on any other ground and it be assumed that in absence of a feasible assessment of the capacity, the Generation Order was not applicable to the appellant Company before 31.
10. 1975.
Mr. Gupta relied on the letter dated 4.6.1975 (document No. 1), referred to above, for showing that the Company emphatically protested against the assumption that it could generate additional 2500 K.W.
It was said that its capability in this regard was limited to 1200 K.W.
The learned counsel referred to the other letters also for a similar purpose.
We think that in view of the revised order of the Divisional Engineer passed on 10.10.1975, vide Annexure 'O ', earlier correspondence is not material for the purpose for which the appellant is trying to use them.
The learned counsel for the respondent has relied on some of them for his argument on the other points and we will have to deal with them again when we take up those points.
So far as the question as to whether an assessment of the feasible capacity of the generating sets of the appellant Company was made by the Divisional Engineer as required by the Generation Order is concerned, we have no hesitation in deciding the issue in favour of the respondent.
On behalf of the appellant it was urged that since the Electrical Adviser cum Chief Electrical Inspector of the State Government who has been mentioned as the appellate authority under Clause 6 of the Generation Order was associated with the assessment by acting as a member of the Committee (vide Annexure 'R 1 ' at page 256 of the Paper Book Vol.
II), the entire process in this regard should be held to be completely vitiated.
In view of our finding in the preceding paragraph, the argument has to be rejected.
Besides, it is not correct to assume that an appeal against the assessment was provided by Clause 6 of the Generation Order which reads as follows: "6.
In case of any dispute between the consumer and the Divisional Engineer acting under Clauses 3, and 4, it shall PG NO 992 be referred to the Electrical Adviser and Chief Electrical Inspector to the Government of Madhya Pradesh whose decision shall be final.
" The above is obviously an arbitration clause in case of a dispute and since the maintainability of the appellant 's writ application before the High Court was decided in its favour, it cannot make a grievance on this score.
Besides, if the appellant Company had a grievance against the assessments which were made in 1975, it ought to have challenged the same then and not to have waited for a number of years before approaching the High Court.
Mr. Gupta challenged the assessment still on another ground.
He contended that while making the assessment, the relevant factors were ignored, and irrelevant and extraneous considerations were taken into account.
The argument which is based on certain scientific technical hypothesis proceeded thus: The Company had 3 Generator Sets described as M.V. Turbo Generator Set, B.B. Turbo Generator Set and AEG Turbo Generator Set; and five Boilers.
Another Boiler was added in 1977.
Every generator set has a rated capacity which has been described by the learned counsel as the level at which operation can continue satisfactorily for indefinite period.
This rated capacity is declared by the manufacturer and can be accurately ascertained without difficulty.
The terms 'overload ' and 'overload capacity ' have been explained by the learned counsel as "one exceeding the level at which operation can continue satisfactorily for an indefinite period" and "excess capacity of a generator over that of its rating", respectively.
It was urgued that overloading may lead to distortion or to overheating with risk of damage, depending on the type of circuit or device, and so in many cases only temporary overloads are permissible.
The overload capacity, it has been said, is referrable generally for a specified time.
The criticism against the report of the Committee is that the Committee took into account the overload capacity of the sets and not the rated capacity.
Mr. Gupta stressed on the point that the AEG Turbo Generator Set was maintained as a standby to be operated only when other sets were not available for any reasons.
He also said that the feasible generation capacity of a set is also dependent on other factors and conditions, namely, age and condition of the set, availability of coal of requisite quality and specification, adequate and continuous supply of water etcetera.
Referring to the report of the Divisional Engineer dated 3.6.1975 (document No. 3 at page 302 of the Paper Book Vol.
Il) it was argued that the Divisional Engineer picked out a moment of time when the plants reached the generation PG NO 993 of 7500 K.W. and concluded therefrom that the appellant was capable of generating 1800 extra K.W. from its captive plant.
It was further suggested that in any view of the matter on the basis of the aforesaid opinion of the Divisional Engineer the appellant Company ought to have been asked to generate only 1800 K.W. more and not 2500 K.W.
Finally it was argued that the Board has to be confined to the reasons in support of the assessment orders which are mentioned therein and cannot be allowed to travel beyond the same.
Mr. Kacker took great pains in going into the reports and specially through the aforementioned report of the Divisional Engineer dated 3.6.1975, with a view to meet the criticism of the appellant and support the report as a correct one on merits.
He also relied on a number of letters sent by the appellant showing that the assessment was accepted as binding on it and claiming from time to time benefits under Proviso (iii) to Clause 3 of the Generation Order which was allowed for a number of years.
The learned counsel relied on this aspect as furnishing strong circumstantial evidence in support of the correctness and binding nature of the assessment impugned belatedly when the appellant approached the High Court.
It is significant to note that at no point of time either in 1975 or later the appellant chose to get a scientific assessment of its generating sets made by an expert, nor even after filing the present writ petition in the High Court did it file any opinion of a person having scientific expert knowledge showing the impugned assessments to be erroneous or undependable.
It is also important to appreciate that the appellant has not either earlier or now made any complaint of mala fides or bias against any of the members of the Committee or the Divisional Engineer or for that matter against any officer of the respondent Board or the State.
On the other hand, the Officers of the Board appear to have taken a very sympathetic attitude towards the appellant for more than four years and allowed it the benefit of additional energy under Proviso (iii) to Clause 3 of the Generation Order very generously.
It was only when the Board discovered in 1980 that the appellant had stopped even informing the Board and obtaining its prior approval as envisaged by the Generation Order before consuming extra energy that the matter was closely examined by the Board 's Officers.
Mr. Kacker is also right in relying upon the conduct of the parties for about four or five years after the assessment was made as furnishing important circumstance relevant to the issue.
We may, therefore, examine a number of letters in this regard some of which have already been mentioned earlier.
PG NO 994 19.
The very first letter of the appellant Company after receiving the impugned direction in Annexure 'H ' dated 17.5.1975 was sent within 4 days on 21.5.1975 and is included at page 195 of Vol.
II of the paper book.
It will be seen that the protest against the assessment referred to by the learned counsel for the appellant was not founded on any of the grounds pressed know.
The basis was "only due to steam limitation", assuring that "once our boiler under erection starts steaming, we can enhance our generation to the full installed capacity.
" The prayer in the end of the letter was to "review the whole matter".
The Divisional Engineer, as mentioned earlier, personally examined the entire matter be novo.
Although in its letter dated the 21st May 1975 the Company had stated that it was not advisable to generate more than 12 K.W. from its own sets, by the next letter dated 30.5.1975 (page 305, Vol.
II) the appellant informed the Board that they were generating about 2000 additional K.W., but were in the need of additional coal, for which the Board was requested to make a recommendation.
In Annexure 'J ' dated 4.6.1975 (page 123 Vol.
II) the protest against the assessment was once more reiterated on account of some trouble with the boilers.
The first paragraph of this letter indicates that the question was under discussion of the Divisional Engineer with the Company 's representatives who was armed during the conference "with all relevant records".
In this background the fresh independent assessment was made by the Divisional Engineer as per the document No. 3 dated 3.6.1975 (page 302, Vol.
Before the fresh independent direction by the Divisional Engineer as contained in the impugned Annexure 'O ' dated 10.
l0.1975 was issued, a suggestion was made on behalf of the Board to the appellant Company for its satisfaction as to the correctness of the assessment by "actually taking the load on the set, after running it in parellel with the Board 's supply system".
The learned counsel for the parties before us explained the scientific implications of the test by "parellel running", but we do not consider it necessary to go in its technical details.
The Board requested the Company 's consent for such a test, to be communicated positively within a week.
By its reply dated 25.8.1975 Annexure 'L ' (page 133, Vol.
II) the Company rejected the suggestion on two grounds, namely, that it was "not having protection system like power relay etc.
"and" in case of tripping of Board 's supply we would be doing the parellelling of the sets"; which was not safe.
In reply thereto the Board satisfactorily met the objections by its next letter Annexure 'M ' dated 25.10.1975 (page 134, Vol.
It was pointed out that the parellel running test will be undertaken only for a short period after which the captive sets would be separated from the Board 's system; and a disturbance free period could be chosen for the same.
Besides, the objections to the suggested test have to be PG NO 995 rejected as frivolous in view of the stand of the Company itself as indicated in the letter Annexure 'N ' (page 135, Vol.
II) dated 6.11.1975, stating that it had no objection into the suggested trial, which the appellant claims to have sent to the Board which fact is however denied.
In the meantime the second assessment order under Annexure 'O ' had already been communicated.
It was, therefore, open to the appellant either to accept and act upon this fresh assess of the boilers in steam generation as the ground for not being able to generate additional electricity as required by the impugned directions.
It was also mentioned that after a sixth boiler became available, the difficulty would stand resolved.
In this background Mr. Kacker placed before us several letters starting with the letter of the Company dated 14.2.1977 (at pages 4 to 8 of additional paper book PG NO 996 prepared and filed by the respondent Board, which was referred to by the learned counsel as Vol.
IV of the Paper Book).
The Company, by this letter requested the Board to charge at the normal tariff for the additional electricity consumed by the Company as emergency supply as per Proviso (iii) to Clause 3 of the Generation Order.
The statements made in the letter appear to be extremely important for the purpose of the Board 's case and it may be useful to consider them in some detail.
In the first paragraph the Company stated that it was again placing for the Board 's consideration, the reasons why it could not generate the additional power according to the direction issued.
In the second paragraph the main difficulty has been mentioned as steam limitation and reason therefor has been stated in the third paragraph as the inferior quality of coal.
Later it was stated thus; "These problems would not have arisen in case our Sixth Boiler recently erected was commissioned and running without any trouble.
" It was said that although the sixth boiler was taken in August, it did not work properly for some time.
Proceeding further the letter stated: "It is only since the beginning of January the Sixth Boiler has been in continuous service, as a result of which we were in a position to repair our other Boilers also.
Since the last week of January, we are generating our full requirement and not even availing the 6U0 K.W. allowed by the Board.
In the penultimate paragraph of the letter, the case for normal tariff on the additional electricity already supplied by the Board was argued in the following manners: "Considering all the above facts, we sincerely hope, that as due to no fault of our own we had to take power from M.P. E.B., more than allotted to us, it is requested that the charges made to us may be on the usual terms as previously granted by the Board for which we will be ever grateful. " (emphasis added) The letter is not only conspicuous by the absence of the objections which were taken later in 1980 before filing of PG NO 997 this writ case, but it positively indicates that the Company accepted the assessment as correct, and as expected, it was actually able to generate the required additional electricity after the addition of the sixth boiler and was pleading for normal tariff for the additional electricity already consumed earlier.
This position is re inforced by several further letters of the Company, but before we go to them we would like to point out another very important fact emerging out of this very letter.
At page 7 of Vol.
II of the paper book the letter dealt with another aspect highly relevant to the present dispute.
Another Limited Company known by the name of "Gwalior Rayons" is having a factory near the appellant Company 's factory and the appellant was supplying electric energy to the other factory illegally and without the permission of the Board.
On an objection by the Board this matter was dealt with in the following words: "It is not out of place to mention in this appeal that we had given now and then some power in the past to the Gwalior Rayons, in emergency for their Beam Dyeing Plant whenever M.P.E.B. power failed.
This was due to the fact as the Beam dyeing plant is a pressure dyeing plant, with a continuous process, there used to be heavy damage to very costly Beams.
Since this issue was raised by your Divisional Engineer, we have completely stopped this type of supply to them, though the same was given to them after reducing our humidity or waste plant load.
It is again our request here that the same may be allowed in emergency under whatever arragement the Board may so decide to avoid costly damage to the cloth.
A fervent appeal in the interest of the other factory belonging to a different Limited Company altogether was made in the above terms.
It has to be remembered that in view of the provisions of section 28(1) of the 1910 Act, the Company was prohibited from supplying any energy to the other factory.
This aspect was stressed in term 2(b) of the agreement between the appellant and the Board as per Annexure 'A (page 62 of Vol.
It was not the appellant 's case then or before us now that it had obtained the previous sanction of the State Government for so doing.
Under Cluase 4 of the Generation Order which reads as follows, jurisdiction was vested in the Divisional Engineer ot the Board to direct a consumer having captive source of power to supply electricity to the Board or to any other consumer only if the consumer was having surplus generation: PG NO 998 "4.
If the consumer having own generating set(s) can have, a result of additional generation reasonable in the opinion of the Divisional Engineer of the Board having jurisdiction, energy, surplus to his requirement, the Divisional Engineer may direct him to supply the surplus to the Board or to another consumer nearby who has been taking supply from the Board and who is willing to take the supply from the consumer having generating sets: Provided that (i) the contract demand of and the supply to the other consumer from the Board shall be reduced correspondingly, whether or not the other consumer avails of the supply from the consumer having the set, (ii) the other consumer shall pay to the consumer having generating set(s) for such supply as if it is supplied from the Board, (iii) if the payment receivable by the consumer having the set under the last preceding clause is less than his incremental cost of additional generation, the Board shall make good the difference to the consumer having the set(s) and (iv) the consumer having the set(s) will not be required to incur any additional expenditure for laying lines for transmitting energy to the other consumer; such lines if required being laid by and at the cost of the Board.
" How could, in these circumstances, the appellant pass on to a third party some of the electricity meant for it, there is no explanation on the records.
Mr. Gupta the learned counsel for the appellant argued that since the other factory was in the neighbourhood it was in the interest of the appellant Company for the sake of security to see that other factory was not plunged in darkness when the supply was inter rupted on account of tripping.
Mr. Kacker rightly pointed out that no such suggestion was ever made on behalf of the appellant in any of its letters.
On the other hand, the reason pleaded in the letter quoted above was to save the other Company from incurring loss due to costly damage to the cloth.
In his final reply Mr. Gupta said that the appellant was passing on some electricity to the Gwalior Rayons only after reducing its humidity or waste plant load as stated in the letter.
The explanation is too vague and it cannot be PG NO 999 assumed that the appellant was making the contribution to its sister concern by creating artificial shortage of supply to its mills.
The appellant 's conduct cannot be explained except on the premise that it was able to generate adequate additional electricity for its purpose and was taking for granted the sympathetic attitude of the Officers of the Board in liberally allowing it additional emergency supply at normal tariff.
Another letter which calls for a detailed consideration was sent by the apellant on 30.5.1979 and is included at pages 16 to 20 of Vol.
A fresh request for emergency supply under Proviso (iii) to Clause 3 of the Generation Order was made in this letter on the ground that the sixth boiler was out for annual overhaul.
It was stated in the opening sentence that this boiler was giving some trouble earlier but later 'stabilised '.
The Company was, therefore, self sufficient "without drawing any power from the Board so far".
The letter proceeded to state that the sixth boiler would be going for annual overhaul and after that the annual overhauling of the other boilers would be carried out; and therefore, 1875 K.W. should be allowed to be drawn for the period mentioned therein.
Assurance about the future was held in the following terms: Now when our Sixth Boiler has been stabilised we would normally not draw any power from the Board after 15.9.1977 when overhauling of all the boilers is complete except in case of emergency due to outage of any of the boilers.
It was further requested that during the period of breakdown emergency power as detailed should be supplied and.
"we would request you that for the power availed by us from the Board for above purpose, say up to a total of 7 days in a month.
we may be charged at the same tariff .
Insisting again that it should be allowed to supply electricity to Gwalior Rayons, described as its sister concern.
the letter read as follows: "Here we may also mention that we have been supplying power to our sister concern M/s Gwalior Rayons.
in accordance with the provisions of sanction granted to us under Section '8 of the I.E. Act vide Govt.
Order No. PG NO 1000 1313/6U61/XIII/74 dated 8.4.1975.
However.
it had not been possible for us to obtain prior Permission from S.E. Gwalior before switching over power to Gwalior Rayons.
It may be mentioned here that power has to be supplied to M/s Gwalior Rayons during the period the Board 's supply remained off.
and it is not practically possible to obtain prior permission for supply in such cases.
We would, there fore, request you that prior permission should be given once for all for supplying power to the Gwalior Rayons during the period supply from the Board to M/s Gwalior Rayons remained off ' This letter dated 30.5.1977 confirms the conclusions derived from the earlier letter dated 14.2.1977 and clarifies that the first letter was not sent by some mistake on the part of the appellant Company.
Request for emergency supply was, however, made from time to time in 1978 and for some time in 1979, which was allowed by the Board.
The other letters including those dated 30.5.1978, 29.6.1978, 7.7.1978 and D 9.9.1978 are all consistent with a correctly made binding assessment of the feasible additional capacity from the generating sets belonging to the Company.
Mr. Gupta contended that throughout the period 1975 to 1979 there was never a demand made by the Board for any energy consumed by the appellant at the penal rate and it was only in 1980 that the Board suddenly decided to press for the additional demand on the basis of the Generation Order.
The learned counsel emphasised that before the provisions of the Generation Order can be relied upon by the Board it is essential for it to make an assessment of the consumer 's capacity to generate electricity from its captive power plant.
The fact that no demand was made for many years leads to the conclusion that such an assessment as required by the provisions of the Generation Order to be made, had not in fact been made, and alternatively assuming that factually the capacity had been assessed, the same must be ignored on account of the conduct of the parties for several years.
The stand of Mr. Kacker, as has been stated earlier, is that the parties acted on the basis that an assessment had been made in accordance with the Generation Order and on that basis the appellant demanded the benefit under Proviso (iii) to Clause (3) of the Order.
The documents relied on by him and discussed in the preceding paragraphs support the respondents ' stand.
They also explain as to why demand on the penal rate wa.
not made earlier.
but it would be helpful to consider a few more facts relevant to this aspect.
PG NO 1001 24.
The system of supply of power to the consumers is such that they can go on drawing electricity beyond their entitlement without any further positive step by the officers of the Board.
The Board is, however, in a position to, by keeping a certain switch known as Air Break Switch open, put a restriction on the consumer from drawing excess energy.
A letter dated 4.6.1975 (document No. l, at page 300 of Vol.
II) sent by the appellant has been strongly relied on by Mr. Kacker for showing that Air Break Switch was permitted to remain closed with a view to assure uninterrupted supply of the appellant at its request.
The result was that the appellant was in a position to draw excess electricity without reference to the officers of the Board.
That letter indicates that the Board was contemplating to keep the switch open and the Company by this letter made a request not to do so.
The appellant Company was fully conscious of the fact that it was consuming electricity beyond its entitlement under the two Orders, by claiming the benefit of the provisions dealing with emergency supply.
and was also alive to the fact that this had to be done only with the prior approval of the Board.
The relevant portion of the letter is in the following terms: "Further at no time it may kindly be noted that power has been availed from MPEB without prior intimation by phone either to Divisional Engineer or Supdt.
Engineer.
By keeping the A.B. Switch open at your end, the delay in supply to J.C. Mills will be considerable which will cause very heavy losses to the J .C. Mills for no fault of their own.
This may kindly be reviewed and . " The learned counsel for the Board was right in saying that on account of this request by the appellant the line was kept open for it unhindered.
This did not mean that the Company was entitled to misuse the privilege, draw extra energy without prior permission and thereafter refuse to pay higher charges when demanded.
It has been conclusively established by a large number of letters on the records of the case that for several years the Company was particular in obtaining the permission of the Board for drawing electricity in excess of what it was entitled to, by the agreement as modified by the Regulation Order and Generation Order, but later, it not only stopped seeking the advance sanction in this regard, it did not even care to inform the Board ot the excess drawal.
The Branch of the respondent Board at Gwalior sent the bills on the basis of the normal tariff, as the question of grant of additional emergency supply was being dealt with by the Head Office at Jabalpur.
The Gwalior Office was not at all dealing with the matter PG NO 1002 relating to the excess emergency supply which aspect was being exclusively dealt with at Jabalpur, and as soon as the relevant facts came to the knowledge of the Head Office of the Board it took up the matter with the appellant Company.
The entire conduct of the parties furnishes strong circumstantial evidence in support of the Board 's case.
Another argument addressed by Mr. Gupta is based on the letters Annex.
`P ' series sent by the Board to the appellant Company from time to time.
They have been included at pages 137 to 156 of Vol.
Il of the paper book, and according to Mr. Gupta they are inconsistent with the Board 's case regarding the appellant 's entitlement to receive the amount of energy from the Board.
He has pointed out that these letters do not suggest that the contract demand had been reduced to nil in accordance with Annexures `H ' and `O '.
By way of illustration he relied on the letter dated 31.10.1975 (at page 138 of Vol.
II) stating that the Company 's maximum demand should not exceed 1875 KW".
We do not find any merit in the submission.
The letters marked as `P ' series did not deal with the entitlement of the appellant Company as a result of both the Orders Regulation and Generation.
The Regulation Order was ot universal application to all the consumers while the Generation Order applied to only such of them who had their own generating sets.
Under the Regulation Order the contract demand was reduced by a certain percentage and provided for payment of charges at penal rate in case of excess consumption.
The rate of cut and the penal rate for additional consumption did not remain constant, and were revised from time to time.
It appears that as and when the revision in the rates took place the consumers were informed as to the effect of the Regulation Order as it stood after modification.
Mr. hacker was right in saying that since the Regulation Order was applicable to all the consumers and letters similar to those marked as Annexure P ' series were being addressed to all of them, there could not be any objection in the Board sending similar letters to the appellant and others having their private generating sets dealing with the effect of the Regulation Order alone, without taking into account the Generation Order.
A perusal of these letters fully supports the respondents ' stand that they were being issued with reference to the Regulation Order alone.
Further, a close examination of the Generation Order would show that the maximum permissible limit available under the Regulation Order had not ceased to be relevant even after the application of the Generation Order.
The entitlement of the appellant due to emergency outage under Proviso (iii) to Clause 3 ot the Generation Order was limited to the original contract demand as reduced by the Regulation Order.
It was, therefore, important for the PG NO 1003 appellant to keep in mind that at no point of time it could be entitled to ask for beyond this limit as emergency supply on any ground what soever.
As this limit fluctuated from time to time on the change in the percentage of reduction in the Regulation Order, the appellant was rightly reminded of the latest position in this regard.
The learned counsel for the respondents was also right in saying that these letters could not have misled the appellant in any manner.
The numerous letters discussed earlier clearly indicate that the appellant correctly appreciated its position and repeatedly made requests for emergency supply under the Generation Order on the assumption that its entitlement had been rendered to zero.
The appellant 's letter dated 30.5.1977 (at page 16 of Vol.
IV) referred to earlier, fully demonstrates that the plea raised by the appellant is devoid of any merit.
A portion of the said letter (not dealt with earlier) is in the following terms: "During the period of break down we would request you to agree to the following arrangement: i.
Before availing Board 's power during the emergency we will intimate the B.E., MPEB, Gwalior as well as S.E.MPEB, Gwalior and send a copy of our letter to the Director (Com), MPEB, Jabalpur.
ii(a) In case 6th boiler is out and other boilers arc working satisfactorily we may be allowed to draw power upto 1200 KW.
(b) In case 6th boiler is on range and one of our M V boilers is out we may be allowed to draw power upto l200 KW.
(c) In case 6th boiler is not and one of our M.V. boilers is also out we may be allowed to draw power upto 1875 KW.
If present stand of the appellant be assumed to be correct, there was no occasion for it to claim varying quantities of power in changing circumstances as mentioned above.
It was also urged on behalf of the appellant that the Board 's letter dated 13.10.1980, Annexure `U ', (at page 182.
II) impugned by the appellant is also inconsistent with the Board 's stand in the present case.
By this letter the appellant was informed that the contract demand of 3490 PG NO 1004 KW as per the agreements between the parties was going to be reduced to 1250 KW under the provisions of the Generation Order, and on further reduction under the Regulation Order it would come down to 875 KW only.
The appellant was accordingly directed to draw power upto 875 KW with effect from 1.8.1980.
The Board further informed the appellant that no additional power will be supplied during the period of overhauling of the private generating sets.
This part of Annexure 'U ' has been set aside by the High Court on the ground that under Proviso (iii) to Clause 3 ot the Generation Order the Board was under a duty to permit the appellant to draw additional electricity on satisfaction ot the relevant conditions for emergency supply, which it could not deny.
The Board has not challenged this part of the High Court 's decision, and the same is not relevant for purposes of the present appeal.
Reliance on behalf of the appellant has been placed on the earlier part of the letter directing it to limit its drawal to 875 KW.
Mr. Gupta explained the situation thus: The contract demand as per the original agreement and the subsequent agreements by the date on which the letter was issued admittedly was 3490 KW.
If the Board 's case that the appellant 's capacity to generate electricity from its own sets was assessed at 2500 KW be accepted as correct, then the appellant would have been held entitled to draw KW only and not 1250 KW as mentioned in the letter.
Mr. Gupta invited us to consider this aspect along with the Board s earlier letter Annexure `R ' dated 28.12.1979 (page 158 of Vol.
II), informing the appellant that additional power to the extent of l90 KW had been sanctioned.
The admitted position in regard to different agreements between the parties is that initially the parties entered into a contract with respect to 1500 KW only which was later raised to 2500 KW.
The Regulation and Generation Orders came into existence at that stage.
In July 1979, a supplementary agreement was executed between the parties for supply of additional 800 KW.
and in December 1979 the Board further sanctioned l90 KW.
The relevant part of the letter relied on by Mr. Gupta is quoted below: "The Board has sanctioned l90 KW additional power (over and above 3300 KW) at 33 KV subject to the following conditions: (1) The Contract Demand shall be reduced in terms of Govt.
Control Order No. 1254/2048/XIII/75 dated 4.4.75 after the decision of the Committee headed by the Electrical Adviser & Chief Electrical Inspector to Govt.
of M.P. regarding re assessment of the capacity of the consumer 's generating set is known.
" PG NO 1005 The argument is that the Board could mention about a Committee proceeding to assess the capacity of the consumer 's captive plant only if there had not been earlier any assessment.
The reduction in the contract demand under the Generation Order should have been made after the assessment work was completed, but as a matter of fact, no such assessment was made and ultimately the letter Annexure `U ' dated 13.10.1980 was issued arbitrarily without any basis.
In absence of an assessment of the capacity under the Generation Order, no reduction was permissible.
Mr. Kacker 's reply is that since the appellant for the period of more than 4 years was pleading for emergency supply from time to time on one ground or the other, an internal Committee of Superintending Engineers which had visited the Company 's plant on 25.9.1980 suggested that the appellant Company be granted additional power to the extent of 260 KW on regular basis instead of examining the grounds relied upon by the appellant every now and then.
The latter part of the letter informing the appellant that it would not in the future be supplied additional power on the ground of emergency has been referred to in support of this argument.
Mr. Kacker further said that unfortunately the Board was held liable for the emergency supply if the necessary conditions were satisfied and thus the appellant has got double advantage and this cannot be the basis for accepting the appellant 's case.
The learned counsel proceeded to say that the letter Annexure `R ' was issued in connection with the sanction of 190 KW additional power, subject to the Government Orders, and the reduction thereunder was only a matter of arithmetical calculation which should have been done without reference to a Committee.
The letter was not sent in connection with any controversy about the assessment of the generating capacity under the Generation Order, and it cannot be interpreted in the manner as suggested on behalf of the appellant.
It was further pointed out that admittedly there was no question of a committee headed by the Electrical Adviser and Chief Electrical Inspector to the Government of Madhya Pradesh to make a fresh assessment under the Generation Order or to undertake the realistic assessment of the additional capacity over again.
The assessment had to be made by the divisional Engineer of the Board.
It was lastly said that this argument addressed by Mr. Gupta before this Court was not advanced before the High Court nor was the point taken in the writ petition or any affidavit there.
On a consideration of the documents and the re,levant circumstances we agree with Mr. Kacker.
The use of the word "re assessment" in the letter quoted above instead of "assessment" also supports the respondents ' case.
The term "re assessment" implies that there had already been an PG NO 1006 assessment earlier.
Even interpreting the letter as suggested by Mr. Gupta, the existence of the earlier assessment by the Divisional Engineer cannot be ignored.
If the appellant was not satisfied with it, it should have taken appropriate step for getting the same quashed in 1975 itself and should not have waited for four or five years before approaching the High Court, and in the meantime taking the benefit of the provisions regarding emergency supply on its basis.
Now in this background let us come back to the argument of Mr. Gupta as mentioned earlier in paragraph 16 above.
In reply Mr. Kacker asserted that it is not correct to assume that a machine can function on a regular basis only according to the rated capacity as declared by the manufacturer.
By way of illustration he relied upon the specifications relating to a machine issued by the Bharat Heavy Electricals Ltd. indicating that the "Peaking capacity ' of the machine with "No time limit" was higher than the "rated output" mentioned.
The learned counsel also analysed the report of the Divisional Engineer along with the data mentioned by the Committee which in his opinion indicated that the maximum capacity of the appellant 's sets technically feasible was much more than that actually assessed and could not be less by any calculation even before the 6th boiler was erected.
After the sixth boiler became available the capacity rose to at least 9700 KW but the Board taking a generous view did not call upon the appellant to generate further additional electricity than that directed earlier.
We have heard the learned counsel at considerable length on this aspect and we think that the question as to what should be considered the correct feasible capacity of the appellant 's sets is one involving complex technical knowledge and the High Court (or for that matter this Court) was well advised not to have attempted to determine it.
We must reiterate the circumstances which appear to be highly relevant, namely, (i) that the Divisional Engineer who has been rightly considered by the Generation Order to have sufficient expert knowledge in this regard reached the conclusion which is under challenge in the present case after personally considering the matter thoroughly along with the Officers of the Company as is apparent by many of the letters; (ii) the figures collected by the members of the Committee are not challenged as incorrect or inaccurate; (iii) it is not suggested that any of the members of the Committee or the Divisional Engineer or for that matter any Officer of the respondent Board or of the Stale Government had any prejudice or bias against the appellant Company; PG NO 1007 (iv) the appellant did not get an independent assessment of its generating sets made by any person having expert knowledge; (v) the appellant avoided to get the correctness of the assessment verified by the parellel running test as suggested by the Board; and (vi) the conduct of both the appellant and the respondent Board as emerging from the documents placed by the parties on the records of the case furnish valuable circumstantial evidence in support of the respondents ' case.
The argument of the appellant challenging the assessment as illegal must, therefore, be rejected.
Mr. Gupta by way of an alternative plea pressed an argument for granting a limited relief.
He urged that even assuming that the assessment of maximum feasible capacity of the appellant 's sets was correctly made in 1975 so as to be binding on the appellant, it is fully established even by the letters of the Board that the position stood materially altered by November 1979 which called for a re assessment.
The Board s letters dated 27.11.1979 (page 157 Vol. II) and 28.12.1979 (page 158, Vol. 11), according to the learned counsel.
indicate that irrespective of whether the initial assessment was good or not, the Board accepted the position that steps for re assessment had to be taken and after taking into account the circumstances, decided to grant an ad hoc benefit of 260 KW by its letter Annexure `U ' dated 13.10.1980 (page 182, Vol.
Il), discussed earlier.
Although the appellant does not agree that the grievance of the appellant was properly met by the grant of the additional 260 KW but since this was allowed by the Board itself, the relief should have been granted with effect from November ~979 and not from 1.8.1980 as mentioned in Annexure `U '.
The plea of the respondent that this additional power was allowed on account of the recurring demand by the Company for emergency supply under Proviso (iii) to Clause 3 of the Generation Order has been challenged as incorrect.
It is urged that the letter Annexure `U ' granting additional 260 KW over and above 875 KW the appellant was held entitled to draw, must be read in the background of Annexure Q dated 27.11.1979 (page 157, Vol.
II) and Annexure 'R ' dated 28.12.1979 (page 158, Vol.
These letters have been discussed earlier while dealing with another argument.
The argument of the appellant is that the Board had recognised the need of re assessment of the capacity and had decided to entrust the work to a committee and it must be presumed that the team must have submitted some report.
However, no such report has been placed by the Board on the records of this case and the suggestion is that it is a case of suppression by the respondent and the Board cannot be heard to say that the team did not go i~ e question of re assessment.
Since the matter was raised by the appellant in November 1979 PG NO 1008 which ultimately resulted in the partial relief up to 260 KW about 11 months later, the benefit ought to have been allowed with effect from November 1979 if not earlier.
The stand of the Board with respect to this additional 260 KW has already been mentioned earlier.
It is argued by the Board that the Generation Order contemplates only a single assessment leading to a single direction and the appellant was not entitled to re assessment.
The word "re assessment" in Annexure 'R ' was, according to the respondents, mentioned due to inadvertence or under a misconception of the exact legal position.
In any event the additional energy was allowed as the result of the repeated demand by the appellant for emergency grant.
With a view to meet the situation which was arising every now and then a generous attitude was taken to allow additional 260 KW.
It is contended that no further claim can be legitimately founded on this act of generosity.
As a result of the High Court 's decision the appellant 's claim for emergency supply was being considered on merits.
The appellant is thus having the advantage of the double benefit with effect from 1.8.1980.
because the Board has neither appealed against that part of the High Court judgment, nor has it withdrawn the special benefit of 260KW, but a further claim cannot be allowed on account of this sympathetic attitude.
In view of our finding that a proper and binding assessment of the capacity of the appellant 's generating sets was made in 1975 by the Divisional Engineer in pursuance of which the direction in Annexure O was issued and in view of the further fact that on that basis the appellant from time to time asked for and was allowed emergency relief under proviso (iii) to Clause 3 of the Generation Order, the argument of Mr. Kacker appears to be correct.
The appellant has, in our view.
failed to establish any right ot additional relief from an earlier date.
The next point taken on behalf of the appellant is that there is no sanction in law for charging at the penal rate for the electricity consumed beyond what is permissible on application of the Generation Order.
Section 22B of the 191() Act confers powers of framing subordinate legislation on the State Government for the purposes and to the extent mentioned therein and consequence of contravention of any such Order is provided in s.42 (e) mentioned below: "42.
Whoever . . . . . . . (e) makes default in complying with any order issued JIYAJEERAO COTTON MILLS vs ELECTRICITY BOARD [SHARMA.
J ] 1009 to him under section 22B or sub section (2) of section 34; shall be punishable with fine which may extend to one thousand rupees, and, in the case of a continuing offence or default, with a daily fine which may extend to one hundred rupees.
" The argument is that section 22B cannot be so construed as to include a delegated power to impose penalty of the delegate 's choice for the contravention of an order issued under the Section.
Since the legislature itself exercised its legislative power in that field by including section 42 in the statute, the State had or has no authority to take any further step for the enforcement of its Order, except by resorting to section 42.
Dealing with section 78 A of the 1948 Act which says that in the discharge of its functions, the Board shall be guided by such directions on questions of policy as may be given to it by the State Government.
Mr. Gupta contended that it cannot be interpreted to effectively clothe the State to direct the Board to do a thing which it is itself nOt empowered to do.
The Board, therefore. should have either prosecuted the appellant under section 42(e) or disconnected the electric supply altogether, but it was not entitled to demand penal charges.
Mr. Kacker countered by saying that section 42 of the 1910 Act belongs to the group of sections 39 to 50 dealing with Criminal Offences and Procedure as is apparent by the heading just above section 39, and deals with the criminal liability only.
The same set of events may give rise at the same time to civil rights as well as to a criminal offence and it is not correct to suggest that merely because provisions arc specifically included in the Act dealing With criminal liability, the civil liability is deemed to have disappeared.
By way of illustration, a simple case of theft ot movable article may be considered: the owner ot the property can set the criminal law in motion and at the same time may claim the property or compensation for it under the civil law.
Mr. Kacker appears to be right in his stand that merely because the appellant became liable to the penalty as mentioned in section 42(e) it cannot on that ground defend an additional demand on account of supply of the extra energy , if otherwise maintainable under the law.
Besides, section 48 puts the matter beyond controversy by expressly stating that the penalty imposed by the aforesaid section shall be in addition to, and not in derogation of, any liability in respect of the payment of compensation which the offender may have incurred.
While commencing his argument, Mr. Gupta had indicated that one of the points on which the appellant relied upon, related to the validity of Clause 3 of the PG NO 1010 Generation Order mandatorily requiring a consumer to generate maximum feasible electricity from its own generating set.
It was suggested that the provisions in the said Clause being in excess of the power under section 22B, were ultra vires.
After completing his argument on the other points he said that he was not pressing this point.
Mr. Kacker, therefore, did not address us on this aspect.
We may not in these circumstances detain ourselves on this question except mentioning the decisions in Adoni Cotton Mills vs A.P. State Electricity Board; , ; State of U.P. vs Hindustan Aluminium Corporation; , ; and New Central Jute Mills vs U. P. State Electricity Board, [1986] Supp.
SCC 581, showing in unambiguous terms that the power is there.
section 22B permits the State Government to issue an appropriate order for regulating the supply, distribution and consumption of electricity The expression "regulate ' occurs in other statutes also, as for example, the , and it has been found difficult to give the word a precise definition.
It has different shades of meaning and must take its colour from the context in which it is used having regard to the purpose and object of the relevant provisions, and as has been repeatedly observed, the Court while interpreting the expression must necessarily keep in view the object to be achieved and the mischief sought to be remedied.
The necessity for issuing the two Orders arose out of the scarcity of electricity available to the Board for supplying to its customers.
The situation did not leave any option to the Board but to make limited supply of electricity to its consumers, and it must be held to have, in the circumstances the right to stagger or curtail the supply.
The Orders were issued in this background and to make the direction mentioned therein effective it was considered essential to impose sanctions which could take any reasonable form; either disconnection in case of gross violation or the lesser sanction of enhanced tariff.
By the Order issued under section 22B and quoted in paragraph 7 of the judgment in Adoni Cotton Mills case (supra) the State Government directed a reduction in supply of electricity to the extent of 75% of the previous average monthly demand and provided for payment of the charges for excess consumption at double the tariff rates.
The Electricity Board thereafter proceeded to impose further restrictions.
Aggrieved by these measures the Adoni Cotton Mills, an aggrieved consumer approached the Court, but its challenge was repelled.
On behalf of the appellant Mr. Gupta attempted to distinguish the decision on the ground that the fixing of a higher tariff for the excess consumption was against public policy and that this aspect was not considered by this Court in Adoni Cotton Mills case.
We do not find any merit in this argument.
The demand of higher charges/tariff PG NO 1011 for electricity consumed beyond legally fixed limit is a reasonable deterrent measure providing an appropriate sanction not as harsh as disconnection of supply of energy altogether and cannot be opposed on the ground of public policy.
We, therefore, hold that none of the two Orders is illegal or unreasonable.
Mr. Gupta alternatively contended that the provisions fixing the electric charges at 4 times the normal tariff for the excess consumption are to be found only in the Regulation Order and since there is no corresponding provision in the Generation Order, there is no sanction for demanding the penal rate for the electricity consumed incontravention of the Generation Order.
He proceeded to say that there is no language in either of the two Orders to link them with each other.
The different measure taken under the two Orders operate under different conditions and circumstances, and they cannot, therefore, be lumped together.
In reply to the argument of Mr. Kacker that since the Schedule to the Regulation Order refers to the 'contract demand ' which expression denotes the original contract demand as reduced by the provisions of both the Regulation Order and the Generation Order, leading to the conclusion that the provisions regarding the payment of penal charges take into account both the Orders together, Mr. Gupta contended that although it is true that by reason of the Generation Order the contract demand is reduced but it cannot be said that a new contract comes into existence for the reduced amount to justify the argument of Mr. Kacker, because the reduction is as a result of operation of law.
In other words, the reduced amount cannot be termed as 'contract ' demand as it is in supersession of the contract demand.
The contract demand, therefore, remains the same as before although there is introduced a statutory bar from drawing it in full measure.
Applying this logic, it was argued by the learned gcounsel that the Generation Order has to be kept apart while working out the effect of the Regulation Order.
He also referred to the subsequent Regulation Order of 1978 in which the relevant Schedule prescribes 50 KW as the minimum entitlement which is inconsistent with the Board 's case.
It is urged that the argument on behalf of the Board that the two Orders have to be read together must, therefore, be rejected.
The reply of Mr. Kacker is three fold: he point was not taken in the writ application before the High Court nor in the grounds before this Court and since it is not a pure question of law it should not be allowed to be raised in the argument; (ii) the two Orders were issued on the same date with the common object to remedy the same problem as is evident from their preambles and so they cannot be read in PG NO 1012 isolation; and (iii) in any event the Electricity Board in levying and making the impugned demand must be deemed to have exercised its power under s.49 of the 1948 Act which it is certainly entitled to.
Gupta said that it was not right to suggest that the point was not raised in the High Court.
He placed before us the review petition filed in the High Court after the disposal of the writ case and relied on the statement in paragraph 3 of the judgment disposing of the review petition.
He stated that the written arguments of the Company consisted of three parts under the heads 'list of dates, notes of argument ' and a 'reply '.
Mr. Gupta fairly conceded that the point was not taken in the writ petition before the High Court and he was not in a position to assert that it was actually argued on behalf of the Company in the first argument addressed before the High Court.
but he claimed that the Company did press the point during the final reply.
He could not deny that the point was not taken when the present appeals were filed in this Court.
The judgment of the High Court does not deal with the point.
In the circumstances, the question arises as to whether the question should be allowed to be urged now and if so how should it be answered .
35 Mr. Gupta contended that merely because the two Orders are issued under the same provision of law on a particular date, they cannot be dovetailed.
The similarity in the preamble of the two Orders is described as not great consequence as it merely borrows the language from s.22B.
Many Orders are issued under section 3 of the Essentila Commodities Act,the argument proceeds, and it cannot, there fore, be suggested that the penalty imposed in one has to be applied to the other without express language to that effect in either of two Orders.
We do not think in view of the fact that the point was not taken on behalf of the Company while instituting the writ application in the High Court and filing the present appeals in this Court, it should be allowed to be urged at the hearing.
Let us assume that the argument of Mr. Gupta is correct.
Immediately the next question would arise as to whether the Board is otherwise authorised in law to levy and demand charges for the excess electricity at the higher rate and if so whether the Board can be said to have exercised its power in this regard.
Mr. Kacker contended that apart from the power of the state Government to limit the supply of electricity to the consumers by an order under section 22B and direct payment of penal charges for excess consumption, the Board is also empowered to impose sanctions by charging enhanced tariff and the authority to do so is derived both under section 49(3) PG NO 1013 of the 1948 Act and section 49(1) read with the original argeement.
The relevant provisions are quoted below: "49.
Provision for the sale of electricity by the Board to persons other than licensees.
(1) Subject to the provisions of this act and of regulations, if any, made in this behalf, the Board may supply electricity to any person not being a licensee upon such terms and conditions as the Board thinks fit and may for the purposes of such supply frame uniform tariffs.
(2) . . . . . . . . . (3) Nothing in the foregoing provisions of this section shall derogate from the power of the Board, if it considers it necessary or expedient to fix different tariffs for the supply of electricity to any person not being a licensee, having regard to the geographical position of any area, the nature of the supply and purpose for which supply is required and any other relevant factors.
(4) In fixing the tariff and terms and conditions for the supply of electricity, the Board shall not show undue preference to any person.
Reliance was placed on several decisions of this Court of the High Courts.
It was further contended that it is not essential for the Board to frame regulations tot the exercise of such power.
The leaned counsel appears to be right.
In Adoni Cotton Mills ' case (supra) the State Government had made an order under section 22B of the 1910 Act limiting the supply to 75% of the previous consumption as was done in the present case and directed the payment of punitive rates for excess consumption.
The Board made supplementary orders for placing further onerous conditions on certain groups of consumers.
This was challenged before the High Court inter alia on the ground that since the State Government had already acted under section 22B, the Board could not further pass supplementary orders and that in any event since the Board had not made regulations laying down the principles under section 79(j) of the 1948 Act, the orders were bad.
Both the points (along with several others) raised by PG NO 1014 the appellant in that case were rejected by this Court.
Referring to section 49(1) of the 1948 Act, the Court observed that the power to enhance the tariff is included in the Section and the expression that "the Board may supply electricity . upon such terms and conditions as the Board thinks fit" in section 49(1) iS related to the terms and conditions of the agreement between the parties.
Sub section ( 1) confers power on the Board to supply electricity upon such terms and conditions as it thinks fit and the terms and conditions include the power of the Board to enhance the rates.
section 49(3) permits the Board to fix different rates for the supply of electricity having regard to certain conditions mentioned therin and ' 'any other relevant factors".
It was held that the expression "any other relevant factors" could not be considered ejusdem generis because there is no genus of the relevant factors.
In New Central Jute Mills Co. Ltd. vs U.P. State Electricity Board, (supra) the situation again was similar to the present case.
The argument pressed before the Supreme Court inter alia was that the Board had no authority to make the demand in excess of the agreed rate under the agreement.
Repelling the contention, the Court observed in paragraph 4 of the judgment that the agreement itself did not envision the supply of electricity in violation of the ban imposed by the State Government in exercise of its power under section 22B of the 1910 Act; nor did the agreement stipulate the rate at which such supply should be charged if notwithstanding the ban against the supply a consumer drew electricity in excess of the permissible quantity.
In the circumstances, the Board was justified in invoking the power under section 49(3) of the 1948 Act which authorised it to supply electricity by charging different tariff having regard to certain conditions and ' any other relevant factors".
section 49(3) was interpreted to be wide enough to cover a situation where electricity in excess of the quantum is drawn in disregard of the ban imposed under section 22B of the l9 10 Act.
We do not consider it necessary to multiply the decisions as there does not appear to be any doubt that either under section 49(1) of the 1948 Act read with the agreement or under section 49(3) or under both the provisions the respondent Board is fully authorised to levy and to make a demand at a higher rate than the usual tariff.
It is also clear that it is not essential for the Board to make regulations indicating the basis for such levy before making the demand.
The appellant has not been able to successfully show before us that the power by the Board has to be exercised in a particular manner and by adopting a particular mode.
If it is assumed that a particular formality has to be completed before a demand can be legitimately raised, the appellant cannot be allowed to claim now that the same is lacking in the present case in the absence of a proper pleading in the original writ petition before the High Court.
If the point had been raised in time, the respondent Board could have placed relevant materials on the issue.
If at the end of the hearing of the case in the High Court the point was mentioned in the appellant 's final reply and included in the PG NO 1015 last instalment of its written argument, it cannot cure the defect in the pleading specially when the judgment of the High Court dismissing the writ application does not deal with the point.
In that view it is not necessary to test the correctness of the argument of Mr. Kacker that the appellant 's entitlement to receive the quantum of electricity from the Board at the normal tariff can be determined only by a combined reading of the two Orders.
We do not, therefore, consider it necessary to decide as to what would have been the precisely correct answer if the point had been properly raised before the High Court at the appropriate stage.
We do not find any merit in any of the points urged on behalf of the appellant.
We were informed by the learned counsel for the parties that the appellant does not accept the correctness of the calculations in the letter 'P ' series and the question is being examined by the High Court in a pending case.
The appellant also asserts that even during the period commencing from November 1979 the Company had pleaded for emergency supply.
The High Court has in the present case directed the prayer for emergency supply to be considered on merits.
Since these questions are not involved in the present appeals, arguments relating to these points have not been addressed before us.
We, in the circumstances, make it clear that any observation made in the present case shall not be treated to have decided those points which are the subject matter of a pending case in the High Court.
It was also pointed out at the Bar that several interim orders were issued by this Court during the pendency of the present appeals and final direction should be given in regard to them.
While granting special leave this Court by its order dated 5.11.1982 directed the appellant Company as condition for interim relief of restoration of electric connection to pay a sum of Rs.50,00,000 within a fortnight and another sum of Rs. 1,50,00,000 within six months with interest from l. 1.1983 at the rate of 12% per annum until payment.
The future payment of the electricity bills was ordered to be made within four weeks from the service of the bills.
The Court also said that the applications made by the appellants for consideration of emergency supply of the electricity should be expeditiously disposed of by the Board on merit, and all payments by the appellants will be subject to adjustment in the light of the decision on the emergency applications.
By the order dated 24.11.1982 the time for payment of Rs.50,00,000 was extended to 6.12.1982.
With respect to the payment of Rs. 1,50,00,000 the Court by its order dated 6.5.1983 permitted the amount to be deposited in PG NO 1016 two equal instalments.
The Court also said that if it was ultimately found that the appellant had paid any amount in excess of the total liability, the Board shall repay such excess amount with interest at the rate of 12% per annum.
By a subsequent order dated 23.4.1984 the appellant was required to pay a sum of Rs. 1,28,00,000 to the Board by the 10th of May, 1984 and to keep the bank guarantee alive till the final disposal of these appeals as condition for continuance of the interim order.
During the hearing of the appeal a grievance was made on behalf of the respondent Board that the bank guarantee had not been effectively renewed and the learned counsel for the appellant undertook on behalf of the Company to correct the defect.
Subsequently it was stated at the Bar that proper bank guarantee had been furnished in accordance with the Court 's direction.
In view of our present decision the respondent Board, besides being entitled to retain the amount already paid to it in pursuance of this Court 's direction, is further entitled to enforce the bank guarantee.
The appellant Company, therefore, must arrange to make the payment withount delay, failing which the Board shall be entitled to take steps for enforcement of the bank guarantee.
The dispute regarding the appellant s claim to receive emergency supply is pending before the High Court.
The appellant shall be entitled to adjustment in the light of the final decision on this point.
| On February 21, 1986 the State Government of Maharashtra appointed Shri Justice B. Lentin as a one man Commission of Inquiry to probe into the death of 14 patients in the government run J.J.B. Hospital between 22.1.1986 and 7.2.1986 after they were administered contaminated glycerol, and to fix responsibility.
The inquiry revealed the existence of a corrupt and venal nexus between the drug firms, the delinquent Food & Drugs Administration and hospital staff on the one hand, and the appellant, some other persons and certain Government officials on the other.
The Commission 's report was an indictment of the State 's public health system.
The Commission having found the evidence given by the appellant self contradictory, issued a show cause notice to him as to why he should not be prosecuted for the offence of giving false evidence on oath under section 193 of the Indian Penal Code, 1860 read with section 340 of the Code of Criminal Procedure, 1973.
After considering the appellant 's objections, the Commission directed filing of a complaint under sections 193 and 228 of I.P.C.
The appellant filed a petition in the High Court assailing the legality and propriety of the order of the Commission directing filing of the complaint, and the same was dismissed by the High Court.
Before this Court, it was contended on behalf of the appellant that (1) the Commission could not be deemed to be a Court for the purposes of section 195(1)(b) of the Code of Criminal Procedure unless declared by the Commission of Inquiries Act itself, as stipulated in sub section
(3) of section 195, PG NO 942 PG NO 943 which provides that in cl.
(b) of sub section
(1), the term 'Court ' means a Civil, Revenue or Criminal Court, and includes a tribunal constituted by or under a Central, Provincial or State Act if declared by that Act to be a Court for the purposes of this Section; (2) the Commission of Inquiry appointed by the State Government was merely a fact finding body appointed by the Government for the 'information of its mind ', and the mere fact that the procedure adopted was of a legal character and it had the power to administer an oath would not impart to it the status of the Court and therefore was not a 'Court ' for the purposes of section 195(1)(b) of the Code; (3) the question was not whether the appellant could be prosecuted for perjury for giving false evidence which was an offence punishable under section 195(1)(b), but whether the Commission was a 'Court ' for the purposes of section 195(1)(b); (4) that sub section to put an end to the controversy, and this was nothing but 'legislative declaration of the law ' contrary to the law declared by this Court in Lalj Haridas case, and a number of statutes contain such a provision in accordance with the existing legislative practice.
The Advocate General appearing on behalf of the State contended that (1) the inclusive part of the definition of 'Court ' in section 195(3) of the Code was ex abundanti cautela and was merely declaratory of the law, and (2) the first part of sub section
(4) of section 5 of the Act satisfied the requirements of the inclusive part of the definition of 'Court ' as contained in sub section
(3) of section 195 of the Code.
Allowing the appeal, it was, HELD: (1) It could not be doubted that sub section
(3) of section 195 of the Code had been enacted by Parliament to implement the recommendations of the 41st Report of the Law Commission to remedy the uncertain state of law due to conflict of opinion between different High Courts as to the meaning of the word 'Court ' in section 195(1)(b) and to that extent the introduction of the inclusive clause in the definition of 'Court ' in sub section
(3) of section 195 had brought about a change in the law.
[966D] (2) Law must be definite, and certain.
If any of the features of the law could usefully be regarded as normative, it was such basic postulates as to the requirement of consistency in judicial decision making.
It was this requirement of consistency that gave to the law much of its rigour.
At the same time, there was need for flexibility.[968F G] (3) A Commission of Inquiry was fictionally a Civil PG NO 944 Court for the limited purpose of proceeding under section 482 of the old Code or section 345 of the present Code.
A fortiori the legal fiction contained in sub section
(5) of section of the Act which related to the proceedings before the Commission was necessarily confined to offences that were punishable under sections 193 and 228 of the Indian Penal Code and did not extend beyond that.
[970F G] (4) A Commission of Inquiry was not a Court properly so called.
A Commission is obviously appointed by the appropriate Government 'for the information of its mind ' in order for it to decide as to the course of action to be followed.
It was therefore a fact finding body and was not required to adjudicate upon the rights of the parties and has no adjudicatory function.
The Government was not bound to accept its recommendation or act upon its findings.
The mere fact that the procedure adopted by it was of a legal character and it had the power to administer an oath would not impart to it the status of a Court.
[972D E] (5) Parliament in its wisdom whenever thought it fit had inserted a special provision for deeming a tribunal to be a Court for the purposes of section 195(1)(b) but had left the other enactments like the Commission of Inquiry Act untouched although sub section
(3) of section 195 had been on the Statute Book for the last over 14 years.
[965D E] (6) The judgment will not however prevent the State Government from launching a prosecution against the appellant for commission of the alleged offences under sections 193 and 228 I.P.C. if otherwise permissible in law.
[977E F] Lalji Haridas vs The State of Maharashtra ; ; M.V. Rajwade vs Dr. S.M. Hasan, ILR (1954) Nagpur 1; Brajnanandan Sinha vs Jyoti Narain, ; ; Puhupram & Ors.
vs State of Madhya Pradesh, ; Balakrishnan vs Income Tax Officer, Ernakulam, ; Jagannath Prasad vs State of Uttar Pradesh, ; Virinder Kumar Satyawadi vs The State of Punjab, ; Balwant Singh & Anr.
vs L.C. Bharupal, I.T.O., New Delhi, ; Chandrapal Singh vs Maharaj Singh, ; Bengal Immunity Co. Ltd. vs Union State of Bihar, ; R. M.D. Chamarbaugwalla vs Union of India, ; ; Commissioner of Income tax Madhya Pradesh & Bhopal vs Sodra Devi, [1958] SCR l; St. Aubyn vs Attorney General, ; ; Shell Co. of Australia vs Federal Commissioner of Taxation, ; Smt.
Ujjam Bai vs State of Uttar Pradesh, ; M.M. khan vs Emperor, ILR and In re.
Maharaja Madhava Singh LR (1905) 31 IA 239.
PG NO 945
|
Appeal No. 105 of 1954.
Appeal by special leave from the judgment and order dated November 6, 1952, of the Labour Appellate Tribunal, Calcutta in Appeal No. Cal 3 of 1952 773 arising out of the award dated September 25, 1951, of the Court of District Judge, Industrial Tribunal, Calcutta in Case No. VIII 23 of 1951.
section C. Isaacs, A. K. Datt and Sukumar Ghose, for the appellants.
M. C. Setalvad, Attorney General for India, D. B. Das and section N. Mukherji, for the respondent.
B. Sen and P. k. Bose, for Intervener (State of West Bengal).
October 11.
The Judgment of the Court was delivered by GOVINDA MENON J.
This appeal is by special leave against the decision of the Labour Appellate Tribunal of India, Calcutta, which modified the award, passed by the Industrial Tribunal, Calcutta, in the matter of a dispute referred to it by the Government of West Bengal, for adjudication with regard to the rates of dearness allowance for clerks and Depot cashiers, employed by the Calcutta Tramway 's Coy.
Ltd., numbering about 600, out of a total of 10,000 workmen.
Disputes having arisen between the workmen of the Calcutta Tramways Coy, Ltd. (which may hereafter be called 'The Company ') on the one hand, and the employers on the other, relating to the dearness allowance payable to the workmen, there were two previous awards, one dated May 16, 1947, by Sri section N. Guha Roy, and the other dated October 27, 1948, by Sri P. K. Sircar.
Both of these awards related to all the employees of the Company and not to the clerks and Depot cashiers alone.
Subsequently a reference was made by the West Bengal Government on June 13, 1951, concerning a dispute relating to the dearness allowance of the workmen of the Company, excluding clerks and Depot cashiers.
There was an award and an appeal, and in that appeal the Appel.
late Tribunal increased the dearness allowance by Rs. 7/8/ for workmen in the pay ranges below Rs. 50 and up to the pay range of Rs. 250 and by a flat rate 774 of Rs. 5 in the higher pay ranges taking the cost of living index of the workmen class at 370 points.
In the present award, which relates to the clerks and the Depot cashiers alone, the Industrial Tribunal gave Rs. 47/8/ as dearness allowance for a pay range of Rs. 51 to Rs. 100 and provided for a progressive increase of Rs. 5 for each slab of Rs. 50 in the pay range.
The Appellate Tribunalincreasedthe amounts so awarded by Rs. 2/8/ more than what was granted to the other workmen of the Company.
The cost of living index for the middle class families had been fixed by an investigating body of the Bengal Chamber of Commerce during the relevant year at 382 points, whereas the index in the case of working class was fixed at 370 points.
The increased amount awarded for the various pay ranges and shown in the decision of the Labour Appellate Tribunal which need not be repeated again, was founded on these cost of living indices though the amount was not the same as recommended by the Bengal Chamber of Commerce.
Before the Labour Appellate Tribunal, as well as the Industrial Tribunal, the claim put forward on behalf of the clerks and Depot cashiers was that the dearness allowance should be on the same rates as decided upon by the Bengal Chamber of Commerce of which the company is a member and no difference should have been made between the dearness allow ance recommended by the Bengal Chamber of Commerce and that to be awarded by the Industrial Tribunal.
In fact, what was urged was that the recommendation of the Bengal Chamber of Commerce ought to have been accepted in its entirety for the reason not only that the Company is a first class member of the Chamber but also that the class of persons, namely the middle classes for whom the recommendation was intended, includes clerks and Depot cashiers of the Company as well, and the same having been accepted ,by the Mercantile Tribunal which dealt with the dearness allowance payable to the employees of the mercantile firms in Calcutta, the Industrial Tribunal, as well as the, Labour Appellate Tribunal, should have 775 followed the same.
The learned Judges of the Appellate Tribunal held that those recommendations were made to the mercantile firms where the workmen consist practically of the clerical and subordinate staff as opposed to Tramways Company where the large percentage of workmen belong to other categories, the clerks and Depot cashiers being only a small minority, though they found that the cost of living index found by the Bengal Chamber of Commerce should be accepted as the criterion for awarding the increased dearness allowance in the case of the employees of the Company as well.
On behalf of the appellants it is urged before us that a different mode of treatment than the one recommended by the Bengal Chamber of Commerce should not have been resorted to in the case of the appellants, for the reason that those recommendations are intrinsically reasonable, considering the uniformity of life and modes of habit of the middle classes to which the clerks and Depot cashiers belong.
The, respondent Company being a member of the Bengal Chamber of Commerce should, instead of ignoring the recommendation have acted upon it as a mandate, so that its action as a member should not be inconsistent with that followed by others especially since there have been no valid reasons alleged for the non acceptance of the recommendation.
It is further urged that there is no acceptable defence put forward that the abovementioned recommendation will not apply to institutions having a mixed staff as the Company in question.
On the other hand, what is stated in the written statement of the Company is that according to the previous award it had been paying a uniform sliding scale of dearness allowance for all categories of workmen as detailed in Paragraph 6(b).
It is, therefore, contended that what the Industrial as well as the Appellate Tribunal should have done was to have evolved a principle to fix the dearness allowance in relation to the ' basic salaries and the cost of living index, as that alone would satisfy the recom mendations of the Bengal Chamber of Commerce.
776 ,We have, therefore, to see whether in following the course now adopted by the Tribunals below they have ignored any legal principle or acted in violation of any statute.
There can be no doubt whatever that if the scheme adumbrated by the Bengal Chamber of Commerce is adopted in the case of clerks and Depot cashiers, they would get amounts far in excess and out of all proportion to what were awarded to the other workmen whose appeal had already been disposed of by the Appellate Tribunal though it has to be recognized that the cost of living index in the case of the appellants has to be considered to be more than the index of workmen whose avocations are the result of physical labour rather than of mental faculties.
In short, the clerks and Depot cashiers should be considered as the white collared fraternity.
In these circumstances, we have to find out whether the procedure followed by the Labour Appellate Tribunal, namely leaving out 20 points un neutralised and allowing Rs. 5 per 20 points rise in the living cost index but taking into consideration a higher living cost index of 382 in the case of the appellants as compared with the average index of the workmen of 370, is a justifiable method to be adopted.
It is difficult to hold that the middle classes in this country can be said to form a separate stratum of society even in a city like Calcutta having the same mode of life, the same necessities, uniform requirements and comforts.
There are different grades even among the middle classes and it is unwise to predicate the same degrees of comforts and necessities for everyone who is said to belong to the middle classes.
Such being the case, to say that the clerks in the mercantile firms can be considered equal in all respects to the 600 clerks and Depot cashiers of the Company, is an argument which cannot be accepted as sound.
The Labour Appellate Tribunal has not completely ignored the recommendations of the Bengal Chamber of Commerce, for it is seen that in raising the amount awarded by the Industrial 777 Tribunal the Appellate Tribunal has based its conclusion on the higher cost of living index in the case of middle class employees.
Such being the case, the point for consideration is whether any question of principle is involved, so that this court might interfere with the conclusions arrived at by the Labour Appellate Tribunal.
Wide and undefinable with exactitude as the powers of the Court are (see Dhakeswari Cotton Mills Ltd. vs Commissioner of Income Tax, West Bengal(1)), it is now well settled that generally the necessary pre requisites for this court 's interference to set right decisions arrived at by Tribunals whose conclusions on questions of fact are final can be classified under the following categories, namely, (1) where ' the Tribunal acts in excess of the jurisdiction conferred upon it under the statute or regulation creating it or where it ostensibly fails to exercise a patent jurisdiction; (ii) where there is an apparent error on the face of the decision and (iii) where the Tribunal has erroneously applied well accepted principles of jurisprudence.
It is only when errors of this nature exist, that interference is called for.
In the present case the appellants have not been able to show that there is any deviation from those principles.
If the Tribunal below had failed to resort to a basic principle, then something might have been said but what has been done is, that in computing the dearness allowance it has considered various methods and adopted one of them.
That being the case, it is ' difficult to say that there is any question of principle at all.
The report of the Central Pay Commission at page 46, in Paragraph 71, made the following recommendation: "Without adopting such a complicated procedure, we think it sufficient to provide by slabs for persons on different levels of pay, as shown in the accompanying table which also provides for diminishing rates of dearness allowance as the cost of living index falls, taking the stages by 20 points at a time".
(1) ; , 949.
778 It refrained from recommending the neutralisation of the entire higher cost of living by means of dearness allowance.
The report of the Committee on Fair Wages appointed by the Government of India in Chapter IV, dealing with Wage Adjustments considered in paragraph 43 the various modes and methods of granting relief to meet the burden of increased cost Of living and came to the conclusion that there is no practice of uniformity in the extent of compensation given to employees to meet the increased cost of living.
It observed as follows: "The Pay Commission has accepted, the principle that the lowest paid employee should be reimbursed to the full extent of the rise in the cost of living and that, higher categories of employees should receive a diminishing but graduated scale of dearness allowance.
The Pay Commission has rejected the principal of a flat rate for all categories of employees, irrespective of their basic salaries".
Finally it came to the conclusion "that for the lowest categories of employees the target should obviously be compensation to the extent of 100 per cent.
of the increase in the cost of living.
For categories above the lowest we agree that the same consideration will not apply.
A flat rate equal to the rate allowed to the leastskilled worker is not likely to satisfy higher categories".
In the analysis regarding the Industrial Awards, issued by the Government of India, Ministry of Labour, the question of dearness allowance is considered somewhat elaborately.
At page 33 there is a discussion regarding the linking of dearness allowance to the cost of index numbers and as to whether a flat rate of dearness allowance irrespective of the income group should be allowed or not.
They further considered the linking of dearness allowance to the cost of living index numbers on the scale of income groups, but at rates diminishing with the income received.
A perusal of the fairly elaborate discussion in Chapter 779 III shows that there cannot be a hard and fast rule applicable to all kinds of employees.
Very much will depend upon the conditions of labour, the nature of the locality and the mode of living.
In Buckingham and Carnatic Company Ltd., Madras vs Workers of the Company(1) the Tribunal considered the question of neutralisation of the rise of the cost of living by the grant of dearness allowance and was of the opinion that cent per cent neutralisation cannot be allowed, as it would lead to a vicious circle and add fillip to the inflatory spiral.
It further held that there was no reason why the Industrial worker should not make sacrifices line all other citizens.
We can now take it as settled that in matters of the grant of dearness allowance except tothe very lowest class of manual labourers whose income is just ' sufficient to keep body and soul together, it is impolitic and unwise to neutralise the entire rise in the cost of living by dearness allowance.
More so in the case of the middle classes.
The criterion to be adopted in the fixation of dearness allowance is also considered in Mahomad Rai Akbarali Khan vs The Associated Cement Companies Limited(2) where similar principles are discussed.
On behalf of the appellants our attention was invited to certain observations contained in The Millowners ' Association, Bombay vs The Rashtriya Mill Mazdoor Sangh(3), but we do not think that any different principle is enunciated there at all.
Mr. Isaacs, the learned counsel for the appellants, laid great stress on the decision in Workmen of the Firestone Tyre and Rubber Company of India Ltd., Bombay vs Firestone Tyre and Rubber Company of India Ltd., Bomba(4) where the Tribunal expressed the opinion that dearness allowance is intended to neutralise rise in the cost of living and as there is a well recognised difference between the clerical staff and other workmen in their cost of living, the latter are not entitled.
(1) , 519, 520.
(2) (3) (4) 101 780 to claim the allowance on the same basis.
From this the learned counsel contends that the recommendations of the Bengal Chamber of Commerce should be accepted in toto.
In our opinion, the decision does not help the point of view put forward on behalf of ' the appellants.
In fact, the Labour Appellate Tribunal has made a distinction between the physical labourers and the clerks and Depot cashiers in whose work it is not alone the physical exertion that is essential but some kind of mental and brain work as well and accordingly the higher cost of living index taken into account.
In such circumstances, it seems to us that the Labour Appellate Tribunal has, after considering the various points of view, come to the correct conclusion in awarding the dearness allowance it did.
There is no question of law or principle involved and the appeal has to be dismissed with costs of the Calcutta Tramways Coy.
Ltd. The State of West Bengal, which has intervened during the appeal, will bear its own costs.
| It is well settled that the decisions of a Tribunal on questions of fact are final and that the Supreme Court would interfere only in cases where (1) the Tribunal acts in excess of the jurisdiction conferred upon it under the statute or regulation creating it or where it ostensibly fails to exercise a patent jurisdiction; (2) there is an error apparent on the face of the decision; (3) the Tribunal has erroneously applied well accepted principles of jurisprudence.
The Bengal Chamber of Commerce of which the respondent Company was a member, had made an investigation into the cost of living index for the middle class families and, fixed the dearness allowance payable to the employees of the mercantile firms in Calcutta.
Before the Industrial Tribunal as well as the Labour Appellate Tribunal the claim was put forward on behalf of the appellants (the clerks of the respondent Company) that the dearness allowance for them should be at the same rates as those decided upon by the Bengal Chamber of Commerce in respect of the middle classes to which the appellants belonged and they contended that the procedure adopted by the Labour, Appellate Tribunal leaving out 20 points of the living cost index un neutralised was not justifiable.
Held, that in matters of the grant of dearness allowance there cannot be a hard and fast rule applicable to all kinds of employees and except in the very lowest class of manual labourers it is not proper to neutralise the entire rise in the cost of living by dearness allowance.
There are different grades among the middle classes and the appellants cannot claim to have the same rates of dearness allowance as those fixed for the clerks of the mercantile firms by the Bengal Chamber of Commerce.
|
minal Appeals Nos.
25 to 27 of 1958.
356 Appeals from the judgment and order dated June 25, 1957, of the Punjab High Court, in Criminal Revisions Nos.
184 D, 185 D and 186 D of 1956, arising out of the judgment and order dated October 23, 1956, of the Sessions Judge, Delhi, in Criminal Revision Applications Nos.
249, 250 and 251 of 1956.
Bipin Behari Lal and R. H. Dhebar, for the appellant.
G. C. Mathur and I. N. Shroff, for the respondent in Cr.
A. No.25 of 1958.
A. G. Ratnaparkhi, for the respondent in Cr. A. No. 26 of 1958.
Respondent in Cr. A. No. 27 of 1959 did not appear.
November 30.
The Judgment of the Court was delivered by WANCHOO J.
These three appeals arise out of three certificates granted by the Punjab High Court in a criminal matter.
They will be dealt with together as the point raised in them is common.
The brief facts necessary for the purpose are these: There is a Government Printing Press at Rashtrapati Bhavan known as Rashtrapati Bhavan Printing Press which is located in the President 's estate in New Delhi.
Jacobs was the General Foreman of this Press.
Every year the budget proposals are printed at this Press under the supervision of Jacobs.
As usual, Jacobs supervised the printing of budget proposals in his official capacity in February 1955 also.
It appears that Jacobs entered into a conspiracy to divulge the budget proposals on receiving valuable consideration for the same.
Consequently the proposals were divulged to D. P. Chadda and were passed on to certain businessmen of Bombay, including Nandlal More and Hiralal G. Kothari through one A. L. Mehra.
All this was done against the provisions of the Official Secrets Act, No. XIX of 1923.
Further an offence was committed under the Prevention of Corruption Act, No. 11 of 1947, also inasmuch as money was paid to Jacobs for divulging the budget proposals.
The same thing happened in February 1956, with 'respect to the 357 budget proposals for 1956 57.
This was discovered on March 9, 1956, and a case was registered under section 165 A of the Indian Penal Code, section 5(2) of the Prevention of Corruption Act, ' section 5 of the Official Secrets Act and section 120 B of the Indian Penal Code and investigation started on March 10, 1956.
Thereafter, pardon was tendered to A.L. Mehra by the Additional District Magistrate on March 23, 1956, under section 337 of the Code of Criminal Procedure.
The four offences mentioned above were specified in the order of the Additional District Magistrate tendering pardon to Mehra.
Thereafter owing to technical legal difficulties a complaint under section 5 of the Official Secrets Act read with section 120 B of the Indian Penal Code was filed against the persons involved and it was, stated in that complaint that proceedings with the respect to the charge under section 5(2) of the Prevention of Corruption Act would be taken separately.
Proceedings then began before a magistrate on this complaint.
It may be mentioned that no proceedings have yet started insofar as the offences under section 5(2) of the Prevention of Corruption Act and section 165 A of the Indian Penal Code are concerned.
In the course of these proceedings before the magistrate, the prosecution wanted to examine Mehra as an approver.
Thereupon the accused persons objected that as the proceedings before the magistrate were only under section 5 of the Official Secrets Act and section 120 B of the Indian Penal Code, Mehra could not be examined as an approver and in consequence the case could not be committed to the Court of Session but should be disposed of by the magistrate himself.
The magistrate held that Mehra could be treated as an approver and proceedings before him were therefore in the nature of commitment proceedings.
Thereupon there was a revision to the Sessions Judge who took the view that as the proceedings before the magistrate were under section 5 of the Official Secrets Act read with section 120 B of the Indian Penal Code and as no pardon could be tendered under section 337 of the Code of Criminal Procedure for these offences, Mehra could not be treated as an approver and had to be examined as an 46 358 ordinary witness and the proceedings must be held to be trial proceedings before the magistrate and not commitment proceedings.
He therefore recommended to the High Court that the order of the magistrate be set aside.
The High court upheld the view of the Sessions Judge and ordered accordingly.
It granted certificates under article 134(1)(c) of the Constitution; and that is how these three appeals have been filed by the State before us.
The only question that has been urged before us is that the view of the magistrate is correct and Mehra could be treated as an approver and examined as such for the purposes of the proceedings before him.
The question whether the case should be committed to the Court of Session does not survive now as we are told that one of the accused has asked for trial by the Court of Session as provided under section 13(2) of the Official Secrets Act.
The High Court examined section 337 of the Code of Criminal Procedure and came to the conclusion that a pardon under that section could only be tendered with respect to certain offences mentioned therein.
It was further of the view that as section 5 of the Official Secrets Act read with section 120 B of the Indian Penal Code was not covered by the words of section 337(1) and as the proceedings before the magistrate were only with respect to these offences, Mehra could not be treated as an approver, to whom pardon had been tendered, for the purpose of these proceedings.
A mere perusal of section 337 of the Code of Criminal Procedure shows that the view of the High Court is correct.
Section 337(1) provides for tender of a pardon in respect of the following offences, namely (i) Any offence triable exclusively by the High Court or Court of Session ; (ii) Any offence punishable with imprisonment which may extend to seven years; (iii) Any offence under any of the following sections of the Indian Penal Code: 161, 165, 165 A, 216 A, 369, 401, 435 and 477 A. 359 Thus pardon can only be tendered with respect to an offence which falls in one of these categories.
It is not disputed that an offence under section 5 of the Official Secrets Act read with section 120 B of the Indian Penal Code does not fall within any of these categories.
So if the proceedings were with respect only to an offence under section 5 of the Official Secrets Act read with section 120 B of the Indian Penal Code, section 337 of the Code of Criminal Procedure would not apply and no pardon could be tendered to any person.
It is urged, however, that section 337(1) contemplates tender of a pardon on condition of the person pardoned making a full and true disclosure of the whole of the circumstances within his knowledge relative to the offence and to every other person concerned, whether as principal or abettor in the commission thereof; and this means that the person to whom pardon is tendered is expected to tell the whole truth including details of any other subsidiary offence which might have been committed in the course of the commission of the offence for which pardon is tendered and therefore the pardon so tendered must be held to include the subsidiary offence, even though, if the subsidiary offence alone were committed and were not of the nature mentioned in section 337(i), no pardon could have been tendered for the same.
Reliance in this connection is placed also on section 339 of the Code of Criminal Procedure, which provides that where any person who has accepted pardon either by wilfully concealing anything essential or by giving false evidence, does not comply with the Condition on which the tender was made, he may be tried for the offence in respect of which the pardon was tendered or for any other offence of which he appears to have been guilty in connection with the same matter.
It is said that the specific provision for trial for any other offence which might have been committed in connection with the same matter in section 339 shows that the pardon would cover the other offence also even though it may not be an offence for which the pardon was and could be tendered.
We are of opinion that no such inference could be drawn from the use of these words in section 339, for that 360 section deals with a different contingency altogether, namely, whether the conditions of the pardon had been complied with.
It is to be remembered that a pardon tendered under section 337 is a protection from prosecution.
Failure to comply with the conditions on which the pardon is tendered removes that protection.
All that section 339 says, provided the requisite certificate under that section is given by the Public Prosecutor, is that the person to whom the pardon is tendered can be prosecuted for the offence for which the pardon was tendered as also any other offence of which he appears to be guilty in connection with the same matter.
This would be just the same as if section 339 merely stated that on failure to comply with the conditions of the pardon such pardon would be for feited.
, The words of section 339 therefore are of no help in construing section 337 and we must look to the words of 337 in deciding whether a pardon could be tendered for an offence under section 5 of the Official Secrets Act read with section 120 B of the Indian Penal Code.
The fact that in the application in which the police requested the Additional District Magistrate for tender of pardon or in the order of the Additional District Magistrate tendering pardon, section 5 of the Official Secrets Act was mentioned along with other offences for which pardon could be tendered would not mean that a pardon could be tendered for an offence under that Act if under the law as provided in section 337(1) no pardon could be tendered for an offence under section 5 of the Official Secrets Act.
As we read section 337(1), it is to our mind perfectly clear that pardon can only be tendered under that provision with respect to the three categories of offences mentioned therein and already indicated above and none other.
As section 5 of the Official Secrets Act read with section 120 B of the Indian Penal Code does not fall within any of these categories no pardon can be tendered with respect to that offence.
Therefore, Mehra to whom pardon has been tendered, could not be examined as an approver in the proceedings which are concerned ,only with an offence under section 5 of the Official Secrets Act read with section 120 B of the Indian Penal Code.
361 Learned counsel for the appellant drew our attention to three cases in support of the view that a pardon under section 337(1) could be tendered not only for the offences of the kind enumerated therein but also other offences which might be committed in the course of the commission of the offences enumerated therein but which might not be within the terms of section 337(1).
These cases are: Queen Empress vs Ganga Charan (1) ; Harumal Parmanand vs Emperor (2); and Shiam Sunder vs Emperor (3).
These cases however refer to different circumstances altogether and were not concerned with 'the interpretation of section 337(1) of the Code of Criminal Procedure.
In all these cases the question that arose before the courts was whether an approver who was prosecuted under section 339 for certain offences could be or should be so prosecuted.
They also turned on the terms of the pardon granted in those particular cases.
It was there held that where a question arose how far a pardon would protect an approver, it.
should not be treated in a narrow spirit, bearinG in mind that in countenaiicing tender of pardons to accomplices the law does not invite a cramped and constrained statement by ' the approver but requires a thorough and complete disclosure of all the facts within his knowledge bearing upon the offence or offences as to which he gave evidence.
The considerations which apply when a trial is taking place tinder section 339 of the Code of Criminal Procedure are entirely different.
The proviso to section 339 shows that at his trial, an approver is entitled to plead that he has complied with the condition upon which tender of pardon was made and if he succeeds in proving that he has complied with the conditions upon which the tender was made he is protected from prosecution with respect to all offences which appear to have been committed in connection with the matter giving rise to the offence for which pardon was tendered.
These three cases really turn on the question whether the accused had complied with the conditions upon which the pardon was tendered to him and it was held that be had so complied.
(1) I.L.R. 11 All.
(2) A.I.R. 1915 Sind 43, (3) A.I.R. 1921 All.
234, 362 In those circumstances, the trial under section 339 was held to be bad.
We are not concerned in the present case with section 339.
What we have to decide is whether a pardon under section 337(1) of the Code of Criminal Procedure can be granted in the case of an offence under section 5 of the Official Secrets Act read with section 120 B of the Indian Penal Code.
To that there can be only one answer on the terms of section 337(1), namely, that no pardon can be granted for an offence of this nature.
Therefore, as the present proceedings before the magistrate are only for an offence under section 5 of the Official Secrets Act read with section 120 B of the Indian Penal Code, Mehra cannot be examined as an approver in that court.
There is no force in these appeals and they are hereby dismissed.
Appeals dismissed.
| On March 9, 1956, a conspiracy to divulge the budget proposals on receiving valuable consideration was discovered and a case was registered under section 165A of the Indian Penal Code, section 5(2) of the Prevention of Corruption Act, 1947, section 5 of the Official Secrets Act, 1923, and section 120B of the Indian Penal Code.
Investigation started on March 10, 1956, and thereafter pardon was tendered to M by the Additional District Magistrate under section 337 of the Code of Criminal Procedure.
Owing to technical legal difficulties a complaint under section 5 of the Official Secrets Act read with section 120B of the Indian Penal Code was filed against the persons involved and proceedings began before a magistrate on this complaint.
In the course of these proceedings the prosecution wanted to examine M as an approver, but the accused persons objected that as the proceedings before the magistrate were only under section 5 of the Official Secrets Act read with section 12 OB of the Indian Penal Code and as no pardon could be tendered under section 337 of the Code of Criminal Procedure for these offences, M could not be treated as an approver but could be examined only as an ordinary witness.
It was contended for the prosecution that as the person to whom pardon was tendered was expected to tell the whole truth including details of other subsidiary offences committed in the course of the commission of the offence for which pardon was tendered, such pardon must be held to include the subsidiary offences though not of the nature mentioned in section 377(1), and therefore M could be considered as an approver in the present proceedings.
Held, that a pardon under section 377(1) of the Code of Criminal Procedure could be tendered only with respect to the offences mentioned therein and that as section 5 of the Official Secrets Act read with section 120B of the Indian Penal Code was not covered by the words of section 337(1) no pardon could be granted for an offence of this nature.
Consequently, as the proceedings before the magistrate were only with respect to these offences, M could not be treated as an approver for the purpose of these proceedings.
|
Civil Appeal No. 2047 of 1969.
A Appeal by Special Leave from the Judgment and Order dated 25 6 1969 of the Andhra Pradesh High Court in Civil Revision Petition No. 346/67.
Y. section Chitaley, section K. Mehta, P. N. Puri and E. M. Sarul Anam for the Appellant.
A. T. M. Sampath and P. N. Ramalingam for the Respondent.
The Judgment of the Court was delivered by CHlNNAPPA REDDY, J.
The short question for consideration in this appeal is whether the practice of the legal profession is 'business ' within the meaning of Section 10(3) (a) (iii) of the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960.
The question arises this way.
The respondent, an Advocate filed an application before the Rent Controller seeking eviction of the appellant, his tenant, from the premises in question on the ground that he required the premises for the purpose of carrying on his profession as an Advocate.
The application was contested by the appellant who was carrying on the business of manufacturing art jewellery in the premises.
We are not concerned in this appeal with the several defences which were raised by the appellant.
Nor are we concerned with the vicissitudes which the case underwent.
For the purposes of this appeal it is sufficient to say that the final Court of fact, namely the Chief Judge of the Court of Small causes, Hyderabad, found that the respondent bona fide required the premises for the purpose of carrying on his profession as an Advocate and that the tenancy was not such as could be split up.
The Appellate authorities passed an order of eviction against the appellant.
Before the High Court, in revision, it was contended by the appellant that the practice of the profession of an Advocate was not business within the meaning of Section 10(3) (a) (iii) and, therefore, the respondent could not seek the eviction of the appellant on the ground that he required the premises for the purpose of carrying on his profession as an Advocate.
It was contended that Section 10(3) (a) (iii) used the expression 'business ' only and not the expression 'profession. ' The contention was negatived by a Division Bench of the High Court of Andhra Pradesh consisting of Gopalrao Ekbote and Ramachandra Rao, JJ.
The tenant has appealed by special leave to this Court.
Dr. Chitaley learned counsel for the appellant argued that there was a clear distinction between 'business ' and 'profession ' and that the practice of a liberal profession like that of an Advocate or a Doctor which 14 had nothing commercial about it was not business within the meaning of Section 10 (3) (a) (iii) of the Andhra Pradesh Buildings ( Lease, Rent and Eviction) control Act 1960.
He argued that though the Andhra Pradesh Act broadly classified buildings into residential and non residential buildings, the landlord of a non residential building could not seek to evict his tenant on the ground of his requirement unless it was for the purpose of carrying on a business.
According to the learned Counsel this indicated that the expression business was to be given a narrow meaning and was to be confined to activities of a commercial nature.
The learned Counsel also urged that the Court should favour a construction which would be beneficient to the tenant.
Dr. Chitaley relied on M. P. Sethurama Menon vs Thaiparambath Kunhukutty Amma 's daughter, Meenakshi Amma and Ors.
(1) Bangalore Water Supply & Sewerage Board etc.
vs R. Rajappa & Ors.
(2) and Stuchbery & Ors.
vs General Accident Fire and Life Insurance Corporation Ltd.(3) The expression business has not been defined in the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960.
It is a common expression which is sometimes used by itself and sometimes in a collocation of words as in "business, trade or profession".
It is a word of large and wide import,, capable of a variety of meanings.
It is needless to refer to the meanings given to that term in the various Dictionaries except to say that everyone of them notices a large number of meanings of the word.
In a broad sense it is taken to mean everything that occupies the time attention and labour of men for the purpose of livlihood or profit '.
In a narrow sense it is confined to commercial activity.
It is obvious that the meaning of the word must be gleaned from the context in which it is used.
Reference to the provisions of the Constitution or other statutes where! the expression is used cannot be of any assistance in determining its meaning in Section 10(3) (a) (iii) of the Andhra Pradesh Building (Lease, Rent and Eviction) Control Act, 1960.
It is not a sound principle of construction tn interpret expressions used in one Act with reference to their use in another Act; more so, if the two Acts in which the same word is used are not cognate Acts.
Neither the meaning, nor the definition of the term in one statute affords a guide to the construction of the same term in another statute and the sense in which the term has been understood in the several statutes does not necessarily throw any light on the manner in which the term should be understood generally.
On the other hand it is a (1) A.I.R. 1967 Kerala 88.
(2) ; (3) [1949] 2 K. B. D. 256.
15 sound, and, indeed, a well known principle of construction that meaning of words and expressions used in an Act must take their colour from the content in which they appear.
Dr. Chitaley very frankly and fairly conceded as much.
Now the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960, is an 'Act to consolidate, and amend the law relating to the regulation of leasing of buildings, the control of rent thereof an(l the prevention of unreasonable eviction of tenants therefrom in the State of Andhra Pradesh.
It applies to the cities of Hyderabad and Secunderabad and to all municipalities in the State of Andhra Pradesh.
The provisions of the Act, however, do not apply to buildings owned by the Government and to buildings constructed on or after 26th August, 1957.
Building is broadly defined as meaning any house or hut or a part of a house or hut, let or to be let separately for residential or nonresidential purposes.
Landlord is defined as the owner of a building, including a person who is receiving or is entitled to receive the rent of a building, on his own account or on behalf of another person etc.
Tenant is defined as a person by whom or on whose account rent is payable for a building.
Section 4 provides for the determination of a fair rent of a building on the application of the tenant or landlord.
Section 10(1) provides that a tenant shall not be evicted whether in execution of a decree or otherwise except in accordance with the provisions of Sections 10, 12 and 13.
Section 10(2) mentions several grounds on which a landlord may seek to evict a tenant.
The grounds are default of payment of rent, sub letting of premises, used for a purpose other than that for which it was leased, commission of acts of waste, conduct amounting to nuisance to the occupiers of the other portions in the same building, securing of alternative accommodation by the tenant and denial of the title of the landlord.
The grounds mentioned in Section 10(2) apply both to residential and non residential buildings.
Section 10(3) (a) (i) provides for the eviction of a tenant where the landlord of a residential building requires it for his own occupation.
Section 10(3)(a)(iii) provides for the eviction of a tenant from a non residential building where "the landlord is not occupying a non residential building in a city town or village concerned which is his own or to the possession of which he is entitled whether under the Act or otherwise (a) for the purpose of a business which he is carrying on on the date of the application, or (b) for the purpose of a business which in the opinion of the Controller, the landlord bona fide proposes to commence".
Section 12 and 13 contain special provisions relating to recovery of buildings by landlord for the purpose of effecting repairs, alterations or additions or for reconstruction.
The scheme of the Act is to prevent unreasonable eviction of 16 tenants by landlords and to provide for eviction on specified grounds.
The Act is of general application and its protection not confined to any classes of tenants nor is the right to evict under the Act limited to any class of landlords.
There is no reason why a landlord who is a member of the legal or medical professions and who requires the premises for carrying on the practice of his profession should be wholly debarred from obtaining possession of the premises.
It is impossible to discover any reason for so making a discrimination against the liberal professions.
But, that would be the result if the expression 'business ' is given a narrow meaning which the appellant wants us to give to that expression.
It would indeed be anamolous to hold that all the provisions of the Act including Section 4 which provides for the determination of fair rent and Section 10(1) which bars the eviction of tenants apply to nonresidential buildings owned by an Advocate but not Section 10 (3) (a) (iii) only.
In our view the expression business occurring in Section 10(3)(a)(iii) is used in a wide sense so as to include the practice of the profession of an Advocate.
The Kerala High Court in M.P. Sethurama Menon vs Meenakshi Amma & Ors.
, (supra) construed the expression 'trade or business ' as connoting commercial activity and as not including the practice of the legal profession.
The learned Judges referred to Article 19(1)(g) of the Constitution, Section 49 of the , the Madras Shops and Establishments Act, 1947 and drew a distinction between the words 'business ' and 'profession. ' As mentioned by us earlier, we do not think that it is right to ascribe to the word 'business ' occurring in the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960, the same meaning that the word may have when it occurs in other statutory provisions.
The word must be interpreted in the context of the statute in which it occurs and not in the context of other statutes or in a manner alien to the context of the statute concerned.
In Bangalore Water Supply & Sewerage Board etc.
vs R. Rajappa Ors., (supra) Chandrachud, J. (as he then was) observed ".
I find myself unable to accept the broad formulation that a Solicitor 's establishment cannot be an industry.
A Solicitor, undoubtedly, does not carry on trade or business when he acts for his client or advises him or pleads for him, if and when pleading is permissible to him.
He pursues a profession which is variously and justifiably described as learned, liberal or noble.
" The observations of the Learned Judge were made in the context of the question whether a Solicitor 's establishment would fall within the definition of 'industry ' under the 17 Industrial Disputes Act.
It would be most unwise to apply this A observation to determine whether the practice of the liberal professions is within the meaning of the expression 'business ' in Rent Control legislation.
In Stuchbery & Ors.
vs General Accident Fire and Life Assurance Corporation Ltd., (supra) it was observed that the carrying on of a Solicitor 's business was the carrying on of a profession and was not the carrying on of a trade or business within the meaning of that phrase in the Landlord and Tenant Act, 1927.
The observation was made in the context of that Act which made a distinction between 'trade or business ' and 'profession '.
In fact sub section 3(a) of Section 17 of the Act expressly said: "for the purposes of this Section premises shall not be deemed to be premises used for carrying on there at a trade or business by reason of their being used for the purpose of carrying on there at any profession".
The question in that case was about the right to compensation for the goodwill attached to the premises where the "business" or "profession" was being carried on.
We do not think 1 that the case is of any help to the appellant.
We may refer here to the decision of Danckwerts, J., in Re Williams ' Will Trusts, Chartered Bank of India, Australia and China and Another vs Williams and Others.(1) where the question was whether the bequest to a son for the purpose of starting him in 'business ' was affective to start the son in medical practice.
The learned Judge held that it did, observing that the word 'business ' was capable of including the practice of a profession and that it plainly included the profession of a Doctor.
We may refer to just one more case i.e. Taramal vs Laxman Sewak Surey Ors(2) where this very question whether the practice of law was a 'business ' within the meaning of the Madhya Pradesh Accommodation Control Act came for consideration before A. P. Sen, J.
The learned Judge held that in the context of the Madhya Pradesh Act, the word 'business ' had to be given a wide meaning so as to include any profession.
We, therefore, agree with the High Court that the practice of law is 'business ' within the meaning of that expression in Section 10(3) (a) (iii) of the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 196().
The appeal is, therefore, dismissed with costs.
M. R. Appeal dismissed.
| The respondent, an advocate, sought to evict his tenant, the appellant, under section 10(3) (a) (iii) of the Andhra Pradesh Building (Lease, Rent and Eviction) Control Act, 1960, on the ground that he required the disputed premises for carrying on his profession.
The court of small causes, Hyderabad, finding that the requirement was bona fide, passed an eviction order against the appellant.
In revision, the High Court negatived the contention that the expression "business" used in section 10(3)(a)(iii), did not include the 'profession ' of an advocate.
Dismissing the appeal, the Court, ^ HELD: 1.
"Business" is a word of large and wide import, capable of a variety of meanings.
In a broad sense it is taken to mean 'everything that occupies the time, attention and labour of men, for the purpose of livlihood or profit '.
The practice of law is 'business ' within the meaning of that expression in section 10(3)(a)(iii).
The Act is of general application, and its protection is not confined to any classes of tenants, nor is the right to evict under the Act, limited to any class of landlords.
There is no reason why a landlord who is a member of the legal or medical professions and who requires the premises for carrying on the practice of his profession, should be wholly debarred from obtaining possession of the premises.
It would be anamolous to hold that all the provisions of the Act apply to non residential buildings owned by an Advocate, excepting section 10(3)(a)(iii).
[14D, E, 16A B, C D] Williams ' Will Trusts, Chartered Bank of India, Australia and China and Anr.
vs Williams and Ors.
, [1953] 1 All.
ELR 536; Taramal vs Laxman Sewak Surey & Ors. , approved.
M. P. Sethurama Menon vs Thaiparambath Kunhukutty Amma 's daughter, Meenakshi Amma & Ors., AIR 1967 Kerala 88; Bangalore Water Supply Sewerage Board, etc.
vs R. Rajappa & Ors., ; ; Stuchbery & Ors.
vs General Accident Fire and Life Assurance Corp. Ltd., [1949] 2 KBD 256; distinguished.
It is a sound principle of construction that, meaning of words and expressions used in an Act, must take their colour from the context in which they appear.
Neither the meaning, nor the definition of a term in one statute, affords a guide to the construction of the same term in another statute, more so, if the two Acts in which the same word is used, are not cognate Acts and the sense in which a term has been understood in several statutes, does not necessarily throw any light on the manner in which it should be under stood generally.
[14G H & 15A] 13
|
minal Appeal No. 170 of 1967.
Appeal by special leave from the judgment and order dated October 25, 1966 of the Bombay High Court in Criminal Appeal No. 805 of 1965.
S.S. Kavalekar, K. Rajendra Chaudhuri and K.R. Chaudhuri, for the appellant.
H.R. Khanna, B.D. Sharma and S.P. Nayar, for respondent No.1.
The Judgment of the Court was delivered by P. Jaganmohan Reddy, J.
This appeal is by special leave directed against the judgment of the Bombay High Court.
81 The appellant is the author of a short story entitled Shama published in the 1962 Diwali Issue of Rambha, a monthly Marathi Magazine, which story is said to be obscene.
Criminal proceedings were, therefore, initiated before the first class Magistrate, Poona by the complainant Bhide under section 292 I.P.C. against the Printer and Publisher accused 1, the writer of the story accused 2 and the selling agent accused 3.
The complainant stated that he had read the aforesaid Diwali issue of Rambha and found many articles and pictures in it to be obscene which are calculated to corrupt and deprave the minds of the readers in general and the young readers in particular.
The Complainant further relented to several other articles in the same issue such as the story of Savitri and certain cartoons but we are not now concerned with these because both the Magistrate as well the High Court did not think that they offended the provisions of section 292 I.P.C. the magistrate after an exhaustive consideration did not find the accused guilty of the offence with which they were charged and, therefore, acquitted them.
The complainant and the State filed appeals against this judgment of acquittal.
Before the High Court it was conceded that there was no evidence that accused No. 3 had sold any copies of the issues of Rambha and accordingly the order of acquittal in his favour was confirmed.
In so far as the other two accused are concerned it reversed the order of acquittal and convicted the printer and publisher accused 1 and the writer accused 2 under section 292 I.P.C. but taking into consideration the degree of obscenity in the passages complained of a fine Rs. 25/ only was imposed on each of the accused and in default they were directed to suffer simple imprisonment for a week.
It was also directed that copies of the magazine Rambha in which the offending story was published and which may be in possession and power of the two accused be destroyed.
The allegation, against the accused is that certain passages in the story of Shama at pp.
111 112, 114, 116, 118 121, 127, 128, 131, and 134 are said to be obscene.
In support of this the complainant examined himself and led the evidence of Dr. P.G. Sahstrabudhe and Dr. G.V. Purohit in support of his allegation that the novel is obscene and that the writer and publisher contravened the provisions of section 292 I.P.C. Accused No. 1 stated that the story of Shama was written by an ;able writer which depicted the frustration in the life of a poet and denied that it was obscene.
The writer Kakodar, accused No. 2 claims to have written about 60 such stories.
which are published in different periodicals by reputed publishers.
He also denies that Shama is obscene and states that he has introduced certain characters in order to condemn the worst and glorify the best and it was never his intention to titillate the sex feelings of the 82 readers, but on the other hand his attempt was to achieve the literary and artistic standard which was in keeping with the style of some of the able and successful writers of Marathi literature.
In support of his defence, he examined Shri Keluskar and Prof. Madho Manohar D.Ws. 1 and 2 respectively.
The Court on its own summoned and examined Prof. N.S. Phadke and Acharya P.K. Atre.
Both the magistrate as well as the learned Judge of the High Court were conversant with Marathi and they seem to have read the story of Shama in the original, an advantage which we have not got.
However, on a consideration of the offending passages in the story to which we shall refer presently, they came to different and opposite conclusions.
It is apparent that the question whether a particular article or story or book is obscene or not does not altogether depend on oral evidence because it is the duty of the court to ascertain whether the book or story or any passage or passages therein offend the provisions of section 292.
Even so as the question of obscenity may have to be judged in the light of the claim that the work has a predominant literary merit, it may be necessary if it is at all required, to rely to a certain extent on the evidence and views of leading litterateurs on that aspect particularly when the work is in a language with which the Court is not conversant.
Often a translation may not bring out the delicate nuances of the literary art in the story as it does in the language in which it is written and in those circumstances what is said about its literary quality and worth by persons competent to speak may be of value, though as was said in an earlier decision, the verdict as to whether the book or article or story considered as a whole panders to the prurient and is obscene must be judged by the courts and ultimately by this Court.
What is obscenity has not been defined either in section 292 IPC or in any of the statutes prohibiting and penalising mailing, importing, exporting, publishing and selling of obscene matters.
The test that has been generally applied in this country was that laid down by Cockburn, C.J. in Hicklin 's case(1) and even after the inauguration of the Constitution and considered in relation to the fundamental right of freedom of speech and expression this test, it has been held, should not be discarded.
In Hicklin 's case(1) while construing statutes 20 and 21 Victoria, a measure enacted against Obscene books, Cockburn, C.J. formulated the test in these words: "I think the test of obscenity is this, whether the tendency of the matter charged as obscenity is to deprave and corrupt those whose minds are open to such immoral influences, and into whose hands publication of (1) 83 this sort may fail.
It is quite certain that it would suggest to the minds of the young of either sex, or even to persons of more advanced years, thought of most impure and libidinous character.
" This Court has in Udeshi vs State of Maharashtra(1) considered the above test and also the test laid down in certain other American cases.
Hidayatullah, J. as he then was, at the outset pointed out that it is not easy to lay down a true test because "art has such varied facets and such individualistic appeals that in the same object the insensitive sees only obscenity because his attention is arrested, not by the general or artistic appeal or message which he cannot comprehend, but by what he can see, and the intellectual sees beauty and art but nothing gross.
" It was also pointed out in that decision at p. 74, "None has so far attempted a definition of obscenity because the meaning can be laid bare without attempting a definition by describing what must be looked for.
It may, however, be said at once that treating with sex and nudity in art and literature cannot be regarded as evidence of obscenity without something more.
It is not necessary that the angels and saints of Michelangelo should be made to wear breeches before they can be viewed.
If the rigid test of treating with sex as the minimum ingredient were accepted hardly any writer of fiction today would escape the fate Lawrence had in his days.
Half the book shops would close and the other half would deal in nothing but moral and religious books which Lord Campbell boasted was the effect of his Act.
" It is, therefore, the duty of the court to consider the obscene matter by taking an overall view of the entire work and to determine whether the obscene passages are so likely to deprave and corrupt those whose minds are open to such influences and in whose hands the book is likely to fail and in doing so one must not overlook the influences of the book on the social morality of our contemporary society.
We can do no better than to refer to this aspect in the language of Hidayatullah, J. at p. 76: "An overall view of the obscene matter in the setting of the whole work would, of course, be necessary, but the obscene matter must be considered by itself and separately to find out whether it is so gross and its obscenity so decided that it is likely to deprave and corrupt those whose minds are open to influences of this sort and into whose hands the book is likely to fall." (1) ; 84 Referring to the attempt which our national and regional languages are making to strengthen themselves by new literary standards after a deadening period under the impact of English, it was further observed at p. 77, "that where obscenity and art are mixed, art must so preponderate as to throw the obscenity into a shadow or the obscenity so trivial and insignificant that it can have no effect and may be overlooked.
In other words, treating with sex in a manner offensive to public decency and morality (and these are the words of our Fundamental Law), judged of by our national standards and considered likely to pander to lascivious, prurient or sexually precocious minds, must determine the result.
We need not attempt to bowdlerize all literature and thus rob speech and expression of freedom.
A balance should be maintained between freedom of speech and expression and public decency and morality but when the latter is substantially transgressed the former must give way.
" Bearing in mind these observations and the tests laid down in Udeshi 's case,(1) we propose to examine, having regard to our national standards, the passages in Shama to ascertain in the light of the work as a whole whether the treat with sex in such a way as to be offensive to public decency and morality as can be considered likely to pander to lascivious, prurient or sexually precocious minds.
The second appellant writes about the life of a poet Nishikant who left school in the days of freedom struggle, wrote revolutionary poems, but as the freedom struggle waned he did not join school as others had done notwithstanding his brother 's advice that he should pass the metric so that he could be employed in service.
As he was mostly unemployed, he was living on his brother and on the bounty of his sister in law who was kind and considerate to him.
Nishikant, it will appear, is emotional, sensitive and has the power to discern right from wrong.
The story starts ,with his being employed as a teacher and his meeting Sharma, the ' Music teacher in the school.
His attraction for her and the opportunity she gives him to meet her alone in her room fills him with a sense of foreboding lest he may have to endure the pangs of suffering which he had to undergo.
in his two earlier affairs with Neela and Vanira.
The poet recalls these two affairs individually and we get the impression that the pain which he underwent should not be repeated.
It is more as a repellent to any further involvement with Shama that these experiences are related.
(1) ; 85 Neela who is about 17 years of age is the daughter 015 a distant maternal cousin of his mother.
As she had reached the marriageable age, her father in Goa, Wasudeo who always treated Nishikant 's mother like his own sister is anxious to get her married to some eligible youngman, but evidently the opportunity for choosing the right person was remote.
So he suggests to Nishikant 's mother that Nishikant should come and bring Neela to Bombay to live with them where they would have better opportunity of choosing a youngman for her to be married.
Nishikant who was appointed in a newspaper office was at first reluctant but his sister in law persuades him and so he goes to Goa.
When he meets Neela, she had changed and was not as ugly as when he had seen her earlier.
The author then depicts the slow but steady maturing of the love between them, the seeking of and getting of opportunities to be near to each other, their having to sleep in the same bed while on the boat coming to Bombay and ultimately falling in love with each other which developed during Neela 's stay in Bombay.
During Neela 's stay with Nishikant 's family the love between her and Nishikant became intense as a result Nishikant proposes to marry her and writes to her father for his consent.
They wait for a reply but unknown to Nishikant, Neela receives a reply from her father rejecting the proposal on the ground that Nishikant is unemployed and would not join Government service even though he had suggested it to him.
He says in that letter that poetry may bring him fame but would not give him a livelihood.
As he was entirely dependant on his brother for his maintenance, the father refused to give his consent in the interest of Neela 's happiness and told her that he was coming back to fetch her.
As Neela was in love with Nishikant but she knew that she would not be married to him, she encourages him to bring their love to culmination.
This state of affairs lasted for a few days before her father took her away.
About two months later Nishikant receives an invitation card for Neela 's marriage and thereafter he received another letter written by Wasudeo to his daughter to which we have earlier referred and which also.
contained at the back of it Neela 's message to Nishikant asking him to forget her.
Even after four years he was unable to forget Neela and had taken to drinking and coming home late.
He was idle for long spells and whenever he thought of Neela he wrote a poem.
Then one day he was introduced to Vanita who was a graduate and a married woman who had left her husband.
She was a critic of stories and novels.
When they met, she had praised his poems and had invited him to come to.
her room ostensibly to discuss his poetry.
Vanita is shown as an oversaxed woman, experienced and forward, making advances and suggestions.
Ultimately she and Nishikant have several affairs till one morning 86 he finds that the person who had introduced her to him was coming out of her room and when he went in he found Vanita sleeping naked.
His spirit revolted seeing her in that condition.
He was greatly upset at her recalcitrance when he asked her how many more men she had.
She replied that it had nothing to do with him, that he had got what he wanted and she does not want to be a slave to any person.
He retorted with indignation that he did not wish to see her face and walked out.
He had then made up his mind not to have any relations with any woman.
It was with such unpleasant experiences that when he met Shama and was attracted to her he was hesitating and avoiding meeting her alone but circumstances conspired to bring them together and again another affair developed between them.
He encourages Shama to sing, writes lyrics for her songs and when she gives a performance in school he arranges for a radio and gramophone representatives to be present there.
Her music was appreciated and she began to get audition from these sources.
It appears one of the school teacher Kale had earlier attempted to make love to Shama and she had slapped him.
When Kale informs Nishikant that he knows about his affairs with Shama, Nishikant gets angry and tells him that he knows how he was slapped by Shama for making advances to her.
This enraged Kale and he seems to have taken his revenge by maligning the character of Shama to the Principal.
As a result of this, the Principal dismissed her.
Hearing this, Nishikant gets angry, goes to the Headmaster and accuses him of being an accomplice of Kale and leaves the service.
He then persuades Shama to start a music school, later gets her engagements in films as a playback singer for which he was asked to write lyrics.
Shama 's reputation as a singer grows rapidly in the Marathi public.
It was then that her uncle knowing of it comes to see her and makes insinuations against Nishikant who is offended and hurt because Shama does not prevent her uncle but listens to him without a demur.
Periodical quarrels are witnessed because Shama becomes more status minded, begins to think of her wealth and position and moves into wealthy quarters all of which are against Nishikant 's outlook and temperament.
Both began to fall apart and the visits of Nishikant to Shama became rare.
Even though Nishikant lives in poverty, he is too proud to ask her money and is not willing to live with her on her conditions.
He stays away from her, showing that he has pride, self respect and spirit of sacrifice.
Suddenly a realisation comes to Shama that she had wronged Nishikant and that she owed everything to him, and therefore has an intense desire for reconciliation.
In this state of affairs When she hears that he is taking part in the Kavi Samelan on the radio she gets into the car and asks her driver to drive fast 87 to the radio station.
On tiffs pitch of expectant reconciliation and ultimate reunion the story ends.
The story read as a whole does not, in our view, amount to its being a pornography nor does it pander to the prurient interest.
It may not be of a very high literary quality and may show immaturity and insufficient experience of the writer, but in none of the passages referred to by the complainant do we find anything offending public order or morality.
The High Court itself did not consider the description of Neela when Nishikant meets her in Goa (at p. 107) objectionable, nor the narration and the description of the situation which is created for Nishikant and Neela on the way back to Bombay from Goa when for want of room they had to sleep on a single bed (p. 112) as obscene.
The passages at pp.
112, 114, 119 120 and 131 have been found by the High Court to come within the mischief of section 292 I.P.C. We have been taken through the corresponding passages in the English translation and even allowing for the translation not bringing out the literary or artistic refinement of the original language, we find little in these passages which could be said to deprave or corrupt those in whose hands the book is likely to fall, nor can it be said that any of the passages advocates, as the High Court seems to think, a licentious behaviour depraving and corrupting the morals of adolescent youth.
We do not think that it can be said with any assurance that merely because adolescent youth read situations of the type presented in the book, they would become depraved, debased and encouraged to lasciviousness.
It is possible that they may come across such situations in life and may have to face them.
But if a narration or description of similar situations is given in a setting emphasising a strong moral to be drawn from it and condemns the conduct of the erring party as wrong and loathsome it cannot be said that they have a likelihood of corrupting the morals of those in whose hands it is likely to fall particularly the adolescent.
In the passage at pp.
113 114 Nishikant takes Neela out to show the sights of the city of Bombay but instead takes her to a picture where after the lights go off, seeing a soldier and his girl friend in front kissing, they also indulge in kissing.
Then as we said earlier, when the love between them develops Nishikant wanted to marry but the father of the girl was unwilling.
Neela realising that their love could never be consummated encourages him to bring it to a culmination.
In this way they enjoy unmarried bliss for a few days until Neela 's father takes her away.
We agree with the learned Judge of the High Court that there is nothing in this or in the subsequent passages relating to Neela, Vanita and Shama which amounts to poronography nor has the author indulged in a description of the sex act or used any 88 language which can be classed as vulgar.
Whatever has been done is done in a restrained manner though in some places there may have been an exhibition of bad taste, leaving it to the more experienced to draw the inferences, but certainly not sufficient to suggest to the adolescent anything which is depraving or lascivious.
To the literate public there are available both to the adults and the adolescents innumerable books which contain references to sex.
Their purpose is not, and they have not the effect of stimulating sex impulses in the reader but may form part of a work of art or are intended to propagate ideas or to install a moral.
The concept of obscenity would differ from country to country depending on the standards of morals of contemporary society.
What is considered as a piece of literature in France may be obscene in England and what is considered in both countries as not harmful to public order and morals may be obscene in our country.
But to insist that the standard should always be/or the writer to see that the adolescent ought not to be brought into contact with sex or that if they read any references to sex in what is written whether that is the dominant theme or not they would be affected, would be to require authors to write books only for the adolescent and not for the adults.
In early English writings authors wrote only with unmarried girls in view but society has changed since then to allow litterateurs and artists to give expression to their ideas, emotions and objectives with full freedom except that is should not fall within the definition of 'obscene ' having regard to the standards of contemporary society in which it is read.
The standards of contemporary society in India are also fast changing.
The adults and adolescents have available to them a large number of classics, novels, stories and pieces, of literature which have a content of sex, love and romance.
observed in Udeshi 's(1) case if a reference to sex by itself is considered obscene, no books can be sold except those which are purely religious.
In the field of art and cinema also the adolescent is.
shown situations which even a quarter of a century ago would be considered derogatory to public morality, but having regard to changed conditions are more taken for granted without in anyway tending to debase or debauch the mind.
What we have to see is that whether a class, not an isolated case, into whose hands the book, article or story falls suffer in their moral outlook or become depraved by reading it or might have impure and lecherous thought aroused in their minds.
The charge of obscenity must, therefore, be judged from this aspect.
We do not think that any of the impugned passages which have been held by the High Court as offending section 292 I.P.C. can (1) ; 89 be said to pervert the morals of the adolescent or be considered to be obscene.
In this view, we allow the appeal, set aside the conviction and fine.
The fine if paid is directed to be refunded.
R.K.P.S. Appeal allowed.
| The respondent by a deed executed in 1951 took on lease from the appellant certain premises in Bangalore.
It was stipulated in the deed that the lease would be for a period of 10 years in the first instance with an option to the lessee to renew the, same every ten years so long as desired.
When in 1961 the first period of ten years was about to expire the respondent asked for a renewal of the lease.
On the appellant refusing to do so, the respondent filed a suit for specific performance, The suit was decreed by the trial court, the first appellate court and the High Court.
Appeal in this Court was filed by special leave.
The contention of the 'appellant was that the lease in question being in the first instance for ten years only was not a lease in perpetuity as contemplated by section 105 of the Transfer of Property Act; however the clauses relating to renewal which were covenants that ran with the land offended the rule against perpetuity in section 14 of the Act.
HELD: The 'appeal must be dismissed.
(a) Section 14 of the Act is applicable only where there is transfer of property.
Even if creation of a lease hold interest is a transfer of a right in property and would fall within the expression 'transfer of property ' the transfer was for a period of ten years only by means of the indenture in the present case.
The stipulation relating to renewal could not be regarded as transferring property or any rights therein.
[143 B] (b) The option of renewal given to the lessee did not contain a covenant which created an interest in the property of the nature that would fail within the ambit of section 14.
[143 F] Ganesh Sonar vs Purnendu Narayan Singha & Ors.
(1962) Pat.
201, applied.
Woodall vs Clifton, [1905]2 Ch.
257, referred to.
(c) In English law the, court would give effect to a covenant for perpetual renewal so long as the intention is clear and it will not be open to objection on the ground of perpetuity.
In India the equitable rule that the burden of a covenant runs with the land is to be found in section 40 of the Transfer of Property Act, but that section its.elf expressly says that the right of the covenanted is not an interest in the land bound by the covenant nor an easement.
It is not 'an interest because the Act does not recognise equitable estate.
[143 G; 144 F] Thus even on the footing that the clauses relating to renewal in the lease, in the present case, contained covenants running with the land the 141 rule against perpetuity contained in section 14 of the Act would not be applicable as no interest in property had been created of the nature contemplated in the provision.
[144 G] Muller vs Trafford, [1901]1 Ch. 54, Weg Motors Ltd. vs Hales & Ors. , 188 and London & South Western Rly.
vs Goreto, , 580, referred to.
|
Civil appeal No. 646 of 1961.
Appeal by special leave from the judgment and decree dated April 7, 1961, of the Punjab High Court in Civil Revision No. 354 of 1959.
Gopal Singh, for the appellates.
Bishan Narain and Naunit lal, for the respondent No. 1. 1962.
January, 17.
The Judgment of the Court was delivered by HIDAYATULLAH, J.
This is an appeal by special leave against an order of the High Court of Punjab at Chandigarh, dated April 7, 1961.
The appellants are five tenants, who have been evicted from certain shops and chobaras in the town of Patiala, on the application of the first respondent, the landlord.
The application by the landlord was made in June, 1957, under section 13 of the Patiala and East Punjab States Union Urban Rent Restriction ordinance, 2006 BK (No. VIII of 2006 BK).
The grounds urged by the landlord were (a) non payment of rent by the tenants, (b) non payment of house tax by the tenants and (c) that the shops were in a state of great disrepair and were dilapidated, and the landlord wished to rebuild them after dismantling the structures.
The landlord averred that he had obtained sanction of the Municipal Committee to a proposed plan of construction, and accumulated some building material before making the application.
The tenants resisted the application.
The Rent Controller framed issues relating to the three 625 grounds; but the first two have ceased to be material now.
On the issue relating to the third ground, the Rent Controller held that in deciding whether the tenants should be ordered to hand over possession to the landlord, the Courts must have regard to the bona fides of the request of the landlord, which meant that the desire to rebuild the premises should be honestly held by the landlord, but that the condition of the building also played an important part in determining whether the landlord had the intention genuinely and was not using this excuse as a devise to get rid of the tenants.
In this connection, the Rent Controller observed that the state of the building, the means of the landlord, and the possibility of a better yield by way of rent, all entered into the appraisal of the landlord 's state of mind.
Examining the case from this angle, the Rent Controller held that there was hardly any proof that the building was in a dilapidated condition.
One solitary witness who testified to this, admitted that he had not seen the building from the inside.
The landlord himself did not give evidence.
On the other hand, there was ample evidence that the building was good.
As regards the financial status of the landlord, the witnesses who stated on his behalf that, he could spend Rs. 5,000 to Rs. 10,000 knew nothing about his means.
Even the landlord 's brother.
who conducted this case on behalf of the landlord, could not give any details.
The plan showed a building requiring about Rs. 20,000 to build.
The landlord had an income of Rs. 200/ per month and his family consisted of his wife and five children.
The Rent Controller, therefore, held that he had no means to rebuild the premises.
The Rent Controller did not feel impressed by the alleged purchase of 40 bags of cement, because a greater part of the cement was used up already in building two or three latrines, and the quantity left was wholly insufficient for the proposed building.
He, therefore, decided the issue against the landlord.
626 On appeal, these findings were confirmed by the appellate authority, who held that the shops and chobaras were in good condition, and that the landlord was not, in good faith, wanting to replace the building, when he had no means to built it.
Against the order of the appellate authority, an application for revision purporting to be under section 15(5) of the East Punjab Urban Rent Restriction Act, 1949 (3 of 1949), was filed in the High Court.
This application was allowed.
The learned single Judge posed the question thus: "The question in the present case is whether there is a bona fide desire to rebuild the premises?".
He referred to an earlier decision of a Divisional Bench of that Court (Civil Revision No. 223 of 1960), in which Gosain, J., laid down the law in the following words: "It is pertinent to note that the word 'building ' in the aforesaid clause is not qualified by the words 'requiring reconstruction ' or 'requiring rebuilding '.
The landlord can, in these circumstances, require any building for the re erection of the same, and when in any case a claim to that effect is made by him the only point that has to be determined is whether on the facts and circumstances of that case his requirement is bona fide.
A building, for instance, may not be immediately unsafe, but its condition may be such that unless it is reconstructed it may involve the landlord at a later date very heavy expenditure.
All round a particular building different types of buildings may have been constructed of an entirely different design and the particular building in question may then be looking very ugly and the landlord may want to bring the same in conformity with the structures around it.
" 627 After quoting this passage, the learned Judge observed that the consideration which must weigh in determining the question of ejectment is whether the landlord genuinely wants to rebuild the premises, and further, that the actual condition of the premises is "a wholly irrelevant factor".
In dealing with the merits of the case, the learned Judge referred to the offer of the landlord to put back the tenants in possession, if the premises were not demolished within a month of his obtaining possession thereof, and concluded, without discussing the evidence, as follows: "Upon the evidence on record it seems to me established beyond all doubt that the landlord genuinely and bona fide requires these premises for rebuilding." He, therefore, set aside the concurrent orders of the two Tribunals, and ordered the eviction of the tenants, giving them two month 's time in which to vacate the premises.
Two questions have been argued in this appeal.
The first is that the revision application is incompetent, because under s.16(4) of the Patiala and East Punjab States Union Urban Rent Restriction ordinance, 'the decision of the appellate authority and subject only to such decision, an order of the Controller shall be final and shall not be liable to be called in question in any court of law whether in a suit or other proceeding by way of appeal or revision".
It is contended that s.15(5) of the East Punjab Urban Rent Restriction Act, which conferred a power of revision on the High Court does not apply to the present case, because this case did not arise in proceedings taken under the Act.
The next contention is that the interpretation placed by the learned Judge upon section 13(3) (a) (iii) read with section 13 (3) (b) is erroneous, and that the High Court had no power to reverse a concurrent finding of fact without itself re appraising the evidence, if at all.
628 On the first point, the learned counsel for the respondents relies upon a decision of this court reported in Moti Ram vs Suraj Bhan (1), where it was held that a revision application in analogous circumstances was maintainable.
In our opinion, even if a revision application lay, the learned single Judge was in error in his interpretation of the relevant sections of the ordinance, and in reversing a concurrent finding of fact, without giving any substantial reasons.
Section 13 of the ordinance, omitting portions which are irrelevant here, reads as follows: "13.
(1) Notwithstanding anything contained in any other law for the time being in force, a tenant in possession of a building or rented land shall not be evicted therefrom in execution of a decree passed before or after the commencement of this ordinance or otherwise and whether before or after the termination of the tenancy, except in accordance with the provisions of this section.
x x x (3) (a) A landlord may apply to the Controller for an order directing the tenant to put the landlord in possession.
x x x (iii)in the case of any building, if he requires it for the re erection of that building or for its replacement by another building, or for the erection of other building; x x x (b) The Controller shall, if he is satisfied that the claim of the landlord is bonafide, make an order directing the tenant to put the landlord in possession of the building or rented land on such date as 629 may be specified by the Controller, and if the Controller is not so satisfied, he shall make an order rejecting the application; x x x (4) where a landlord who has obtained possession of building or rented land in pursuance of an order under. sub paragraph (iii) of the aforesaid paragraph (a) put that building to any use or lets it out to any tenant other then the tenant evicted from it, the tenant who has been evicted may apply to the Controller for an order directing that he shall be restored to possession of such building or rented land and the Controller shall make an order accordingly. " Reading these provisions as a whole, it is obvious that if the landlord 's need be genuine and he satisfies the Controller, he can obtain possession of the building or the land, as the case may be.
If, however, he does not re erect the building and puts it to any other use or lets it out to another tenant, the former tenant can apply to be put back in possession.
Clause (b) clearly shows both affirmatively and negatively that the landlord must satisfy the Controller about his claim, before he can obtain an order in his favour.
The Controller has to be satisfied about the genuineness of the claim.
To reach this conclusion, obviously the Controller must be satisfied about the reality of the claim made by the landlord, and this can only be established by looking at all the surrounding circumstances, such as the condition of the building, its situation, the possibility of its being put to a more profitable use after construction, the means of the landlord and so on.
It is not enough that the landlord comes forward, and says that he entertains a particular intention, however strongly, 630 said to be entertained by him.
The clause speaks not of the bona fides of the landlord, but says, on the other hand, that the claim of the landlord that he requires the building for reconstruction and re erection must be bona fide, that is to say.
honest in the circumstances.
It is impossible, therefore, to hold that the investigation by the Controller should be confined only to the existance of an intention to reconstruct, in the mind of the landlord.
This intention must be honestly held in relation to the surrounding circumstances.
In our opinion, the interpretation placed by the Punjab High Court (in the decision of Gosain, J.) puts too narrow a construction, and leaves very little for the Controller to decide.
It is well known that Rent Restriction Acts were passed in view of the shortage of houses and the High rents which were being demanded by landlords.
The very purpose of the Rent Restriction Acts would be defeated, if the landlords were to come forward and to get tenants turned out, on the bare plea that they want to reconstruct the houses, without first establishing that the plea is bona fide with regard to all the circumstances, viz., that the houses need reconstruction or that they have the means to reconstruct them, etc.
The two Tribunals below had gone into the matter thoroughly, and had agreed that the landlord had neither the means to reconstruct the building nor had he made any attempt to face cross examination as a party.
They were also of the opinion that the building was in a good state and did not need to be pulled down or reconstructed.
With such clear findings, one would expect that a revising Court, however vide its powers may be, would, at least, go into the question over again, if it was going to depart from this unanimous conclusion.
It is hardly necessary to go into the question of the extent of the powers of the High Court under section 15(5) of the Rent Restriction Act.
They have been adverted to in the ruling of this Court, above mentioned.
They 631 do not, however, include the power to reverse concurrent findings, without showing how those findings are erroneous.
In the present case, the learned Judge has given his conclusion without adverting to single piece of evidence, from which his conclusion was drawn.
In these circumstances it cannot be said that he had examined the propriety of the order sought to be revised, even under the provisions of the law he was administering.
Learned counsel relying upon the case to which we have already referred, said that there the sanction by the Municipal Committee was taken into consideration in deciding the need of the landlord.
The facts in that case are not fully stated, and from the observations, it would appear that there was other evidence besides the sanction by the Municipal Committee, on which the conclusion of the High Court was supported.
In any event, a case cannot be an authority on a point of fact, and each case will have to be examined in the light of the circumstances existing in it.
In the present case, the two Tribunals specially appointed to consider these matters, went thoroughly into the question, and discussed it from a correct angle.
If they had examined they facts after instructing themselves correctly about the law, a Court of revision should be slow to interfere with the decision thus reached, unless it demonstrates by its own decision, the impropriety of the order, which it seeks to revise.
No attempt of this kind has been made in this case, and in our opinion, the High Court was not justified in reversing the clear finding.
In the result, this appeal must be allowed.
The order of the High Court is set aside, and that of the appellate authority is restored.
The landlord shall pay the costs here and in the High Court.
Appeal allowed.
| The Estate of Maharaja Man Singh of Ayodhya Raj devolved on his death successively on his two widows and thereafter, according to V the plaintiff a minor on his grandfather G, who died in 1942.
Respondent claimed the estate as adopted son of the junior widow of the Maharaja.
V filed a petition for leave to sue in forma pauperis for declaration of title to the estate making his father R a party.
The plaintiff 's petition was rejected by the Subordinate Judge, on the ground that it disclosed no cause of action.
R 's application to be transposed as petitioner was also rejected.
V and R preferred revision applications to the High Court of Allahabad.
The plaintiff 's application was rejected by the High Court holding inter alia that there was nothing in the petition to show that succeeded to the estate as the nearest male reversioner of the last male holder.
R 's application was rejected by the High Court on the ground that relief in an application to sue in forma pauperis is personal to the applicant and nobody else can be made a co applicant, because 1, R. 10 of the Code of Civil Procedure does not apply to a proceeding for permission to sue as a pauper.
^ Held, that O. XXXIII of the Code of Civil Procedure lays down the procedure for institution of a suit by pauper.
By cl. 5 (d) the court is required to ascertain whether the allegation made in the petition show a cause of action, but it does not enter upon a trial of the issues affecting the merits of the claim made by the petitioner.
By the statute, the jurisdiction of the Court is restricted to ascertaining whether on the allegations a cause of action is shown: the jurisdiction does not extended to trial of issues which must fairly be left for decision at the hearing of the suit.
An application to sue in forma pauperis, is but a method prescribed by the Code for institution of a suit by a pauper without payment of Court fee; and there is nothing personal in such an application.
The suit commences from the 676 moment an application for permission to sue in forma pauperis as required by O. 33 of the Code is presented, and O. 1 r. of the Code would be as much applicable in such a suit as in a suit in which court fee had been duly paid.
A person who claims to join a petitioner praying for leave to sue in forma pauperis must himself be a pauper.
Claim to join by transposition as an applicant must be investigated; it is not liable to be rejected on the ground that the claim made by the original applicant is personal to himself.
|
Appeal No. 433 of 1957.
Appeal from the judgment and order dated August 24, 1956, of the Rajasthan High Court at Jodhpur in Civil Misc.
Case No. 17 of 1955.
B. D. Sharma, for the appellant.
A. N. Kripal, R. H. Dhebar and D. Gupta, for the respondent 1958.
October 17.
The Judgment of the Court was delivered by VENKATARAMA AIYAR J.
This is an appeal against the judgment of the High Court of Rajasthan in a reference under section 66(1) of the Indian Income tax Act, 1922, hereinafter referred to as the Act.
The facts, so far as they are material, are these The appellant is a resident of what was once the independent State of Udaipur.
There was in that State a Company called the Mewar Industries, Ltd., registered under the provisions of the law in force in that State, and the appellant held 266 shares in that Company.
On January 18, 1950, the Company went into liquidation, and on April 22, 1950, the liquidator distributed a portion of the assets among the shareholders, and the appellant was paid a sum of Rs. 26,000 under this distribution.
It is common ground that this sum represents the undistributed profits of the Company which had accrued during the six accounting years preceding the liquidation.
It should be mentioned that there was in the State of Udaipur no law imposing tax on income, and that it was only under the Indian Finance Act, 1950 that the residents of the State of Rajasthan, in which the State of Udaipur had merged, became liable for the first time to pay tax on their income.
That Act came into force on April 1, 1950.
We are concerned in these proceedings with the assessment of tax for the year 1951 52, and that, under section 3 of the Act, has to be on the income of the previous year, i.e., 1950 51.
Now, the dispute in the present case relates to the sum of Rs. 26,000 paid by the liquidator to the appellant on April 22, 1950.
By his order dated July 3, 1952, the Income tax Officer held 206 that this was dividend as defined in section 2(6A)(c) of the Act and included it in the taxable income of the appellant in the year of account.
The appellant took this order in appeal to the Appellate Assistant Commissioner who by his order dated January 12, 1953, confirmed the assessment.
There was a further appeal by the appellant to the Appellate Tribunal, who also dismissed it on November 10, 1953.
On the application of the appellant, the Appellate Tribunal referred the following question for the decision of the High Court: " Whether on the facts and in the circumstances of this case, the aforesaid sum of Rs. 26,000 was liable to be taxed in the assessee 's hands as dividend within the meaning of that term in section 2(6A)(c) of the Indian Income tax Act.
" The reference was heard by Wanchoo, C. J. and Modi, J. who by their judgment dated August 24, 1956, answered it in the affirmative.
It is against this judgment that the present appeal has been preferred on a certificate granted by the High Court under section 66A(2) of the Act.
The sole point for determination in this appeal is whether the sum of Rs. 26,000 received by the appellant on April 22, 1950, is dividend as defined in.
section 2(6A)(c) of the Act.
That definition, as it stood on the relevant date and omitting what is not material, was in these terms: " 6(A) 'dividend ' includes (a) any distribution by a company of accumulated profits whether capitalised or not if such distribution entails the release by the company to its shareholders of all or any part of the assets of the company ; (c) any distribution made to the shareholders of a company out of accumulated profits of the company on the liquidation of the company: Provided that only the accumulated profits so distributed which arose during the six previous years of the company preceding the date of liquidation shall be so included;".
207 The definition of " previous year " as given in section 2(l 1), omitting what is not material, is as follows: " Previous year " means in respect of any separate source of income, profits and gains (a) the twelve months ending on the 31st day of March next preceding the year for which the assessment is to be made. " On these provisions, the contention of the appellant is that under the definition in section 2(6A)(c) the assets of a company distributed after it has gone into liquidation will be dividend only if they represented the profits thereof accumulated during the six previous years preceding the date of the liquidation, and that, in the present case, though the amounts distributed came out of the accumulated profits of the Company, those profits had not been accumulated within the six previous years of the liquidation of the Company.
It is not in dispute that the profits which were distributed had been accumulated during the years 1943 44 to 1948 49, i.e., during the six years preceding the liquida tion.
The point in controversy is whether those years can be said to be " previous years " within section 2(6A)(c) of the Act.
The appellant contends that " previous year " as defined in section 2(l 1) of the Act means the year which is previous to the assessment year, that accordingly when there is no year of assessment, there can be no previous year, that construing the words " six previous years " in section 2(6A)(c) in the light of the definition of "previous year" in section 2(l 1) of the Act, the years 1943 44 to 1948 49 cannot be held to be previous years, because the Indian Income tax Act came into force in the State of Rajasthan only on April 1, 1950, and prior to that date there was at no time any law imposing tax on income in the State of Udaipur, that there was therefore no year of assessment, and that, in consequ ence, the sum of Rs. 26,000 received by the appellant on April 22, 1950, is not a dividend as defined in section 2(6A)(c).
The contention of the respondent which has been accepted by the Income tax authorities and by the learned Judges in the Court below is that the expression " six previous years" is used in section 2(6A)(c) not in the technical and restricted sense in which the 208 words " previous year " are used in section 2(11) of the Act, and that, in the context, it means six consecutive accounting years preceding the liquidation of the company.
The question is which of these two interpretations is the right one to be put on the language of section 2(6A)(c).
The argument of Mr. Sharma for the appellant is that section 2(11) having defined the meaning which the expression 'previous year" has to bear in the Act, that meaning should, according to the well settled rules of construction, be given to those words wherever they might occur in the statute, and that that is the meaning which must be given to the words " six previous years " in section 2(6A)(c).
It is to be noticed that the definitions given in section 2 of the Act are, as provided therein, to govern " unless there is anything repugnant in the subject or context ".
Now, the appellant contends that the words " unless there is anything repugnant " are much more emphatic than words such as " unless the subject or context otherwise requires ", and that before the definition in the interpretation clause is rejected as repugnant to the subject or context, it must be clearly shown that if that is adopted, it will lead to absurd or anomalous results.
And our attention was invited to authorities in which the above rules of construction have been laid down.
It is unnecessary to refer to these decisions as the rules themselves are established beyond all controversy, and the point to be decided ultimately is whether the application of the definition ins.
2(l 1) is repelled in the context of section 2(6A)(c).
Turning to the language of section 2(II), we have this that according to the definition contained therein, " previous year " is the year which is previous to the year of assessment, and that means that there can be only one previous year to a given year of assessment.
When section 2(6A) (c) speaks of six previous years, it is obvious that it uses the expression " previous year " in a sense different from that which is given to it in section 2(l 1), because it would be a contradiction in terms to speak of six previous years in relation to any specific assessment year.
It was argued that under section 13(2) of 209 the , words in the singular should be read as including the plural, and that, therefore, the definition of "previous year" in section 2(l 1) could be read as meaning " previous years ".
But section 13 only enacts a rule of construction which is to apply " unless there is anything repugnant in the and to read a " previous year " in section 2(l 1) would be to nullify the previous year " enacted therein, and such a construction must therefore be rejected as repugnant to the context.
It was then suggested that all the six previous years might be regarded as previous each to the next following year if that was itself a year of assessment, and that such a construction would, consistently with the contention of the appellant, give full effect to the definition in section 2(11) of the Act.
But this argument overlooks that while there may be several preceding years to a given year of assessment there can be only one previous year in relation to it, and that it would make no sense to speak of six previous years with reference to a year of assessment.
We are satisfied that it would be repugnant to the definition of " dividend " in section 2(6A)(c) to import into the words " six previous years " the definition of previous year" in section 2(l 1) of the Act.
An examination of the policy underlying section 2(6A)(c) also leads to the same conclusion.
When a company makes profits and instead of distributing them as dividend accumulates them from year to year and at a later date distributes them to the shareholders, the amounts so distributed would be dividend under section 2(6A) (a), but when a company which has so accumulated the profits goes into liquidation before declaring a dividend and the liquidator distributes those profits to the shareholders, it was held in Commissioners o Inland Revenue vs Burrell (1) that such distribution was not a dividend because when once liquidation intervenes, there was no question of distribution of dividends, and all the assets of the company remaining after the discharge of its obligations were surplus divisible among (1) 210 the shareholders as capital.
It was to remove this anomaly that the Indian legislature, following similar legislation by British Parliament in the year 1927, enacted section 2(6A) (1) in 1939.
The effect of this provision is to assimilate the distribution of accumulated profits by a liquidator to a similar distribution by a company which is working; but subject to this limitation that while in the latter the profits distributed will be dividend whenever they might have been accumulated, in the former such profits would be dividend only in so far as they came out of profits accumulated within six years prior to liquidation.
Now, the reason of it requires that those years must be a cycle of six years preceding the liquidation, arid that is what is meant by the words " previous years ".
It was argued for the appellant that if that was what was intended by the legislature, that was sufficiently expressed by the words " preceding the liquidation ", and that the words previous years " would be redundant.
But the words preceding years " would have meant calendar years, whereas the accounting years of the company for ascertainment of profits and loss might be different from the calendar years, and the words " previous year " would be more appropriate to connote the financial year of a company.
Now, it should be mentioned that when a company in liquidation distributes its current profits,, that would also be not dividend as held in Burrell 's case (1), and the law to that extent has been left untouched by section 2(6A)(c).
And it has accordingly been held by the High Courts that the current profits of a company in liquidation which are distributed to the shareholders are not dividend within section 2(6A)(c), Vide Appavu Chettiar vs Commissioner of Income tax (2) and Girdhardas & Co. Ltd. vs Commissioner of Incometax (3).
Therefore, accumulated profits which are sought to be caught in section 2(6A) (c) would be the profits accumulated in the financial years preceding the year in which the liquidation takes place, and it is this that is sought to be expressed by the words " previous years " in section 2(6A) (c).
In the present case, as the Company went into liquidation on January 18, 1950, (1) (2) (3) 211 excluding the current year which commenced on April 1, 1949, the six previous years will be the years 1943 44 to 1948 49.
So far, we have considered the question on the language of section 2(6A)(c) and the policy underlying it.
On behalf of the respondent, certain authorities were cited as supporting his contention that the expression it previous years " in section 2(6A) (c) is not to be interpreted in the sense in which the expression " previous year" is defined in section 2(l 1) of the Act.
It is sufficient to refer to one of them, and that is the decision of this Court in Commissioner of Income tax, Madras vs K. Srinivasan and K. Gopalan (1).
There, the point for decision was as to the interpretation to be put on the words " end of the previous year " in section 25, sub sections
(3) and (4) of the Act which dealt with discontinuance of or succession to a business, and it was held that the expression " previous year " in those provisions meant an accounting year expiring immediately preceding the date of discontinuance or succession.
The decision is not itself relevant to the present discussion, but certain observations therein are relied on as bearing on the point now under consideration.
Mahajan, J. delivering the judgment of the Court observed: " The expression 'previous year ' substantially means an accounting year comprised of a full period of twelve months and usually corresponding to a financial year preceding the financial year of assessment.
It also means an accounting year comprised of a full period of twelve months adopted by the assessee for maintaining his accounts but different from the financial year and preceding a financial year.
For purposes of the charging sections of the Act unless otherwise provided for it is co related to a year of assessment immediately following, but it is not necessarily wedded to an assessment year in all cases and it cannot be said that the expression 'previous year ' has no meaning unless it is used in relation to a financial year.
In a certain context it may well mean a completed accounting year immediately preceding the happening of a contingency." (I) , 501 212 The learned Judges in the Court below have relied on these observations, and quite rightly, as supporting their conclusion that the expression " six previous years " in.
section 2(6A) (c) means only the six accounting years of a company preceding the date of liquidation.
The appellant sought to raise one other contention, and that is that the Indian Companies Act came into operation in the Udaipur territory on April 1, 1951, only by force of the Part B Stater, Laws Act (111 of 1951), that during the relevant period the Mewar Industries Ltd. was not a company as defined in section 2(5A) of the Act, and that therefore the distribution of assets made by that Company on April 22, 1950, could not be held to be a dividend as defined in section 2 (6A) (c).
But that is not a question which was referred for the opinion of the High Court under section 66(1) of the Act; nor is it even dealt with by the Tribunal and therefore cannot be said to arise out of its order.
Moreover, whether the Mewar Industries Ltd., is a Company as defined in the Indian Income tax Act is itself a question over which the parties are in controversy.
The definition of " Company " under the Indian Income tax Act has undergone several changes from time to time, and on the relevant date it stood as follows: " 2(6) 'Company ' means (i) any Indian Company or (ii) any association, whether incorporated or not and whether Indian or non Indian, which is or was assessable or was assessed as a company for the assessment for the year ending on the 31st day of March, 1948, or which is declared by general or special order of the Central Board of Revenue to be a company for the purposes of this Act.
" It is contended for the respondent that the Mewar Industries Ltd., was an association which was assessable as a Company for the year ending March 31, 1948, and that it was, in fact, assessed; but the appellant disputes this.
As the point turns on disputed question of fact.
, it cannot be allowed to be raised at this stage.
213 In the result, we hold that the sum of Rs. 26,000 received by the appellant on April 22, 1950, ",as dividend as defined in section 2(6A) (c) of the Act and is chargeable to tax.
The appeal fails, and is dismissed with costs.
Appeal dismissed.
| The appellant, a resident of the once independent State of Udaipur, held 266 shares in the Mewar Industries Ltd., a company registered in that State.
There was no law in the State of Udaipur imposing tax on income and it was on April 1, 1950that for the first time the residents of Rajasthan, in which the State had merged, became liable to pay such a tax.
On January 18, 1950, the Company went into liquidation and on April 22, 1950, the liquidator distributed a portion of the assets among the shareholders, the appellant receiving a sum of Rs. 26,000.
This sum represented the undistributed profits of the company which had accrued during the six accounting years preceding the liquidation.
The income tax authorities included this sum in the taxable income of the appellant for the assessment year 1051 52 holding that it was dividend as defined in section 2(6A)(c) of the Indian Income tax Act.
Under section 2(6A)(c) the distribution of accumulated profits which arose during the " six previous years " preceding the date of liquidation would be dividend.
Section 2(1) defined " previous year " to mean the year which was previous to.the assessment year.
The appellant contended that " previous years " in section 2(6A)(c) must be read in the light of the definition is section 2(1) and as in the present case there had been no law imposing a tax prior to April 1, 1950, the profit for the years 1943 44 to 1948 49 cannot be held to be profits which " arose during the six previous years ", and consequently could not be taxed as dividend as defined in section 2(6A)(c) of the Indian Income tax Act.
Held, that the said sum was dividend within the meaning of section 2(6A)(c) of the Act and was liable to tax.
The definitions given in section 2 Of the Act applied unless there was anything repugnant in the subject or context.
It would be repugnant to the definition of " dividend " in section 2(6A)(c) to import into the expression " six previous years " the definition of " previous year " in section 2(ii) of the Act.
By the expression "previous years " in section 2(6A)(c) of the Act was meant the financial years preceding the year in which liquidation took place.
Commissioner of Income tax, Madras vs K. Srisivasan and Gopalan, , referred to. 205
|
: Special Leave Petition (Crl.) No. 489 of 1979.
From the Judgment and Order dated 9 11 1978 of the Kerala High Court in Crl.
R.P. No. 260/77.
K. T. Harendra Nath and T. T. Kunhikannan for the Petitioner.
The Order of the Court was delivered by KRISHNA IYER, J. The Petitioner has pressed before us certain points of law which have not been urged before the High Court and so we are unable to examine the tenability of those points.
For this reason, petition must be dismissed.
Counsel drew our attention to the fact that although the episode, which is the subject matter of the prosecution under section 16 (1A) (i) read with section 7(i) and section 2(1A) of the prevention of Food Adulteration Act, took place allegedly in 1972.
There was inexplicable, inordinate delay in trial.
The case was tried in 1977 which, according to counsel, prejudiced the petitioner considerably.
We are aghast at the traumatic impact on criminal justice inflicted by delayed trials when human memory becomes faded and vivid testimony is withheld.
The present case is an instance in point.
We feel strongly that the trial courts in the country should ensure that, in the spirit of Article 21 of the Constitution, food adulteration cases, 5 which involve imprisonment, are tried expeditiously so that neither the prosecution nor the accused is prejudiced by unusual procrastination.
We express the hope that the High Court concerned will issue peremptory directions to trial Judges demanding expeditious disposal of such cases.
In the present case, prosecution evidence, as regards taking of samples, is perhaps not as good as it would have been had the trial been prompt.
We do not want forensic martyrdoms for prosecutions in food adulteration cases, thanks to tarred trials blamable on the judicial process.
The State Government has a duty to sanction the required courts in obedience to the mandate of Article 21 which implies judicial justice without undue delay.
Maybe, there is some grievance for the petitioner that he was disabled in defending himself properly, hampered by the lapse of five years, but unfortunately the point was not pressed before the High Court; and, we do not think it proper to investigate the substantiality of the prejudice.
As for the sentence, true that, in this case, it is not shown that the petitioner is a big merchant.
Perhaps he was a petty dealer and counsel represents that the trade has been wound up.
It is also submitted that the petitioner has served about three months out of the six months of imprisonment.
Having regard to the totality of circumstances, it is open to the petitioner to move the State Government to remit the remaining portion of the sentence, if so advised, and it would be for the Government to consider at all whether it should exercise its power of remission and its impact on society.
N.K.A. Petition dismissed.
| HELD : The trial courts in the country should ensure that in the spirit of Article 21 of the Constitution, food adulteration cases which involve imprisonment are tried expeditiously so that neither the prosecution nor the accused is prejudiced by unusual judicial procrastination.
The High Court concerned should issue peremptory directions to the trial judges demanding expeditious disposal of cases.
The State Government has a duty to sanction the required courts in obedience to the mandate of Article 21 which implies judicial justice without undue delay.
[4H, 5A B] It would be for the State Government in the instant case to consider at all whether it should exercise its power of remission and its impact on the society.
[5D E]
|
No. 37 of 1950.
Appeal from a judgment of the Bombay High Court (Chagla C.J. and Dixit J.) in Appeal No. 281 of 1947.
K. section Krishnaswami Aiyangar (K. Narasimha Aiyangar, with him) for the appellant.
M.C. Setalvad, Attorney General for India, (B. Sen, with him) for the respondent.
December 1.
The Judgment of the court was deliv ered by CHANDRASEKHARA AIYAR J.
This appeal, preferred ch from the decree of the Bombay High Court in Appeal No. 281 of 1947, raises the question whether an execution application seeking to execute a final decree, passed by the let Class Subordinate Judge 's Court at Poona, on 6th December, 1932, for a sum of Rs. 1,24,215 and odd, is barred by limitation.
The decree was made in a suit for dissolution of a partner ship and the taking of accounts.
854 The execution application was filed on 4th October, 1946, and the amount stated to be due under the decree on that date was Rs. 2,30,986 and odd.
The previous execution application No 946 of 1940 filed in the Court of the 1st Class Sub Judge, Sholapur, to which the decree had been transferred for execution, was made on 24th June, 1940.
It was dismissed on 9th September, 1940, for non prosecution.
It would thus be seen that the present application was filed after the lapse of 12 years from the date of the final decree and 3 years from the date of the final order on the previous application.
To surmount the bar of limitation, the decree holder, who is the appellant before us, raised four contentions:firstly, that the final decree, which provided that the plaintiff should pay the deficit court fees on the decretal amount before the execution of the decree, was a conditional decree, and that time began to run from the date when the condition was fulfilled on 5th Decem ber, 1935, by payment; secondly, that the period occupied by the insolvency proceedings from 10th August, 1937, to 14th December, 1942, initiated by the decree holder to get the first judgment debtor Walchand Ramchand Kothari (with whom alone we are now concerned) adjudged an insolvent, should be excluded under section 14 (2) of the Limitation Act; third ly, that the period occupied by one Tendulkar, who was the creditor of the present decree holder, in seeking to execute this decree, should be deducted; and lastly, that as the judgment debtor prevented execution of the decree against the 'Prabhat ' newspaper by suppressing his ownership of the same, a fresh starting point of limitation springs up in the decree holder 's favour from the date of the discovery of the fraud.
The Subordinate Judge held that the execution applica tion was not barred, agreeing with every one of these con tentions.
On appeal to the High Court Chagla C.J. and Dixit J. reversed this decision, holding that it was not a condi tional decree, that the steps taken by Tendulkar to execute this decree were of no avail, and that the insolvency pro ceedings were for a 855 different relief altogether, so that section 14 (2) of the Limitation Act could not be invoked.
They concurred with the finding of the Subordinate Judge that the judgment debtor prevented the execution of the decree within 12 years by fraudulent concealment of his ownership of the 'Prabhat ' newspaper and that the twelve years ' bar of limi tation did not apply; but they held that the application was barred under article 182 of the Limitation Act, as more than three years had run from 9th September, 1940, the date of the dismissal of the previous execution application, before the present application was filed on 4th October, 1946.
Points 1 to 3 above mentioned are of no avail to the appel lant.
The decree was not a conditional one in the sense that some extraneous event was to happen on the fulfilment of which alone it could be executed.
The payment of court fees on the amount found due was entirely in the power of the decree holder and there was nothing to prevent him from paying it then and there; it was a decree capable of execu tion from the very date it was passed.
There could be no exclusion of the time occupied by the insolvency proceedings which clearly was not for the purpose of obtaining the same relief.
The relief sought in insolvency is obviously differ ent from the relief sought in the execution application.
In the former, an adjudication of the debtor as insolvent is sought as preliminary to the vesting of all his estate and the administration of it by the Official Receiver or the Official Assignee, as the case may be, for the benefit of all the creditors; but in the latter, the money due is sought to be realized for the benefit of the decree holder alone, by processes like attachment of property and arrest of person.
It may be that ultimately in the insolvency proceedings the decreeholder may be able to realize his debt wholly or in part, but this is a mere consequence or result.
Not only is the relief of a different nature in the two proceedings but the procedure is also widely divergent.
The steps taken by the appellant 's creditor Tendulkar to attach this decree and put it in execution do not save limitation.
His darkhast for attachment of the 856 present decree was on 3rd April, 1940, and for execution of the present decree was on 1st February, 1944, more than 3 years from 9th September, 1940, which is the date of the dismissal of the appellant 's prior execution petition.
The learned Advocate for the appellant therefore devot ed most of his argument to the fourth contention set forth above.
That the judgment debtor respondent suppressed his ownership of the 'Prabhat ' newspaper and fraudulently pre vented the execution of the decree against this property has been found by both the Courts below, as stated already.
It was strenuously urged that the fraud so found is not merely fraud as broadly interpreted under section 48 (2), Civil Procedure Code, but also strict or concealed fraud within the meaning of section 18 of the Limitation Act.
In this connection, it is as well to set out very briefly the nature of the concealment and the steps taken by the judgment debtor to achieve the same.
He purchased the 'Prabhat ' newspaper with all its assets and goodwill from its previ ous owner one Purushottam Mahadev in 1938 under the letter marked Exhibit 129.
He opened current accounts in several banks, and gave the name of one Abhyankar as the owner of the paper, but he was himself operating on those accounts.
One Rajwade, a friend of the judgment debtor, was shown as the printer and publisher of the paper.
Even in his supplementary written statement flied in Court in answer to the present execution, marked Exhibit 88 (page 53 of the printed book), the defendant asserted in paragraph 2 that he became the owner of the newspaper only in April,/944, and that previously he had no ownership or right in the same.
He did not go into the witness box to refute the allegation that he was the owner ever since the purchase of the paper in 1938 and that he opened accounts in the names of other people on which he was operating for his own benefit.
On these facts, the Subordinate Judge found as follows : "I think on the whole that the evidence establish es beyond doubt that the judgment debtor had concealed his proprietary interest in his newspaper called 857 Prabhat ' from June, 1938, to April, 1944.
The only purpose for which the property could have been concealed in this way was probably the fear that the decree holder would pounce upon it if he came to know about it.
The decree holder came to know of this fraud after April, 1944; for thereafter the judgment debtor made an open declaration that the newspaper belonged to him.
I think therefore that this fraud has prevented the decree holder from executing the decree against some property of the judgment debtor.
" In this finding, the High Court concurred.
After referring to the stratagem adopted by the judgment debtor in Bhagu Jetha vs Malick Bawasaheb(1), the learned Judges observed: "In this case, in our opinion, the stratagem is much more dishonest.
The attempt on the part of the judgment debtor was to conceal his property, to deny its ownership and to put forward a mere benamidar as the real owner of that property.
In our opinion, therefore, the execution of the decree is not barred under section 48.
The 'judgment debtor has, by fraud, prevented the execution of the decree within 12 years before the date of the application for execution by the decree holder and therefore the decree under consideration is capable of being executed.
" On the strength of this concurrent finding, Mr. Krish naswami Iyengar for the appellant argued that the fraud fell within the scope of section 18 of the Limitation Act and that if it were so, he was out of the woods, inasmuch as the proper article to apply would be article 181 of the/imita tion Act.
The right to apply accrued to him when the fraud became known to him in or about June, 1946. 'Till then he was kept by the fraud from the knowledge of his right to make an application against the property.
Law does not require him to make futile successive applications in execu tion, in the face of this fraud.
He was not in a position to seek even the arrest of the judgment debtor as he had got himself declared in the insolvency proceedings as agriclu turist." within the meaning of the Deccan (1) I.L.R. 110 858 Agriculturists ' Relief Act.
alleging falsely that he was not in receipt of any income by way of salary or remuneration from the newspaper concerned and that he was mainly depend ent on the income of his family lands for his maintenance.
There can be no question that the conduct of the re spondent was fraudulent within the meaning of section 48 (2) of the Civil Procedure Code.
Though benami transactions are common in this country and there is nothing per se wrong in a judgment debtor purchasing property in another man 's name, we have to take into account all the circumstances attending the purchase and his subsequent conduct for find ing out whether it was part of a fraudulent scheme on his part to prevent the judgment creditor from realizing the fruits of his decree.
Fraudulent motive or design is not capable of direct proof in most cases; it can only be in ferred.
The facts before us here leave no room for doubt that the true object of the judgmentdebtor was to prevent the execution of the decree against the ' Prabhat ' news paper Which he had purchased.
Other persons were shown as the printer and the publisher of the newspaper, while Abhy ankar was mentioned as the proprietor, The judgement debtor, was, however, operating on those accounts for his own benefit.
In the Insolvency Court, he set up the plea that he was an agriculturist, by suppressing the truth about his ownership of the paper, and pretending that his income was mainly, if not solely, from the family lands.
He kept up this show till April 1944, when probably he felt that he was sale from the reach of the judgment creditor.
Even in his answer to the execution application, out of which this appeal has arisen, he had the hardihood to assert that he was not the owner of the paper till April 1944.
It should also be remembered that he did not get into the witness box to explain what other necessity there was for all this camouflage, except it be to cheat the appellant of his dues under the decree.
Mr. Setalvad, the learned Attorney General, who appeared for the respondent, pointed out that there 859 was no benami purchase and that the holding out of Abhyankar as the proprietor of the ' Prabhat ' did not amount to any false representation or misrepresentation to the judgment creditor, as the accounts on which reliance was placed were accounts opened in the banks and were not ordinarily avail able for inspection by third parties.
This line of reasoning is hardly convincing, when we have to consider whether what is attributed to the judgment debtor does not amount to a fraudulent scheme or device for preventing execution of the decree that had been passed against him for a very large sum of money.
In the very nature of things, fraud is secret in its origin or inception and in the means adopted for its success.
Each circumstance by itself may not mean much, but taking all of them together, they may reveal a fraudulent or dishonest plan.
It would be convenient to set out here in extenso sec tion 48, Civil Procedure Code, and section 18 of the Limita tion Act before we proceed to consider the soundness of the arguments advanced by both sides in support of the positions they have taken up.
Section 48, Civil Procedure Code (which corresponds to section 230 of the Code of 1882), is in these terms: " 48.
(1) Where an application to execute a decree not being a decree granting an injunction has been made, no order for the execution of the same decree shall be made upon any fresh application presented after the expiration of 12 years from (a) the date of the decree sought to be executed, or (b) where the decree or any subsequent order directs, any payment of money or the delivery of any property to be made at a certain date or at recurring periods the date of the default in making the payment of delivery in respect of which the applicant seeks to execute the decree.
(2) Nothing in this section shall be deemed (a) to preclude the Court from ordering the executior of a decree upon an application presented after the expiration of the said term of twelve years, where the 860 judgment debtor has by fraud or force prevented the execu tion of the decree at some time within twelve years immedi ately before the date of the application; or (b) to limit or otherwise affect the operation of arti cle 183 of the first Schedule to the Indian Limitation Act, 1908.
" Section 18 of the Limitation Act, 1908, runs thus: " 18.
Where any person having a right to institute a suit or make an application has, by means of fraud, been kept from the knowledge of such right or of the title on which it is founded, or where any document necessary to establish such right has been fraudulently concealed from him, the time limited for instituting a suit or making an application (a) against the person guilty of the fraud or accessory thereto, or (b) against any person claiming through him other wise than in good faith and for a valuable consideration, shall be computed from the time when the fraud first became known to the person injuriously affected thereby, or, in the case of the concealed document, when he first had the means of producing it or compelling its production." Whether the fraud of the judgment debtor should actually prevent the execution of the decree or whether it is enough if the fraud has been committed without esulting in actual prevention is a question on which there has been some diver gence of opinion in the decided cases.
The former view was taken in an early Madras case Kannu Pillay vs Chellathammal and ) Others(1) and receives support from the decision reported in Sri Raja Venkata Lingama Nayanim Bahadur Varu and Another vs Raja Inuganti Rajaopala Venkata Narasimha Rayanim Bahadur Varu and five Others(2)to which our learned brother Mr. Justice Patanjali Sastri was a party.
The latter view ( (1) [1898] M.I.J. Mad.
861 is indicated in M.R.M.A.S.P. Ramathan Chefliar vs Mahalingam Chetti(1) by a Bench of which Sir Madhavan Nair J. was a member.
It is not necessary to determine which view is correct, as we have here definite findings of both the Courts below that there was fraud preventing the execution of the decree within the meaning of Section 48 of the Civil Procedure Code.
The appellant thus escapes the bar of the 12 years ' period and he has a fresh starting point of limitation from the date of the fraud for section 48 of the Civil Procedure Code.
In other words, the decree holder has another 12 years within which he can execute his decree.
Having thus got over the difficulty in his way under section 48 of the Code of Civil Procedure, he has next to meet the objection under the Limitation Act.
On behalf of the appellant, it was urged that section 18 of the Limita tion Act applied to the facts and that the right to apply accrued to the appellant when the fraud by the judgment debtor became known to him in 1946.
No reliance was placed on section 18 of the Limitation Act in the courts below and no reference to it is found in the grounds of appeal to this court.
It is however mentioned for the first time in the appellant 's statement of the case.
If the facts proved and found as established are sufficient to make out a case of fraud within the meaning of section 18, this objection may not be serious, as the question of the applicability of the section will be only a question of law and such a question could be raised at any stage of the case and also in the final court of appeal.
The following obser vations of Lord Watson in Connecticut Fire Insurance Co. vs Kavanagh (2) are relevant.
He said: "When a ques tion 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 interests of justice to entertain the plea.
The expediency of (1) 1.L.R. (2) 862 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." Mr. Setalvad, however, urged that the appellant should not be allowed to rely on section 18 now for the first time and that even if fraud within the meaning of that section had been pleaded the respondent might have adduced counter evidence by himself going into the witness box or otherwise.
According to him, the approach to the question of fraud under section 18 of the Limitation Act is quite different from the approach under section 48 of the Civil Procedure Code.
There may be cases where the fraud alleged and found is fraud in the wider sense of the term within the meaning of section 48 (2) of the Civil Procedure Code, but the same facts do not amount to fraud as strictly construed under section 18 of the Limitation Act.
The fact that the decree holder in the lower courts relied on section 48, Civil Procedure Code, only does not prevent him from relying on section 18 of the Limitation Act if the facts necessary to be established for bringing in the assistance of section 18 of the Limitation Act are admitted, or proved.
It is not disputed that the fraud contemplated by section 18 of the Limitation Act is of a different type from the fraud contem plated by section 48 (2) of the Civil Procedure Code.
The wording of section 18 which requires the fraud "to prevent knowledge of the right to make the application" is neces sarily of a different nature from the fraud which prevents the decree holder from making an application for execution.
Conceding to the appellant the right to rely on section 18 of the Limitation Act even at this late stage, let us see if it is really of any help to him on the facts found.
The section has been quoted already.
It speaks of the right to institute a suit or make an application which by means of fraud has been kept from the knowledge of the person having the right or the title on which it is founded.
The right to apply for 863 execution of a decree like the one before us is a single and indivisible right, and not a composite right consisting of different smaller rights and based on the decree holder 's remedies to proceed against the person of the judgment debtor or his properties, moveable and immoveable.
Togive such a meaning would be to split up the single right into parcels and to enable the decree holder to contend that while his right to proceed against a particular item of property is barred, it is not barred in respect of other items.
We would then be face to face with different periods of limitation as regards one and the same decree.
An inter pretation which leads to this result is prima facie un sound.
Both sides agreed that this is the true position, but they reached it from slightly varying standpoints.
According to the appellant, fraud even with reference to one property gives him a further extension of 12 years under section 48 (2) as regards the whole decree and it is not necessary for him to show that he had proceeded against the other properties of the judgment debtor.
According to the respondent, the fraud must consist in the concealment of the knowledge of the decree holder 's right to apply for execution of the decree and it is not enough to prove or establish that the fraud prevented him from ' proceeding against a specific item.
The two contentions, lead to the same conclusion about the indivisibility of the decree, but along different lines.
In our opinion, the facts necessary to establish fraud under section 18 of the Limitation Act are neither admitted nor proved in the present case.
Concealing from a person the knowledge of his right to apply for execution of a decree is undoubtedly different from preventing him from exercising his right, of which he has knowledge.
Section 18 of the Limitation Act postulates the former alternative.
To read it as referring to an application for execution to proceed against a particular property would be destructive of the oneness of the decree and would lead to multiplicity of periods of limitation.
It is true that articles 181 and 182 of the Limitation Act and section 48, 864 Civil Procedure Code, should be read together.
The articles expressly refer to the section.
But they are independent or parallel provisions, different in their scope and object.
As held in Kalyanasundaram Pillai vs Vaithilinga Vanniar (1) section 48 (2) extends the 12 years ' period of closure by a further period of similar duration but the necessity of resort to article 182 is not thereby obviated.
The decree holder must have been taking steps to keep the decree alive and the only circumstance that could relieve him of this obligation is the existence of fraud under section 18 of the Limitation Act.
The learned Advocate of the appellant asked how it could be possible for him to apply in execution when there was the fraud and whether the law contemplated that, even though the fraud prevented execution of the decree, he was to go on filing useless or futile applications every three years merely for keeping the decree alive.
The answer is simple.
The fraud pleaded namely suppression of owner ship of the 'Prabhat ' newspaper, did not conceal from him his right to make an application for execution of the de cree.
Indeed, the suppression, which began in 1938, did not prevent the decree holder from applying for execution in 19 10; and in his answers in cross examination, he has adimitted that there were other properties to his knowledge against which he could have sought execution, viz., deposits in several banks of the judgment debtor 's monies but stand ing in his wife 's or daughter 's names, life insurance poli cies for which premia were being paid by him, law books written and published by him, movable properties in the house at Poona etc.
As a matter of fact, the appellant 's present application seeks execution against several of these properties.
Nothing prevented him therefore ,from seeking such execution within 3 years of the dismissal of his prior application in 1940.
Even with reference to the 'Prabhat ', all that the decree holder states is that as he had no evidence to prove that the concern belonged to the defendant he did not take any steps, and not that he had no (1) I,L.R. 1939 Mad.611 865 knowledge of the ownership.
To quote two sentences from his deposition: "I had suspected that defendant No. 1 was the real owner of the business all the while.
But I had no posi tive knowledge or information till 1946" . . "I could not take any step for attaching the defendant 's business till 1946 as I had no evidence to prove the defendant 's fraud till then.
" There is no obligation on the judgment debtor to post the decree holder with all details of his properties; it is the decree holder 's business to gather knowledge about the properties so that he can realise the fruits of his decree.
In dealing with this evidence, Mr. Krishnaswami lyengar relied on the Privy Council decision, Rahimbhoy vs Turner in 20 I.A. 1 and referred to the following observation of Lord Hobhouse at page "But their Lordships consider, and in this they agree with both the Courts below, that all that the appellant Rahimbhoy has done is to show that some clues and hints reached the assignee in the year 1881, which perhaps, if vigorously and acutely followed up, might have led to a complete knowledge of the fraud, but that there was no disclosure made which informed the mind of the assignee that the insolvent 's estate had been defrauded by Rahimbhoy of these assets in the year 1867.
" The passage cited does not apply here because the appellant admits knowledge, which is more than a mere suspicion, but states that he had no evidence to prove the defendant 's ownership.
In any event, it has not been established within the meaning of section 18 of the Limitation Act that the fraud alleged and proved kept back from him the knowledge of his right to execute the decree.
It is thus clear that the appellant cannot get the benefit of section 18 of the Limitation Act.
It was next argued on behalf of the appellant that under section 48(2) of the Civil Procedure Code, because of the fraud of the respondent the appellant got a fresh starting point of limitation for the Limitation Act also 111 866 and therefore the starting point contemplated in the third column of the schedule to the Limitation Act relating to applications for execution should be the date when the fraud was discovered by the appellant.
In other words, it was argued that the effect of section 48 was not merely to make the 12 years ' period start from the discovery of fraud for the purpose of section 48(2) of the Civil Procedure Code but also to give a fresh starting point for the schedule to the Limitation Act.
This argument cannot be accepted.
If a man is prevented from making an application, because of the fraud of the debtor, he is not necessarily prevented from knowing his right to make the application.
By the enactment of section 18, the Legislature has distinctly contemplated that for the Limitation Act the starting point is changed on the ground of fraud, only when the knowledge of the right to make the application is prevented by the fraud of the judg mentdebtor.
Having the knowledge that he had the right to make the application, if the judgment debtor prevents the decree holder from knowing the existence of certain properties against which the decree could be enforced, the case is clearly not covered by the words of section 18 of the Limitation Act.
Therefore the argument advanced on behalf of the appellant is unsound.
It was urged that the various starting points mentioned in the third column to article 182 of the Limitation Act cannot apply because none of them specify a fresh starting point for execution acquired on the ground of the fraud of the judgment debtor.
This argument, in our opinion, instead of helping the appellant, goes against him.
Such a provision in the third column in the article relating to execution of decrees is not necessary because provision for such a con tingency is made in section 18.
Affirmatively, by the inclu sion of section 18 in the Limitation Act, and, negatively, by not providing for a separate period of limitation in the case of the fraud of the judgment debtor in the third column in the articles, the Legislature has clearly indicated that unless advantage could be taken by the 867 decree holder under section 18 on the ground of the fraud of the judgment debtor, fraud does not give any other relief under the Limitation Act.
This scheme of the Legislature is not inconsistent with section 48 of the Civil Procedure Code.
The two provisions in the two Acts have to be read as related to the same subject but dealing with two differents aspects.
Without section 48 of the Civil Procedure Code a decree holder, if he made applications as required by arti cle 181 or 182 of the Limitation Act, could keep his decree alive for an indefinite period.
The Legislature, as a matter of policy, ruled that a decree of a civil court (but excluding the High Court) shall not be kept alive for more than 12 years, although all necessary steps are taken under the Limitation Act to keep the decree alive and operative.
That is one limit to the right of the decree holder to enforce the decree of the court.
The second limitation to his right, which is independent of the first, is that he must keep the decree alive under article 182 or 181, as the case may be.
In the case of the fraud of the judgment debtor provision is made in section 48(2) for enlarging the 12 years period prescribed under section 48.
For defeating the plea of the bar of limitation under the Limitation Act, in the case of fraud of the judgment debtor, provision is found in section 18 of the Limitation Act.
If the particu lar case of fraud set up and proved is not covered by those words, there is no protection against the same in the Limi tation Act.
Read in that way, the two legislative provi sions are neither conflicting nor overlapping; and they are capable of operating harmoniously, as they deal with different situations and circumstances.
The argument ad vanced on behalf of the appellant that because of the fraud he got not merely a fresh starting point for computing the 12 years period prescribed in section 48 ( '2,) of the Civil Procedure Code but is also entitled to an extension of the time under the Limitation Act, must therefore fail.
The second contention urged on behalf of the appellant that because in the third column of article 182 868 fraud is not mentioned, the case is covered by article 181 does not also appear to be sound.
The third column in article 182 prescribes the starting point of limitation under different specified circumstances.
It does not, and indeed need not, mention the ground of fraud because if fraud of the kind against which the Limitation Act contem plates relief, as prescribed in section 18 of the Limitation Act, is established, the time is automatically altered by operation of that section.
If the case does not fall under that section, no relief is permitted under the Limitation Act and the starting point for computing the period must be as mentioned in the third column, irrespective of the question of fraud.
In our opinion, therefore, the conten tion that because of the fraud established in the present case under section 48(2) of the Civil Procedure Code, the appellant gets a fresh starting point of limitation under article 182 of the Limitation Act is unacceptable.
The appellant relied on the general principle of juris prudence that fraud stops or suspends the running of time and that it should be applied in his favour, apart from section 18 of the Limitation Act.
Rules of equity have no application.
where there are definite statutory provisions specifying the grounds on the basis of which alone the stoppage or suspension of running of time can arise.
While the courts necessarily are astute in checkmating or fighting fraud, it should be equally borne in mind that statutes of limitation are statutes of repose.
For the reasons given above we concur in the conclusion reached by the High Court and dismiss the appeal with costs.
Appeal dismissed.
| The vendors executed an agreement for sale in respect of a certain survey number which according to the agreement was to be diverted to non agricultural purposes and thereafter a sale deed was to be executed.
In pursuance to the said agreement the vendors applied for diversion which was sanctioned subject to the payment of premium and other conditions.
Before the sale deed was executed respondent No. 1 Sridhar brought a suit for pre emption against the appellant on the ground that he had a co occupancy in the survey number in dispute being the owner of the adjoining survey number.
The suit was decreed and on appeal the High Court inter alia held that the transaction was a sale which was subject to pre emption and that the failure to execute and register a sale deed was a subterfuge to defeat the right of pre emption.
The question for decision was (1) whether a right of pre emption had accrued to respondent Sridhar under the provisions of the Berar Land Revenue Code, 1928, and (2) whether the appellant was guilty of fraud in that in order to defeat the right of pre emption the deed of sale was not executed, but for all intents and purposes the appellant had become the owner of the property.
Held, that the right of pre emption in Berar did not arise from Mohamedon Law and did not exist till it was brought from Land laws of the Punjab or North West Provinces.
The right of pre emption under the Berar Land Revenue Code extended to transactions of sale, usufructuary mortgages and leases for 15 years or more and right under Mohamedon Law applies only to sales.
The word sale has no wider connotation under section 176 of the Berar Land Revenue Code than it has in the Transfer of Property Act.
After the application of Transfer of Property Act to Berar a transaction of sale could not be effective except through a registered instrument.
The contract of sale in the instant case created no interest in favour of the appellant and the proprietary title did not validly pass from the vendors to the appellant and until that was completed no right to enforce pre emption arose.
The transfer of 249 property, where the Transfer of Property Act applied, had to be under the provisions of the Transfer of Property Act only and neither the Mohamedon Law nor any other personal law of transfer of property could override the statute law.
There are no equities in favour of a pre emptor, whose sole object is to disturb a valid transaction by virtue of the right created by statute.
Held, further that it is neither illegal nor fraudulent for the parties to a transfer, to avoid and defeat a claim for preemption by all legitimate means and a person is entitled to steer clear of the laws of pre emption by all lawful means.
|
ION: Criminal Appeal No. 167 of 1961.
Appeal by special leave from the judgment and order dated September 29, and October 11, 1961, of the Bombay High Court in Criminal Appeal No. 906 of 1961.
section G. Patwardhan, J. B. Dadachanji, O. C. Mathur and Ravinder Narain for the appellant.
H. R. Khanna and P. D. Menon for the respondent.
January 18.
The Judgment of the Court was delivered by KAPUR J.
This is an appeal against the judgment and order of the High Court of Bombay secting aside the order of acquittal of the appellant and sentencing her to one year 's rigorous imprisonment and evicting her from the premises which she was occupying as a tenant.
The appellant was tried by the Additional Chief Presidency Magistrate, Esplanade, Bombay for offences under sections 3(2) and 4(1) of the Suppression of Immoral Traffic in Women and Girls Act (Act 104 of 1956) hereinafter called the 'Act '.
The charge against the appellant was that she supplied a girl to Manmohan Anandji Mehta who is a witness and she kept or managed a brothel at block No. 6, plot No. 144; Shivaji Park, Bombay; that she knowingly lived on the earnings of prostitution and that the procured women for the purpose of prostitution.
The story of the prosecution was that information was received by Police Superintendent Kanga that the premises were being used as a brothel and that the appellant was supplying 634 girls for the purpose of prostitution.
He thereupon laid a trap and sent two persons, Manmohan Anandji Mehta and Prabhakar K. Loke, the former was to ask for a girl for the purpose of prostitution and the latter was to be a panch i. e. a witness of that fact.
Sub Inspector Purohit, it is stated, gave two one hundred rupees marked currency notes to Manmohan Anandji Mehta with the instruction that he was to pay out of that to the appellant and thus to obtain a girl from her for the purpose of prostitution.
He along with Loke went to the house of the appellant, rang the bell and was admitted by her.
He then asked the appellant to arrange a girl for him and both Manmohan Anandji Mehta and Loke are alleged to have said that they wanted two girls for enjoyment.
Two girls were shown, one Kamal Govind and the other Indu Bapurao Salunke both of whom are witnesses.
The amount quoted by the appellant in the case of the former was Rs. 100/ and for the latter Rs. 50/ .
Manmohan Anandji Mehta selected Kamal and handed over heroine one hundred rupees currency note to the appellant which she put under her blouse.
Manmohan Anandji Mehta and the girl then went into the kitchen and there they undressed and were later found naked on the floor and in a rather compromising position.
On a signal being given the police i.e. Superintendent Kanga and Sub Inspector Purohit entered the premises and were told by Loke that Manmohan Anandji Mehta and the girl were in the kitchen.
The police officers opened the door of the kitchen and found both Manmohan Anandji Mehta and Kamal as stated above.
They then were asked to dress and come out.
Manmohan Anandji Mehta then returned the other one hundred rupees currency note to superintendent Kanga.
A woman Panch who had accompanied the police party searched the appellant and recovered the one hundred rupees currency note from under the blouse.
It is stated that the male members of the party were at that time in a passage adjoining the 635 hall where the appellant was searched.
The appellant was tried for the offences above mentioned but was acquitted by the Additional Chief Presidency Magistrate.
On appeal the High Court set aside the order of acquittal and sentenced her to a year 's rigorous imprisonment and also ordered her eviction from the premises she was occupying as a tenant.
The evidence mainly consists of Manmohan Anandji Mehta and Loke and the two police officers.
The testimony of Manmohan Anandji Mehta and Loke by itself may not, in the circumstances of the case, be of much value but their testimony receives corroboration and thus gives credence to the prosecution case.
The evidence of Police Superintendent Kanga shows that when the door of the kitchen was pushed open both Kamal and Manmohan Anandji Mehta were naked and were in a compromising position; their clothes were lying by the side of the mattress, The testimony of Sub Inspector Purohit is also to the same effect.
The other circumstances which is very much against the appellant is that there is evidence to show that when the woman panch accompanied the police party and searched the appellant a hundred rupees currency note was found from her person under her blouse.
The fact is deposed to by Sub Inspector Purohit and by Police Superintendent Kanga.
Loke has also deposed to the same effect.
But it was submitted on behalf of the appellant that this evidence should not be accepted as, according to law, no woman can be searched except by another woman and having regard to the emphasis on decency under sections 52 and 103 of the Criminal Procedure Code that cannot be done in the presence of men.
There is no evidence to show except that of Manmohan Anandji Mehta that the men were asked to move away from the hall or had actually left the hall during the search.
But assuming they were not in the hall even then it will not be an extraordinary circum 636 stance that one or all of them should have seen the hundred rupees, note being taken out from under the blouse of the appellant.
The High Court has, accepted the testimony of Loke and we find no reason to depart from the usual practice of this Court, of accepting such findings.
Besides, the High Court has also accepted the testimony of Loke in regard to the payment of a hundred rupees currency note to the appellant which proves that money was paid before the girl, Kamal Govind, was asked to go with Manmohan Anandji Mehta for the purpose of prostitution.
Counsel for the appellant emphasised two points: (1) that the woman, who was brought by the police to search the appellant and is alleged to have recovered the hundred rupees note from her person, has not been produced and (2) that considering that the person to be searched was a woman it must be presumed that in accordance with the requirements of law and of decency no man could have been present when the search of the appellant took place.
In support of the first contention reference is made to a judgment of this, Court in Purvez Ardeshir Poonawalla vs The State of Bombay(1), where the necessity of producing the search witness was emphasised and it was observed: "This is, one of those cases where the rule in regard to search witnesses becomes applicable and importance must be attached to the lack of that class, of search witnesses which are envisaged by the Criminal Procedure Code in section 103.
" The Privy Council also in Malak Khan vs Emperor(2) emphasised the necessity of the presence of search witnesses.
Lord Porter there said: "In their Lordship 's opinion the presence of witnesses, at a search is always desirable and their absence will weaken and may sometimes destroy the acceptance of the evidence as, to the finding of the articles. ." 637 The observations in Poonawalla 's case (1) and Lord Porter in Malikkhan vs Emperor (2) are not directly applicable in the present case.
As we have said above there is evidence in this case which has been accepted by the High Court that a hundred rupees note was given to the appellant by Manmohan Anandji Mehta.
There is also evidence that as a consequence of the payment of money Manmohan Anandji Mehta did hire Kamal Govind for prostitution and it is regrettable to say that with the money given to him by the police he acted not merely as a 'bogus customer ', as he has been described, but his participation was more active, reprehensible, immodest, indecent and indecorous.
If in any case the following observations of Lord Goddard, Chief Justice, in Brannan, vs Peek (3) are apposite it is this case: "The court observes with concern and disapproval the fact that the police authority as Derby thought it right to send a police officer into a public house to commit an offence.
It cannot be too strongly emphasised that,. it is wholly wrong for a police officer or any other person to be sent to commit an offence in order that an offence by another person may be detected.
" We have only to substitute the words "aid an act of prostitution" for "to commit an offence" and the analogy is complete.
In this case two youngmen were given money to go to the house of the appellant and also to use that money in rather an improper manner.
Manmohan Anandji Mehta seems to be a person of rather doubtful character and the employment of this class of persons for detection of offences is hardly a credit to any one.
What is more reprehensible and a matter of greater concern is the sending, with him a young student who was reading for his Matriculation.
To use students in 638 this manner should not be allowed by any governmental authority in a country like ours.
It is no justification to say that, in order to suppress immoral traffic in women and to stop prostitution somebody has to be used and the only class of people that can be employed are persons like Manmohan Anandji Mehta who is confessedly a police agent and Loke who is a youngman willing to be employed by the police.
After saving this we have still to see what is the consequence of the testimoney of these witness produced in this case.
The High Court has believed the testimony of Loke in regard to the payment of one hundred rupees and there is evidence to show that amount was used for the purpose of procuring Kamla for prostitution.
The payment must therefore be held to be proved.
It may be that the search was contrary to the spirit or even the letter of the Criminal Procedure Code but the fact remains that the High Court has accepted that there was a search and a hundred rupees currency note was recovered and even if the recovery of a hundred rupees currency note were held not proved, the payment of that amount will not thereby become unproved if there evidence which the High Court has accepted.
On the findings of the High Court we are unable to come to any other conclusion but the one to which the High Court came that the appellant is guilty of the offences of which she was accused.
The next submission of Counsel for the appellant was that the High Court in appeal could not order the appellant 's eviction because that power only a Magistrate has under section 18 of the Act.
The argument raised was that the powers of the appeal court under section 423, Criminal Procedure Code are to reverse the order of acquittal or to order a fresh enquiry or a retrial etc.
but not to order eviction.
But this argument is untenable in view of the fact that in the Act there is a specific provision in section 18 639 of the Act authorising the making of such an order by a court convicting a person of offences under section 3 or section 7 of the Act.
The relevant portion of section 18 is as follows: section 18 "Closure of brothels and eviction of offenders from the premises, (1). . ,and if after hearing the person concerned, the magistrate is satisfied that the house. . or portion is being used as a brothel or for carrying on prostitution then the magistrate may pass orders (a) directing eviction of the occupier within seven days of the passing of the order from the house. . (2) A court convicting a person of any offence under section 3 or section 7 may pass orders under sub section (1) without further notice to such person to show cause as required in that sub section.
" The High Court ordered the conviction of the appellant under section 3 of the Act and therefore it had the power to order her eviction.
The second contention is also without substance.
The appeal is therefore dismissed.
Appeal dismissed.
| The Court of Wards granted to the appellants a large area of land belonging to the Bettiah Raj which was then under the management of the Court of Wards, on the recommendation of the Board of Revenue, at half the usual rates.
A few years later, the Working Committee of the Indian National Congress expressed the opinion that the settlement of the lands was against public interest, and in 1950, the Bihar Legislature passed an Act called the Sathi Lands (Restoration) Act, 1950, which declared that, notwithstanding anything contained in any law for the time being in force the settlement granted to the appellants shall be null and void and that no party to the settlement or his successors in interest shall be deemed to have acquired any right or incurred any liability thereunder, and empowered the Collector to eject the appellants if they refused to restore the lands.
The appellants, alleging that the Act was unconstitutional, applied under article 226 of the Constitution for a writ of mandamus against the State of Bihar restraining it from taking any action under the Act.
It was found that there were several other settlements of lands belonging to the Bettiah Raj on similar terms against which the Government had taken no action: Held, that the dispute between the appellants and the State was really a private dispute and a matter to be determined by a judicial tribunal in accordance with the law applicable to the case, and, as the Legislature had, in passing the impugned enactment singled out the appellants and deprived them of their right to 1130 have this dispute adjudicated upon by a duly constituted Court, the enactment contravened the provisions of article 14 of the Constitution which guarantees to every citizen the equal protection of the laws, and was void.
Legislation which singles out a particular individual from his fellow subjects and visits him with a disability which is not imposed upon the others and against which even the right of complaint is taken away is highly discriminatory.
Though 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, yet 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.
Ameerunnissa Begum vs Mahboob Begum ; and Gulf of Colorado etc.
Co. vs Ellis ; referred to.
|
Appeal No. 284 of 1972.
(From the Judgment and Order dated 3 5 1971 of the Delhi High Court in I.T. Case No. 6 D of 1964) A.K. Sen, V.S. Desai and Bishamber Lal, for the appellant.
G.C. Sharma and S.P. Nayar, for the respondent.
The Judgment of the Court was delivered by BHAGWATI, J.
This is an appeal by special leave direct ed against the Judgment of the Delhi High Court answering in favour of the Revenue a question which was directed to be referred by the Tribunal under section 66(2) of the Indian Income Tax Act, 1922.
The controversy between the parties arises out of an assessment made on the assessee as a Hindu Undivided Family for the assessment year 1948 49, the corre sponding accounting year being the financial year 1947 48.
The assessee was at the material time a Hindu Undivided Family with one Roshan Lal as its manager and karta.
Till June 1947 the assessee was carrying on business in gold and jewellery at Chowk Surjan Singh in Lahore.
In view of the impending partition of India Roshan Lal decided to move out of Lahore and accordingly he transferred a sum of Rs. 12,094/ from the account of the assessee with the Lahore Branch of the Punjab National Bank Ltd. to the New Delhi Branch of that bank in June 1947.
He also transferred from the Lahore 156 Branch of the punjab National Bank Ltd. to the branch of that bank at New Delhi two sums of Rs. 13,000/ and Rs. 6,000/ , the former in his own name and the latter in the name of his wife and obtained fixed deposit receipts for these two amounts from the New Delhi Branch of the Bank in July 1947.
He left Lahore in June 1947 and proceeded to Mussoorie but on his way he stopped at Amritsar for a few days.
He opened an account with the Amritsar Branch of the Imperial Bank of India by depositing a sum of Rs. 300/ with a view to obtaining a locker in the safe deposit vault where he could deposit for sale custody a trunk which he had brought with him from Lahore containing gold ornaments, jewellery and cash.
It seems that a locker was not avail able and hence he deposited the trunk in a sealed condition with the Amritsar Branch of the Imperial Bank of India on 25th june, 1947.
The sealed trunk, according to the asses see, contained gold ornaments of the value of Rs. 1,19,320/ , gold rawa of the value of Rs. 1,69,020/ and stones of the value of Rs. 4,000/ .
Roshan Lal then went to Mussoorie via Haridwar and stayed at Mussoorie until about October 1947.
The case of the assessee was that during this period Roshan Lal did not carry on any business nor did he have any other means of income.
In October 1947 Roshan Lal came over to Delhi and rented a house in Kinari Bazar with a view to settling down in Delhi.
He started looking for suitable premises for commencing business and it was only in February 1948 that he succeeded in securing suitable prem ises at Dariba Kalan in Delhi.
He then started gold and jewellery business in these premises in the name and style of Roshan Di Hatti on 30th March, 1948.
The business was joint family business of the assessee and the first entry made in the books of account of the assessee was dated 30th March, 1948 and it was as follows: Gold Ornaments Rs. 1,19,320/ Gold Rawa Rs. 1,69,020/ Stones Rs. 4,000/ Bank balance with the Imperial Bank of India, Delhi Rs. 35,053/ Bank balance with Hindustan Commercial Bank, Delhi Rs. 221/ Cash Rs. 2,800/ .
The assessee thus brought in an aggregate capital of Rs. 3,33,414/in the business on 30th March, 1948.
It appears that the assessee prospered in this gold and jewellery business of Roshan Di Hatti but it did not file any return of income nor paid any income tax.
It came to the notice of the Income Tax Officer some time in the beginning of 1957 that the assessee had made considerable income in its gold and jewellery business but had failed to pay any tax on such income and hence the Income Tax Officer issued a notice to the assessee under section 34(1)(a) of the Indian Income Tax Act, 1922 for bringing the income of the assessee for the assessment year 1948 49 to tax.
The assessee filed its return of income and in the course of the assessment pro ceedings, the Income Tax Officer, called upon the assessee to explain the nature and source of the capital of Rs. 3,33,414/ brought by it into the business on 30th March, 1948.
The assessee pointed 157 out that gold rawa, ornaments and cash representing this capital were brought by Roshan Lal when he migrated from Lahore and they were kept in a sealed trunk with the Amrit sar Branch o[ the Imperial Bank of India and when Roshan Lal came over to Delhi in October 1947, he.
deposited the same in a locker in the safe deposit vault of Hindustan Commer cial Bank at Delhi and when the business of the assessee was commenced, he surrendered the locker and brought the entire gold, jewellery and cash into the business.
It was empha sised by the assessee as a supportive fact that after Roshan Lal migrated from Lahore in June 1947 until the assessee started the business of Roshan Di Hatti on 30th March, 1948, neither the assessee nor Roshan Lal had any other business or means of income from which the assets of Rs. 3,33,414/ could have been earned.
This explanation was given in the course of various statements made by the asses see from time to time before the Income Tax Officer.
The assessee also examined Hira Lal, Father in law of Roshan Lal and filed affidavits of Mulk Ram, Bills Mal, Dalai, Wazir Chand, Devidas Mehra and Panna Lal before the Income Tax Officer for the purpose of showing that the assessee was having a large gold and jewellery business in Lahore before migration and that it did not carry on any business in India before starting the business of Roshan Di Hatti on 30th March, 1948.
The Income Tax Officer also examined Prem Nath and Kishan Chand, brothers of Roshan Lal.
The statement of Prem Nath was to the effect that their father was a man of ordinary means who was almost reduced to penury by about 1940 and that he had given a sum of Rs. 2000/ to his son Roshan Lal for starting gold and jewellery business in 1935 and he had also subsequently lent some monies to Roshan Lal at nominal interest.
Prem Nath deposed that for the purpose of the business of the assessee, Roshan Lal was occupying a shop belonging to his father but he was not paying rent though demanded on the ground that he did not have sufficient income to pay the rent It was also stated by Prem Nath that before the partition of the country the standard of living of Roshan Lal and his family was no higher than that of Prem Nath who was getting a salary of Rs. 150/ per month.
The statement of Prem Nath was clear ly directed towards showing that the assessee did not have any flourishing business or large income prior to partition.
The Income Tax Officer, on the basis of this material before him, rejected the explanation offered by the assessee and came to the conclusion that it was not possible to believe that the assessee had been able to accumulate capital to the extent of Rs. 3,33,414/ out of income from the business carried on by it in Lahore and since the nature and source of the capital of Rs. 3,33,414/ credited in the books of account of the business on 30th March, 1948 was not satis factorily explained, the Income Tax Officer, gave credit only for a sum of Rs. 20,000/ and treated the balance of Rs. 3,13,414/ as income of the assessee from undisclosed sources.
The assessee appealed against this order of the Income Tax Officer and on appeal, the Appellate Assistant Commis sioner took the view that, on the facts as disclosed by the material placed on record in the proceedings, a much larger allowance should have been made in respect of the capital brought by the assessee from Lahore and he allowed a further sum of Rs. 80,000/ .
The reason given by the Appellate 158 Assistant Commissioner for taking this view are a little material and they may be reproduced as follows: "There is documentary evidence to show that assessee transferred an amount of Rs. 12,094/ from the Punjab National Bank account at Lahore to the same bank in New Delhi in June 1947.
It is also seen that he also transferred two amounts Rs. 13,000/ in his own name and Rs. 6,000/in his wife 's name from the Punjab National Bank, Lahore, to the same Bank at Minto Road, New Delhi and fixed deposit receipts were taken for this total sum of Rs. 19,000/from the Delhi Bank in July 1947.
All these monies including the realised fixed deposits later on went into the asses see 's account with the State Bank of India which reveals a credit balance of Rs. 35,053/ as on 30 3 1948.
This at least shows that the assessee was not a man of very small means while he was at Lahore.
He was having four accounts in different banks at Lahore.
The particulars, however, are not available and it is also stated that most of these accounts were very small; but even then a man of very modest means would not normally have so many bank accounts.
Moreover, while at Lahore Shri Roshan Lal had taken life insur ance Policies Rs. 22,000/ .
A number of letters and receipts regarding business trans actions in Lahore were also filed which indi cate that the Lahore business was not as small as the Income Tax Officer has taken it to be.
There are some papers which relate to deals worth Rs. 10,000/ or more at one time.
There are also several vouchers relating to adver tisement charges paid at Lahore All these things together with the fact that the asses see was in position to transfer a sum of Rs. 31,000/ approx.
through banks indicate that he was doing fairly well in the business at Lahore.
How he could have managed to evade tax at Lahore for all these years, is a mys tery; but from the circumstances of the case it appears that the assessee had certainly assessable incomes while he was doing business there during the pre partition period.
There is another factor which has also to be given its due weight.
While leaving Lahore and coming over to India in JUne 1947, the assessee stopped for few days at Amritsar.
There on the 25th June, 1947 he deposited a sealed box with the State Bank of India Amritsar Branch.
This box was withdrawn by him on the 20 10 47.
These facts are corroborated by the bank certificate.
The assessee claims that he had considerable amount of jewellery and gold etc.
(part of his trading stock in Lahore) as well as cash, in this box that is why he did not take the risk of carrying.
it with him on his way to Mussoo rie, but kept in deposit with the State Bank at Amritsar till such time.
as he was able to settle down in India.
The contents of the seated box are unknown to the bank and so it is not possible to ascertain what the box actually contained.
But it is reasonable to 159 presume that there must have been something quite valuable in the box as otherwise the assessee would not have kept it in the custody of a bank like State Bank of India.
It must also be noted that as early as June, 1947, the assessee hired a locker in the Hindustan Commercial Bank Ltd., New Delhi.
It is clear therefore, that when in June, 1947, the asses see was leaving Lahore he must have had with him quite a substantial amount either in the form of jewellery etc., or cash, as otherwise he would not have taken the precaution of either depositing the sealed box with the State Bank of India at Amritsar or opening a locker in a New Delhi Bank.
Considering all the evidence discussed above, I am of the opinion that the Income Tax Officer 's allowance of Rs. 20,000/ only as capital brought over from Pakistan is too low.
It is true that the capital disclosed in the books as on 30 3 1948 is mostly unverifiable and even assuming that the assessee was doing reasonably well in his business at Lahore, there are hardly any reasons to believe that he could have accumulated so much capital and could have brought all that capital safely into India; but the circumstances of the case do in my view justify a much larger allowance for old capital than has been allowed by the Income Tax Officer.
In my opinion, a reduction of the. assessment by Rs. 80 '000/will meet the requirement of the case.
" The Appellate Assistant Commissioner thus reduced the figure undisclosed income of the assessee to Rs. 2,33,414/ .
But this relief was not enough and the assessee pre ferred a further appeal to the Tribunal.
When the appeal came to.
be heard by the Tribunal, Roshan Lal, who was present at the hearing, was asked by the Members of the Tribunal as to how he had brought gold and jewellery from Lahore and he stated that it was brought in train in a box of the size of 2 1/2 'x l1/2 'x 1 ' and he was then asked what was the weight of the box, to which he replied stating that the weight of the contents of the box was about eight seers.
The Tribunal then, after hearing the arguments of the par ties, rejected the appeal.
The main arguments which weighed with the Tribunal in negativing the appeal of the assessee were: first, if the weight of the contents of the box was only eight seers, the value of gold and jewellery in the box could not be more than Rs. 66,000/ at the then current rate of gold at Rs. 90/ per tola; secondly, the Government of India had issued a Press Note in January 1952 requiring all evacuees to declare the amounts of money brought by them from Pakistan and assuring them that in case they did so, no further enquiries would be made from them as to how they had earned the same and whether they had paid any tax on it and yet the assessee had not declared 'before the Revenue au thorities until the commencement of the assessment proceed ings in 1957 that it had brought the capital of Rs. 2,33,414/ from Pakistan; thirdly, the assessee claimed to have a flourishing business in Lahore in the course of which it was supposed to have earned enough to enable it to save a capital of Rs. 3,33,414/ and yet it had not filed 160 any income tax return nor was it ever assessed to income tax in Lahore and fourthly, the depositions of Mulk Ram, Billa Mal, Dalai, Wazir Chand, Devidas Mehra and Panna Lal were vague and based on hearsay and they had no evidentiary value in the absence of contemporaneous primary evidence.
The Tribunal, accordingly, held that the assessee could not have brought assets worth more than Rs. 1,00,000/ from Lahore and the estimate made by the Appellate Assistant Commissioner did not call for any interference and in this view, the Tribunal confirmed the assessment of the bal ance of Rs. 2,33,414/ as the undisclosed income of the assessee for the assessment year 1948 49.
The assessee applied to the Tribunal for referring to the High Court the question of law arising out of its order but the Tribunal declined to make a reference on the ground that in its opinion no question of law arose out of its order.
This led to the making of an application to the High Court under section 66(2), but the High Court also took the same view and rejected the application.
The assessee there upon preferred an appeal to this Court by special leave and in the appeal, an order was made by this Court referring the following question for the opinion of the High Court: Whether there was material for coming to the conclusion that Rs. 2,33,414/ , out of the capital of Rs. 3,33,414/credited in the books of account of the assessee on 31st March, 1948, represented income from undis closed source ? Pursuant to this order the Tribunal stated a case for the opinion of the High Court and the High Court answered the question referred to it in favour of the Revenue by holding that there was material on the basis of which the Tribunal could come to the conclusion that Rs. 2,33,414/ represented the undisclosed income of the assessee.
Hence the present appeal by the assessee with special leave ob tained from this Court.
Now, the law is well settled that the onus of proving the source of a sum of money found to have been received by an assessee is on him.
If he disputes the liability for tax, it is for him to show either that the receipt was not income or that if it was, it was exempt from taxation under the provi sions of the Act.
In the absence of such proof, the Revenue is entitled to treat it as taxable income.
This was laid down as far back as 1958 when this Court pointed out in A. Govindarajulu Mudaliar vs Commissioner of Income tax (1) that "there is ample authority for the position that where an assessee fails to prove satisfactorily the source and nature of certain amount of cash received during the ac counting year, the Income Tax Officer is entitled to draw the inference that the receipts are of an assessable nature".
To put it differently, where the nature and source of a receipt, whether it be of money or of other property, cannot be satisfactorily explained by the assessee, it is open to the Revenue to hold that it is the income of the assessee and no further burden lies on the Revenue to show that that income is from any particular source.
Vide Com missioner of Income Tax, U.P. vs Devi Prasad Vishwanath Prasad(2).
Here, (1) (2) 161 in the present case, the assessee introduces in the books of account of its business on 30th March, 1948, capital of Rs. 3,33,414/ which consisted of gold rawa, gold ornaments, stones and cash.
The burden of accounting for the receipt of these assets was clearly on the assessee and if the assessee failed to prove satisfactorily the nature and source of these ' assets, the Revenue could legitimately hold that these assets represented the undisclosed income of the assessee.
The assessee offered the explanation that these assets had been brought by Roshan Lal when he migrated from Lahore in June 1947 and they represented the entire savings of the assessee in Pakistan.
This explanation was disbe lieved.
by the Tribunal which took the view that, on the material on record, it was not possible to hold that the assessee must have brought more than Rs. 1,00,000/ from Lahore and hence the Tribunal added the balance of Rs. 2,33,414/ as undisclosed income of the assessee.
This conclusion reached by the Tribunal was clearly a finding of fact and hence it could be assailed only if it was shown that the Tribunal had acted without any material or upon a view of the facts which could not reasonably be entertained or the facts found were such that no person acting judicial ly and properly instructed as to the relevant law would have come to that determination.
Vide Mehta Parikh & Co. vs Commissioner of Income Tax, Bombay(1).
Let us consider what were the primary facts established by the material on record.
The assessee was admittedly carrying on the business of Roshan Di Hatti in Lahore from 1935 until June 1947 when Roshan Lal migrated from Lahore.
It is true that the assessee was not paying any Income tax in Lahore but, as pointed out by the Appellate Assistant Commissioner in his order, a number of letters and receipts regarding business transactions in Lahore were filed by the assessee which showed that the business in Lahore was not small and there were documents and papers which referred to.
dealings involving Rs. 10,000/ or more at a time and there were also several vouchers produced by the assessee relating to advertising charges paid at Lahore.
The busi ness carried on by the assessee at Lahore was, therefore, a reasonably large business though its extent could not be verified by any reliable material produced by the assessee.
The assessee undoubtedly filed affidavits of Mulk Ram, Billa Mal, Dalai, Wazir Chand, Devidas Mehra and Panna Lal, but, as commented upon by the Tribunal, these affidavits were vague and could not be regarded as having much evidentiary value.
Still they did go to show that the Lahore business of the assessee was a fairly large business.
The Tribunal was no doubt right in commenting that primary evidence with regard to the extent of the Lahore business of the assessee was not forthcoming, but it must be remembered that the assessee was being called upon to prove the extent of its business in a territory from which the members of the Hindu Undivided Family had to flee for their lives and from where it was totally impossible to produce any primary evidence.
Be that as it may, it was found as a fact by the Appellate Assistant Commissioner and this finding was not disturbed by the Tribunal that the assessee "was doing fairly well in the business in Lahore".
Roshan Lal, in anticipation of the partition of the country which was soon to follow, decided to move out of Lahore in June 1947 at a time when massacre and holocaust had not yet started 162 and he was in a position to remove his belongings.
He migrated from Lahore with all his belongings and came over to Amritsar and he brought with him a trunk which he wanted to keep in a locker in Safe Deposit Vault of the Imperial Bank of India.
He could not obtain a locker and hence he deposited the sealed trunk with the Amritsar Branch of the State Bank of India instead of carrying it with him to Mussoorie.
There is no documentary evidence to show as to what were the contents of the sealed trunk but, as pointed out by the Appellate Assistant Commissioner and not dissented by the Tribunal, "it is reasonable to presume that there must have been something quite valuable in the box as otherwise the assessee would not have kept the custo dy of a bank like the State Bank of India".
There can be no doubt, as observed by the Appellate Assistant Commissioner, and not disputed by the Tribunal that the assessee "must have had with him quite a substantial amount either in the form of jewellery etc.
or cash, or otherwise he would not have taken the precaution of either depositing the sealed box with the State Bank of India, Amritsar opening a locker in a New Delhi Bank".
The clear finding of the Appellate ASsistant Commissioner, affirmed by the Tribunal, therefore, was that Roshan Lal did bring ornaments, jewellery and cash with him when he migrated from Lahore in June 1947 and kept the same in a sealed trunk with the Amritsar Branch of the State Bank of India.
If that be so, then on what material could it be said that the ornaments, jewellery and cash brought by the assessee and kept in the sealed trunk were of the value of only Rs. 1,00,000/ and no more.
What were the materials on the basis of which the claim of the assessee that Roshan Lal had brought gold, ornaments and cash of the value of Rs. 3,33,414/ could be rejected ? The only materials relied upon by the Tribunal was that the assessee had never filed any income tax return nor ever paid any tax on the income of its business in Lahore and the presumption must, therefore, be that the assessee did not earn any assessable income before migration from Lahore.
Now, it is true that where an assessee has not paid income tax, the presumption ordinarily must be that the assessee had no assessable income, but here the fact remains that the assessee transferred no less than an aggregate sum of Rs. 31,094/ from Lahore to New Delhi and also brought sub stantial amount either in the form of jewellery etc.
or cash" and deposited the same in a sealed trunk with the Imperial Bank of India, Amritsar Branch in June 1947.
obviously the assessee could not have done unless it had a reasonably large business in Lahore and, therefore, the fact that the assessee did not pay income tax in Lahore cannot have much evidentiary value.
All that it would show is that, as pointed out by the Tribunal, "the assessee has not been very straightforward in his dealings with the income tax departments".
The Tribunal also relied upon certain answers given by Roshan Lal when he was questioned by the Members of the Tribunal at the hearing of the appeal.
It must be pointed out straight away that 163 these answers given by Roshan Lal could not be relied upon by the Tribunal for the purpose of coming to any conclusion adverse to the assessee, because there is a procedure pre scribed in Rules 29. 30 and 31 of the Income Tax Appellate Tribunal Rules for taking additional evidence before the Tribunal and if the Members of the Tribunal wanted to exam ine Roshan Lal on any aspects of the case they should have followed this procedure.
But unfortunately the Members of the Tribunal, disregarding the prescribed procedure, put questions to Roshan Lal in an informal manner unauthorised by the Rules.
The answers given by Roshan Lal could not in the circumstances form part of the record and the Tribunal was not entitled to reply upon the same in arriving at its findings of fact.
It may be noted that the High Court also took the view that the procedure adopted by the Tribunal was irregular and the answers given by Roshan Lal should be left out of account.
One other circumstance on which the Tribunal relied was that notwithstanding the Press Note issued by the Government of India in January 1952 the assessee did not declare that.
it had brought assets of the value of Rs. 3,33,4/4/ from Pakistan and this circumstance, according to the Tribunal, cast considerable doubt on the version put forward by the assessee.
Now, the Press Note of Government of India was not produced before us but we will assume that it did promise a certain concession to the evacuees.
who declared the assets brought by them from Pakistan.
Even so, we fail to see how it could be utilised as a circumstance militating against the explanation of the assessee.
Both according to the Appellate Assistant Commissioner as well as the Tribunal, the assessee did bring assets worth Rs. 1,00,000/ from Lahore in June 1947 and these assets were admittedly not disclosed by the assessee despite the Press Note issued by the Government of India.
Then, how could any inference be drawn from the non disclosure of the assets by the assessee that the assessee must not have brought assets represent in the balance of Rs 2,33 414/ 9 Whether the assets brought by the assessee were Rs 1,00,000/ or Rs. 3,33,414/ the fact remains that they were not disclosed by the assessee despite the Press Note of the Government of India and hence no adverse reference could be drawn from the fact of non disclosure of the assets by the assessee.
It will, therefore, be seen that there was no mate rial on the basis of which the Tribunal could come to the conclusion that though the assessee had a fairly large business in Lahore and had brought its entire ornaments, jewellery and cash from Lahore and deposited the same in a sealed trunk with the Amritsar Branch of the Imperial Bank of Inaia, these ornaments, jewellery and cash were worth not more than Rs. 1,00,000/ .
One may also ask the question that if the assessee did not bring assets worth more than Rs. l,00,000/ from Lahore, where and how did it get the remaining assets of the value of Rs 2 33 414/ ? Roshan Lal had come away from Lahore as a refugee and conditions in post partition India were also highly unsettled and the clear and undoubted evidence was that neither Roshan Lal nor the assessee had any business or other means of 164 income in India until 30th March, 1948.
In this situation, it is impossible to believe that the assessee could have earned such a huge amount of profit as Rs. 2,33,414/ within a few months, even if it be assumed that some business was started by it in October 1947 when Roshan Lal came down to Delhi.
The utter improbability, amounting almost to, impossibility, of the assessee having earned such a large amount of Rs. 2,33,414./ as profit within a few months in the disturbed conditions which then prevailed in India was a circumstance which ought to have been taken into account by the Tribunal but which the Tribunal unfortunately failed to do.
It may be pointed out that it was not the case of the Revenue that the books of account of the business were subsequently written up and the entry crediting the capital of Rs. 3,33,4.14/ on 30th March, 1948 was not a genuine entry and the undisclosed profits of the subsequent years were sought to be concealed by the showing a bogus entry of Rs. 3,33,414/ as capital contribution on 30th March, 1948.
If such had been the case, the present argument as to the improbability of the assessee having earned such a huge amount of Rs. 2,33,414/ within a few months, would not have been available to the assessee.
But the Revenue did not dispute the correctness of the entry and accepted that assets worth Rs. 3,33,414/ were introduced in the business on 30th March, 1948 and sought to include the amount of Rs. 3,33,414/ representing the value of these assets as undis closed income of the assessee for the assessment year 194849.
The only question could, therefore, be whether these assets were brought by the assessee from Lahore in June 1947 or they represented the concealed income earned by the assessee during the period June 1947 to 30th March, 1948.
The impossibility of the assessee having earned such a huge amount of profit within a a few months immediately after migration to India in the disturbed and unsettled conditions which then prevailed must, therefore, necessarily support the inference that the assessee must have brought these assets from Lahore.
We are, therefore, of the view that in reaching the conclusion that out of the capital of Rs. 3,33,414/ I credited in the books of the assessee on 30th March, 1948, assets of the value of Rs. 2,33,414/represented undisclosed income of the assessee for the assessment year 1948 49, the Tribunal acted without any material or in any event, the finding of fact reached by the Tribunal was unreasonable or such that no person acting judicially and properly instruct ed as to the relevant law would come to such finding.
We accordingly allow the appeal, set aside the order of the High Court and answer the question referred by the Tribunal in the negative.
The 'Commissioner will pay the costs of the appeal to the assessee.
P.H.P. Appeal allowed.
| The assessee, a Hindu Undivided Family, was carrying on business in gold and jewellery in Lahore till June 1947.
In view of the impending partition of India Roshan Lal decided to move out of Lahore and accordingly transferred sums of Rs. 12,094/ , Rs. 13,000/ and Rs. 6,000/ from Lahore Banks to New Delhi Banks.
He left Lahore and pro ceeded to Mussoorie in June, 1947.
On his way, he stopped at Amritsar for a few days and opened an account with the Imperial Bank of India with a view to obtaining a locker in the Safe Deposit Vault but a locker was not available and hence he deposited a trunk which he had brought from Lahore containing gold ornaments, jewellery and cash with the Imperial Bank of India.
The assessee came to Delhi in October, 19.,7.
and rented a house.
In February, 1948.
he succeeded in securing business premises and started busi ness on 30.3.1948.
The first entry in the books of account on 30.3.1948 showed gold ornaments of Rs. 1,19,320/ , Gold Rawa Rs. 1,69,020/ Stones worth Rs. 4,000/ Bank balance with the Imperial Bank of India, Delhi Rs. 35,053/ Bank Balance with Hindustan Commercial Bank.
Delhi Rs. 221/ and Cash of Rs. 2.800/.
The assessee thus brought in an aggre gate capital of Rs. 3,33,414/ in the business on 30.3.1948.
in 1957.
it came to the notice of the Income Tax Officer that the assessee had made considerable income in his gold and jewellery business but had failed to pay any tax on such income and hence issued a notice to the assessee under section 34(1)(a) of the Indian Income Tax Act, 1922, for bringing the income of the assessee for the assessment year 1948 49 to tax.
The assessee flied his return.
In the course of the assessment proceedings the I.T.O. called upon the assessee to explain the nature and source of the capital of Rs. 3,33,414/ .
The assessee contended that he brought the gold Rawa, ornaments and cash representing the capital when he migrated from Lahore and they were kept in a sealed trunk with the bank at Amritsar and thereafter brought over to Delhi and deposited in the Safe Deposit Vault of Hindustan Commercial Bank at Delhi.
When the business of the asses see was commenced,he surrendered the locker and brought the entire gold, jewellery and cash into the business.
The assessee observed that till he started his business in March 1948, neither the ,assessee nor Roshan Lal had any other business or means of income from which the amount of Rs. 3,33,414/ could have been earned.
The assessee examined some witnesses.
The ITO also examined the broth ers of Roshan Lal who stated that the father of Roshan Lal was a man of ordinary means who was almost reduced to penury by about 1940 and that he had given a sum of Rs. 2000/ to his son Roshan Lal for starting gold and jewellery business in 1935 and he had also subsequently lent some tooroes to Roshan Lal on nominal interest.
The Income Tax Officer rejected the explanation offered by the assessee and came to the conclusion that it was not possible to believe that the assessee had been able to accumulate capital to the extent of Rs. 3.33,414/ out of income from the business carried on.
The Income Tax Officer gave credit for a sum of Rs. 20,000/ and treated the balance of Rs. 154 3,30,414/ as income of the assessee from undis closed source.
On appeal,the Appellate Assistant Commis sioner allowed a further sum of Rs. 80,000./ on the follow ing grounds: (1) That the assessee transferred a sum of Rs.12,004/ ,Rs./3,000/ and Rs. 6,000/ from Banks as Lahore to the Bank at New Delhi.
This shows that the assessee was not a man of very small means while he was at La hore.
(2) He was having accounts in 4 different Banks and a man of very modest means would not have normally so many Bank accounts.
(3) While at Lahore.
Roshan Lal had taken Life Insurance Policies worth Rs. 22.000/ .
A number of letters and receipts regarding business transactions in Lahore Indicated that the Lahore business was not as small as the Income Tax Officer had taken it to be.
The assessee stopped at Amritsar and opened an account and took Safe Deposit Vault where he deposited a sealed box.
It is reasonable to presume that there must have been something quite valuable in the box.
A further appeal filed by the assessee to the Tribunal failed.
The tribunal, when the appeal came to be heard, put a question to Roshan Lal as to how he had brought gold and jewellery from Lahore and enquired about the weight of the box.
The Tribunal after hearing the arguments of the parties rejected the appeal.
The main arguments which weighed with the Tribunal were: (1) that the weight of the box was too less: (2) that the assessee did not disclose his assets under the scheme of the Government of India published in the Press Note in January 1952, requiring all evacuees to declare the amounts of money brought by them from Paki stan.
(3) that the assessee did not file any income tax returns in Lahore.
The High Court con firmed the finding of the Tribunal in the reference.
Allowing the appeal, HELD: (1) The law is well settled that the onus of proving the source of a sum of money found to have been received by an assessee is on him.
[160 E] A A.Govindaralulu Mudaliar vs Commissioner of Income Tax and Commissioner of Income Tax, U.P. vs Devi Prasad Vishwanath Prasad followed.
(2) The conclusion of the Tribunal on a finding of fact can be assailed only if it is shown that the Tribunal had acted without any matenal or upon a view of the facts which could not reasonably be entertained or the facts found were such that no person acting judicially and properly instructed as to the relevant law would have come to that determination.
[161 C D].
Mehta Parikh & Co. vs Commissioner of Income Tax Bombay , followed.
(3) The Tribunal was right in commenting that primary evidence with regard to the extent of the Lahore business of the assessee was not forthcoming but it must be remem bered that the assessee was being called upon to prove the extent of his business m a territory from which the member of the Hindu undivided family had to .flee for their lives and from where it was totally impossible to produce any primary evidence. The.
finding of the AAC that the assessee was doing fairly well m the business m Lahore was not disturbed by the Tribunal. The .AAC found that it was reasonable to presume to at there Was something.
quite valuable m the box .and this finding was also not dissented by the Tnbunal.
There was no material to show that the orna 155 ments, jewellery and cash brought by the assessee and kept in the sealed trunk were of the value of only Rs. 1 lac and not more.
The circumstances that the assessee had not filed any Income Tax return could be of no avail to the Revenue because admittedly the assessee had brought substan tial amount from Lahore.
[161 D G] (4) The Tribunal was wrong in relying upon certain answers given by Roshan Lal, about the weight of the sealed box when he was questioned by the Tribunal at the hearing of the appeal.
It must be pointed out straightway that the answer given by Roshan Lal could not be relied on by the Tribunal because there is a procedure prescribed in rules 29.
30 and 31 of the Income Tax Appellate Tribunal Rules for taking additional evidence before the Tribunal and if the members of the Tribunal wanted to examine Roshan Lal on any aspects of the case.
they should have followed this procedure.
The answers given by Roshan Lal disregarding the perscribed procedure could not form part of the record and the Tribunal was not entitled to rely upon the same.
[162 H, 163 A C] (5) The Tribunal erred in relying on the Press Note be cause admittedly the assessee had brought a sum of Rs. 1 lac to India and even that was not declared to the Government of India.
[163 E F] (6) There was no material on the basis of which the Tribunal could come to the conclusion that the ornaments.
jewellery and cash were not worth than Rs. 1 lac.
It was not proved that Roshan Lal or the assessee had any business or other means of income in India until 30.3.1948.
The genuineness of the entry of March 1948 was also not chal lenged.
It is utterly improbably amounting almost to impossibility that the assessee could have earned such a large amount of Rs. 2.33.414/ as profit within a few months in the disturbed conditions which then prevailed in India.
[164 B E] (7) The Tribunal acted without any material and in any event, the finding of fact reached by the Tribunal was unreasonable or such that no person acting judicially and properly instructed as to the relevant law would come to such finding.
[164 F G]
|
Civil Appeal No 531 of 1986 From the Judgment and order dated 22.5.1984 of the Rajasthan High Court in S.B. Civil Writ Petition No. 114 of 1985.
Sushil Kumar Jain and Sudhanshu Atreya for the Appellant.
B.D.Sharma for the Respondents.
The question is whether the appellant having his date of birth as January 2, 1956 had attained the age of 28 years on January 1, 1984 and was therefore disqualified from being considered for direct recruitment to 668 the Rajasthan Administrative Service under r. l l B of the Rajasthan State & Subordinate Service (Direct Recruitment by Competitive Examination) Rules, 1962 (for short 'the Rules ').
Put very briefly, the essential facts are these.
The Rajasthan Public Service Commission invited applications for direct recruitment to the Rajasthan Administrative Service and allied services of the Government of Rajasthan by a competitive examination to be held in 1983.
Under the directions issued by the Commission, the minimum age prescribed for candidates was 21 years and the maximum 28 years.
It was prescribed that the candidate should have attained the age of 21 years on January 1, 1984 and should not have attained the age of 28 years i.e. On the first day of January next following the last date fixed for receipt of application.
The appellant was allowed to appear in the written examination, but by an order dated June 12, 1984, the Assistant Secretary to the Commission intimated the appellant that his candidature was rejected on the ground that he had attained the age of 28 years on January 1, 1984 and was therefore ineligible for consideration.
Feeling aggrieved, the appellant moved the High Court under article 226 of the Constitution and contended that his date of birth was January 2, 1956 and that he had not attained the age of 28 years on January 1, 1984.
His claim was contested by the respondents who pleaded that the appellant had attained the age of 28 years on January 1, 1984 and therefore his form was properly rejected.
During the pendency of the writ petition, the High Court by an interim order dated September 14, 1984 directed the Commission to interview the appellant if he was otherwise eligible for being considered except on the ground of age.
The appellant was acoordingly interviewed but the result was withheld.
A learned Single Judge by his judgment and order dated January 19, 1985 held that if the date of birth of the appellant was January 2, 1956 he would complete the age of 28 years only at the end of the day of January 1, 1984 and there he could not be said to have attained the age of 28 years on that date.
He accordingly held that the Commission was not justified in rejecting the candidature of the appellant on the ground that he had attained the age of 28 years on January 1, 1984 and therefore was not eligible for consideration.
On appeal, a Division Bench disagreed with the view expressed by the learned Single Judge and reversed his judgment on the ground that the words used in r. 11 B of the Rules are, 'must not have attained the age of 28 years on the first day of January next following the last date fixed for receipt of application ' and not that he should have completed the age of 28 years on that day.
They relied upon the 669 undisputed fact that the first day of January next following the last A date fixed for receipt of application in this case was January l, 1984.
Accordingly, they held that the appellant was born on January 2, 1956 and, as such, he had attained the age of 28 years as soon as the first day of January, 1984 commenced.
They further held that the appellant had not only attained the age of 28 years, but had also completed the same at 12 o 'clock in the midnight of January 1, 1984.
According to the learned Judges, on January 2, 1984, the appellant would be one day more than 28 years and, as such, he was disqualified to appear at the examination under r. 11 B of the Rules.
The conclusion of the learned Judges may best be stated in their own words: "In calculating a person 's age, the day of his birth must be counted as a whole day and he attains the specified age on the day preceding, the anniversary of his birth day." In coming to that conclusion the learned Judges relied upon the language of r. 11 B of the Rules which prescribes the age limit for the said examination and also referred to section 4 of the .
They have relied on certain decisions of different High Courts, particularly to that in G. Vatsala Rani represented by guardian and father, P.M.G. Kini vs Selection Committee for Admission to Medical Colleges, Bangalore Medical College, Bangalore 2 represented by the Secretary, AIR and to some English decisions laying down the principle for determination of age.
It is argued that the learned Judges were in error in introducing the legal concept of the age of majority as laid down in section 4 of the for the purpose of interpreting r. 11 B. It is said that the purpose of r. 11 B framed by the Government was to prescribe the maximum and minimum age limits for entry into the Rajasthan Administrative Service and allied services of the Government of Rajasthan.
It is submitted that as commonly understood, a person attains a particular age after he has completed a given number of years.
It is said that there is no reason why the words of r. 11 B 'must have attained the age of 21 years and must not have attained the age of 28 years ' should not be understood in the ordinary sense.
At first blush, the contention advanced appears to be rather attractive but on deeper consideration it cannot prevail.
Learned counsel for the appellant drew our attention to the fact that the Union Public Service Commission has been interpreting the 670 words 'must have attained the age of 21 years and must not have attained the age of 26 years on the first day of August next following ' in the way the appellant contends for.
These words are taken from r.4 of the Indian Administrative Service (Appointment by Competitive Examination) Regulations, 1955 framed by the Central Government in pursuance of r. 7 of the Indian Administrative Service (Recruitment) Rules, 1954.
Presumably, there would be similar provisions laying down the qualification as to age in other central services as well.
R. 4 insofar as material reads: "4.
Conditions of Eligibility In order to be eligible to compete at the examination, a candidate must satisfy the following conditions, namely: (i) (ii) Age He must have attained the age of 21, and not attained the age of 28 on the first day of August of the year in which the examination is held: Provided that the upper age limit may be relaxed in respect of such categories of persons as may from time to time, be notified in this behalf by the Central Government, to the extent and subject to the conditions, notified in respect of each category. ' Undoubtedly, the Union Public Service Commission has been interpreting the provision as to attainment of age in a like manner.
This would be clear from the advertisement issued by it on December 8, 1984 which is in these terms: "Age limit: (ka) The candidate should have attained the age of 21 years on 1st August.
hut should not have attained the age of 26 years, that is, he should not have born before the 2nd August, 1959 and after the 1st August, 1964," We are afraid, the interpretation of r.
I l B of the Rules cannot proceed upon the basis adopted by the Union Public Service Commission.
Rule 11 B of the Rules provides: "11 B. Age.
Notwithstanding anything contained regarding 671 age limit in any of the service Rules governing through the A agency of the Commission to the posts in the State Service and in the Subordinate Service mentioned in Schedule I and in Schedule II respectively, a candidate for direct recruitment to the posts to be filled in by combined competitive examinations conducted by the Commission under these Rules must have attained the age of 21 years and must not have attained the age of 28 years on the first day of January next following the last date fixed for receipt of application.
" It is plain upon the language of r. l l B that a candidate 'must have attained the age of 21 years and must not have attained the age of 21 years on the first day of January next following the last date fixed for receipt of application '.
Last day fixed for receipt of application in this case, was January 1, 1983.
First day of January next following that day would be January 1, 1984.
The object and intent in making r. 11 B was to prescribe the age limits upon which the eligibility of a candidate for direct recruitment to the Rajasthan Administrative Service and other allied services is governed.
At first impression, it may seem that a person born on January 2, 1956 would attain 28 years of age only on January 2, 1984 and not on January 1, 1984.
But this is not quite accurate.
In calculating a person 's age, the day of his birth must be counted as a whole day and he attains the specified age on the day preceding, the anniversary of his birth day.
We have to apply well accepted rules for computation of time.
One such rule is that fractions of a day will be omitted in computing a period of time in years or months in the sense that a fraction of a day will be treated as a full day.
A legal day commences at 12 o 'clock midnight and continues until the same hour the following night.
There is a popular misconception that a person does attain a particular age unless and until he has completed a given number of years.
In the absence of any express provision, it is well settled that any specified age in law is to be computed as having been attained on the day preceding the anniversary of the birth day.
In Halsbury 's Laws of England.
3rd edn., vol.
37, para 178 at p. 100, the law was stated thus: "In computing a period of time, at any rate, when counted in years or months, no regard is generally paid to fractions of a day, in the sense that the period is regarded as comp 672 lete although it is short to the extent of a fraction of a day Similarly, in calculating a person 's age the day of his birth counts as a whole day; and he attains a specified age R on the day next before the anniversary of his birth day.
" We have come across two English decisions on the point.
In Rex vs Scoffin, LR the question was whether the accused had or had not completed 21 years of age.
section l0(I) of the Criminal Justice Administration Act, 1914 provides that a person might be sent to Borstal if it appears to the court that he is not more than 21 years of age.
The accused was born on February 17, 1909.
Lord Hewart, CJ held that the accused completed 21 years of age on February 16,1930 and that he was one day more than 21 years of age on February 17, 1930 which was the Commission day of Manchester Assizes.
In Re.
Shurey, Savory vs Shurey, LR [1918] I Ch.
263 the question that arose for decision was this: Does a person attain a specified age in law on the aniversary of his or her birthday, or on the day preceding that anniversary? After reviewing the earlier decisions, Sargant, J. said that law does not take cognizance of part of a day and the consequence is that person attains the age of twenty one years or of twenty five years, or any specified age, on the day preceding the anniversary of his twenty first or twenty fifth birthday or other birthday, as the case may be.
From Halsbury 's Laws of England, 4th edn., vol 45, para 1143 at p. 550 it appears that section 9 of the Family Law Reforms Act, 1969 has abrogated the old common law rule stated in Re. Shurey, Savory vs
Shurey (supra).
It is in recognition of the difference between how a person 's age is legally construed how it is understood in common parlance.
The Legislature has expressly provided in section 4 of the that how the age of majority is to be computed.
It reads: "4.
Age of majority how computed In computing the age of any person, the day on which he was born is to be included as a whole day, and he shall be deemed to have attained majority, if he falls within the first paragraph of section 3, at the beginning of the twenty first an 673 niversary of that day, and if he falls within the second A paragraph of section 3, at the beginning of the 18th anniversary of that day." The Section embodies that in computing the age of any person, the day on which he was born is to be included as a whole day and he must be deemed to have attained majority at the beginning of the eighteenth anniversary of that day.
As already stated, a legal day commences at 12 o 'clock midnight and continues untill the same hour the following night.
It would therefore appear that the appellant having been born on January 2, 1956, he had not only attained the age of 28 years but also completed the same at 12 o 'clock on the midnight of January 1, 1984.
On the next day i.e. On January 2, 1984, the appellant would be one day more than 28 years.
The learned Judges were therefore right in holding that the appellant was disqualified for direct recruitment to the Rajasthan Administrative Service and as such was not entitled to appear at the examination held by the Rajasthan Public Service Commission in 1983.
We affirm the view taken by the learned Judges as also the decisions in G. Vatsala Rani 's case, (supra).
It is rather unfortunate that the appellant should upon the construction placed on r. 11 B of the Rajasthan State and Subordinate Services (Direct Recruitment by Competitive Examination) Rules.
1962 fail to secure entry into the Rajasthan Administrative Service and allied services of the Government of Rajasthan merely because he exceeds the upper age limit just by one day.
The Government ought to consider the question of relaxing the upper age limit in the case of the appellant in order to mitigate the hardship, if otherwise permissible.
There is need for a provision like the proviso to r. 4 of the Indian Administrative Service (Appointment by Competitive Examination) Regulations, 1955, conferring the power of relaxation on the State Government under certain conditions without which a deserving candidate would be rendered ineligible for appointment.
The result is that the appeal must fail and is accordingly dismissed.
There shall be no order as to costs.
G A.P.J. Appeal dismissed.
| For direct recruitment to the Rajasthan Administrative Service and allied services of the Government of Rajasthan by a competitive examination to be held in 1983, the Rajasthan Public Service Commission prescribed that the candidate should have attained the age of 21 years on January 1, 1984 and should not have attained the age of 28 years i.e. On the Ist day of January next following the last date fixed for receipt of application.
F The appellant was allowed to appear in the written examination, but later on he was intimated by the Commission that his candidature was rejected on the ground that he had attained the age of 28 years on January 1, 1984 and was therefore ineligible for consideration.
The writ petition filed by the appellant under article 226 was allowed by a Single Judge holding that if the date of birth of the appellant was January 2, 1956 he would complete the age of 28 years only at the end of the day of January 1, 1984 and therefore he could not be said to have attained the age of 28 years on that date.
666 on appeal by the respondents, a Division Bench reversed the Judgment of the Single Judge.
In appeal to this Court, on behalf of the appellant it was con tended: (i) that the Division Bench erronously introduced the legal concept of the age of majority as laid down in section 4 of the for the purpose of interpreting r. 11 B of the Rajasthan State and Subordinate Services (Direct Recruitment by Competitive Examination) Rules 1962 and (ii) that as commonly understood, a person attains a particular age after he had completed a given number of years and there is no reason why the words of r. 11 B "must have attained the age of 21 years and must not have attained the age of 28 years" should not be understood in the ordinary sense.
Dismissing the appeal, ^ HELD: 1.
In the absence of any express provision, while calculating a person 's age, the day of his birth must be counted as a whole day and he attains the specified age on the day preceding, the anniversary of his birthday.
One of the well accepted rules for computation of time is that fractions of a day will be omitted in computing a period of time in years or months in the sense that a fraction of a day will be treated as a full day.
A legal day commences at 12 O 'clock midnight and continues until the same hour the following night.
This principle is in conformity with section 4 of the Indian Majority Act 1875.[671F G] G. Vatsala Rani, P. M. C. Kini v .
Selection Committee for Admission to Medical Colleges, Bangalore Medical College, Bangalore 2, AIR , Rex
Scoffin, LR [1930] l KB 741 & Shurey, Savory F. vs Shurey, I,R , approved.
Halsbury 's Laws of England, 3rd edn.
37, para 178 at 100, relied upon.
The object and intent in making r. llB of the Rajasthan State & Subordinate Services (Direct Recruitment by Competitive Examination) Rules, 1962 was to prescribe the age limits upon which the eligibility of a candidate for direct recruitment to the Rajasthan Admmistrative Service and other allied services is governed.
The expression "must not have attained the age of 28 years on the first day of January next following the last day fixed for receipt of application" in r. llB has to be interpreted by applying the aforesaid principle and not on the basis 667 adopted by UPSC while interpreting r. 4 of the Indian Administrative A Services (Appointment by Competitive Examination) Regulations, 1955 framed by the Central Government in pursuance or r. 7 of the IAS (Recruitment) Rules 1954.
[670A B] 3.
The last day fixed for receipt of application in this case, was January 1, 1983.
First day of January next following that day would be January 1, 1984.
the appellant having been born on January 2, 1956, he had not attained the age of 28 years but also completed the same at 12 o 'clock on the midnight of January 1, 1984.
On the next day i.e. On January 2, 1984, the appellant would be one day more than 28 years.
The Division Bench of the High Court was, therefore, right in holding that the appellant was disqualified for direct recruitment of the Rajasthan Administrative Service in the examination held by the Rajasthan Public Service Commission in 1983.
[673C D] The Court emphasised the need for a provision like the proviso to r. 4 of the Indian Administrative Service (Appointment by Competitive Examination) Regulations 1955 conferring the power of relaxation on the State Government under certain conditions without which a deserving candidate would be rendered ineligible for appointment and advised the Government to consider the question of relaxing the upper age limit in the case of the appellant in order to mitigate the hardship, if otherwise permissible, because he exceeded the upper age limit just by one day.
[673E F]
|
Appeal No. 673 of 1963.
Appeal from the judgment and decree dated September 22, 1960, of the Allahabad High Court in Income tax Mis cellaneous Case No. 188 of 1953.
section K. Kapur and R. N. Sachthey, for the appellant.
Veda Vyasa and Naunit Lal, for the respondent.
April 30, 1964.
The Judgment of the Court was delivered by SUBBA RAo, J.
The question for decision in this appeal is whether when the Income tax Officer in his discretion assessed an association of persons to income tax, the Appel late Assistant Commissioner in appeal or the Income tax Appellate Tribunal in further appeal can set aside that order and direct him to assess the members of that association individually. 'Me facts lie in a small compass and they areas follows: 'Me assessee consisted of several persons combined together for the purpose of purchasing coal in order to supply the 87 same to customers for domestic purposes and other small scale industries.
For the assessment year 1948 49 the Income tax Officer levied tax upon the total income in the hands of the said association of persons.
The assessee claimed that in the circumstances of the case it should not be assessed to tax as an association of persons, but the proportion of the income in the hands of each of the members of the association might be assessed to tax instead.
As the Income tax Officer did not comply with this request, the assessee preferred an appeal to the Appellate Assistant Com missioner, but it was dismissed.
On a further appeal to the Income tax Appellate Tribunal, the Tribunal held that though the Income tax Officer had the power to assess the income of the association of persons as such or in the alternative on the individual members thereof in respect of their propor tionate share in the income,, it (the Tribunal) had no power under the Act to direct the Income tax Officer to exercise his rower in one way or other.
The following question was referred to the High Court, of Allahabad under section 66(2) of the Indian Income tax Act, 1922: "If in pursuance of section 3 of the Indian Income tax Act the Income tax Officer levies the income tax in respect of the total income of the previous year of an association of persons upon the said association of persons as a collective unit, whether the Tribunal is competent to direct the Income tax Officer to levy the income tax proportionately upon the individual members of the said association of persons in respect of the proportionate income of each of the members consisting the said association of persons.
" A Division Bench of the High Court held that the Appellate Tribunal had power to sat aside the Income tax Officer 's assessment against the association and to give consequential and ancillary directions to the said Officer to assess the Individuals.
Learned counsel for the Revenue contends that under the Indian Income tax Act, 1922, he reinafter called the Act, the Income tax Officer has no option but to assess the total 88 income of the association of members, though the indivi dual 's share in the income may be added to his individual income for the purpose of ascertaining his total income.
He further argues that even if the Income tax Officer has the option to assess to income tax the association of persons on its total income or the individual members thereof in respect of their proportionate share of the income, if he had exercised the option in one way or other neither the Appellate Assistant Commissioner in appeal nor the Income tax Appellate Tribunal in further appeal has power to direct the Incometax Officer to exercise his discretion in a different way; and for this conclusion he seeks to draw strength from his further submission that no appeal lies at the instance of the association of persons when they are assessed as one unit on the ground that the Officer should have assessed the individual members of the said association.
At the outset it will be convenient to read the relevant provisions of the Act.
Section 3.
Charge of Income tax: Where any Central Act enacts that income tax shall be charged for any year at any rate or rates, tax at that rate or those rates shall be chareed for that year in accordance with, and subject to the provisions, of, this Act in respect of the total income of the previous year of every indi vidual, Hindu undivided family, company and local authority, and of every firm and other association of persons or the partners of the firm or the members of the association individually.
Section 14.
(2) The tax shall not be payable by an assessee (b) if a member of an association of persons other than a Hindu undivided family, a company of a firm, in respect of any portion of the amount which he is entitled to receive from the associa, tion on which the tax has already been paid by the association.
89 Section 30.
(1) Any assessee objecting to the amount of income assessed under section 23 . . . . . or the amount of tax determined under section 23 under this Act may appeal to the Appellate Assistant Commissioner against the assessment or against such refusal or order: Section 31.
(3) In disposing of an appeal the Appellate Assistant Commissioner may, in the case of an order of assessment, (a) confirm, reduce, enhance or annul the assessment, or (b) set aside the assessment and direct the Incometax Officer to make a fresh assessment after making such further inquiry as the Income tax Officer thinks fit or the Appellate Assistant Commissioner may direct, a ,id the Income tax Officer shall thereupon proceed to make such fresh assessment and determine where necessary the amount of tax payable on the basis of such fresh assessment.
x x x x x x (4) Where as the result of an appeal any change is made in the assessment of a firm or association of persons or a new assessment of a firm or associations of persons is ordered to be made, the Appellate Assistant Commissioner may authorise the Income tax Officer to amend accordingly any assessment made on any partner of the firm or any member of the association.
Section 3 imposes a tax upon a person in respect of his total income.
The persons on whom such tax can be imposed ,are particularized therein, namely, Hindu undivided family, company, local authority, firm, association of persons, partners of firm or members of association individually.
The section, therefore, does not in terms confer any power on any particular officer to assess one of the 90 persons described therein, but is only a charging section imposing the levy of tax on the total income of an assessable entity described therein.
The section expressly treats an association of persons and the individual members of an association as two distinct and different assessable entities.
On the terms of the section the tax can be levied on either of the said two entities according to the provisions of the Act.
There is no scope for the argument that under section 3 the assessment shall be only on the association of persons as a unit though after such assessment the share of 'he income of a member of that association may be added to his other income under section 14(2) of the Act.
This construction would make the last words of the section, viz., "members of the association individually" a surplusage.
This argument is also contrary to the express provisions of section 3, which mark out the members of the association individually as a separate entity from the association of persons.
Income of every person whether he is a member of an association or not is liable to the charge under the head " 'every individual".
Section 14(2) (b) only says that if such an individual happens to be a member of an association of persons which has already been assessed, the tax would not be payable in respect of the share of his income again.
That under the Act an assessment can be made on an association of persons as a unit or, alternatively, on the individual members thereof in respect of their respective shares of the income was assumed by this Court in Commissioner of Income tax vs Raja Reddy Mallaram(1).
We, therefore, hold that section 3 impliedly gives an option to an appropriate authority to assess the total income of either the association of persons or the members of such association individually.
The next question is whether the said option is given only to the Income tax Officer and is denied to the Appellate Assistant Commissioner and the Appellate Tribunal.
Under the Act the Income tax Officer, after following the proce dure prescribed, makes the assessment under section 23 of the Act.
Doubtless in making the assessment at the first instance he has to exercise the option whether he should assess the association of persons or the members thereof (1) [1964]51 I.T.R. 285 (S.C.) 91 individually.
It is not because that any section of the Act confers an exclusive power on him to do so, but because it is part of the process of assessment; that is to say, he has to ascertain who is the person liable to be assessed for the tax.
If he seeks to assess an association of persons as an assessable entity, the said entity can object to the assessment, inter alia, on the ground that in the circumstances of the case the assessment should be made on the members of the association individually.
The Income tax Officer may reject its contention and may assess the total income of the association as such and impose the tax on it.
Under section 30 an assessee objecting to the amount of income assessed under section 23 or the amount of tax determined under the said section or denying his liability to be assessed under the Act can prefer an appeal against the order of the Income tax Officer to the Appellate Assistant Commissioner.
It is said that an order made by the Income tax Officer rejecting the plea of an association of persons that the members thereof shall be assessed individually does not fall under one or other of the three heads mentioned above.
What is the substance of the objection of the assessee? The assessee denies his liability to be assessed under the Act in the circumstances of the case and pleads that the members of the association shall be assessed only individually.
The expression "denial of liability" is comprehensive enough to take in not only the total denial of liability but also the liability to tax under particular circumstances.
In either case the denial is a denial of liability to be assessed under the provisions of the Act.
In one case the assessee says that he is not liable to be assessed to tax under the Act, and in the other case the assessee denies his liability to tax under the provisions of the Act if the option given to the appropriate officer under the provisions of the Act is judicially exercised.
We, therefore, hold that such an assessee has a right of appeal under section 30 of the Act against the order of the Income tax Officer assessing the association of members instead of the members thereof individually.
If an appeal lies, section 31 of the Act describes the powers of the Appellate Assistant Commissioner in such an appeal.
Under section 31 (3) (a) in disprosing of such an appeal the Appellate Assistant Commissioner may, in the, case of an order of assessment, confirm, reduce, enhance or 92 annul the assessment; under cl.
(b) thereof he may set aside the assessment and direct the Income tax Officer to make a fresh assessment.
The Appellate Assistant Commissioner has, therefore, plenary powers in disposing of an appeal.
The scope of his power is coterminous with that of the Income tax Officer.
He can do what the Income tax Officer can do and also direct him to do what he has failed to do.
If the Income tax Officer has the option to assess one or other of the entities in the alternative, the Appellate Assistant Commissioner can direct him to do what he should have done in the circumstances of a case.
Under section 3 3 (I ), au assessee objecting to an order passed by an Appellate Assistant Commissioner under section 28 or section 31 may appeal to the Appellate Tribunal within 60 days of the date on which such order is communicated to him.
Under section 33(4), "The Appellate Tribunal may, after giving both parties to the ,appeal an opportunity of being heard, pass such orders thereon as it thinks fit, and shall communicate any such orders to the assessee and to the Commissioner." Under section 33(5), "Where as the result of an appeal any change is made in the assessment of a firm or association of persons or a new assessment of a firm or association of persons is ordered to be made, the Appellate Tribunal may authorise the Income tax Officer to amend accordingly any assessment made on any partner of the firm or any member of the association".
Under this section the Appellate Tribunal has ample power to set aside the assessment made on the association of persons and direct the Income tax Officer to assess the individuals or to direct the amendment of the assessment already made on the members.
The comprehensive phraseology used both in section 31 and section 33 of the Act does not countenance the attempt of the Revenue to restrict the powers of the Appellate Assistant Commissioner or of the Appellate Tribunal; both of them have power to direct the appropriate authority to assess the members individually instead of the association of persons as a unit.
We, therefore, hold, agreeing with the High Court, that the Appellate Tribunal has jurisdiction to give directions to the appropriate authority to cancel the assessment made or the association of persons and to give appropriate directions 93 to the authority concerned to make a fresh assessment on the members of that association individually.
The answer given by the High Court to the question propounded is correct.
In the result, the appeal fails and is dismissed with costs.
Appeal dismissed.
| There were five firms in Sivakasi manufacturing matches under the name and style of Shenbagam Match Works, Brilliant Match Works, Manoranjitha Match Works, Pioneer Match Works and Gnanam Match Works.
The sole proprietor of Shenbagam Match Works and one partner from each of the four firms entered into a partnership in their individual capacity and executed a partnership deed dated April 1, 1950.
The Income tax Officer registered the said partnership 'deed under section 26(A) of the Act; but the Commissioner of Income tax acting under section 33B of the Act, cancelled the registration of the said partnership deed.
On appeal, the Tribunal held that the said partnership deed was not a genuine one.
On a reference the High Court held on a construction of the partnership deed that the Match Works were not the real parties to the partnership but the parties to the document were the real partners.
This appeal has come by way of special leave.
HELD: (i) (per K. Subba Rao and section M. Sikri JJ) that the discretion conferred on the Income tax Officer under section 26 A of the Act is a judicial one and he cannot refuse to register a firm on mere speculation, but he shall base his conclusion on relevant evidence.
The jurisdiction of the Income tax Officer under section 20 A is, confined to the ascertaining of two facts namely, (i) whether the application for registration is in conformity with the rules made under the Act, and (ii) whether the firm shown in the document.
(Partnership deed) presented for registration is a bogus one or has no legal existence.
(ii) In the present case the partnership deed ex facie conforms to the requirements of the law of partnership as well as the Income tax Act.
There is no prohibition under the partnership Act against a partner or partners of other firms combining together to form a separate partnership to carry on a different business.
The fact that such a partner or partners entered into a sub partnership with others in respect of their share does not detract from the validity of the partnership; nor the manner in which the said partner deals with the share of his profits is of any relevance to the question of validity of the partnership.
(iii) The tribunal erred in holding the partnership deed as not a genuine one.
In the present case the assessde firm has a separate legal existence, and as such the two circumstances relied upon by the Tribunal, namely, that one of the partners of the assessee firm, brought in the capital from his parent firm or that the profits earned by some of the partners were surrendered to the parent firm, would be irrelevant.
A partner of a firm can certainly ' secure his capital from any source or 20 surrender his profits to his sub partner or any other person.
Those facts cannot conceivably convert a valid partnership into a bogus one.
In the present case the partnership deed is a genuine document and it complies with the requirements of law.
It is not an attempt to evade tax, but a legal device to reduce its tax liability.
(iv) A question of law within the meaning of section 66(2) of the Act arose for decision in this case as the Tribunal misconstrued the provisions of the partnership deed and relied upon irrelevant considerations in coming to the conclusion.
Sree Meenakshi Mills Ltd. vs Commissioner of Income tax, Madras.
[19561 S.C.R. 691, relied on.
Per Shah, J. (i) It was exclusively within the province of the Tribunal to decide the question whether the partners entered into the partnership in their individual capacities or as representing their match factories and its decision that in entering into the deed of partnership, the named partners represented their respective match factories, was not open to be canvassed in a reference under section 66(2) of the Indian Incometax Act.
In a reference under section 66(2) the High Court was not authorised to disregard the finding of the Tribunal on a question which was essentially one of fact.
In the present case the High Court was not justified in interfering with the finding of the Tribunal on a question of fact because it was not the case of the assessee that the conclusion of the Tribunal was based on no evidence or that it was perverse.
(ii) Where the law prescribes conditions for obtaining the benefit of reduced liability to taxation, those conditions, unless otherwise provided, must be strictly complied with, and if they are not so complied with, the taxing authorities would be bound to refuse to give the tax payer the benefit claimed.
It would be open to the Income tax Officer to decline to register a 'deed, even if under the general law of partnership the rights and obligations of the partners ex nomine thereto may otherwise be adjusted.
If the requirements relating to the form in which the petition is to be presented are not complied with, and the relevant information is withheld the Income tax Officer may be justified in refusing registration.
In the present case the Income tax Officer was bound to refuse registration as the application submitted by the five partners of the assessee did not conform to the requirements of rr. 2 and 3 of Indian Income tax Rules.
|
Appeal No. 440 of 1966.
Appeal by special leave from the order dated May 30, 1964 of the Central Government Labour Court, Dhanbad in Application No. L.P. 123 of 1962.
H. R. Gokhale, C. A.,Chopra, P. C. Bhartari, land 0.
C. Mathur, for the appellant.
Janardan Sharma, for the respondent.
The Judgment of the Court was delivered by Vaidialingam, J.
This appeal, by special leave, by the appellant Bank, is directed against the order, dated May 13, 1964, of the Central Labour Court, Dhanbad, rejecting an application, filed by the Bank, under section 33(2)(b), of the (Act XIV of 1947) (hereinafter called the Act), and declining to grant approval of the action taken, by the Bank, by way of discharging the respondent workman, from the Bank 's services.
The respondent was, at the material time, the Assistant Ac countant, at the main Office of the Bank, at Calcutta.
In view of certain serious irregularities, noticed by the Bank, in respect of the work of the respondent in the Current Accounts Department and, in particular, in current account ledgers Nos. 4 and 6, by order dated March 8, 1961, the respondent was suspended, with immediate effect.
He was also informed that the charges against him would be communicated, in due course.
By a further communication, dated March 13/14, 1961, the respondent was required to offer his explanation, in respect of four allegations made in the said communication.
The main allegations were that, in respect of ledger 'accounts Nos. 4 and 6, standing in the names of Messrs. Commercial Bureau and Messers Evergreen Paper Syndicate and Messrs. Gokul Chand Radharam, respectively, overdrafts had been allowed, by the respondent, from time to time, without obtaining the sanction of the authorities competent to allow overdrafts.
The other allegations were to the effect that the respondent, who was charged with the duty of supervising both these ledgers.
did not bring to the notice.
of the authorities the said irregularities, that must have come to his knowledge, and that the pass book of ledger No. 4 was missing.
The respondent sent a reply, dated March 17, 1961, wherein he has admitted that, in the course of discharge of his routine duties and responsibilities, in good faith and honestly, he had granted overdrafts to the parties referred to, by the Bank, temporarily, in excess of their credits or limits, without reference to the higher authorities.
He also admitted that it was a blunder on his part and that he should not have done so.
He offered an explanation to, the effect that he was led to believe in the credit worthiness of the individuals, because of their long association with the Bank and also because of the fact that, on prior occassions, overdrafts 253 had been granted to them, in excess of permissible limits.
He also stated that the Bank had not been put to any financial loss because of his having granted the overdrafts; but, he again admitted his negligence, in not strictly abiding by the Bank 's rules, when he made the overdrafts.
He, however, added that his conduct had always been guided by good faith and honesty.
This Was the answer, regarding the main allegations, contained in the Bank 's letter, dated March 13/14, 1961.
He also stated, regarding the other minor allegations, that it was not his duty to report about the debit balances, which was the function of the ledger keeper, and that he was not also responsible for the loss of the pass book, of ledger No. 4.
He wound up his explanation by stating that his conduct, in making the overdrafts, without obtaining the sanction of the higher authorities,, was an omission which had been, unfortunately, committed by him, and he expresed regret for the same and requested the management to excuse him, accepting his explanation.
The appellant Bank was not satisfied with the explanation offered by the respondent, and communicated a charge sheet, on June 3, 1961.
The main charges related to the overdrafts, paid by the respondent, in ledger Nos. 4 and 6, without obtaining the permission of the proper sanctioning authority.
The Bank also informed the respondent that he would, be given a further opportunity to explain his conduct, in relation to those matters, and defend himself in the enquiry which would be held by the Agent of the Bank, on June 20, 1961, at 3.30 p.m.
The respondent again sent a reply, dated July 11, 1961, to the charge sheet served on him.
In this reply also, he admitted that, in the course of discharge of his routine duties and responsibilities, he had allowed the parties, mentioned in the charge sheet, to overdraw, in excess of their credits, without reference to the higher authorities, and that it was a blunder on his part which he should not have committed.
But, he again reiterated that he, in good faith and bona fide, was led to believe about the credit worthiness of the parties, who had long association, with the Bank.
He also emphasized, here again, that the Bank had not been put to any financial loss, because of his conduct.
He again admitted that this act of permitting the parties concerned to overdraw, in excess of their limits, without reference to the sanctioning authorities, amounted to negligence, but his conduct was perfectly bona fide and honest.
He also offered explanation, on the minor alle gations, to the effect that it was the duty of the ledger keeper to give the figures regarding the overdrafts and that he had not done any mis reporting to the higher authorities.
Finally he made a plea that he had been serving the institution for over 20 years without any blemish, and the unfortunate omission, done by him, in the matter of not taking the sanction of the higher authorities, might be excused, accepting his expression of regret, 254 The inquiry proceedings (conducted by the Agent, who was the Inquiry Officer), produced before the Labour Court, shows that the respondent was examined in the first instance.
After eliciting answers regarding the duration of his employment, in the institution, and as to the nature of the work he was discharging, he was asked about the charge sheet served on him, as well as the explanation, furnished by him.
The respondent has categorically answered to the effect that he has understood the charge sheet and that he does not want to add anything more to the explanation that he has already submitted.
This answer must have reference to the explanation, furnished by him, on June 20, 1961, in answer to the charge sheet, wherein he has admitted his mistake in sanctioning the overdrafts, to the parties concerned, with out obtaining the sanction of the appropriate authorities.
But, inasmuch as he has stated, in his explanation, that on prior occasions also overdrafts have been allowed beyond the permissible limits, certain questions were put to him, in respect of those matters.
The respondent, no doubt, appears to have stated that some of the cheques, issued to the parties concerned, have been initialled by an Officer of the Bank, Mr. Bhatena.
The respondent, again, squarely admitted, in his answers, that he has committed a blunder in granting advances, on his own responsibility, of about Rs. 87,000.
He has also admitted that he did not make any reference to the Agent, when passing the cheques, regarding the accounts of Messrs. Evergreen Paper Syndicate or Messrs. Gokul Chand Radharam.
During the course of the inquiry, the respondent was allowed to search the records concerned, and trace, if possible, any cheques that may have been initialled by Mr. Bhatena, and no such cheque could be traced.
Inasmuch as three other officers, whose conduct was being enquired into, had made certain statements against the respondent, the latter was asked as to whether he wanted to examine, or cross examine those persons; and the respondent very clearly stated that he did not like to cross examine anybody.
The Management then examined Mr. Bhatena and Mr. Savkar, two Officers of the Bank, in the presence of the respondent.
It is also seen that the respondent has also put certain questions to those two witnesses; and he has also stated that he has no further questions to be put to them.
At the conclusion of the recording of the evidence, it is seen that the respondent finally made an appeal to the Enquiring Officer to consider his case sympathetically, at the same time admitting his acts of omission, in the discharge of his duties.
He has also expressed his gratitude for the patient hearing that has been given to him during the inquiry.
The Enquiry Officer, in his report, dated November 10, 1961, has, after referring to the nature of the enquiry conducted by him, 255 found the respondent guilty of the main charges of having permitted the parties concerned, to obtain overdrafts, beyond the permissible limits, without having obtained the sanction of the appropriate authorities.
In this connection, the Enquiry Officer has referred to the fact that these allegations have been admitted by the respondent.
Regarding the other minor allegations, that the respondent caused other officers to record debit balances incorrectly, and the loss of the pass book relating to ledger No. 4, the respondent was exonerated.
The Enquiry Officer was of the view that the offence committed by the respondent, of which he had, been found guilty, was very serious which merited dismissal; but, in view of the long number of years of service put in by the respondent and as no loss has resulted to the Bank itself, he held that the respondent should be discharged from service.
The Bank communicated the order of discharge, by its letter, dated June 27, 1962, enclosing a pay order for Rs. 472.70 being the wages for one month, viz., July 1962.
The respondent, who had a right to file an appeal, against this order of discharge, based upon the finding of the Enquiry Officer, does not appear to have had recourse to any appeal, but, on the other hand, filed a representation, dated July 11, 1962, before the Managing Director of the appellant Bank.
Even in this representation, he has not, in any manner, attacked the enquiry proceedings, nor the findings recorded by the Enquiry Officer.
On the other hand, he again admitted his fault in having permitted, overdrafts, to the parties concerned, without obtaining the sanction of the appropriate authorities after expressing regret for his conduct.
He also stated that the Bank had not suffered any financial loss, because of his conduct.
Having due regard to these circumstances, he made a plea for mercy being shown to him, by cancelling the order of discharge and permitting him to resume his duties in the Bank.
The Managing Director, by his communication, dated September 17, 1962, rejected the representation made by the respondent, and declined to reinstate him in the Bank 's service.
In the meanwhile, inasmuch as an industrial dispute was pending before the National Industrial Tribunal, the appellant had filed, an application, before the said Tribunal, on March 17, 1962, under section 33(2) of the Act, seeking approval of the action taken against the respondent, on the basis of the recommendation of the Enquiry Officer.
This application was transferred to the Central Government Labour Court, Dhanbad, on April 18, 1962.
in the objections, dated September 2, 1963, filed by the respondent before the Labour Court, for the first time he raised the plea that in view of the advice given by the officers of the Bank, he sent replies admitting his guilt regarding the allegations made against him, by the Bank.
He also raised the plea that the overdrafts, that were given by him, to the parties concerned, were 256 really due to oral orders given by the then Agent and the Superintendent, on telephone.
He also raised the plea that he was not allowed to represent his case, through the Union, before the Enquiry Officer, nor was he allowed to cross examine the persons making allegations against him.
We have elaborately referred to the matters, mentioned above, because the question, that arises for consideration, in this appeal, is as to the correctness of the view of the Labour Court, that the domestic enquiry conducted by the Bank, as against the respondent, is not fair and that principles of natural justice have been violated.
The Labour Court, by its order under attack.
has held that the domestic enquiry, conducted by the Bank, is not proper and that rules of natural justice have not been observed; and, in consequence, it has declined to grant the approval, sought for, by the Bank.
At this stage, it may be mentioned that the Labour Court has held in favour of the management, that it has complied with the proviso to section 33(2)(b) of the Act, as interpreted, by this Court, in its decision in Strawboard Manufacturing Co. vs Gobind(1).
That is, it has held that the action of the Bank, by way of discharge, payment of wages and making of the application for approval, have been taken as part of the same transaction.
For coming to the conclusion that the inquiry proceedings are violative of the rules of natural justice, the Labour Court has given three reasons (i) in the inquiry, the respondent has been examined, even in the first instance, and he was cross examined, to elicit points in support of the charges; (ii) the respondent was not allowed to crossexamine witnesses; and (iii) the respondent was prejudiced, in his defence, as he had to conduct his defence without the assistance of the Union, during the enquiry.
There can be no controversy that the principles of natural justice must be observed, in the conduct of a domestic enquiry, and the workman, concerned, must be allowed reasonable opportunity to defend himself.
It has also been held, by this Court, that rules of natural justice require that the workman, proceeded against, should be informed clearly of the charges levelled against him; witnesses should be normally examined in the presence of the employee, in respect of the charges; if statements, taken previously and given by witnesses, are relied on, they should be made available to the workman concerned the workman should be given a fair opportunity to examine witnesses, including him self in support of his defence; and the Enquiry Officer should record his findings, based upon the evidence so adduced.
So far as grounds Nos. 2 and 3, given by the Labour Court are concerned, it is clear from the record of the enquiry proceedings, that the respondent was permitted to put questions to Mr Bhatena and Mr. Savkar, who were examined, during the enquiry (1) [1962] Supp. 3 S.C.R. 618.
257 We have also referred to the fact that the Enquiry Officer has recorded that the respondent has stated that he has no further questions to be put to them.
We have also referred to the fact that the inquiry proceedings show that the respondent was specifically asked as to whether he wanted to examine or cross examine the three other Officers, whose conduct was also under enquiry, and who had made certain statements against the respondent; but the respondent categorically stated that he did not like to examine or cross examine any of those persons.
The respondent has not stated, even in the representations made by him to the Managing Director, that he was not given any opportunity to cross examine the witnesses produced in the inquiry.
Again, even in his evidence before the Labour Court, the respondent has categorically stated that he has not made any request, in writing, for being represented by the Union, at the inquiry.
Apart from the fact that he has no such right, even factually it is seen that he made no such request.
Therefore the findings of the Tribunal that the respondent was not permitted to cross examine the witnesses during the domestic enquiry, and, that he was prejudiced in his defence because he was not permitted to have the assistance of the Union, are both erroneous.
Then the question is as to whether the inquiry proceedings can be considered to have been conducted in violation of the rules of natural justice, inasmuch as the respondent was examined, even in the first instance.
We have already indicated that, as a fact, it is borne out by the records that the respondent, so far as the inquiry against him was concerned, was examined, in the first instance, and Mr. Bhatena and Mr. Savkar, were examined later.
According to the Labour Court, the object of the management, in examining the respondent, in the domestic enquiry even in the first instance, was to have the charges substantiated by statements got out of the mouth of the employee, rather than to examine witnesses for the Bank, in support of the charges.
It is the further view of the Labour Court that the respondent has been, so to say, cross examined, just to elicit points in substantiation of the charges.
These circumstances, according to the Labour Court, violate the principles of natural justice and, as such vitiate the domestic enquiry.
In this connection, the Labour Court has relied upon certain observations, contained in the judgment of this Court in Associated Cement Co. Ltd., vs Workmen(1) viz.: "It seems to us that it is not fair in domestic enquiries against industrial employees that at the very commencement of the enquiry, the employee should be (1) , 661. 258 closely cross examined, even before any other evidence is led against him." and draws the inference that under no circumstances should a workman, whose conduct is the subject of disciplinary proceedings, by a domestic tribunal, should be examined, in the first instance.
We are of the opinion that no such conclusion could be drawn from the decision, referred to above.
In that case, it will be Seen ', the management had charge sheeted one Malak Ram, with disorderly behaviour when a cinema, show was being given.
Malak Ram, at all stages, stoutly denied his having taken part in any hooliganism or rowdyism, as alleged by the management.
Under those circumstances, instead of adducing evidence, in the first instance, regarding the allegations made against Malak Ram, in the domestic enquiry, the management commenced the proceedings, with a very close examination of Malak Ram himself.
The nature of the questions put to him also clearly indicated that the worker was being cross examined, and answers sought to be elicited in support of the allegations made by the management.
This Court, in coming to the conclusion that the conduct of an enquiry, in that manner, constitutes a very serious infirmity, made the ob servations, quoted above.
Therefore, it will be seen, that in that case, when the workman concerned was totally denying the allegations made against him, it was the duty of the management to let in evidence, in the first instance, to substantiate its allegations, and permit the workman to cross examine those witnesses and also permit him to let in independent evidence, in defence of his plea; and this Court emphasized that the normal rule to be followed, in such, enquiries, is, as stated above.
In the case before us, we have already referred to the various proceedings that have taken place, from which it will be seen clearly that the workman was ' at all stages, admitting the truth of the allegations made against him, by the management.
In his communication, dated March 17, 1961, as well as, in his reply, to the charges, made by him on June 20, 1961, he has `categorically admitted that he has committed a mistake in permitting the constituents concerned to overdraw, without obtaining the sanction of, the appropriate authorities.
Even when the enquiry proceedings began, he had stated that he had nothing more to add, in respect of the charges framed against him.
When once the workman himself has, in answer to the charge levelled against him, admitted his guilt, in our opinion, there will be nothing more for the management to enquire into.
That was the position in the case before us.
Therefore, we are not inclined to agree with the reasoning of the Labour Court that when there has been an admission ' of guilt, by the respondent himself, it can still be stated, that there is a violation of the principles of natural justice merely because of the fact that the workman was examined, in the first instance.
Nor, are we impressed with the further view, expressed by the Labour Court, that the way in which answers 259 were elicited from the workman, showed that there has been a cross examination, by the management, to obtain points in substantiation of the charges.
We have gone through the entire examination of the respondent at the domestic enquiry, and we are satisfied that there is no such infirmity.
In fact, the question of the management trying to obtain answers to support the charges, does not arise at all, in this case because the respondent has consistently admitted his guilt, at all stages.
On the other hand, the nature of the questions put to the respondent clearly indicate that the management, when once the workman had, admitted his guilt, was only giving him an opportunity to explain his conduct or to refer to circumstances, if any, which could be taken into account in extenuation of his conduct.
The management had also permitted the respondent to put questions to the other two witnesses, examined during the enquiry, viz., Mr. Bhatena and Mr. Savkar.
We must, however, emphasize that the rules of natural jus tice, as laid down by this Court, will have to be observed, in the conduct of a domestic enquiry against a workman.
If the allegations are denied, by the workman, it is needless to state that the burden of proving the truth of those allegations will be on the management; and, the witnesses called, by the management, must be allowed to be cross examined, by the workman, and the latter must also be given an opportunity to examine himself and adduce any other evidence that he might choose, in support of his plea.
But, if the workman admits.
his guilt, to insist upon the manage ment to let in evidence above the allegations, will, in our opinion, only be an empty formality.
In such a case, it will be open to the management to examine the workman himself, even in the first instance, so as to enable him to offer any explanation for his conduct, or to place before the management any circumstances which will go to mitigate the gravity of the offence.
But, even then, the examination of the workman, under such circumstances, should not savour of an inquisition.
If, after the examination of the workman, the management chooses to examine any witnesses, the workman must be given a reasonable opportunity to cross examine those witnesses and also to adduce any other evidence ' that he may choose.
Having considered the enquiry proceedings, in its entirety, in this case, we are satisfied that there has been no violation of the rules of natural justice.
Therefore, it follows that the order of the Labour Court, refusing to grant approval, as asked for, by the management, is erroneous and, as such, it is set aside.
In the result, the appeal is allowed , but parties will bear their own costs in this appeal.
G.C. Appeal allowed.
| The respondent who was an employee of the appellant bank was charged with issuing unauthorised overdrafts to a constituent.
A domestic enquiry was held against him.
In two written explanations before the enquiry he admitted, the allegations against him and only pleaded extenuating circumstances.
At the enquiry he was examined in the first instance; having again admitted his fault he was asked certain questions by the Enquiry Officer in respect of the extenuating circumstances pleaded by him.
Two more witnesses were then examined by the Enquiry Officer.
Finally, according to the latter 's report the respondent was discharged.
In proceedings under section 33(2)(b) of the the Labour Court, Dhanbad held that the enquiry was bad for violation of natural justice inasmuch as the respondent had teen examined before other witnesses and was unduly cross examined.
The bank appealed by special leave.
Held: The rules of natural justice as laid down by this Court have to be observed in the conduct of a domestic enquiry against a workman.
If the allegations are denied by the workman the burden of proving the truth of those allegations will be on the management; and the witnesses called by the management must be allowed to be cross examined by the workman and the latter must also be given an opportunity to examine himself and adduce any other evidence that he might choose, in support of his plea.
But if the workman admits his guilt, to insist upon the management to let in evidence about the allegations will be an empty formality.
In such a case it will be open to the management to examine the workman himself, even in the first instance, so as to enable him to offer any explanation for his conduct, or to place before the management any circumstances which will go to mitigate the gravity of the offence.
But, even then, the examination of the workman, under such circumstances, should not savour of an inquisition.
If, after the examination of the workman the management chooses to examine any witnesses, the workman must be given a reasonable opportunity to cross examine those witnesses and also to adduce any other evidence that he may choose.
[259D F] In the present case the respondent in his written explanations had admitted the charges and therefore there was no violation of natural justice in first examining him.
The questions put to him were not unfair.
The Labour Court was wrong in not giving approval to his discharge.
[258F; 259A, G] Associated Cement Co. Ltd., vs Workman , distinguished.
Strawboard Manufacturing Co. vs Gobind, [1962] Supp.
3 S.C.R. 618, referred to.251 252
|
Civil Appeal No. 1507 of 1969 Appeal from the Judgment and order dated the 12th March, 1968 of the Punjab and Haryana High Court in Civil Writ No. 1376 of 1967.
WITH Civil Appeal Nos.
1202 20 of 1970 919 From the Judgment and Order dated the 23rd day of July, 1967 of the Punjab and Haryana High Court in Civil Writ Petition Nos.
2934 & 2955 of 1968 and L.P.A. Nos.
597 599/68, Civil Writ Nos.
242 45/69, 423, 471, 477, 783 785, 787 89 & 792 of 1969.
AND Civil Appeals Nos.
1564 67 of 1970 Appeals from the Judgment and Order dated the 20th November, 1969 of the Punjab and Haryana High Court in L.P.A. Nos.
57 59 69.
AND Civil Appeals Nos.
743 94 of 1974.
From the Judgment and Order dated the 23rd July, 1969 of the Punjab and Haryana High Court in Civil Writ Nos. 343, 334, 353, 354, 365, 379, 381, 384, 385, 421, 422, 424, 456 481, 493, 518, 519, 520, 529 of 1969, 2933, 2948, 2949, 2956, 2975 78, 3021, 3111, 3188 of 68, 254, 264, 307, 308, 715, 706, 674, 662, 661, 604, 596, 588, 554, 737, 786, 791, 798, 828, 836, 945, 839 of 1969.
R.N. Poddar for the Appellants in CA.
I.S. Goel and R.N. Poddar for the Appellants in CA.
1202 20.
M.S. Gujral and R.N. Poddar for the Appellants in CA.
743 794/74.
K.G. Bhagat, Additional Soliciter General and R.N. Poddar for the Appellants in CAs.
1564 67/70.
T.S. Munjral and H.K. Puri for Respondent in CA.
P.R. Mridul, V.S. Desai, section Rangarajan in CAs.
1204 to and in CA.
743, 762 & 770.
T.S. Munjral, K.C. Dua and Poonam Malhotra for the Respondents in CAs 1204 06, 1564 67, 743, 762, 764, 765 770.
R.C. Bhatia and P.C. Kapoor for Respondents in CAs.
1202 03, 1207 20, 744 761, 768, 766 769 & 771 794.
920 The Judgment of the Court was delivered by CHANDRACHUD, CJ.
These appeals have a long history.
Liquor vends were put to auction by the Excise Department of the Government of Haryana whereupon, the highest bidders were given the necessary licences to sell liquor.
Some of the licensees committed default in the payment of amounts due from them under the terms of the auction.
Thereupon, the vends were reauctioned except for three vends which, though published for reauction, were given by private negotiations.
The original licensees, who were called upon to pay the difference between the amount which they were liable to pay and the amount realised by resale of the vends, filed writ petitions in the High Court of Punjab and Haryana contending that the State Government had no power to demand the various amounts which they had allegedly defaulted in paying.
The High Court accepted that contention, holding that the State Government had no authority to demand the amounts for failure to pay which, the vends were put to resale.
As a necessary consequence of that finding, the fresh grants made by reauction or private treaty were held invalid.
The result of this was that the writ petitioners stood relieved of their obligation to make good the shortfall.
This is the broad history of these appeals.
We will take up Civil Appeal No. 1507 of 1969 for consideration first.
The facts of that case and the events lending to the present proceedings are mentioned in a judgment of this Court reported in State of Haryana vs Jage Ram(1).
In this case, an auction was held on March 27, 1967 for the grant of a retail vend known as Biswan Meel, Sonepat, for the year 1967 68.
The respondents Jage Ram and others offered the highest bid in that auction.
Under Condition 14 (iii) of the auction, respondents became liable to pay an amount calculated at the rate of Rs. 17.60 per litre, which came to Rs. 10,92,960.00.
They paid a security deposit for the due performance of the terms of the auction but they committed default in payment of instalments which fell due on April 10 and April 25, 1967.
On May 17, 1967 the Excise authorities cancelled the licence of the respondents and informed them that the vend will be resold on May 23, 1967 at the risk of the respondents.
In pursuance of the order dated May, 17, the Biswan Meel vend was reauctioned on May 23, the highest bid offered being in the sum of Rs. 2,46,000.00.
On July 11, respondents were called upon by a notice to pay a sum of 921 Rs. 7, 41,577.40, being the difference between the amount which they were liable to pay under the terms of the original auction and the amount fetched in the reauction.
Thereupon, respondents filed a writ petition in the High Court challenging the legality of that notice.
The High Court allowed the writ petition, quashed the order cancelling the respondents ' licence as also the notice calling upon them to make good the shortfall of seven lakh rupees and odd.
The High Court gave to the State of Punjab a certificate to appeal to this Court.
The appeal came up for hearing before a three Judge Bench which by its aforesaid Judgment dated April 21, 1980 held that the writ jurisdiction of the High Court under Article 226 cannot be used for avoiding contractual obligations.
On merits, it was held by this Court following a Constitution Bench decision in Har Shanker vs The Deputy Excise and Taxation Commissioner,(1) that since rights in regard to the manufacture and sale of intoxicants are vested in the State, it is open to the State to part with these rights, which are in the nature of a privilege, for consideration.
The Court further held that the amounts which the State Government had charged to the respondents were neither in the nature of a tax nor in the nature of an excise duty but were in the nature of a price which the State Government was entitled to charge as consideration for parting with its privilege in favour of the licensees.
After setting aside the judgment of the High Court and upholding the demand made by the State Government upon the respondents, the question naturally arose whether the respondents could be held liable for the shortfall between the bid offered by them and the amount realised in the reauction.
It was urged by the respondents that the reauction which was held on May 23, 1967 was not in accordance with the relevant Rules and therefore, they could not be called upon to pay the difference between the amount which they were originally liable to pay and the amount which was fetched in the reauction of the vend.
To be more specific, it was contended on behalf of the respondents that no notice of the intended resale was given as required by Rule 36 (3) of the Punjab Liquor Licence Rules, 1956, that no notice was published or affixed at any conspicous public place notifying the proposed resale, nor indeed was the resale announced by the beat of drums.
According to the respondents, one 922 Lal Chand went to the office of the Excise and Taxation Officer, Rohtak, and managed to have his bid accepted in the resale of the vend.
Respondents further urged that through the resale of the vend was to be effective for a period of about 10 months out of the 12 months for which the vend was originally auctioned, there was a large shortfall of over Rs. 7 lakhs on account of the fact that due publicity was not given to the resale.
By the aforesaid judgment dated April 21, 1980 this Court remanded the matter to the High Court and called for its findings on two questions: (1) Whether it was necessary according to the Rules which were in force at the relevant time to give publicity to the reauction, and (2) if so, whether such publicity was in fact given to the reauction.
The High Court has transmitted its findings to this Court, which are against the respondents.
The High Court has held by its order dated September 29, 1980 that the Rules relied upon by the respondents by which publicity is required to be given to the resale are directory and not mandatory and that these rules were substantially complied with.
These findings are assailed by the respondents who, by reason of the findings of the High Court, are virtually in the position of appellants now.
The finding of the High Court that the rules were substantially complied with is based on an affidavit filed by Shri N.S. Bedi, Deputy Excise and Taxation Commissioner, Sonepat, in which he has stated that 'all possible steps were taken in connection with the publicity done for the reauction of the vend '.
The affidavit says that telegrams were issued on May 19, 1967 by the Excise and Taxation Officer, Rohtak to the Excise and Taxation Officers of Hissar, Karnal, Gurgaon, Mohindergarh, Ambala and Jind informing them that the reauction will be held on May 23, 1967 at 10.00 a.m. and asking them to give due publicity to the reauction.
The affidavit further says that letters were also written on May 20, 1967 to the 'important licensees of the State ' informing them of the date and time of the reauction and requesting them to attend it.
The affidavit asserts that 40 bids were recorded in the reauction and the 40th bid, being the highest, was accepted.
It seems to us impossible to accept the findings of the High Court.
We will not enter into the controversy whether the rules 923 governing reauction of vends, of which respondents allege breach, are directory or mandatory in character.
Even assuming for the purpose of argument that they are directory, we are unable to hold that they have been substantially complied with.
Rule 36 (24) of the Punjab Liquor Licence Rules, 1956 as amended by the Notification dated March 31, 1967 says that when a licence is cancelled, it may be resold by public auction or by private contract in accordance with the procedure laid down in the other clauses of Rule 36.
Clause (3) of Rule 36 runs thus : "36(3) The Collector will give timely notice of the date and place of the auction: (a) the condition to which the auction will be subject; (b) the number and situation of the shops to be licensed for the sale of (country liquor); (c) the prices, if any, fixed for the retail vend of country spirit or; (d) the occasions, if any, on which the shops will be closed; and (e) any other information which may be of use to intending bidders." No notice as required by this sub rule was given to the public at all.
Neither the time nor the date of the reauction, nor the location or description of the vend which was to be put to reauction, nor the conditions of the reauction were ever published by the Excise authorities prior to the reauction.
What was done by the concerned authorities was to send telegrams to Excise Officers of five districts with a request that they should give publicity to the reauction.
The officers of those five districts seem to have sat cool over those telegrams because there is no evidence showing that they took any steps for publishing the reauction.
A curious feature of this case is that the Excise authorities claim to have sent letters to five private licensees informing them that the reauction was fixed for the 23rd of May 1967 at 10.00 a.m.
These letters are at Annexure R 8 and are dated May 20, 1967.
20th May fell on a Saturday and the reauction was fixed for 23rd May which was the following Tuesday.
924 In the normal course, these letters would have been received by the addressees on Monday, that is, a day or less prior to the date of the reauction which was to be held the next morning at 10 O 'clock.
In these circumstances, it is difficult to hold that any publicity as such was given to the reauction.
When a rule requires 'publicity ' to be given to an auction sale, what is necessarily implied is that due steps must be taken to give sufficiently advance intimation of the intended sale and its material terms to the members of the public or, at least, to that section of the public which normally engages in the kind of business which is the subject matter of the auction sale.
Even the five special invitees would have found it difficult to come prepared to take part in resale which was held on 23rd May.
They were not invited to a wedding feast.
They were invited to attend the resale of a liquor vend and it is well known that a certain amount has to be paid by the successful bidder on the fall of the hammer.
We are also unable to appreciate that the Excise authorities of the Government of Haryana should have picked and chosen some five particular persons as recipients of the notice of reauction.
How their names transpired and what is their particular status, respectability and standing in the liquor trade, are matters on which no light is thrown.
There is no material before us on which to doubt the integrity of the authorities who were connected with the reauction.
But their conduct must be above suspicion.
The bid sheet shows that only six persons offered bids in the reauction and none of the five invitees was amongst those six.
It appears that a small, closely knit group participted in the reauction, successfully keeping out others who might have of offered adequate bids in the reauction, were they to have notice thereof.
Indeed, the amount which was fetched in the reauction itself furnishes prima facie evidence that all was not well with the reauction.
The respondents had given their original bid in the sum of Rs. 10,92,960.00 which covered a period of one year from April 1, 1967 to March 31, 1968.
The reauction was held on May 23, 1967 for a licence which was to be effective for the little over 10 months.
It is surprising that the reauction should have fetched a bid of as small an amount as Rs. 2,46,000.
Since the reauction was not held in accordance with the rules, either in their letter or in their spirit, and since, especially, due publicity was not given to the reauction, it is impossible to uphold reauction and mulet the respondents in the resultant shortfall.
We 925 are of the opinion that rule 36(3) of the Rules was not even substantially complied with.
It is reasonable to assume that since due publicity was not given to the reauction, adequate bids were not received, resulting in prejudice to the respondents.
Accordingly, we set aside the finding of the High Court that the relevant rules governing reauction of vends were complied with substantially.
Since the reauction did not conform to the rules and the respondents were prejudice thereby, they cannot be held liable to make good the difference between the amount which was payable by them and the amount which was fetched at the reauction.
The result is that the appeal filed by the State of Haryana is dismissed, though for different reasons, and the respondents absolved from their liability to pay the amount which is demanded of them by the notice dated May 7, 1967 issued by the Collector and Deputy Excise and Taxation Commissioner, Haryana.
That disposes of Civil Appeal No. 1507 of 1969.
We will now take up for consideration two other groups of appeals, viz, Civil Appeals 1202 to 1220 of 1970 and Civil Appeals 743 to 794 of 1974.
No question of reauction arises in these groups of appeals except in Civil Appeals Nos.
1204, 1205 and 1206 of 1970.
We shall deal with those three appeals separately a little later.
The question which arises in the remaining appeals in these two groups, as regards the power of the State Government to charge the particular amount to the licensees is concluded by the judgments of this Court in Har Shunkar vs The Deputy Excise and Taxation Commissioner, State of Haryana vs Jage Ram (supra) and State of Punjab vs Ajudhia Nath(1).
It was held in those decisions that the State Government has the power to charge the particular amounts to the licensees.
The judgments of the High Court denying to the State Government that power must therefore be set aside and to that extent the appeals filed by the State of Haryana allowed.
The appeals which now remain for consideration are Civil Appeals 1204 to 1206 of 1970 and Civil Appeals 1564 to 1567 of 1970.
In these cases also, as in all other cases which are being disposed of by this judgment, the power of the State Government to 926 levy the particular charge must be upheld in view of the aforesaid three judgments.
The judgment of the High Court in these cases shall therefore have to be set aside to the extent to which the High Court had denied that power to the State Government.
But the further question which arises in these appeals is whether the respondents can be called upon to pay the difference between the amounts which they were liable to pay under the terms of the original auction in their favour and the amounts which were fetched in the resale of the vends.
The facts of these groups of cases are even more peculiar than the facts of Civil Appeal No. 1507 of 1969 with which we have dealt at the outset of this judgment.
In these cases, it was originally intended to reauction the vends in respect of which the respondents had committed default and some publicity, not due or adequate by any standard, was given to the reauction.
The reauctions commenced as scheduled but the Excise authorities changed their mind in midstream and decided, without any rhyme or reason, to withdraw the reauctions and to grant fresh licences by private negotiations on the spot.
We agree fully with the very careful judgment of Justice Bal Raj Tuli that due publicity was not given to the reauction.
It is stated in the affidavit filed on behalf of the State Government in the High Court that, directions were given to the Excise and Taxation Officer, Gurgaon by a circular letter that he should give wide publicity to the reauction due to be held on July 24, 1968.
The circular letter was not placed on the record, nor was the High Court a apprised as to how the Excise and Taxation Officers of the Governments of Haryana and Punjab gave publicity in their respective districts to the proposed reauctions.
It is significant that the respondents wrote letters to the Excise and Taxation Officer, Gurgaon on July 20, 1968 complaining that due publicity was not being given to the reauctions and that the Rules required such publicity to be given.
In spite of this, no steps were taken to comply with the requirement of the rules, even though the cost of publicity would have been required to be borne by the respondents themselves.
It was urged that Hindi handbills were distributed in Delhi advertising the auction.
Even those handbills do not contain the requisite information which is required to be published under rule 36(3).
Tuli, J. was therefore right in not treating the handbills as constituting due publicity to the reauctions.
927 If the reauctions cannot be upheld since due publicity was not given to them, the grant of licences by private negotiations during the course of reauctions would also have to be set aside.
Assuming that there were valid reasons for revoking the decision to hold the reauctions, like the paucity of adequate bids at the reauctions, the reauctions should have been postponed and due publicity given to the decision to grant licences by private negotiations.
By rule 36(24), power has been conferred to resell vend by public auction or by private contract.
But this latter power has to be exercised with great care and circumspection.
Public auction has to be the normal mode of selling public property.
It is open to public gaze and eschews many temptations to which private contracts are subject.
It is only when at public auction is not feasible or has failed to attract bidders after due publicity, that a private contract can be negotiated for disposing of public property or rights in such property.
Not only is no reason forthcoming why the intention to hold a public auction was abandoned after the auction had commenced but the proceedings were not adjourned even for a few days in order to publicise the intention to resell the vends by private contract.
The Excise authorities could not have abruptly decided to jettison the original intention of holding a public auction and grant licences by private negotiations on the spur of the moment, that very day and at that very hour.
The decision smacks of arbitrariness, is unfair and unreasonable, and cannot be allowed to stand.
For these reasons, respondents in Civil Appeals 1204 to 1206 of 1970 and Civil Appeals 1564 to 1567 of 1970, are not liable to pay the difference between the amounts which they were liable to pay under the original auctions and the amounts which they were liable to pay under the original auctions and the amounts which were fetched by the re grant of licences by private contracts.
The aforesaid discussion will show that the appeals filed by the State of Haryana succeed to the extent that the State Government has the power to levy the charge which it demanded of the respondents.
The finding of the High Court that the State Government has no such power is incorrect and must be set aside.
The findings called for by us from the High Court on the question whether due publicity was given to the reauctions are set aside.
We hold that due and adequate publicity was not given to the reauctions.
We also hold that the regrant of licences by private negotiations is not in conformity with the Rules and must be struck down in the circumstances of the case.
As a result of the infirmities from which the reauctions and the re grant of licences by private 928 contract suffer, respondents in whose cases fresh licences were granted either in reauctions or by private contract will not be liable to make good the shortfall.
The reauctions were necessitated on account of the default committed by the respondents, but the reason of the shortfall is the laxity and arbitrariness with which the resale of the vends was held or fresh licences granted by private contract.
There will be no order as to costs in any of these appeals.
Order accordingly.
H.L.C. Dismissing the appeals in which liquor vends was resold and allowing And appeals in which liquor vends was not resold.
| The first respondent who lost to the appellant by 24 votes in the Assembly Elections filed an election petition in the High Court under section 81 of the Representation of the People Act, 1951 asking for the appellant 's election to be set aside and for declaration that he should be declared as the successful candidate.
In para 9(i) of the petition the respondent pleaded that 74 ballot papers cast in his favour were wrongly rejected on the ground that they did not contain the signature of the Presiding Officer.
The High Court ordered inspection of these ballot papers.
The High Court held that the rejection of these 74 ballot papers for want of the Presiding Officer 's signature was not justified and gave the respondent No. 1 credit of all those votes and on that basis while setting aside the election of the appellant, declared the first respondent to have been duly elected.
Hence this appeal.
The appellant urged that the pleading in para 9(i) of the Election petition did not amount to a concise statement of the material facts as required by law; the High Court went wrong in allowing inspection of the ballot papers; the 74 ballot papers in dispute did not contain the signature of the presiding officer and were rightly rejected at the counting in view of the mandatory provision in rule 56(2) of the Conduct of Elections Rules, 1961 and the High Court 's view that in the absence of a prayer for recrimination under section 97 of the Act, the appellant was precluded from asking for a recount of the other rejected ballot papers is not tenable in law.
Dismissing the appeal, HELD: An election petition is presented in terms of section 81 of the Act.
Section 83 prescribed as to what the petition should contain.
Clause (a) of sub section
(1) of section 83 states that an election petition shall contain a concise statement of the material facts on which the petitioner relies.
In the instant 119 case the number of ballot papers alleged to have been wrongly rejected has been furnished, the counting table number has been given, the booth number has also been disclosed and the ground for rejection has even been pleaded.
The only specific detail which was wanting was the serial number of the ballot papers.
This particular was not available to the election petitioner in spite of attempts made on his behalf.
The Court, therefore, agrees with the High Court that in the facts and circumstances of the case the pleading in paragraph 9(i) set out the material facts in a proper way and no defect can be found with it.
The High Court had rightly ordered the inspection of the ballot papers.
[126 B C; H; 127 A; 128 F G; 127 F] Samant N. Balakrishan etc., vs George Fernandez and Ors, etc.; , explained and distinguished, Bhabhi vs Sheo Govind and Ors., [1975] Suppl.
S.C.R. 202, referred to.
Rule 38(1) of the Conduct of Election Rules, 1961 provides inter alia that every ballot paper before it is issued to an elector shall be stamped on the back with a distinguishing mark and shall be signed in full on its back by the presiding officer.
The distinguishing mark can be put by anyone but the signature has got to be of the presiding officer and obviously he has to personally do that job.
Rule 56(2)(h) provides that the returning officer shall reject a ballot paper if it does not bear both the distinguishing mark and the signature as mentioned in sub rule (1) of rule 38.
There is a proviso to sub rule (2) of rule 56 which says that where the returning officer is satisfied that any such defect as is mentioned in clause (h) has been caused by any mistake or failure on the part of a presiding officer or polling officer, the ballot paper shall not be rejected merely on the ground of such defect.
The proviso, once it is applicable is a mandate that the ballot paper is not to be rejected.
[129 F G; 130 G; 129 E F; 130 E; 131 H] In the instant case the 74 ballot papers in dispute were rejected because they did not contain the signature of the presiding officer as required under rule 38(1).
To see whether the proviso to sub rule (2) of rule 56 was applicable, it has to be found out whether the absence of the signature of the presiding officer on these ballot papers was on account of mistake or of his failure.
On the submissions at the bar, the question of mistake does not arise.
It was the obligation of the presiding officer to put his signature on the ballot papers before they were issued to the voters.
Every voter has the right to vote and in the democratic set up prevailing in the country no person entitled to share the franchise can be denied the privilege.
Nor can the candidate be made to suffer.
Keeping this position in view the Court is of the definite view that the present case is one of the failure on the part of the presiding officer, who had been taken ill on the date of poll and was away from the place of polling for quite some time, to put his signature on those ballot papers so as to satisfy the requirement of law.
The ballot papers therefore were not liable to be rejected as the proviso applied and the High Court came to the correct conclusion in counting these ballot papers and giving credit thereof to the respondent No. 1.
[130 C; F G; 131 F H; 130 H; 131 E; H; 132 A] 120 In a case in which the election petition claims that the election of the returned candidate is void, and also asks for a declaration that the petitioner himself or some other person has been duly elected, section 100 as well as section 101 of the Act would apply, and it is in respect of the additional claim for such declaration that section 97 comes into play.
Section 97(1) thus allows the returned candidate to recriminate and raise pleas in support of his case that the other person in whose favour a declaration is claimed by the petition cannot be said to be validity elected, and these would be pleas of attack and it would be open to the returned candidate to take these pleas, because when he recriminates, he really becomes a counter petitioner challenging the validity of the election of the alternative candidate.
The result of section 97(1) therefore is that in dealing with a composite election petition, the Tribunal enquires into not only the case made out by the petitioner, but also the counter claim made by the returned candidate.
That being the nature of the proceedings contemplated by section 97(1), it is not surprising that the returned candidate is required to make his recrimination and serve notice in that behalf in the manner and within the time specified by section 97(1) proviso and section 97(2).
If the returned candidate does not recriminate as required by section 97, then he cannot make any attack against the alternative claim made by the petition.
[135 A F] Kum.
Shradha Devi vs Krishna Chandra Pant & Ors.
, ; ; Jabar Singh vs Genda Lal, ; and P. Malaichami vs M. Andi Ambalam & Ors. ; referred to.
In the instant election petition two reliefs had been claimed, firstly, for setting aside the election of the returned candidate, i.e. the appellant, and secondly, for a declaration that the election petitioner (respondent No. 1) was the duly elected candidate.
The relief claimed was in terms of section 100(1)(d) (iii) and section 101(a) of the Act.
Admittedly no application for recrimination was filed by the appellant.
In the absence of a recrimination petition conforming to the requirement of section 97 of the Act the appellant who happens to be an advocate and is presumed to know the law, was not entitled to combat the claim of the election petitioner on the ground that if the remaining rejected ballot papers had been counted the election petitioner would not have been found to have polled the majority of the valid votes.
[132 D E; 133 A; 138 C D]
|
Civil Appeal No. 2522 of 1969.
From the Judgment and Order dated 12 5 1969 of the Punjab and Haryana High Court in L.P. No. 8/69.
Ravindra Bana and M. N. Shroff for the Appellant.
T. section Arora and M. L. Lahoty for the Respondent.
The Judgment of the Court was delivered by SHINGHAL, J.
One Nathi held 36 standard acres and 8 standard units of land in village Bhanguri, and as the "permissible area" within the meaning of clause (3) of section 2 of the Punjab Security of Land Tenures Act, 1953, (hereafter referred to as the Act) in his case was 30 standard acres, Collector (Surplus) Nuh, declared 6 standard acres and 8 standard units of land as "surplus area", by his order dated November 25, 1959.
Nathi died on July 14, 1965, leaving his widow Smt.
Kela Devi respondent No. 1, and his mother Smt.
Mando respondent No. 2, as heirs.
The two heirs made an application under sections 10 A(b) and 10B of the Act stating that as the land of Nathi had been inherited by them in equal shares, and the holding with each one of them was much below the "permissible area" of 30 standard acres, there was no "surplus area" within the meaning of clause (5 a) of section 2 of the Act and no part of it could therefore be utilized for allotment to other tenants.
That application was however dismissed by Collector (Surplus) on March 13, 1967, on the ground that the "surplus area" declared in Nathi 's life time had already been allotted to other tenants and could not be excluded from the holding in the hands of his widow and mother.
An appeal was taken to the Commissioner of Ambala, but it was dismissed on January 30, 1968, as he took the view that the order of allotment of the "surplus area" of Nathi 's holding amounted to "utilisation" of that land under section 10 A(a).
A revision was taken to the Financial Commissioner, but it was rejected on May 8, 1968, for the same reason.
Kela Devi and Smt.
Mando then approached the High Court of Punjab and Haryana by a writ petition under articles 226 and 227 of the Constitution.
It was opposed by the present appellants on the ground 1122 that as the "surplus area" had been declared and allotted to various tenants during the life time of Nathi (except for an area of 8 kanals in village Ghelab) the writ petitioners were not entitled to succeed, as the "surplus area" had already been utilized.
It was also pleaded that possession of eight pieces of land had already been delivered to the tenants before the death of Nathi.
The controversy before us does not relate to those pieces of land which had been allotted to various tenants and of which possession was given to them during the life time of Nathi.
The learned Single Judge of the High Court who initially heard the writ petition allowed it by his judgment dated October 29, 1968, in so far as it related to the portion of land of which possession had not been given to other tenants and, to that extent, he set aside the above mentioned orders of the Collector, the Commissioner, and the Financial Commissioner by which the application of Smt.
Kela Devi and Smt.
Mando was rejected.
An appeal was taken to a Division Bench of the High Court, but it was dismissed on May 12, 1969.
That is why the present appeal has been filed on the basis of the High Court 's certificate under Article 133 (1)(c) of the Constitution.
The only question which therefore arises for consideration is whether the High Court was right in taking the view that mere allotment of land to other tenants under section 10 A(a) of the Act did not amount to utilisation of the "surplus area" when the resettled tenants had not taken possession under the allotment orders.
It is not in controversy that it had been finally decided that the "surplus area" in the case of Nathi was 6 standard acres and 8 standard units, and a decision to that effect was taken in his life time on November 25, 1959.
It is also not in dispute that orders were made for the allotment of the "surplus area" to other tenants under section 10 A(a) of the Act which reads as follows "10 A(a) The State Government of any officer empowered by it in this behalf shall be competent to utilize any surplus area for the resettlement of tenants ejected, or to be ejected, under clause (i) of sub section (1) of section 9.
" While therefore the section empowers the State Government or its authorised officer to "utilise" any "surplus area" for the resettlement of tenants, the Act does not define what is meant by an order of utilisation under the section.
A clue to what is actually meant by that expression, is however to be found in clause (b) of section 10 A which provides as follows, 1123 "10 A(b) Notwithstanding anything contained in any other law for the time being in force and save in the case of land acquired by the State Government under any law for the time being in force or by an heir by inheritance no transfer or other disposition of land which is comprised in surplus area at the commencement of this Act, shall affect the utilization thereof in clause (a).
" The clause therefore has the effect of saving the land comprised in the "surplus area", if it has been acquired by an heir by inheritance.
So where an heir succeeds by inheritance, as in this case, that basic fact would affect the utilisation of the surplus area even if only an order has been made under clause (a) of section 10 A for its utilisation for the resettlement of other tenants but that order has not been implemented.
In order to understand the full meaning and effect to the provisions of section 10 A, it is necessary to make a cross reference to rules 18, 20 A, 20 B and 20 C of the Punjab Security of Land Tenures Rules, 1956 (hereafter referred to as the Rules).
Rule 18 deals with the procedure for allotment of "surplus area" to other resettled tenants.
Rule 20 A provides for the issue of certificates of allotment of lands to them, and rule 20 B provides for delivery of possession and makes it obligatory for the resettled tenant to take possession of the land allotted to him within a period of two months or such extended period as may be allowed by the officer concerned.
Rule 20 C provides, inter alia, for the execution of a "qabuliyat" or "patta" by a resettled tenant.
It would thus appear that while allotment of land is an initial stage in the process of utilisation of the "surplus area", it does not complete that process as it is necessary for the allottee to obtain a certificate of allotment, take possession of the land within the period specified for the purpose, and to execute a "qabuliyat" or "patta" in respect thereof.
The process of utilisation contemplated by section 10 A of the Act is therefore complete, in respect of any "surplus area", only when possession thereof has been taken by the allottee or the allottees and the other formalities have been completed, and there is no force in the argument that a mere order of allotment has the effect of completing that process.
Reference in this connection may also be made to rule 20 D of the Rules which provides that in case a tenant does not take possession of the "surplus area" allotted to him for resettlement within the period specified therefor, the allotment shall be liable to be cancelled and the area allotted to him may be utilized for the resettlement of 1124 another tenant.
It cannot therefore be dobted that a completed title does not pass to the allottee on a mere order of allotment, and that order is defeasible if the other conditions prescribed by law are not fulfilled.
So when the process of utilisation of Nathi 's "surplus area" had not been completed by the time his heirs by inheritance made the aforesaid application to the authorities concerned, it was permissible for those authorities to re examine the question whether there was any "surplus area" at all after Nathi 's holding had been inherited by his two heirs in equal shares so as to reduce the area of the holding of each one of them below the permissible area.
The High Court therefore rightly allowed the writ petition of the respondents.
As there is no force in this appeal, it is dismissed but, in the circumstances, we do not make any order as to the costs.
P.B.R. Appeal dismissed.
| Entry 12 of Part IX of the Schedule to the Constitution (Scheduled Tribes) Order 1950 prior to its amendment in 1956 read as "Gond including Media (Maria) and Mudia, (Muria)".
By the Scheduled Castes and Scheduled Tribes (Amendment) Act 63 of 1956 the said Entry was substituted by Entry 12 in Paragraph 5 of Part VII A of the Schedule to the Order.
It read as "12 Gond, including: Arakh or Arrah. Mana. " "Mana" was the 30th community amongst the communities included in that Entry.
In 1976 the entire Schedule to the order as it stood prior to the amendment was substituted by a new Schedule.
Entry 18 of Part IX of the new Schedule corresponding to Entry 12, prior to the amendment, showed 'Mana ' community as one of the communities included in the group of communities headed by "Gond" community.
In the election to the State Assembly held in February, 1978 the appellant was declared successful from a constituency reserved for Scheduled Tribes.
In his election petition impugning the appellant 's election respondent No. 1 who was the unsuccessful candidate challenged the election on the ground that the appellant did not belong to any of the Scheduled Tribes specified in Part IX of the Schedule to the 1950 Order as it stood at the time of the election and was therefore not qualified to be chosen to fill the seat reserved for the Scheduled Tribes.
The High Court set aside the appellant 's election.
In appeal to this Court it was contended on behalf of the appellant that while the word "including" in Entry 12 of the 1950 Order as it stood after its amendment in 1956 showed that the communities referred to therein were those having affinity with the Gond Tribe and its omission in Entry 18 as amended in 1976 showed that the group of communities mentioned in this Entry, need not necessarily be those having mutual affinity amongst them so that a person belonging to any "Mana" community should be treated as a person belonging to a Scheduled Tribe even though it had no affinity with the "Gond" tribe.
Dismissing the appeal ^ HELD: 1.
The High Court was right in setting aside the appellant 's election on the ground that he did not belong to a Schedule Tribe.
[1147 B] 1136 2.
(a) Even when the Order, before its amendment in 1976 used the term "including", this Court giving a restricted meaning to "Mana", held that only 'Mana ' community which had affinity with the 'Gond ' community could be considered as a Scheduled Tribe and that 'Kshatriya Bidwaik Mana ' community to which the appellant belonged could not be treated as a Scheduled Tribe.
[1143F G] (b) A reading of Part IX of the Schedule to the Order shows that certain communities had been grouped together under a single Entry in the light of Article 342 of the Constitution which requires part of or groups within a tribal community also to be specified in the Order.
Therefore the communities mentioned against any specific Entry are those which have mutual affinity amongst them.
[1144C E] (c) Merely because a new Schedule had been substituted for the old one it cannot be said that Parliament had intended to treat persons belonging to "Kshatriya Bidwaik Mana" community also as a Scheduled Tribe.
Where there are two communities with the same name one having affinity with a tribe and the other not having anything to do with it and both are treated as Scheduled Tribes, the community which has affinity with another tribe is shown along with it in the same group against a single Entry and the other is shown against a different Entry.
Therefore the Mana community included in Entry 18 can only be that which has affinity with 'Gonds ' and any other community which also bears the name 'Mana ' but does not have any such affinity cannot be deemed to fall within the scope of 'Mana ' in Entry 18.
[1144H, 1145C D] 3.
The term "including" is sometimes used in a definition to give an extended meaning to the word defined.
Sometimes it is used as a synonym for "means" and not as a word of extension but limitation.
[1143C D] Dilworth vs Commissioner of Stamps, [1899] A.C. 99 at pp.
105 106, South Gujarat Roofing Tiles Manufacturers Association & Anr.
vs State of Gujarat & Anr.
, ; , referred to.
|
Appeals Nos.
2382 2384 of 1966.
Appeals from the judgment and orders dated October 6, 1966 of the Mysore High Court in Writ Petitions Nos.
1056, 1607 and 1298 of 1966, section T. Desai, section C. Javali and Vineet Kumar, for the appellant (in all the appeals).
M. M. Ramamurthi and Shyamala Pappu, for respondent No. 1 (in all the appeals) and respondent No. 2 (in C. A. No. 2382 of 1966).
89 The Judgment of the Court was delivered by Shah, J.
On May 3, 1966 the Municipality of Raichur imposed octroi duty on goods specified in Sch.
11 to the Mysore.
Municipalities Act 22 of 1964, entering the municipal limits for consumption, use or sale.
The respondents who are traders in cloth at Raichur moved the High Court of Mysore by petitions under article 226 of the Constitution challenging the levy and collection of octroi duty on goods described in Sch.
II of the Act in pursuance of the notification dated May 3, 1966.
The High Court of Mysore held that the tax was properly imposed, but in their view collection of the tax was not authorised by law.
The High Court accordingly issued a writ of mandamus restraining the Municipal Council, Raichur from recovering the octroi duty levied in pursuance of the notification dated May 3, 1966.
The Municipal Council, Raichur, has appealed to this Court against the orders passed by the High Court.
The relevant provisions of the Mysore Municipalities Act 22 of 1964 and the Bye Laws may be summaried.
By section 94 the Municipal Council is authorised, subject to the general or special orders of the Government, and after observing the preliminary procedure prescribed by section 95, to levy, among other taxes, octroi on goods specified in Sch.
II entering the municipal limits for consumption, use or sale therein.
By sub section
(3) of section 94 it is provided that the taxes specified in sub section
(1) shall be assessed, levied and collected in accordance with the provisions of the Act and the rules made by the Government under section 323.
Section 95 prescribes the procedure preliminary to imposition of tax.
A municipal council has by resolution passed at a general meeting to select for the purpose one or more of the taxes specified in section 94 and in such resolution to specify the classes of persons or of property or of both which the municipal council proposes to make liable and to prescribe exemptions which it proposes to make, the amount or rate at which the municipal council.
proposes to assess any such class, and in the case; of octroi, the octroi stations.
The resolution must be published in the official Gazette and in such other manner as may be prescribed.
Any inhabitant of the municipality may within one month from the publication of the notice submit his objection to the imposition of the tax or to the amount or rate proposed, or to the classes of persons or property to be made liable, or to any exemptions proposed.
The municipal council must take into consideration the objections and submit to the Government of the State such objections with its opinion thereon and any modifications proposed in accordance therewith together with a copy of the notice.
A resolution sanctioned by the Government together with a notice reciting the sanction and the date and number thereof may then be published by the ,municipal council in the official Gazette, and the tax as prescribed by the, resolution shall be imposed accordingly.
Sub section (2) of "The publication of a notice under this section shall be conclusive evidence that the tax has been imposed in 90 accordance with the provisions of this Act and the rules made thereunder".
Section 123 provides that every municipal council when submitting for sanction a proposal for the imposition of octroi, shall submit therewith for sanction bye laws for the purposes of cl.
(m) of sub section
(1) of section 324 or adopt model bye laws made for the said purposes.
Section 124 deals with "non liability for octroi and refund of octroi on goods in transit".
Section 125 invests the municipal council with power to exempt articles liable to octroi duty, and section 126 relates to the presentation of bills for octroi and prescribes penalties for evasion of payment of octroi.
Section 127 prescribes the penalty for selling articles liable to octroi without a licence, or for being in possession of any such article on which octroi has not been paid.
Section 323 authorises the Government to make rules for carrying out all or any of the purposes of the Act and to prescribe forms for any proceeding for which it considers that a form shall be prescribed.
Exercising the authority conferred by section 323 the Government of Mysore published on September 2, 1965, the Mysore Municipalities Taxation Rules, 1965.
Rules 25 to 32 deal with the collection of octroi.
Rule 25 deals with the mode of collection; r. 26 with pay ment of octroi, r. 27 with assessment and collection of octroi at octroi station; and r. 28 with the procedure in case where octroi is leviable ad valorem.
Rule 3.1 requires the municipal council to maintain a list of traders and public bodies allowed to have an account current, and r. 32 requires a trader or public body allowed, to have an account current to present a declaration in Form VII.
Section 324 authorises the municipal council to make, alter or rescind bye laws, subject to the provisions of the Act and the rules made thereunder.
Clause (m) provides, insofar as it is material: " providing for the exhibition of tables of octroi, requiring a licence to be obtained for the sale of any article liable to octroi and prescribing the, conditions on or subject to which such licence may be granted, refused, suspended or withdrawn, regulating, subject to any general or special orders which the Government may make in this behalf, the system under which refunds are to be made on account thereof when the goods on which the octroi has been paid, or article manufactured wholly or in part from such goods, are again exported and the custody or storage of goods declared not to be intended for use or consumption or for sale within the municipality;. . .
Section 325(2) provides that a municipal council may by resolution adopt in respect of any matter the model bye laws made by the Government under sub section
(1) of section 325 in respect 'of matters specified in section 324.
Sub section (3) of section 325 provides: "If a municipal council proposes to adopt the model bye laws in respect of any matter subject to any modifications, the procedure specified in sub sections (4), (5) and (6) 91 of section 324 shall be followed as if the modifications were bye laws proposed to be made by the municipal council.
The modifications as approved by the Government shall be published in the prescribed manner and the model bye laws shall subject to such modifications come into force from such date as may be specified by the municipal council and where no date is specified on the date of such publication".
Sub sections (4) & (5) of section 324 set out the procedure to be followed by the municipal council in the making and publication of bye laws.
Sub section (6) authorises the local Government while approving the bye laws to make any changes therein which appear to it to be necessary.
In the present case the Municipal Council adopted the model bye laws framed by the Government.
It appears, however, that the table of rates in model bye law 16 relating to the levy of storage fee and charges on goods placed in the bonded warehouses was left blank.
The Municipal Council has however by resolution prescribed a, table of rates of storage fee and charges in respect of different classes of articles stored in the bonded warehouses.
The respondents challenge in this Court the validity of the imposition of octroi duty on two grounds: (i) that there was no valid resolution by the Municipal Council under section 94 of the Act selecting the octroi duty for imposition, and (ii) that the model bye laws having been altered by adding a tariff of storage fee in the bonded warehouses without following the procedure prescribed under section 324(4) & (5), the model bye laws could not be deemed to have been validly adopted by the Municipal Council.
They also submit that the Municipal Council has no authority to collect octroi duty, and support the judgment of the High Court, on that question.
Before considering the arguments advanced at the Bar, the steps taken by the Municipal Council for imposing the tax and for adoption of the model bye laws may be briefly set out.
On June 11, 1965 the Standing Committee of the Raichur Municipal Council resolved to levy octroi duty according to Sch. 11 under section 94 of the Mysore Municipalities Act, ' 1964, at the maximum rates at the octroi barriers specified therein.
It was recited in the resolution that confirmation of the general body be obtained.
By resolution dated June 28, 1965 the general body resolved unanimously to confirm the recommendations of the Standing Committee dated June 11, 1965.
On October 27, 1965 the notification under section 95 of the Act by the Municipality inviting objections to the proposals to impose octroi tax was published.
No Objections were received from any resident of the Municipality against the proposal to levy octroi.
On February 26, 1966 there was a special general body meeting of the, Municipal Council and it was resolved to levy 92 octroi with effect from April 1, 1966.
The resolution was in the following terms: "After due decision and consideration it was unanimously resolved to levy the octroi duty on all the goods imported within municipal limits of Raichur under the Schedule II of Mysore Municipalities Act, 1964, from the first day of April 1966.
Further the Committee resolved that the Hyderabad District Municipalities Octroi Rules, 1959, will continue till the new Octroi Rules and Bye laws are finalised under Mysore Municipalities Act, 1964.
" But this resolution was amended on March 25, 1966, and the second paragraph was substituted by the following paragraph: "Further the Committee resolved that the appended Bye laws framed by the Municipality in the light of Octroi Model Bye laws 1965 published by the Government in the Mysore Gazette dated 11th November, 1965, have been fully approved.
" Approval to the modification in the second paragraph was ob tained by circulation to the members and not in an open general meeting.
On March 31, 1966 the minutes of the meeting dated February 26, 1966, and the adoption of the resolution modifying the second paragraph by circulation on March 25, 1966, were read, heard and confirmed unanimously.
The storage fee under bye law 16 of the model bye laws was also adopted.
On April 16, 1966 sanction of the Government under section 96 of the Act to the levy of octroi and the adoption of model bye laws was given, and on May 3, 1966, the notification under section 97 of the Act imposing octroi duty under Sch.
II to the Act and adopting the bye laws was published.
Thereafter on various dates in the months of July and August 1966, the writ petitions out of which these appeals arise were filed.
There is no substance in the contention that the municipal council had not passed a resolution selecting the octroi tax for imposition.
As stated earlier, on June 11, 1965, the Standing Committee of the Municipal Council had "resolved to impose octroi duty" under Sch. 11 to the Act.
But the resolution also stated that confirmation of the general body meeting should be obtained.
The Municipal Council at its meeting dated June 28, 1965 treated the resolution of the Standing Committee as a recommendation and confirmed the recommendation.
The resolution dated June 28, 1965, was passed by the general body and thereby the Municipal Council adopted the recommendations of the Standing Committee, and resolved to select levy of octroi duty at the maximum rates at the octroi barriers specified therein.
It is true that the resolution modifying the original resolution dated February 26, 1966 was passed by circulation on March 25, 93 1966.
But in view of the terms of section 80(5) the validity of the resolution was not liable to be questioned on the ground of irregularity which manifestly did not affect the merit of the case.
, It may be recalled that on March 31, 1966 the "circulation dated 25 3 66 were read, heard and confirmed unanimously.
" The plea that a resolution passed by the Municipal Council cannot, under the Act, be modified or cancelled within three months is without force.
Section 57 of the Act provides that no resolution of a municipal council shall be modified or cancelled within three months after the passing thereof except by a resolution passed in the manner prescribed in that behalf.
There are no materials on the record to prove that the requirements of section 57 were not complied with, and section 97(2) prohibits an enquiry into the regularity of the procedure for imposition of the tax after a notice under section 97(1) is published.
This Court in Municipal Board, Hapur vs Raghuvendra Kripal & Ors.(1) in dealing with a similar provision in section 135 of the U. P. Municipalities Act 2 of 1916, held that section 135(3) shuts out enquiry into the procedure by which a tax had been imposed.
Hidayatullah, J., speaking for the majority observed (p. 958) .
"There is a difference between the tax and the imposition of the tax.
The former is the levy itself and the latter the method by which the levy is imposed and collected.
What the sub section does is to put beyond question the procedure by which the tax is imposed, that is to say, the various steps taken to impose it." Section 97(2) makes the publication of the notice under section 97(1) conclusive evidence that the tax has been imposed in accordance with the provisions of the Act and the rules made thereunder.
The expression "imposed in accordance with the provisions of this Act", in our judgment, means "imposed in accordance with the procedure provided under the Act".
All enquiry into the regularity of the procedure followed by the Municipal Council prior to the publication of the notice is excluded by section 97(2).
This is not a case in which the Municipal Council had not selected a tax for imposition by a resolution: nor is it a case in which the Municipal Council was seeking to levy tax not authorised by law.
A Municipal Council when submitting for sanction a proposal for the imposition of octroi has to submit under section 123 with the proposal for imposition of octroi, also ' bye laws for the purposes of cl.
(m) of sub section
(1) of section 324, or to adopt model bye laws made for the said purposes.
It is to be noticed that under section 94(3) of the Act the tax has to be.
assessed, levied and collected in accordance (1)[1966] I S.C.R. 950.
94 with the provisions of the Act and the rules made by the Government under section 323.
Bye laws contemplated to be made under section 324(1)(m) and required to be adopted from the model bye laws or specially framed and submitted under section 123 deal with matters of details, such as the exhibition of tables of octroi; requiring a licence to be obtained for the sale of any article liable to octroi and prescribing the conditions on or subject to which such licence may be granted, refused, suspended or withdrawn , regulating the system under which the refunds are to be made when the goods on which the octroi has been paid are again exported; for the custody or storage of goods declared not to be intended for use or consumption or for sale within the municipality; prescribing a period of limitation after which no claim for refund of octroi shall be entertained; and prescribing the minimum amount for which any claim for refund may be made.
If bye laws in respect of these matters specified in cl.
(m) of section 324(1) are made and submitted for sanction or model bye laws framed by the Government for those purposes are adopted, the requirements of section 123(1) will be satisfied, and if the State Government sanctions the resolution of the Municipal Council imposing octroi duty under section 97(1) and the notice is duly published, octroi duty may be collected by the Municipal Council.
Defect in the bye laws will not affect the authority of the Municipal Council to collect the tax, for the authority arises under section 94(3) from the Act and the rules.
The Municipal Council of Raichur adopted the model byelaws made by the Government.
None of the bye laws "for the purposes" of cl.
(m) of section 324 in the model bye laws was defective or incomplete.
The model bye laws undoubtedly did not prescribe the storage fee, and the resolution of the Municipal Council levying storage fee at the rates set out in the bye laws and submitted to the Government was not made in conformity with the terms of section 324(4) & (5).
The High Court held that the bye laws adopted by the Muni cipal Council were invalid because (1) the resolution dated February 26,1966 could not have been modified by circulation; and (2) that it was not shown that the Municipal Council had complied with the requirements of section 57 when modifying the resolution dated February 26, 1966; and (3) that the State Government had not fixed the time prescribed by bye laws Nos.
23(e), 27, 28 and 32, and since no decision was taken on those bye laws by the Municipal Council, the enforcement of the octroi levy was "rendered difficult".
It is clear that under section 325(3) modifications to the model bye laws alone require compliance with sub sections
(4) & (5) of section 324.
It may be assumed that fixing a tariff for storage fee under bye law 16 which is not prescribed under the model bye laws amounts to 95 modification of the bye laws, but even on that assumption only bye law 16 may be deemed to be invalid, and the power to collect the storage fee may not be lawfuly exercised by the Municipal Council: that does not affect the validity of the other bye laws.
If without a particular bye law, the scheme of the.
rest of the bye laws may be unworkable, it may follow by necessary implication that the other bye laws have also become ineffective.
But that cannot be said of the defect in adopting the table of fees for the purpose of bye law 16.
The Municipal Council may not be entitled to levy any charge for storage under bye law 16, but that is the only effect of non compliance with the terms of sub sections
(4) and (5) of section 324.
The other bye laws remain valid and operative, for they are plainly severable.
Bye law 23(e) of the model bye laws provides that no refunds shall be allowed in respect of goods which are transported outside the municipal limits within one month of their being brought into the municipal limits, but regarding which the intimation has not been given to the Municipal Commissioner or Chief Officer within such time as may be fixed by the Municipal Council.
Bye law 27 provides that the application for refund with the goods to which it relates shall be presented at the Octroi Station through which it is transported outside the municipal limits within such interval from the hour of examination as the municipal council may determine.
Similarly bye law 28 provides that the Octroi Official inCharge of the Octroi Station shall satisfy himself that the goods produced for transport outside the municipal limits as covered by the refund application correspond with the entries in the refund application form and that they are presented within the time fixed by the Municipal Council under bye law 27.
In our judgment, the time contemplated to be fixed for the purposes of bye laws 23(e), 27 & 28 need not be fixed by the bye laws.
If time is fixed by resolution of the Municipal Council even after the bye laws are sanctioned, there would be no defect in the bye laws.
Bye law 32 provides that no person shall sell articles men tioned therein without obtaining a licence granted in that behalf.
The model bye law is silent as to the articles which may not be sold without obtaining a licence.
Bye laws 313 to 36 depend for their 'operation upon the list of articles being effectively incorporated in bye law 32.
Failure to incorporate the list of articles would result in the Municipal Council being unable to enforce compliance with the requirements of taking out a licence.
But we are unable to hold that because of the failure to fix the time under bye laws 23(e), 27, 28, or for failure to incorporate the list of articles in bye law 32, the rest of the bye laws became ineffective.
We are of the view that even without these bye laws and bye law 16, octroi duty may be levied by the Municipal Council.
In our view, the High Court was in error in holding that the model byelaws which were adopted by the Municipal Council were unenforceable.
96 The appeals must therefore be allowed and the petitions filed by the respondents dismissed with costs in this Court.
One hearing fee.
The order passed by the High Court regarding the costs is maintained.
G.C. Appeals allowed.
| On June 11, 1965, the Standing Committee of the Raichur Municipal Council resolved to levy octroi duty according to Sch.
II under section 94 of the Mysore Municipalities Act, 1964.
It was recited in the resolution that the confirmation of the general body be obtained.
The general body unanimously approved the resolution of the Standing Committee.
On October 27, 1965 the notification under section 95 of the Act inviting objections from the public was published; no objections were received.
On February 26, 1966 there was a special general body meeting and it was.
resolved to levy octroi with effect from April 1, 1966.
This resolution was however amended by modification of its second paragraph on March 25, 1966.
Approval to this modification was obtained at first by circulation to the members on March 31, 1966 the minutes of the meeting dated February 26, 1966 and the adoption of the resolution modifying the second paragraph by circulation on March 25, 1966, were read, heard and confirmed unanimously.
As required by section 123 of the Act the model bye laws framed by Government were adopted but the table of rates in model bye law 16 relating to the levy of storage fee and charges on goods placed in the bonded warehouses was, left blank.
The rates were fixed by the Council by its resolution of March 31, 1966.
On April 16, 1966 sanction of the Government under section 96 of the Act to the levy of octroi and the adoption of model by laws was given and on May 3, 1966, the notification under section 97 of the Act imposing octroi duty under Sch.
II and adopting the bye laws was published.
The respondents who were dealers in cloth in Raichur moved the High Court of Mysore under article 226 of the Constitution.
The High Court held that though octroi had been properly levied its collection wag unau thorised owing to defects in the bye laws adopted.
The municipality appealed.
The following questions fell for consideration: (i) whether the resolution levying the octroi and the subsequent modification of the said resolution were procedurally valid (ii) whether the fixation of rates for the purpose of model bye law 16 was validly made, the procedure in section 324(4) and (5) not having been followed , (iii) whether the bye laws were unenforceable for the reason that they did not fix the time for the purpose of bye laws 23, 27 and 28 and did not give a list of articles for the purpose of bye laws 33 to 36.
HELD:(i) The resolution of the Standing Committee selecting octroi tax for imposition expressly stated that confirmation of the general body would be obtained, and such confirmation was actually obtained.
It could not in the circumstances be contended that 88 there was no valid resolution by the Municipal Council under section 94 selecting octroi duty for imposition.
[92F H] The resolution modifying the original resolution dated February 26, 1966 was no doubt passed by circulation but later the said circulation was "read, heard and confirmed unanimously" by the general body.
Under section 80(5) any irregularity not affecting the merit of the case can be cured and section 97(2) prohibits enquiry into the regularity of the procedure by which a tax has been imposed after a notice under section 97 (1) is published.
No material had been placed before the Court to show that in making the modification section 57 had not been complied with.
[93A D] Municipal, Board, Hapur vs Raghuvendra Kripal & Ors., ; , relied on.
(ii)If bye laws in respect of the matters specified in cl.
(m) of section 324(1) are made and submitted for sanction or model bye laws framed by the Government for those purposes are adopted, the requirements of section 123(1) will be satisfied, and if Government sanctions the resolution of the Municipal Council imposing octroi duty under section 97(1) and the notice is duly published.
octroi duty may be collected by the Municipal Council.
Defect in 'the bye laws will not affect the authority of the Municipal Council to collect the tax for the authority arises under section 94(3) from Act and the Rules.
[94C D] The Municipal Council by fixing a tariff for storage fee under bye law 16 modified the model bye laws, and since the modification was made without the Procedure prescribed in section 324(4) and (5) the said bye law was invalid.
As a result the Municipal Council was not entitled to levy any charge for storage under bye law 16.
But the validity of other bye laws was not thereby affected.
[94H 95C] (iii)The time contemplated to be fixed for the purposes of byelaws 23(e), 27 and 28 need not be fixed in the bye laws.
If time is fixed by resolution of the Municipal Council after the bye laws are sanctioned, there would be no defect in the bye laws.
[95E F] Bye laws 33 to 36 depend for their operation upon the list of articles being effectively incorporated in bye law 32.
Failure to incorporate the list of articles would result in the Municipal Council I being unable to enforce compliance with the requirement of taking out a licence.
The rest of the by laws did not threby become ineffective.
[95G H]
|
Appeal No. 1121 of 1966.
Appeal by special leave from the judgment and order dated August 17, 1965 of the Punjab High Court, in Letters Patent Appeal No. I 10 of 1965.
203 Janardan Sharma and R. N. Sachthey, for the appellant.
The respondent did not appear.
The Judgment of the Court was delivered by Sikri, J.
This appeal by special leave is directed against the judgment of the High Court of Punjab accepting the petition filed by the rate payers of Municipal Committee, Rohtak, respondents before us, and ordering that the State Government shall not proceed with the constitution of the Rohtak Improvement Trust under the notification of August 30, 1961.
The High Court allowed the petition because it held (1) that sub section
(3) of section I of the Punjab Town Improvement Act (Punjab Act IV of 1922) here in after referred to as the Act only envisages the creation 'of a Trust in a Municipal area where a Committee is functioning and so is in a position to hold a special meeting to decide whether or not it considers the creation of a trust desirable, and (2) that once a trust ceases to exist under section 103(l) of the Act in order to recreate the trust, the Act has to be applied again, and as the Municipal Committee had at a special meeting held on November 9, 1962, decided unanimously that the Act should not be applied the Government was bound to give effect to that decision.
The learned counsel for the appellant, Mr. Sachthey, contends that the High Court has placed a wrong interpretation on the two provisions mentioned above and somehow section 4 A of the Act was not noticed by the High Court.
Before we deal with the interpretation of the provisions mentioned above it is necessary to state a few facts.
The Rohtak Municipal Committee was superseded on August 2, 1954.
The Government purported to extend the provisions of the Act to the whole of the area of the Municipality on May 21, 1958.
The notification to this effect reads "In pursuance of the provisions of sub section of Section I of the Punjab Town Improvement Act 1922 (Punjab Act No. IV of 1922), the Governor of Punjab proposes to apply the provisions of the said Act to the whole of the area of the municipalities specified below with effect from 9th June, 1958 1. . 2. . 3.
Rohtak,. " Sub section (3) of section 1 of the Act reads as follows "1.
(3) This section and section 66 shall come into force at once.
The State Government may by notification propose to apply the rest of the Act to the whole or any part of any municipality and to any locality adjacent 204 thereto, on such date as may be specified in such notification; and the Act shall come into operation after the, lapse of three months unless within that period the municipal committee concerned at meeting convened for the purpose of considering the application of the Act resolve by a majority of two thirds that the Act should not be so applied.
" In pursuance of this notification a trust was set up.
But on August 30, 1961, the Government issued a notification in exercise of its powers under sub section
(1) of section 103 of the Act and declared that the Rohtak Improvement Trust shall be dissolved with effect from August 30, 1961 from which the Chairman and the trustees of the aforesaid Trust ceased to function.
Section 103(1) of the Act reads as follows : "103.
(1) When all schemes sanctioned under this Act have been executed or have been so far executed as to render the continued existence of the trust, in the opinion of the State Government, unnecessary, or when in the opinion of the State Government it is expedient that the trust shall cease to exist, the State Government may by notification declare that the trust shall be dissolved from such date as may be specified in this behalf in such notification; and the trust shall be deemed to be dissolved accordingly.
" It appears that on the supersession of the Municipality of Rohtak in 1954 an Administration was appointed under section 238 of the Punjab Municipal Act, 191 1.
This section, inter alia, provides: "238.
(1) . (2) When a committee is so superseeded.
the following consequences shall ensue (a). (b) all powers and duties of the committee may, until the committee is reconstituted, be exercised and performed by such persons as the State Government may appoint in that behalf;" Fresh elections of the Municipal Committee, Rohtak, were held in July 1961, and the Municipal Committee reconstituted on January 10, 1962.
On October 23, 1962, the Government informed the Deputy Commissioner, Rohtak, that it had decided to reconstitute Rohtak Improvement Trust immediately and asked the Deputy Commissioner to recommend a panel of six names of suitable persons for appointment as trustees and the Government also asked him to call upon the Municipal Committee, Rohtak, to elect its representatives as trustees.
205 This was not to the liking of the Municipal Committee and the Municipal Committee unanimously passed a resolution on November 9, 1962, strongly opposing the reconstitution of the Improvement Trust, Rohtak.
The Government by notification dated January 10, 1963, in exercise of powers conferred 'by sub section
(2) of section 4 of the Act appointed one Major section K.Mehta as Chairman, Rohtak Improvement Trust.
The Municipal Committee was again requested to send two names of three members of the Municipal Committee to be appointed as trustees as required by cl.
(b) of sub section
( 1) of section 4 of the Act.
Thereupon 32 rate payers filed the petition under article 226 of the Constitution challenging the reconstitution of the Rohtak Improvement Trust.
Coming to the first point decided by the High Court, it seems to us that section 4 A to the Act was not brought to its notice and if it had been brought to its notice the High Court may well have come to the contrary conclusion.
Section 4 A which, was inserted by Punjab Act VIII of 1936 reads : "4 A.
During the period of supersession of a Municipal Committee under section 238 of the Punjab Municipal Act, 191 1, the three seats allotted to the Municipal Committee on the trust under clause (b) of sub section (1) of section 4 shall be filled by the State Government by appointing any three persons by notification in the Official Gazette.
The term of office of every trustee so appointed shall be three years or until the Trust is dissolved, whichever period is less, provided that if the Municipal Committee is reconstituted three members of the Municipal Committee shall be elected or appointed in accordance with the provisions of section 4, and on their election or appointment the three trustees appointed by the State Government under this section shall cease to be members of the Trust.
" Reading section 1(3) and section 4A of the Act, and section 238 of the Punjab Municipal Act, 191 1, together, it seems to us that the true meaning of the latter portion of sub section (3) of section 1 is that when the Government applies the section and the Municipal Committee has been superseded before that date, it is the Administrator who would exercise the powers given under the latter part of that sub section; in other words, the Administrator would be competent to say to the Government that the Act shall not come into operation.
The words of section 238 of the Punjab Municipal Act are very wide and it is difficult to limit the expression "all powers and duties of the committee" in any manner.
The Municipality exercised powers by resolution passed by majority and the fact that this particular resolution had to be by two third majority does not lead 206 to the conclusion that the power to oppose the application of the Act vesting in the Municipal Committee cannot be exercised by the Administrator under section 238, Punjab Municipal Act.
Section 4A of the Act clearly proceeds on the basis that while the Municipal Committee stands superseded the appointment of trustees which was originally to be made by the Municipal Committee would be made 'by the State Government.
As the High Court did not have section 4 A before it had relied on the anomaly that where a Municipal Committee was suspended the Government could nominate some members of the suspended Committee as members of the Trust or otherwise fill these vacancies, and the High Court felt that it could not believe that it was the intention of the Legislature.
Coming to the second point.
made by the High Court, it seems that the High Court has wrongly,, held that once the Act has been applied it is necessary that it should be applied again when the Municipal Committee is reconstituted.
There is nothing in the words of sub section
(3) of section I to 'warrant this conclusion.
Once the Act has come into operation in accordance with the provisions of sub section
(3) of section 1 there is no provision by which the Act can cease to apply.
The only point that remains is,: when a trust has been dis solved under section 103 of the Act, can it be reconstituted under the Act ? The only provisions under which a trust can be reconstituted under the Act are sections 3 and 4.
Section 3 reads : "3.
The duty of carrying out the provisions of this ' Act in any local area shall, subject to the conditions and limitations hereinafter contained, be vested in a board to be called "The (name of town) Improvement Trust" hereinafter referred to as the 'The Trust"; and every such board shall be a body corporate and have perpetual succession and common seal, and shall by the said name sue and be sued.
" Section 4 reads; "4.
(1) The trust shall consist of seven trustees, namely The other sub sections of section 4 provide how the trustees are to be appointed.
It seems to us that if the trust could originally be created under sections 3 and 4, reading sections 3 and 4 and section 12 of the General Clauses Act, the Government has the power to create a view trust or reconstitute a new trust.
We may mention that section 12 of the Gene 207 ral Clauses (Punjab.) Act, 1898, provides that "where by any Punjab Act any power is conferred then that power may be exercised from time to time as occasion requires.
" In the result the judgment of the High Court is set aside, the appeal allowed and the writ petition dismissed.
There, will be no order as to costs throughout.
Y.P. Appeal allowed.
| The Rohtak Municipal Committee was superseded in August 1954, and an Administrator was appointed under section 238 of the Punjab Municipal Act, 1911.
In June 1958 the provisions of the Punjab Town Improvement Act, 1922, were extended to the Municipality and the Rohtak Improvement Trust was set up under the Act.
In August 1961, the Government issued a notification under section 103 (1) of the 1922 Act dissolving the Trust.
The Municipal Committee was reconstituted in January 1962 and in October 1962 the Government decided to reconstitute the Trust.
The Municipal Committee thereupon passed a resolution opposing the reconstitution of the Trust.
In January 1963, however, the Government re constituted the Trust and the Municipal Committee was asked to name its representatives to be appointed as trustees.
The rate payers filed a writ petition challenging the reconstitution of the trust and the High Court allowed the petition.
In appeal to this Court, HELD : (1) The attention of the High Court was not drawn to section 4A of the 1922 Act and therefore it erred in holding that the Trust could not be set up in 1958 because, under section 1(3) of the 1922 Act a Trust cannot be created in a Municipal area unless the committee was functioning.
Under section 4A, where the Municipal Committee was superseded the State ,Government could appoint the trustees, and there was no anomaly in the Government nominating the trustees, because, the Administrator who had all the powers and duties of the Committee under section 238 of the 1911 Act was competent to say to the Government that the 1922 Act should not be applied to the Municipality.
[205 C D 206 B] (2) Once the 1922 Act had come into operation under section 1(3), it ,continues to apply and it was not necessary to apply it again when the Municipal Committee was reconstituted in 1962.
[206 D] (3) Under sections 3 and 4 of the 1922 Act and the General Clauses (Punjab) Act, 1898, Government has the power to create a new trust or reconstitute a Trust which was dissolved.
[206 H]
|
Appeal No. 85 of 1956.
20 154 Appeal from the judgment and order dated January 8, 1954, of the High Court of Saurashtra, at Rajkot, in Civil Misc.
Application No. 70 of 1952.
R. J. Kolah and A. C. Dave, for the appellant.
Porus A. Mehta and R. H. Dhebar, for respondent No. 1. 1956.
November 23.
The Judgment of the Court was, delivered by BHAGWATI J.
This appeal with a certificate of fitness granted by the High Court of Saurashtra raises an interesting question whether the agarias working in the Salt Works at Kuda in the Rann of Cutch are workmen within the meaning of the term as defined in the , hereinafter referred to as the Act.
The facts as found by the Industrial Tribunal are not in dispute and are as follows.
The appellants are lessees of the Salt Works from the erstwhile State of Dharangadhara and also hold a licence for the manufacture of salt on the land.
The appellants require salt for the manufacture of certain chemicals and part of the salt manufactured at the Salt Works is utilised by the appellants in the manufacturing process in the Chemical Works at Dharangadhara and the remaining salt is sold to outsiders.
The appellants employ a Salt Superintendent who is in charge of the Salt Works and generally supervises the Works and the manufacture of salt carried on there.
The appellants maintain a a railway line and sidings and also have arrangements for storage of drinking water.
They also maintain a grocery shop near the Salt Works where the agarias can purchase their requirements on credit.
The salt is manufactured not from sea water but from rain water which soaking down the surface becomes impregnated with saline matter.
The operations are seasonal in character and commence sometime in October at the close of the monsoon.
Then the entire area is parceled out into plots called pattas and they are in four parallel rows intersected by the railway 155 lines.
Each agaria is allotted a patta and in general the same patta is allotted to the same agaria year after year.
If the patta is extensive it is allotted to two agarias who work the same in partnership.
At the time of such allotment, the appellants pay a sum of Rs. 400/ for each of the pattas and that is to meet the initial expenses.
Then the agarias commence their work.
They level the lands and enclose and sink wells in them.
Then the density of the water in the wells is examined by the Salt Superintendent of the appellants and then the brine is brought to the surface and collected in the reservoirs called condensers and re tained therein until it acquires by natural process a certain amount of density.
Then it is flowed into the pattas and kept there until it gets transformed 'into crystals.
The pans have got to be prepared by the agarias according to certain standards and they are tested by the Salt Superintendent.
When salt crystals begin to form in the pans they are again tested by the Salt Superintendent and only when they are of a particular quality the work of collecting salt is allowed to be commenced.
After the crystals are collected, they are loaded into the railway wagons and transported to the depots where salt is stored.
The salt is again tested there and if it is found to be of the right quality, the agarias are paid therefore at the rate of Rs. 0 5 6 per maund.
Salt which is rejected belongs to the appellants and the agarias cannot either remove the salt manufactured by them or sell it.
The account is made up at the end of the season when the advances which have been paid to them from time to time as also the amounts due from the agarias to the grocery shop are taken into account.
On a final settlement of the accounts, the amount due by the appellants to the agarias is ascertained and such balance is paid by the appellants to the agarias.
The manufacturing season comes to an end in June when the monsoon begins and then the agarias return to their villages and take up agricultural work.
The agarias work themselves with their families on the pattas allotted to them.
They are free to engage extra labour but it is they who make the payments to 156 these labourers and the appellants have nothing to do with the same.
The appellants do not prescribe any hours of work for these agarias.
No muster roll is maintained by them nor do they control how many hours in a day and for how many days in a month the agarias should work.
There are no rules as regards leave or holidays.
They are free to go out of the works as they like provided they make satisfactory arrangements for the manufacture of salt.
In about 1950, disputes arose between the agarias and the appellants as to the conditions under which the agarias should be engaged by the appellants in the manufacture of salt.
The Government of Saurashtra, by its letter of Reference dated November 5, 1951, referred the disputes for adjudication to the Industrial Tribunal, Saurashtra State, Rajkot.
The appellants contested the proceedings on the ground, inter alia, that the status of the agarias was that of independent contractors and not of workmen and that the State was not competent to refer their disputes for adjudication under section 10 of the Act.
This question was tried as a preliminary issue and by its order dated August 30, 1952, the Tribunal held that the agarias were workmen within the meaning of the Act and that the reference was intra vires and adjourned the matter for hearing on the merits.
Against this order the appellants preferred an appeal being Appeal No. 302 of 1952, before the Labour Appellate Tribunal of India, and having failed to obtain stay of further proceedings before the Industrial Tribunal pending the appeal, they moved the High Court of Saurashtra in M.P. No. 70 of 1952 under articles 226 and 227 of the Constitution for an appropriate writ to quash the reference dated November 5, 1951, on the ground that it was without jurisdiction.
Pending the disposal of this writ petition, the appellants obtained stay of further proceedings before the Industrial Tribunal and in view of the same the Labour Appellate Tribunal passed an order on September 27, 1953, dismissing the appeal leaving the question raised therein to the decision of the High Court.
By their judgment dated January 8, 1954, the learned Judges 157 of the High Court agreed with the decision of the Industrial Tribunal that the agarias were workmen within section 2(.s) of the Act and, accordingly, dismissed the application for writ.
They, however, granted a certificate under article 133(1) (c) of the Constitution and that is how the appeal comes before us.
The sole point for determination in this appeal is whether the agarias working in the Salt Works of the appellants at Kuda are workmen within the definition of that term in section 2(s) of the Act.
" Workman " has been thus defined in section 2 (s) of the Act: "(s) 'Workman ' means any person employed (including an apprentice) in any industry to do any skilled or unskilled manual or clerical work for hire or ' reward and includes, for the purposes of any proceedings under this Act in relation to an industrial dispute, a workman discharged during that dispute, but does not include any person employed in the naval, military or air service of the (Government).
" The essential condition of a person being a workman within the terms of this definition is that he should be employed to do the work in that industry, that there should be, in other words, an employment of his by the employer and that there should be the relationship between the employer and him as between employer and employee or master and servant.
Unless a person is thus employed there can be no question of his being a workman within the definition of the term as contained in the Act.
The principles according to which the relationship as between employer and employee or master and servant has got to be determined are well settled.
The test which is uniformly applied in order to determine the relationship is the existence of a right of control in respect of the manner in which the work is to be done.
A distinction is also drawn between a contract for services and a contract of service and that distinction is put in this way: " In the one case the master can order or require what is to be done while in the other case he can not only order or require what is to be done 158 but how itself it ,;hall be done." (Per Hilbery, J. in Collins vs Hertfordshire County Council (1).) The test is, however, not accepted as universally correct.
The following observations of Denning L.J., at pp. 110, III in Stevenson, Jordan and Harrison Ltd. vs Macdonald and Evans (2) are apposite in this context: "But in Cassidy vs Ministry of Health (3) Lord Justice Somervell, pointed out that test is not universally correct.
There are many contracts of service where the master cannot control the manner in which the work is to be done as in the case of a captain of a ship.
Lord Justice Somervell, went on to say: One perhaps cannot get much beyond this: 'Was the contract a contract of service within the meaning which an ordinary man would give under the words '? " I respectfully agree.
As my Lord has said, it is almost impossible to give a precise definition of the distinction.
It is often easy to recognize a contract of service when you see it, but difficult to say wherein the difference lies.
A ship 's master, a chauffeur, and a reporter on the staff of a newspaper are all employed under a contract of service; but a ship 's pilot, a taxi man, and a newspaper contributor are employed under a contract for services.
One feature which seems to run through the instances is that, under a contract of service, a man is employed as part of the business, and his work is done as an integral part of the business; whereas., under a contract for services, his work, although done for the business, is not integrated into it but is only accessory to it.
" We may also refer to a pronouncement of the House of Lords in Short vs J. & W. Henderson, Ltd. (4) where Lord Thankerton recapitulated the four indicia of a contract of service which had been referred to in the judgment under appeal, viz., (a) the master 's power of selection of his servant, (b) the payment of wages or (1) , 615.
(2) , Ill. (3) , 543 s.c. , 352 3.
(4)(1946)62T.L.R. 427,429.
159 other remuneration, (c) the master 's right to control the method of doing the work, and (d) the master 's right of suspension or dismissal, but observed: "Modern industrial conditions have so much affected the freedom of the master in cases in which no one could reasonably suggest that the employee was thereby converted into an independent contractor that, if and when an appropriate occasion arises, it will be incumbent on this House to reconsider and to restate these indicia.
For example, (a), (b) and (d) and probably also (c), are affected by the statutory provisions and ,rules which restrict the master ',% choice to men supplied by the labour bureaux, or directed to him under the Essential Work provisions, and his power of suspension or dismissal.
is similarly affected.
These matters are also affected by trade union rules which are atleast primarily made for the protection of wage earners.
" Even in that case, the House of Lords considered the right of supervision and control retained by the employers as, the only method if occasion arose of securing the proper and efficient discharge of the cargo as sufficiently determinative of the relationship between the parties and affirmed that " the principal requirement of a contract of service is the right of master in some reasonable sense to control the method of doing the work and this factor of superintendence and control has frequently been treated as critical and decisive of the legal quality of relationship.
The position in law is thus summarised in Halsburv 's Laws of England, Hailsham edition, Vol. 22, page 112, para. 191: " Whether or not, in any given case, the relation of master and servant, exists is a question of fact; but in all cases the relation imports the existence of power in the employer not only to direct what work the servant is to do, but also the manner in which the work is to be done.": and until the position is restated as contemplated in Short vs J. & W. Henderson Ltd., (supra), we may take it as the prima facie test for determining the relationship between master and servant, 160 The principle which emerges from these authorities is that the prima facie test for the determination of the relationship between master and servant is the existence of the right in the master to supervise and control the work done by the servant not only in the matter of directing what work the servant is to do but also the manner in which he shall do his work, or to borrow the words of Lord Uthwatt at page 23 in Mersey Docks and Harbour Board vs Coggins & Griffith (Liverpool) Ltd., and Another (1), " The proper test is whether or not the hirer had authority to control the manner of execution of the act in question The nature or extent of control which is requisite to establish the relationship of employer and employee must necessarily vary from business to business and is by its very nature incapable of precise definition.
As has been noted above, recent pronouncements of the Court of Appeal in England have even expressed the view that it is not necessary for holding that a person is an employee, that the employer should be proved to have exercised control over his work, that the test of control was not one of universal application and that there were many contracts in which the master could not control the manner in which the work was done (Vide observations of Somervell, L.J., in Cassidy vs Ministry of Health (supra), and Denning, L.J., in Stevenson, Jordan and Harrison Ltd. vs MacDonald and Evans (supra).) The correct method of approach, therefore, would be to consider whether having regard to the nature of the work there was due control and supervision by the employer or to use the words of Fletcher Moulton, L.J., at page 549 in Simmons vs Health Laundry Company (2): " In my ' opinion it is impossible to lay down any rule of law distinguishing the one from the other.
It is a question of fact to be decided by all the circumstances of the case.
The greater the amount of direct control exercised over the person rendering the services by the person contracting for them the stronger the (1) ; 23.
(2) [1910] 1 K.B 543, 54 550.
9 161 grounds for holding it to be a contract of service, and similarly the greater the degree of independence of such control the greater the probability that the services rendered are of the nature of professional services and that the contract is not one of service.
" The Industrial Tribunal on a consideration of thes facts in the light of the principles enunciated above, came to the conclusion that though certain features which are usually to be found in a contract of service were absent, that was due to the nature of the industry and that on the whole the status of the agarias was that of workmen and not independent contractors.
It was under the circumstances strenuously urged before ,us by the learned counsel for the respondents that the question as regards the relationship between the appellants and the agarias was a pure question of fact, that the Industrial Tribunal had jurisdiction to decide that question and had come to its own conclusion in regard thereto, that the High Court, exercising its jurisdiction under articles 226 and 227 of the Constitution, was not competent to set aside the finding of fact recorded by the Industrial Tribunal and that we, here, entertaining an appeal from the decision of the High Court, should also not interfere with that finding of fact.
Reliance was placed on the observations of Mahajan, J., as he then was, in Ebrahim Aboobakar vs Custodian General of Evacuee Property (1) "It is plain that such a writ cannot be granted to quash the decision of an inferior court within its jurisdiction on the ground that the decision is wrong.
Indeed, it must be shown before such a writ is issued that the authority which passed the 'order acted without jurisdiction or in excess of it or in violation of the principles of natural justice.
But once it is held that the court has jurisdiction but while exercising it made a mistake, the wronged.
party can only take the course prescribed by law for setting matters right inasmuch as a court has jurisdiction to decide rightly as well as wrongly. " (1) ; ,702.
21 162 There is considerable force in this contention of the respondents.
The question whether the relationship between the parties is one as between employer and employee or between master and servant is a pure question of fact.
Learned counsel for the appellants "relied upon a passage from Batt 's "Law of Master and Servant", 4th edition, at page 10: " The line between an independent contractor and a servant is often a very fine one; it is a mixed question of fact and law, and the judge has to find and select the facts which govern the true relation between the parties as to the control of the work, and then he or the jury has to say whether the person employed is a servant or a contractor.
" This statement, however, rests upon a passing observation of Mc Cardie, J. in Performing Right Society Ltd. vs Mitchell and Booker (Palais de Danse)(1) and is contrary to the oaten& of authorities which lays down that whether or not in any given case the relation of master and servant exists is purely one of fact.
(Vide Halsbury 's "Laws of England", Hailsham edition, Vol. 22, page 112, para.
191; Per Cozens Hardy, M.R. at page 547 and Per Fletcher Moulton, L.J. at page 549 in Simmons vs Heath Laundry Company (supra).
It is equally well settled that the decision of the Tribunal on a question of fact which it has jurisdiction to determine is not liable to be questioned in proceedings under article 226 of the Constitution unless at the least it is shown to be fully unsupported by evidence.
Now the argument of Mr. Kolah for the appellants is that even if all the facts found by the Tribunal are accepted they only lead to the conclusion that the agarias are independent contractors and that the finding, therefore, that they are workmen is liable to be set aside on the ground that there is no evidence to support it.
We shall, therefore, proceed to determine the correctness of this contention.
Apart from the facts narrated above in regard to which there is no dispute, there was the evidence of the Salt Superintendent of the appellants which was recorded before the Tribunal: (1) 163 "The panholders are allotted work on the salt pans by oral agreement.
The Company has no control over the panholders in regard to the hours of work or days of work.
The Company 's permission is nor sought in matter of sickness or in matter of going out to some village.
The Company has no control over the panholders as to how many labourers they should engage and what wages they should pay them.
The company 's supervision over the work of the panholders is limited to the proper quality as per requirements of the Company and as per standard determined by the Government in matter of salt.
, The company 's supervision is limited to this extent.
The Company acts in accordance with Clause 6 of the said agreement in order to get the proper quality of salt.
Panholders are not the workmen of the Company, but are contractors.
The men, who are entrusted with pattas, work themselves.
They can engage others to help them and so they do.
There is upto this day no instance that any penholder who is entrusted with a patta, has not turned up to work on it.
But we do not mind whether he himself works or not.
If any penholder after registering his name (for a patta) gets work done by others, we allow it to be done.
We own 319 pattas.
Some patta8 have two partners.
In some, one man does the job.
ID all the pans, mainly the panholders work with the help of their (respective) families.
" Clause 6 of the agreement referred to in the course of his evidence by the Salt Superintendent provided: " 6.
We bind ourselves to work as per advice and instructions of the officers appointed by them in connection with the drawing of brine or with the process of salt production in the pattas and if there is any default, negligence or slackness in executing it on our part or if we do not behave well in any way, the Managing Agent of the said Company can annul this agreement and can take possession of the patta, brine, well etc., and as a result we will not be entitled to claim any 164 sort of consideration or compensation for any half processed salt lying in our patta; or in respect of any expense incurred or labour employed in preparing kiwa patta, well bamboo lining etc.
" There was also the evidence of Shiva Daya, an agaria, who was examined on behalf of the respondents: " There is work of making enclosures and then of sinking wells.
The company supervises this work.
While the wells are being sunk, the company measures the density of the brine of wells.
In order to bring the brine of wells to the proper density, it is put in a condenser and then the Company tests this and then this brine is allowed to flow in the pattas.
The bottom of a patta is prepared after it is properly crushed under feet and after the company inspects and okays that it is alright, water is allowed to flow into it.
When salt begins to form at the bottom of a patta, an officer of the company comes and inspects it.
At the end of 21 months, the water becomes saturated, i.e., useless, and so it is drained away under the supervision of the company.
Then fresh brine is allowed to flow into the patta from the condenser.
This instruction is also given by the company 's officer.
" It was on a consideration of this evidence that the Industrial Tribunal came to the conclusion that the supervision and control exercised by the appellants extended to all stages of the manufacture from beginning to end.
We are of opinion that far from there being no evidence to support the conclusion reached by the Industrial Tribunal there were materials on the record on the basis of which it could come to the conclusion that the agarias are not independent contractors but workmen within the meaning of the Act.
Learned counsel for the appellants laid particular stress on two features in this case which, in his submission, were consistent only with the position that the agarias are independent contractors.
One is that they do piece work and the other that they employ their own labour and pay for it.
In our opinion neither of these two circumstances is decisive of the question.
As 165 regards the first, the argument of the appellants is that as, the agaria8 are under no obligation to work for fixed hours or days and are to be paid wages not per day or hours but for the quantity of salt actually produced and passed, at a certain rate,, the very basis on which the relationship of employer and employees rests is lacking, and that they can only be regarded as independent contractors.
There is, however, abundant authority in England that a person can be a workman even though he is paid not per day but by the job.
The following observations of Crompton, J. in Sadler vs Henlock (1) are pertinent in this behalf : " The test here is, whether the defendant retained the power of controlling the work.
No distinction can be drawn from the circumstances of the man being employed at so much a day or by the job.
I think that here the relation was that of master and servant, not of contractor and contractee." (See also Blake, vs Thirst (2) and Halsbury 's " Laws of England ", Hailsham edition, Vol. 22, page 119, para.
194, wherein it is stated that if a person is a worker and not a contractor, " it makes no difference that his work is piece work ".) As regards the second feature relied on for the appellants it is contended that the agaria8 are entitled to engage other persons to do the work, that these persons are engaged by the agaria8 and are paid by them, that the appellants have no control over them and that these facts can be reconciled only with the position that the agaria8 are independent contractors.
This argument, however, proceeds on a misapprehension of the true legal position.
The broad distinction between a workman and an independent contractor lies in this that while the former agrees himself to work, the latter agrees to get other persons to work.
Now a person who agrees himself to work and does so work and is, therefore, a workman does not cease to be such by reason merely of the fact that he gets other persons to work along (1) ; , 578 ; ; , 212.
(2) (1863) 32 L.J. (Exchequer) 188. 166 with him and that those persons are controlled and paid by him.
What determines whether a person is a workman or an independent contractor is whether he has agreed to work personally or not.
If he has, then he is a workman and the fact that he takes assistance from other persons would not affect his status.
The position is thus summarised in Halsbury 's 'Laws of England ', Vol. 14, pages 651 652: " The workman must have consented to give his personal services and not merely to get the work done, but if he is bound under his contract to work personally, he is not excluded from the definition, simply because he has assistance from others, who work under him." (See also Grainger vs Aynsley : Bromley vs Tams (1); Weaver vs Floyd (2) and Whitely vs Armitage (a).) In the instant case the agarias are professional labourers.
They themselves personally work along with the members of their families in the production of salt and would, therefore, be workmen.
The fact that they are free to engage others to assist them and pay for them would not,in view of the above authorities, affect their status as workmen.
There are no doubt considerable difficulties that may arise if the agarias were held to be workmen within the meaning of section 2 (s) of the Act.
Rules regarding hours of work etc., applicable to other workmen may not be conveniently applied to them and the nature as well as the manner and method of their work would be such as cannot be regulated by any directions given by the Industrial Tribunal.
These difficulties, however, are no deterrent against holding the agarias to be workmen within the meaning of the definition if they fulfil its requirements.
The Industrial Tribunal would have to very well consider what relief, if any, may possibly be granted to them having regard to all the circumstances of the case and may not be able to regulate the work to be done by the aqarias and the remuneration to be paid to them by the employer in (1) (1881) 6 Q.B.D. 182.
(2) (3) 167 the manner it is used to do in the case of other industries here the conditions of employment and the work to be done by the employees is of a different character.
These considerations would necessarily have to be borne in mind while the Industrial Tribunal is adjudicating upon the disputes which have been referred to it for adjudication.
They do not, however, militate against the conclusion which we have come to above that the decision of the Industrial Tribunal to the effect that the agarias are workmen within the definition of the term contained in section 2 (s) of the Act was justified on the materials on the record.
We accordingly see no ground for interfering with that decision and dismiss this appeal with costs.
Appeal dismissed.
| Clause 3(2)(a) of the Edible oil, Edible oil Seeds and oil Cakes (Declaration of Stocks) order, 1976 enjoins that before a consignment of oil leaves a place a stock holder who transports edible oils shall make a declaration in Form II to the specified officer of the place (in this case the Tehsildar of the) Taluk from where such edible oils are transported.
Clause (b) enjoins that the declaration shall be shown at every check post on the route immediately after arrival there.
A police officer seized in transit a truck carrying a large quantity of ground.
nut oil on the ground that the requisite declaration in Form II had not been furnished to the Tehsildar of the place of despatch of the consignment.
The Deputy Commissioner, after issuing a notice to the respondent under section 6B of the , released the truck and the consignment on taking from him an indemnity bond and a bank guarantee towards the price of oil.
The respondent however produced before the Deputy Commissioner a copy of the invoice issued by the seller and a declaration in Form 39 prescribed under the Mysore Sales Tax Act, 1957.
The Deputy Commissioner ordered confiscation of the truck and the oil on the view that the respondent had contravened the provisions of clause 3(2) (a) and (b) of the order.
On appeal the Sessions Judge affirmed this order.
A single Judge of the High Court in revision held that there was no contravention of the requirement of the order because the day on which the goods were despatched being a Sunday, it was impossible for the respondent to deliver on that day to Tehsildar the declaration in Form II and that the law would not expect a citizen to do the impossible.
The respondent in the State 's appeal to this Court contended that: (1) the confiscation of the entire consignment was arbitrary and excessive in that the use of the word "may" in section 6A made exercise of that power discretionary; (2) since there was nothing to show that the goods had been seized, the power of 830 confiscation under section 6A had not been properly exercised and (3) the order of confiscation was a nullity in that the Deputy Commissioner had not issued a proper show cause notice under section 6B of the Act.
Allowing the State 's appeal ^ HELD: 1 (a) The word "may" used in section 6A does not mean that the Deputy Commissioner could not order confiscation of the entire consignment of an essential commodity where he found contravention of any of the orders issued under section 3 of the Act.
The power conferred on the Deputy Commissioner under section 6A is a power coupled with public duty.
[834 H] (b) In directing confiscation of the entire consignment which was being transported without furnishing the declaration in Form II the Deputy Commissioner acted in public interest.
The whole purpose of the control order was to maintain control over the stock of essential commodities at a place with a view to securing their equitable distribution and availability at fair prices.
The requirements of clause 3 (2) (a) and (b) are mandatory.
[835 C D] (c) "Stock holder" as defined in the order includes the purchaser of oil who is in possession or control thereof.
By a legal fiction the explanation treats the owner to have control over the oil in transit.
Respondent 4 being the purchaser fell within the definition of "stock holder".
Moreover there was nothing to show that the consignor had reserved the jus disponendi by the terms of the contract or appropriation and, therefore, the property in the goods passed to respondent 4 (purchaser) on delivery to a common carrier under section 25 of the .
[836 A B] (d) The Deputy Commissioner was right in holding that the declaration in Form II was required to be filed before the specified officer before the goods left a place and that the declaration should be produced at every check post in transit as required by law.
The respondent having contravened the provisions of clause 3 (2) (a) and (b) of the order the truck and the consignment of oil were rightly confiscated.
[837 A C] (e) It is not correct to say that since the date of despatch of the goods was a Sunday there was no need to comply with the requirements of clause 3 of the order.
If the consignment had to be despatched on Sunday nothing prevented the parties from furnishing the declaration a day earlier.
In a transaction of such a magnitude a duty was cast on the party to comply with the requirements of the order before the consignment left the place.
[834 A B] 2.
The very fact that the seized groundnut oil was released only after the respondent furnished the requisite Bank guarantee clearly showed that the consignment had been seized.
Therefore power under section 6A had been correctly exercised.
[837 E F] 3.
There was no breach of the requirement of section 6B.
In response to the show cause notice issued by the Deputy Commissioner respondent 4 appeared before him and filed a copy of the invoice and declaration in Form 39 of the Mysore Sales Tax Act.
The Deputy Commissioner gave a hearing to the parties.
That being so, validity of the confiscation under section 6C could not be challenged.
[837 G H] 831
|
Civil Appeal No. 2752 of 1972.
Appeal by Certificate from the Judgment and Order dated the 5th November, 1970 of the Punjab and Haryana High Court in Income Tax Reference No. 38 of 1969.
G. A. Shah & Miss A. Subhashini for the appellant.
Naunit Lal & Mr. Kailash Yasudev for respondent.
The Judgment of the Court was delivered by PATHAK, J.
Is a smuggler, who is taxed on his income from smuggling under the Income Tax Act, 1922, entitled to a deduction under Section 10(1) of the Act on account of the confiscation of currency notes employed in the smuggling activity? The respondent, Piara Singh, was apprehended in September, 1958 by the Indian Police while crossing the Indo Pakistan border into Pakistan.
A sum of Rs. 65,500/ in currency notes was recovered from his person.
On interrogation he stated that he was taking the currency notes to Pakistan to enable him to purchase gold in that country with a view to smuggling it into India.
The Collector of Central Excise and Land Customs ordered the confiscation of the currency notes.
The Income Tax Officer now took proceedings under the Indian Income Tax Act, 1922 for assessing the assessee 's income and determining his tax liability.
He came to the finding that out of Rs. 65,500/ an amount of Rs. 60,500/ constituted the income of the assessee from undisclosed sources.
An appeal by the assessee was dismissed by the Appellate Assistant Commissioner.
In second appeal before the Income Tax Appellate Tribunal the assessee represented that if he was regarded as engaged in the business of smuggling gold he was entitled to a deduction under Section 10(1) of the Income Tax Act of the entire sum of Rs. 65,500/ as a loss incurred in the business on the confiscation of the currency notes.
The Appellate Tribunal upheld the 1124 claim to deduction.
It proceeded on the basis that the assessee was carrying on a regular smuggling activity which consisted of taking currency notes out of India and exchanging them for gold in Pakistan which was later smuggled into India.
At the instance of the Revenue, a reference was made to the High Court of Punjab and Haryana on the following question: "Whether on the facts and in the circumstances of the case the loss of Rs. 65,500/ arising from the confiscation of the currency notes was an allowable deduction under section 10(1) of the Income tax Act, 1922?" The High Court answered the question in the affirmative.
And now this appeal by the Revenue.
In our Judgment, the High Court is right.
The Income Tax authorities found that the assessee was carrying on the business of smuggling They held that he was, therefore, liable to income tax on income from that business.
On the basis that such income was taxable, the question is whether the confiscation of the currency notes entitles the assessee to the deduction claimed.
The currency notes carried by the assessee across the border constituted the means for acquiring gold in Pakistan, which gold he subsequently sold in India at a profit.
The currency notes were necessary for acquiring the gold.
The carriage of currency notes across the border was an essential part of the smuggling operation.
If the activity of smuggling can be regarded as a business, those who are carrying on that business must be deemed to be aware that a necessary incident involved in the business is detection by the Custom authorities and the consequent confiscation of the currency notes.
It is an incident as predictable in the course of carrying on the activity as any other feature of it.
Having regard to the nature of the activity possible detection by the Customs authorities constitutes a normal feature integrated into all that is implied and involved in it.
The confiscation of the currency notes is a loss occasioned in pursuing the business, it is a loss in much the same way as if the currency notes had been stolen or dropped on the way while carrying on the business.
It is a loss which springs directly from the carrying on of the business and is incidental to it.
Applying the principle laid down by this Court in Badridas Daga vs Commissioner of Income tax the deduction must be allowed.
In Commissioner of Income tax, Gujarat vs S.C. Kothari this Court held that for the purpose of Section 10(1) of the Income Tax Act, 1922 a loss incurred in carrying on an illegal business must be 1125 deducted before the true figure of profits brought to tax can be computed.
Grover, J., speaking for the Court, observed: If the business is illegal, neither the profits earned nor the losses incurred would be enforceable in law.
But, that does not take the profits out of the taxing statute.
Similarly, the taint of illegality of the business cannot detract from the losses being taken into account for computation of the amount which can be subjected to tax as "profits" under Section 10(1) of the Act of 1922.
The tax collector cannot be heard to say that he will bring the gross receipts to tax.
He can only tax profits of a trade or business.
That cannot be done without deducting the losses and the legitimate expenses of the business.
" Reliance was placed by the Revenue on Haji Aziz and Abdul Shakoor Bros. vs Commissioner of Income tax, Bombay City II.
In that case, however, the assessee carried on the lawful business of importing dates from abroad and selling them in India.
The import of dates by steamer was prohibited.
Nonetheless he imported dates from Iraq by steamer, and the consignments were confiscated by the customs authorities.
But the dates were released subsequently on payment of fine.
The assessee 's claim to deduction under section 10(2) (xv) of the Income Tax Act was rejected on the ground that the amount was paid by way of penalty for a breach of the law.
An infraction of the law was not a normal incident of business carried on by the assessee, and the penalty was rightly held to fall on the assessee in some character other than that of a trader.
Reference was made by the Revenue to Soni Hinduji Kushalji & Co. vs Commissioner of Income tax, A.P.
The assessee 's claim to the deduction of the value of gold confiscated by the customs authorities was found unsustainable by the court.
The decision in that case can be explained on the ground that the assessee was carrying on a lawful business in gold, silver and jewellery and committed an infraction of the law in smuggling gold into the country.
Our attention has also been invited to J. section Parkar vs V. B. Palekar and Others where on a difference of opinion between two learned Judges of the Bombay High Court a third learned Judge agreed with the view that the value of gold confiscated by the customs authorities in smuggling operations was not entitled to deduction against the estimated and assessed income from an undisclosed source.
It was observed that the loss arose by reason of an infraction 1126 of the law and as it had not fallen on the assessee as a trader or business man a deduction could not be allowed.
Apparently, the true significance of the distinction between an infraction of the law committed in the carrying on of a lawful business and an infraction of the law committed in a business inherently unlawful and constituting a normal incident of it was not pointedly placed before the High Court in that case.
We hold that the assessee is entitled to the deduction of Rs. 65,500/ , and accordingly we affirm the view taken by the High Court on the question of law referred to it.
The appeal fails and is dismissed with costs.
S.R. Appeal dismissed.
| A Sub Inspector of Police arrested the respondent for offences under sections 4 and 5 of the Bombay Prevention of Gambling Act on a warrant issued under section 6 of the Act by the Deputy Superintendent of Police.
The respondent 's application for release on bail was rejected by the Sub Inspector on the ground that a circular order issued by the District Superintendent of Police prohibited him from releasing on bail persons that were arrested in respect of offences under sections 4 and S of the Act.
He, however, produced the respondent before a Magistrate.
D The High Court in the writ petition filed by the respondent upheld his contention that offences under sections 4 and S of the Act being cognizable and bailable, the Commissioner of Police and officers to whom a warrant can be granted for the purpose of investigation under the Act, have to release the accused on bail under the provisions of section 496 of the Code of Criminal Procedure 1898 since the impugned order ran counter to the statutory provisions it was bad in law.
The High Court also held that since under section 6 of the Act the Police Commissioner and certain other officers mentioned therein have the power and authority to arrest persons accused of having committed offences under sections 4 and S of the Act without warrant, the offences are cognizable.
Dismissing the appeal, ^ HELD: (a) Since the Commissioner of Police, who is competent to direct by issuing special warrant or general order under section 6(1)(i), another police officer of the requisite rank to arrest persons found gambling or present in a gaming house, can also arrest personally the offender concerned, the offences under sections 4 and S of the Act are cognizable.
Such offences are admittedly bailable.
[400 F G] (b) The Commissioner of Police or the Police officer who is authorised by him to search, arrest and investigate such offences, is under a legal obligation to release the accused on bail under the provisions of section 496 of the Code.
The authority to grant bail to the person arrested in execution of such a warrant is derived by the officer arresting from the statute and consequently no executive instructions or administrative rules can abridge or run counter to the statutory provisions of the Code.
Since the impugned order of executive instructions are contrary to or inconsistent with the provisions of the Code and 392 on a true construction, there is nothing in section 6 or any other provision of the Act which takes away the right and power conferred by the Code on the police officer to grant bail to the person arrested by him for offences under sections 4 and 5 of the Act the impugned order was ultra vires and bad in law and had been rightly quashed by the High Court.
[400 G H] Union of India vs I. C. Lala etc., A.I.R. 1973 S.C. 2204=[1973] 3 SCR 818, 824 applied.
(a) Under Section 6(1) of the Act (subject to the conditions of the proviso) a Commissioner of Police may empower by a general order or authorise by special warrant a police officer not below the rank of a sub Inspector to do any of the acts and things enumerated in sub clauses (a) to (d) of that subsection, including the act of arresting a person found gambling or present in a common gaming house.
It follows therefrom, by necessary implication, that the Commissioner of Police can personally do any of the aforesaid acts and things which he could authorise any other police officer of the requisite rank to do.
The primary repository of the plenary power to do tho aforesaid acts and things, constituted under sub clause (i) is the Commissioner of Police.
The sub clause only enable him to employ his subordinate police officers not below the authorised rank of Sub Inspector to execute his general order or special warrant to arrest for offences under sections 4 and 5 of the Act.
In short section 6 confers the power of arrest thereunder only on a specified class of police officers and not on any or every police officer.
[396D F & G] (b) It is settled law that the expression "Police officer" used in the definition of cognizable offence in section 4(1)(f) of the Code of Criminal Procedure does not necessarily mean "any and every" police officer.
An offence will still be a cognizable offence within this definition even if the power to arrest without warrant for that offence is given by the statute to police officers of a particular rank or class only.
[398 C] Queen Empress vs Deodhar Singh ILR , 150 approved.
|
Appeal No. 143 of 1952.
Appeal under article 132(1) of the Constitution of India from the Judgment and Order, dated the 997 11th December, 195 1, of the High Court of Judicature, Rajasthan at Jodhpur in D. B. Civil Miscellaneous Case No. 1 of 1951.
M. C. Setalvad, Attorney Genaral for India and K. section Hajela, Advocate General of Rajasthan, (Porus A. Mehta, with them) for the appellant, N. C. Chatterjee.
and U. M. Trivedi (Jiwan Sinha Chandra and Ganpat Rai, with them) for the respondent.
March 15.
The Judgment of the Court was delivered by GHULAM HASAN J.
This appeal filed on a certificate granted by the High Court of Rajasthan under article 132(1) of the Constitution arises from the judgment and order of the said High Court (Wanchoo C.J. and Bapna J.) in a petition under article 226 of the Constitution, whereby the High Court held that section 8 A inserted in Rajasthan Ordinance No. XXVII of 1948 by section 4 of Rajasthan Ordinance No. X of 1949, and the amendment to section 8 A by section 3 of Rajasthan Ordinance XV of 1949 are void under article 14 of the Constitution and issued a writ restraining the State of Rajasthan from collecting rents from the tenants of lands comprising the Jagir of Bedla held by the respondent.
The respondent Rao Manohar Singhji is the owner of the Jagir of Bedla situate in the former State of Mewar, now included in the State of Rajasthan.
The former State of Mewar was integrated in April, 1948, to form what was known as the former United State of Rajasthan.
In April and May, 1949, the latter State was amalgamated with the former States of Bikaner, Jaipur, Jaisalmer and Jodhpur and the former Union of Matsya to form the present United State of Rajasthan.
Three Ordinances, No. XXVII of 1948 and Nos.
X and XV of 1949, were issued by the former State of Rajasthan in connection with State Jagirs.
The management of the Jagirs including the Jagir of Bedla was assumed by the former State of Rajasthan in virtue of the powers under these Ordinances.
After the final formation of the State of Rajasthan in May, 129 998 1949, the Ordinances remained in force in a part of the present area of Rajasthan with the result that while jagirs in a part of the area were managed by the State in that area, the Jagirs in the rest of the State were left untouched and remained with the Jagirdars.
On 4th January, 1951, the respondent filed a petition under article 226 of the Constitution contending that the said Ordinances were ultra vires the Constitution and that they became void under article 13 (1) of the Constitution of India, read with articles 14 and 31.
The respondent challenged the Ordinances firstly because they constitute an infringement of articles 14, 19 and 31 of the Constitution and secondly because the Jagirdars only of the former State of Rajasthan which was formed in 1948 are prejudicially affected, while Jagirdars of the States which integrated later on are not at all affected (Para 9, K and L).
It was alleged that there was a denial of equality before the law and the equal protection of the laws by reason of these Ordinances and further that the State had taken possession of the property of the respondent without providing for compensation.
The reply of the State was that the Jagir was a State grant held at the pleasure of the Ruler and that it reverted to the Ruler on the death of the holder of the Jagir and was regranted to his successor after the Ruler had recognized the succession.
The rights of the Jagirdars were non heritable and nontransferable and the Jagirs could not be partitioned amongst the heirs of the Jagirdar.
It was pleaded therefore that even if the State took possession of the Jagir, the Jagirdar was not entitled to compensation under article 31 (2).
It was also alleged that the impugned Ordinances had merely the effect of transferring the management of the Jagirs to the Government and did not deprive the Jagirdars of their property and they were consequently not hit by article 31 (2).
It was denied that there was any discrimination under article 14 of the Constitution.
The High Court held on the first question that the pro I visions of Ordinances Nos.
X and XV of 1949 are not void under article 31 (2) or 19 (1) (f ).
On the second point they recorded the conclusion that section 8 A which was introduced in Ordinance No. XXVII of 1948, by section 999 4 of Ordinance No. X of 1949, and the amendment to section 8 A by section 3 of Rajasthan Ordinance No. XV of 1949, are void under article 13 (1) of the Constitution, read with article 14.
The High Court accordingly, allowed the petition and prohibited the State from collecting rents from the tenants of the land comprising the Jagir of Bedla held by the respondent.
This judgment was given on 11th December, 1951, but we understand that since then the State has passed Acts abolishing Jagirs throughout the State.
The question however is of some importance to the respondent inasmuch as it affects his right of collecting the rents even though for a short period.
In appeal it is contended by the learned AttorneyGeneral on behalf of the State of Rajasthan that the decision of the High Court that the impugned section 8 A as amended was hit by article 14 of the Constitution is erroneous.
Before deciding the validity of this contention it will be necessary to refer briefly to the relative provisions of the Ordinances.
Ordinance No. I of 1948 (the United State of Rajasthan Administration Ordinance, 1948) was made and promulgated on April 28, 1948, by the Rajpramukh of Rajasthan to provide for the administration of the United State ,of Rajasthan after the latter came into existence.
On July 26, 1948, Ordinance No. XXVII of 1948, [the United State of Rajasthan Jagirdars (Abolition of Powers) Ordinance, 1948] was made and promulgated by the Rajpramukh providing for the abolition of judicial powers of Jagirdars and executive powers in connection with the judiciary and vesting them in the Government.
Section 8 of this Ordinance authorised the Government to make orders with a view to carrying out and giving effect to the provisions and pur poses of the Ordinance and the various powers enumerated in that section.
Then came section 8 A which was introduced by Ordinance X of 1949 [the United State of Rajasthan Jagirdars (Abolition of Powers) (Amendment) Ordinance, 1949].
It reads thus: "Without prejudice to the generality of the foregoing provisions, it is hereby enacted that the revenue which was heretofore collected by Jagirdars shall 1000 henceforward be collected by and paid to the Government; the Government will after deducting the collection and other expenses pay.
it to the Jagirdar concerned.
" It was amended by section 3 of Ordinance No. XV of 1949 [the United State of Rajasthan Jagirdars (Abolition of Powers) (2nd Amendment) Ordinance, 1949] by adding to section 8 A after the word 'Revenue ' the following: " Including taxes, cesses and other revenue from forests.
" It is not denied that when the State of Rajasthan was formed in April and May, 1949, the Jagirdars of only a part of the present State of Rajasthan could not collect their rents while Jagirdars in other areas which were covered by Jaipur, Bikaner, Jaisalmer and Jodhpur and Matsya Union were under no such disability.
It appears that in the former State of Rajasthan provisions regarding the management by Government of Jagirs and the right to collect rents already existed, whereas there was no such provision in the former States of Jaipur, Bikaner, Jaisalmer and Jodhpur and Matsya Union, but when the integration took place in April and May, 1949, the discrimination exhibited itself not by virtue of anything inherent in the impugned Ordinances but by reason of the fact that Jagirdars of one part of the present State of Rajasthan were already subjected to a disability in the matter of management of their Jagirs while the other parts were wholly unaffected.
This discrimination, however undesirable, was not open to any exception until the Constitution came into force on January 26, 1950, when article 13 of the Constitution declared that "all laws in force in the territory of India immediately before the commencement of this Constitution, in so far as they are inconsistent with the provisions of this Part, shall, to the extent of such inconsistency, be void.
" It becomes therefore necessary to see whether the impugned provision which is discriminatory on the face of it is hit by article 14 which declares that "the State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India.," Such an obvious discrimination 1001 can be supported only on the ground that it was based upon,,,& reasonable classification.
It is now well settled by the decision of this court that a proper classification must always bear a reasonable and just relation to the things in respect of which it is proposed.
Judged by this criterion it seems to us that the discrimination is based on no classification at all and is manifestly unreasonable and arbitrary.
The classification might have been justified if the State had shown that it was based upon a substantial distinction, namely that the Jagirdars of the area subjected to the disability were in some way different to those of the other area of Rajasthan who were not similarly situated.
It was perfectly possible for the State to have raised a specific ground in order to get out of the mischief of article 14, that the discrimination was based upon what the learned Attorney General called geographical consideration, that the Jagirs of the particular area were governed by different laws of tenure and thus constituted a class by itself and that that was a good ground for differentiation.
No such ground was ever put forward before the High Court, much less was any attempt made to substantiate such a ground.
In the absence of any allegation supported by evidence we are unabe to find in favour of the State that the Jagirdars of the particular area to which category the respondent belongs were differently situated to other Jagirdars.
The preambles of the Ordinances do not purport to show that the conditions in the former State of Rajasthan were such as to justify the imposition of the disability on the Jagirdars of that State while the conditions prevailing in the other States forbade such a course.
The High Court held that the Ordinance abolishing the Police and the Judicial powers and the administrative powers of the Jagirdars in respect to revenue in forests was open to no objection but there was no reason for taking away from the Jagirdars by section 8 A the power to collect rents to which they were entitled.
We agree with the High Court in holding that there was no real and substantial distinction why the Jagirdars of a particular area should continue to be 1002 treated with inequality as compared with the Jagirdars in another area of Rajasthan.
We hold therefore that no rational basis for any classification or differentiation has been made out.
Section 8 A of the impugned Ordinance as amended is a clear contravention of the respondent 's right under article 14 of the Constitution and must be declared void.
The case of Frank J. Bowman vs Edward A. Lewis(1) relied upon by the learned Attorney General on behalf of the State is inapplicable to the facts and circumstances of the present case.
By the Constitution and laws of Missouri the citizens residing in one hundred and nine counties of the State of Missouri had the right and privilege of an unrestricted appeal to the supreme Court of the State, while, at the same time the right of appeal was denied to the citizens of the State residing in four of the counties in the easterly portion of the State, as also to those residing in the City of St. Louis.
It was contended that this feature of the judicial system of Missouri was in conflict with the 14th Amendment of the Constitution of the United States.
Bradley J. held that the equality clause in the 14th Amendment contemplates the protection of persons against unjust discriminations by a State; it has no reference to territorial or municipal arrangements made for different portions of a State.
He went on to say: " If a Mexican State should be acquired by treaty and added to an adjoining State or part of a State, in the United States, and the two should be erected into.a new State, it cannot be doubted that such new State might allow the Mexican 1aws and judicature to continue unchanged in the one portion, and the common law and its corresponding judicature in the other portion.
Such an arrangement would not be prohibited by any fair construction of the 14th Amendment.
It would not be based on any respect of persons or classes, but on municipal considerations alone, and a regard to the welfare of all classes within the particular territory or jurisdiction.
" This passage which was strongly relied upon by the learned Attorney General does not advance his case (1) 1O1 U.S 22; ; 1003 for in the present cage there is no question of continuing unchanged @the old laws and judicature in one portion and a different law in the other.
As we have already said there is nothing to show that there as any peculiarity or any special feature in the Jagirs of the former State of Rajasthan to justify differentiation from the Jagirs comprised in the States which subsequently integrated into the present United State of Rajasthan.
After the new State was formed, there was no occasion to take away the powers of Jagirdars of a disfavoured area and to leave them intact in the rest of the area.
The case in Ramjilal vs Income tax Officer, Mohindargarh (1) is distinguishable on the ground that that case proceeded upon the principle that "pending proceedings should be concluded according to the law applicable at the time when the rights or liabilities accrued and the proceeding commenced was a reasonable law founded upon a reasonable classification of the assessees which is permissible under the equal protection clause.
" Such is however not the case here.
Reliance was also placed on the case of The State of Punjab vs Ajaib Singh and Another(1).
In that case the Abducted Persons (Recovery and Restoration) Act of 1949 was not held to be unconstitutional under article 14 upon the ground that it extended only to the several States mentioned in section 1(2), for in the opinion of the court classification could well be made on a geographical basis.
There the Muslim abducted persons found in those States were held to form one class having similar interests to protect and their inclusion in the definition of abducted persons could not be called discriminatory.
; The learned Attorney General referred to two cases decided by the same.
Bench of the Rajasthan High Court, Thakur Madan Singh vs Collector of Sikar(3), and an unreported judgment delivered on November 10, 1953, In re, Raja Hari Singh vs Rajasthan and argued (1) (1951] S.C.R. 127.
(2) ; (3) Rajasthan Law Weekly, 1954, P.1.
1004 that the Bench had not stuck to its view expressed in the judgment under appeal.
A careful, perusal of the judgments in these cases will show that this is far from being the case.
The former case was distinguished from the case under appeal on the ground that there was a reasonable basis for classification in that case, while no such basis existed in the case before us.
It appears that before Jaipur State merged into the present United State of Rajasthan there were District Boards existing in that State.
They were continued on the formation of the new State but there were no District Boards in the other States.
The argument that the Jaipur District Boards Act was invalid under article 14 of the Constitution was repelled it being held that the existence of District Boards in Jaipur was for the welfare of all classes within Jaipur that Jaipur had reached a higher stage of development than many of the other States and it would have been a retrograde step to deprive the People living in the former Jaipur State of the benefits of Local Self Government conferred by the District Boards Act.
Reliance was placed on the observations of Bradley J. in Frank J. Bowman vs Edward A. Lewis(1) in connection with the illustration of the Mexican State and* the learned Chief Justice referred with approval to the decision under appeal before us.
In the second case the attack was on the alleged discriminatory provision contained in the Mewar Tenancy Act and the Land Revenue Act.
Under these Acts the rent rates had been approved by the Board of Revenue and the Government and they were alleged to be detrimental to the interests of the Jagirdars.
The Jagirdars had challenged those Acts by a petition under article 226.
It appears that no such laws existed in the other parts of Rajasthan.
The decision of the High Court proceeded on the ground that it was not shown that there were no similar tenancy and Land Revenue laws in other parts of Rajasthan and the impugned Acts being ameliorative legislation designed to raise the economic status of the agriculturists in Mewar could not be said to constitute any discrimination merely because no such legislation (1) ; ; 1005 existed in the other parts of Rajasthan .
This difference between the two parts did not justify that such progressive and ameliorative measures for the welfare of the people existing in a particular area should be done, away with and the State be brought down to the level of the unprogressive States.
The judgment shows that the Bench far from going back on its previous view adhered to it and expressly distinguished the case under appeal before us on its special facts.
As a result of the foregoing discussion we hold that the view taken by the High Court is correct.
We accordingly dismiss the, appeal with costs.
Appeal dismissed.
| The respondent limited companies purchased certain premises in Calcutta for the purpose of providing residential accommodation for their staff.
They instituted suits against the appellants for the recovery of possession of two flats on the ground that as these flats were required for housing their officers, they were reasonably required for the occupation of the respondents within the meaning of section 13(1) (f) of the West Bengal Premises Tenancy Act, 1956.
The Trial Court dismissed the suits but the High Court allowed an appeal and held that a limited company can be a landlord within the meaning of section 13(1) (f) and can reasonably require the premises for its own occupation; and that where there are several landlords, the requirement of the premises by the landlords for the occupation of one or more of them is sufficient to bring the case within section 13(1) (f).
In the appeal before the Supreme Court the only question for determination was whether on the construction of the terms of an agreement which was normally signed between each of the respondents and any officer who was allotted a flat, the officer occupied the flat as a tenant or a licensee, and therefore whether the officer 's occupa tion would be the company 's own occupation within the meaning of clause (f).
Held:Dismissing the appeal: The High Court nightly held that the respondent reasonably required the flats for the second respondent company 's own occupation through officers holding flats on its behalf as licensees.
[29B] Under the standard form of agreement, the occupation of the officer ceased on the termination of his employment, upon his death, or on his transfer and the company was at liberty to allot him any other flat or to assign the premises to any other employee or other person during his absence.
In view of these and its other terms the agreement operated as a license and not as a tenancy.
It created no interest in the land and gave only a personal privilege or license to the servant to occupy the premises for the greater convenience of his work.
[28F H] Under section 105 of the Transfer of Property Act, a lease is the transfer of a right to enjoy the premises whereas under section 52 of the Indian Easements Act a license is a privilege to do something on the premises which otherwise would be unlawful.
The transaction is a lease if it grants an interest in the land; it is a license if it gives a personal privilege with no interest in the land.
[27E F] Errington vs Errington and Woods, ; , 298: Associated Hotels of India Ltd. vs R. N. Kapoor. ; ; 3815.
Addiscombe Garden Estates Ltd. and Anr, V. Crabe and Ors. , 525; referred to.
24 A service occupation is a particular kind of license whereby a servant is required to live in the premises for the better performance of his duties.
Now it is also settled law that a servant may be a licensee though he may not be in service occupation.
[27H] Nippon Menkwa Kalmshiki vs F. Portlock, A.1.R. ; and Torbett vs Faulkner, , 560; referred to.
|
Appeal No. 701 of 1964.
Appeal from the judgment and order dated August 10, 1961 of the Calcutta High Court in Civil Rule No. 1428 of 1958.
section V. Gupte, Solicitor General, R. Ganapathy Iyer and R. H. Dhebar, for the appellant.
G. section Chatterjee and P. K. Chatterjee, for the respondent.
directed against the judgment of the High Court accepting a petition under article 226 of the Constitution and quashing adjudication proceedings under the Foreign Exchange Regulation Act, 1947 (VII of 1947) hereinafter referred to as the Act.
The relevant facts are as follows: Following the recovery in 1954 of some foreign currency and Travelers Cheques at No. 311, Bow Bazar Street, Calcutta, where the respondent alongwith his, mother and brother, carried on the business of jewellers, the Director of Enforcement issued a notice on April 23, 1958,on the petitioner calling upon him to show cause within 10 days of the receipt of the notice why adjudication proceedings should not be.
held against him for contravention of s.23(1)of the Act.
On May 10, 1958, the respondent replied to the above memorandum giving his version as to how he came into possession of the foreign currency, but he denied having sold any travellers cheques.
He prayed that the proceedings may be dropped and the currency seized returned to him.
The Director of Enforcement, after considering the cause shown by the respondent came to the conclusion that the adjudication proceedings should 'be held.
He, therefore, requested the respondent to arrange to be present either personally or through, his authorized representative before the Director on May 13, 1958, in the office of the Calcutta Branch of the Directorate.
On, this, on May 13, 1959, the respondent filed a petition under art 226 of the Constitution challenging the adjudication proceeding& 36 on various grounds, the principal grounds being that section 23 (1) (a) and section 23D of the Act were ultra vires of article 20(2) of the Constitution, and that the offence having been committed in 1954, the proposed adjudication was illegal and entirely without jurisdiction.
Before the High Court, at the time of the final hearing, the petitioner was allowed to raise the point that section 23 ( 1 ) (a) as well as section 23D contravened article 14 of the Constitution.
Mitter, J. held that section 23 (1) (a) violated article 14 of the Constitution and was accordingly ultra vires the Constitution, and that the relative provision of section 23D must also be condemned.
Regarding the second point, namely, whether section 23 (1) (a), having, been substituted by the Amending Act XXXIX of 1957, would have retrospective operation in respect of the alleged offence, which took place in 1954, the High Court came to the conclusion that the petitioner "had a vested right to be tried by an ordinary court of, the land with such rights of appeal as were open to all", and although section 23 (1) (a) was procedural, where a vested right was affected, prima facie, it was not a question of procedure.
Thea, the High Court came to the conclusion that the provision as to adjudication by the Director of Enforcement could not have any retrospective operation.
The learned Judge observed that "the impairment of a right by putting a new restriction thereupon is not :a matter of procedure only.
It impairs a substantive right and an enactment which does so is not retrospective unless it says so expressly or by necessary intendment." Accordingly, is stated before, the adjudication proceedings were quashed being without jurisdiction.
This Court held in Shanti Prasad Jain vs Director of Enforcement(1) that section 23(1) and section 23D of the Foreign Exchange Regulation Act did not violate article 14 of the Constitution.
Mr. P. K. Chatterjee, counsel for the respondent, properly concedes that he cannot press this point.
The learned Solicitor General, who appeared on behalf of the appellant, contends that the High Court was in error in holding that the accused had a vested right to be tried by an ordinary criminal court.
He says that the amendment only changed the venue of trial from a Magistrate to the Director of Enforcement in some cases and no vested right was affected.
He refers to the decision of this Court in Rao Shiv Bahadur Singh vs The State of Vindhya Pradesh(2) where Jagannadhadas, J., speaking for the Court, observed at p. 1200 as follows (1) ; (1) ; 37 "In this context it is necessary to notice that what is prohibited under article 20 is only conviction or sentence under an ex post facto law and not the trial thereof.
Such trial under a procedure different from what obtained at the time of the commission of the offence or by a court different from that which had competence at the time cannot ipso facto be held to be unconstitutional.
A person accused of the commission of an offence has no fundamental right to trial by a particular court or by a particular procedure, except in so far as any constitutional objection by way of discrimination or the violation of any other fundamental right may be involved.
" Before its amendment by Act XXXIX of 1957, section 23(1) of the Act read as follows : "23(1) Whoever contravenes any of the provisions of this Act or of any rule, direction or order made thereunder shall be punishable with imprisonment or a term which may extend to two years or with fine or with both, and any Court trying any such contravention may, if it thinks fit and in addition to any sentence which it may impose for such contravention, direct that any currency, security, gold or silver, or goods or other property in respect of which the contravention has taken place shall be confiscated. .
After the amendment by Act XXXIX of 1957, another section 23(1) was substituted and section 23D was added, which read as follows "23(1) If any person contravenes the provisions of section 4, section 5, section 9, section 10, sub section (2) of section 12, section 17, section 18A or section 18B or of any rule, direction or order made thereunder, he shall (a) be liable to such penalty not exceeding three times the value of the foreign exchange in respect of which the contravention has taken place, or five thousand rupees, whichever is more, as may be adjudged by the Director of Enforcement in the manner hereinafter provided, or. . . " "23D. (1) For the purpose of adjudging under clause (a) of sub section (1) of section 23 whether any person has committed a contravention the Director of Enforcement shall hold an inquiry in the prescribed manner 38 after giving that person a reasonable opportunity of being heard and if, on such inquiry, he is satisfied that the person has committed the contravention, he may impose such penalty as he thinks fit in accordance with the provision of the said section 23; Provided that if, at any stage of the inquiry, the Director of Enforcement is of opinion that having regard to the circumstances of the case, the penalty which he is empowered to impose would not be adequate, he shall, instead of imposing any penalty himself, make a complaint in writing to the Court. " The effect of these provisions is that after the amendment of 1957, adjudication proceedings or criminal proceedings could be taken up in respect of a contravention mentioned in section 23(1) while before the amendment only criminal proceedings before a Court could be instituted to punish the offender.
The High Court, as already observed, held that the new amendment did not apply to contravention which took place before the Act came into force.
Mr. Chatterjee, the learned counsel for the respondent, urges that a substantive vested right to be tried by an ordinary court existed before the amendment, and he relied on Maxwell 11 th Edition, p. 217, where it is stated that "the general principle, however, seems to be that alterations in procedure are retrospective, unless there be some good reason against it." He says that there is a good reason if the principles of article 20 are borne in mind.
In our opinion, there is force in the content on of the learned Solicitor General.
As observed by this Court in Rao Shiv Bahadur Singh vs The State of Vindhya Pradesh(1) a person accused of the commission of an offence has no vested right to be tried by a particular court or a particular procedure except in so far as there is any Constitutional objection by way of discrimination or the violation of any other fundamental right is involved.
It is well recognized that "no person has a vested right in any course of procedure" (vide Maxwell 11th Edition, p. 216), and we see no reason why this ordinary rule should not prevail in the present case.
There is no principle underlying article 20 of the Constitution which makes a right to any course of procedure a vested right.
Mr. Chatterjee complains that there is no indication in the Amending Act that the new procedure would be retrospective and he further says that this affects his right of appeal under the Criminal Procedure Code.
But if this is a matter of Procedure, (1) ; 39 then it is not necessary that there should be a special provision to indicate that the new procedural law is retrospective.
No right of appeal under the Criminal Procedure Code is affected because no proceedings had ever been started under the Criminal Procedure Code.
Mr. Chatterjee 's next point is that the new section 23(1)(a) con travenes article 20(1) of the Constitution.
He says that section 23(1) (a) prescribes a minimum penalty while under the old section 23(1) the Magistrate had an option of fixing a fine less than the minimum prescribed under section 23 ( 1 ) (a).
But we are unable to agree with him that the new section prescribes any minimum.
What it does prescribe is a maximum.
The words "not exceeding" cover not only the expression "three times the value of the foreign exchange" but also the words "five thousand rupees" Therefore, no greater penalty than might have been levied under the old section has been prescribed by the new section 23 (1 ) (a), and consequently there is no breach of article 20(1) of the Constitution.
We may add that the offence is alleged to have been commit ted in 1954 and notice of adjudication was sent in 1958 and now we axe in the year 1965.
It would be expedient if the adjudication proceedings are disposed of as expeditiously as possible.
In the result the appeal is accepted and the petition under article 226 dismissed.
The appellant will have his costs here and in the High Court.
Appeal allowed.
| The appellant was convicted of the offence under section 66(1) (b) of the Bombay Prohibition Act, 1949, for being in possession on September 21, 1960 of bottles of two different Ayurvedic medicinal preparations con training 52.3% and 54.5% alcohol respectively.
The appellant 's case that possession of the preparations by him was not in contravention of the Act, because the preparations were medicinal preparations containing alcohol which were unfit for use as intoxicating liquor within the meaning of section 24A of the Act, was rejected.
The trial court held that the offending articles were Ayurvedic preparations in which alcohol was generated by a process of fermentation and as alcohol exceeded 12 per cent by volume, the preparations did not correspond with the limitations prescribed by the provision to section 59A, and therefore the exemption prescribed by section 24A was inoperative.
The Court of Sessions and the High Court agreed with that view.
It was also contended on behalf of the respondents that even if the two medicinal preparations corresponded with the description and limitations under section 59A, they were still preparations fit for use as intoxicating liquor and therefore outside the exemption in section 24A.
HELD: The appellant was wrongly convicted and his conviction must he set aside.
(i) There was clear evidence on the record that the offending preparations were not preparations in which alcohol was generated by fermentation.
The proviso to section 59A Would therefore have no application.
[146 E F] (ii) On the date on which the two medicinal preparations were attached in September 1960, by vitrue of sub section (7) of section 6A they were deemed for the purpose of the Act to be unfit for use as intoxicating liquor and their possession was; not an offence.
A subsequent declaration by the State under section 6A(6) in October, 1960, that they were fit for use as intoxicating liquor, could not have retrospective operation, and possession which was innocent could not, by subsequent act of the State, be declared as offending the statute.
[150 A] The State of Bombay vs F. N. Balsara, ; , referred to.
The State of Bombay vs Narandas Mangild Agarwal & Anr.
[1962] Sup. 1 S.C.R. 15, distinguished.
|
t Petition (Civil) No. 1152 of 1988.
(Under Article 32 of the Constitution` of India).
M.K. Ramamurthi, R.C. Pathak, Naresh Mathut, Sudhir Kumar and Ms. Baby Lal for the petitioners.
B. Dutta, R.K. Joshi and S.K. Jain for the Respondents.
The Judgment of the Court was delivered by S.C. AGRAWAL, J.
The only question which arises for consideration in this writ petition, filed under Article 32 of the Constitution, is whether persons who were employed in temporary capacity with the Oil & Natural Gas Commission (hereinafter referred to as 'the Commission '), when it was being run as a Department of the 159 Government of India prior to the enactment of the Oil & Natural Gas Commission Act, 1959 (hereinafter referred to as 'the ONGC Act ') and who were subsequently absorbed in the Commission, as established under the said Act, are entitled to pension, in addition to the Provident Fund benefits to which they are entitled under the provisions of the Employ ees ' Provident Fund and Miscellaneous Provisions Act (here inafter referred to as the Provident Fund Act ').
The Commission was initially formed as a Department of the Government of India and it continued to be so till October 15, 1959, when the ONGC Act was enacted and the Commission was established as a statutory body under the said Act.
Section 13 of the ONGC Act makes provision for transfer of service of the existing employees to the Commis sion on the same tenure, remuneration and terms and condi tions as they would have held, if the Commission had not been established, until such tenure, remuneration and terms and conditions are duly altered by the Commission.
In the proviso of Sub Section (1) of Section 13 of the ONGC Act, it is further provided that the tenure, remuneration and terms and conditions of service of any such employee shall not be altered to his disadvantage without the previous approval of the Central Government.
In exercise of the powers conferred by Section 32 of the ONGC Act the Commission, with the previous approval of the Central Government, has made the Oil & Natural Gas Commission (Terms and Conditions of Ap pointment and Service) Regulations, 1975 (hereinafter re ferred to as the Regulations ').
In clause 2(b) of Regulation 3, it has been provided that nothing in the Regulation shall operate to deprive any employee of any right or privilege to which he is entitled by the terms or conditions of service, or any agreement, subsisting between such person and the Government.
By notification No. GSR 705, dated May 16, 1961, Sched ule 1 to the Provident Fund Act was amended so as to make the provisions of the said Act applicable to any industry engaged in the manufacture of petroleum or natural gas exploration, prospecting, drilling or production with effect from June 30, 1961.
By another Notification No. GSR 706, dated May 16, 1961, issued under Section 1(3)(b) of the Provident Fund Act the provisions of the said Act were made applicable to establishments engaged in the storage or transport or distribution of petroleum or natural gas or products of either petroleum or natural gas with effect from June 30, 1961.
A corresponding amendment was made in the Employees ' Provident Fund Scheme, 1952 (hereinafter referred to as 'the Provident Fund Scheme '), by Notification dated 160 June 5, 1961, whereby Sub Clause (xviii) was inserted in Clause (b) of sub para (3) of para 1 of the said scheme and thereby the Provident Fund Scheme was made applicable, with effect from June 30, 1961, to factories relating to petrole um or natural gas exploration, prospecting, drilling or production and petroleum or natural gas refining and estab lishments engaged in the storage or transport or distribu tion of petroleum or natural gas or products of either petroleum or natural gas covered by the notifications of the Government of India in the Ministry of Labour and Employ ment, Nos.
G.S.R. 705 and 706, dated May 16, 1961, respec tively.
As a result of the aforesaid amendments introduced in the Provident Fund Act and the Provident Fund Scheme, the provisions of the Provident Fund Act and the Provident Fund Scheme became applicable to the Commission with effect from June 30, 1961.
The petitioners in this writ petition represent the employees who were employed on temporary basis with the Commission prior to the enactment of the ONGC Act and who have been absorbed in the Commission after the enactment of the ONGC Act and the establishment of the Commission is a statutory body.
The case of the petitioners is that while they were employed in the Commission before the enactment of the ONGC Act, they were entitled under the relevant rules governing their service, to pension on their being made permanent and that the said right to pension, which was part of their conditions of service, is protected under Section 13(1) of the ONGC Act.
The petitioners have submitted that persons who were employed on temporary basis with the Com mission prior to the enactment of the ONGC Act and were absorbed in the Commission subsequent to the enactment of the ONGC Act are entitled to pension on their retirement irrespective of the fact that they are entitled to Provident fund benefits under the provisions of the Provident Fund Act and the Provident Fund Scheme.
The writ petition has been contested by the Commission and in the counter affidavit filed on behalf of the Commis sion it has been stated that after the introduction of Contributory Provident Fund, in accordance with the provi sions of the Provident Fund Act and the Provident Fund Scheme, the petitioners have been availing the benefits of Contributory Provident Fund and since the petitioners have opted for Contributory Provident Fund under the Provident Fund Act and the Provident Fund Scheme they cannot claim pension in addition to Contributory Provident Fund.
It has been submitted that, on the date of enactment of the ONGC Act, the petitioners were temporary 161 employees and they were not entitled to pension under the relevant service rules applicable to them and, therefore, they are not entitled to pension on their retirement after being absorbed in the Commission subsequent to the enactment of the ONGC Act.
It has been further submitted that the petitioners cannot claim a double benefit i.e., Contributory Provident Fund as well as pension, and that they could either claim Contributory Provident Fund or pension, and since they opted for Contributory Provident Fund on the introduction of the Provident Fund Scheme and have been availing the said benefit during the past 28 years, they cannot be permitted to claim pension in addition to Contrib utory Provident Fund.
Shri M.K. Ramamurthi, the learned counsel for the peti tioners, has placed reliance on Sub Section (1) of Section 13 of the ONGC Act and Clause (2) of Regulation 3 of the Regulations which provide as under: "Section 13(1): Subject to the provisions of this Act, every person employed by the existing organisation immediately before the date of establishment of the Commission shall, on and from such date, become an employee of the Commission with such designation as the Commission may determine and shall hold his office or service therein by the same tenure, at the same remuneration and upon the same terms and condi tions as he would have held the same on such date if the Commission had not been established and shall continue to do so unless and until his employment in the Commission is terminated or until such tenure, remuneration and terms and conditions are duly altered by the Commission: Provided that (a) the tenure, remuneration and terms and conditions of service of any such person shall not be altered to his disadvantage without the previous approval of the Central Government; (b) any service rendered in the existing organisation by any such person shall be deemed to be service under the Commis sion; and (c) all persons employed by the Commission on the date of 162 its establishment, who, immediately before such date.
hold, in a permanent or quasi permanent capacity, posts in connec tion with the affairs of the Union or of any State, but not posts in the existing organisation, shall be treated as Government servants on foreign service with the Com mission." "Regulation 3(2): Nothing in these regulations shall operate to deprive any employee of any right or privilege to which he is entitled: (a) by or under any law for the time being in force; or (b) by the terms or conditions of service, or any agreement.
subsisting between such person and the Government, or (c) by the terms of any agreement subsisting between him and the Commission at the commencement of these regulations.
" The submission of Shri Ramamurthi is that in view of SubSection (1) of Section 13 of the Act, the employees who were employed in the Commission immediately before the establishment of the Commission under the ONGC Act became employees of the Commission and they are entitled to hold their office or service in the Commission upon the same terms and conditions as they were applicable to them on the date of such establishment of the Commission and they are entitled to continue to do so until such terms and condi tions are duly altered by the Commission and that any such alteration in the terms and conditions of service which is to their disadvantage could be made only with the previous approval of the Central Government and the said right of the employees is also protected by Clause (2) of Regulation 3 of the Regulations which have been framed by the Commission with the previous approval of the Central Government.
Shri Ramamurthi has urged that under the relevant Service Rules, which were applicable to the petitioners at the time when they were absorbed in the service of the Commission on the enactment of the ONGC Act, the petitioners, though temporary employees, were entitled to pension on their being made permanent and that the said right of the petitioners, being part of their conditions of service, has been protected by Sub Section (1) of Section 13 of the ONGC Act, as well as Clause (2) of Regulation 3 of the Regulations and it has not been taken away 163 because the Central Government has not given its approval to the denial of the said right of the petitioners.
In support of his aforesaid submissions, Shri Ramamurthi, has invited our attention to the provisions of Rule 13 of the Central Civil Services (Pension) Rules 1972 (hereinafter referred to as 'the Pension Rules '), which deals with commencement of qualifying service and prescribes that qualifying service of a government servant shall commence from the date he takes charge of the post to which he is appointed either substan tively or in an officiating or temporary capacity, provided that officiating or temporary service is followed without interruption by substantive appointment in the same or another service or post.
The Pension Rules were issued in 1972 and were not applicable at the time when the petitioners were absorbed in the Commission on the enactment of the ONGC Act, 1959.
It is, however, not disputed that the provisions with regard to pension, as contained in the Civil Service Regulations which were applicable at that time, were not different from those contained in the Pension Rules and pension was payable only if the employment was substantive and permanent (Regulations 352, 362 and 368).
Under the Civil Service Regulations, an employee who was initially engaged on contract and was subsequently appointed to the same or different post in a substantive capacity on pensionable basis without interrup tion of duty was allowed the option of surrendering the Government contribution to his Contributory Provident Fund together with the interest thereon for the period of the contract and to count one half of the contract service towards pension (see: Choudhari 's compilation of Civil Service Regulations, 5th Edition, Volume I, pages 216 217).
Similarly, in cases where a permanent Government servant was transferred to an autonomous organisation consequent on the conversion of a Government Department into such a body, there was Government order dated 5th November, 1964 (Annex ure III to the writ petition) which provided that the Gov ernment servant would be given an option to either retain the pensionary benefit available to him under the Government Rules or be governed by the Rules of the autonomous body.
This option was also available to quasi permanent and tempo rary employees after they had been confirmed in the autono mous body.
In other words, a Government servant could either avail pensionary benefits or the benefit of Contributory Provident Fund, but he could not avail both the benefits.
In the Pension Rules, there is an express provision in Rule 2(d) which prescribes that the said Rules shall not apply to persons entitled to the benefit of a Contributory Provident Fund.
164 In the present case, the petitioners were employed on temporary basis at the time when the Commission was established as a statutory body under the ONGC Act and on that date they were not entitled to claim pension because under the relevant Rules pension was not payable to a person employed on temporary basis.
The petitioners, therefore, cannot claim that on the date of their becoming the employ ees of the Commission established under the ONGC Act in 1959, they had a fight to pension which has been protected under Sub Section (1) of Section 13 and Clause (2) of Regu lation 3 of the Regulations.
The petitioners cannot also claim protection of the aforesaid provisions on the basis that right to receive pension was part of their condition of service on the date of their becoming the employees of the Commission under Sub Section (1) of Section 13 of the ONGC Act, in as much as under the relevant service rules applica ble to them, they could either claim pension or the benefit of the Contributory Provident Fund and they could not avail both the benefits.
Since the petitioners are entitled to the benefit of the Contributory Provident Fund under the Provi dent Fund Act and the Provident Fund Scheme and have availed the said benefit for the past 28 years, they should be taken to have opted for said benefit and they cannot invoke the service rules with regard to pension and claim the right to receive pension as part of their conditions of service.
We are, therefore, unable to accept the contention of Shri Ramamurthi, 'based on the provisions of Sub Section (1) of Section 13 of the ONGC Act and Clause (2) of Regulation 3 of the Regulations, that the petitioners are entitled to claim pension in addition to the Provident Fund payable to them under the Provident Fund Act and the Provident Fund Scheme.
Shri Ramamurthi, has next contended that in view of Section 12 of Provident Fund Act, the right of the peti tioners to pension has been preserved and the introduction of the Contributory Provident Fund under the provisions of the Provident Fund Act and the Provident Fund Scheme does not disentitle the petitioners from claiming pension to which they were entitled before the introduction of the Contributory Provident Fund in the Commission.
In support of the aforesaid submission, Shri Ramamurthi has placed reli ance on the decision of this Court in Sorn Prakash Rekhi vs Union of India & Another, ; Section 12 of the Provident Fund Act, provides as under: "No employer in relation to an establishment to which any 165 Scheme or the Insurance Scheme applies shall, by reason only of his liability for the payment of any contribution to the Fund or the Insurance Fund or any charges under this Act or the Scheme or the Insurance Scheme reduce, whether directly or indirectly, the wages of any employee to whom the Scheme or the Insurance Scheme applies or the total quantum of benefits in the nature of old age pension, gratuity, Provi dent Fund or life insurance to which the employee is enti tled under the terms of his employment, express or implied.
" The said provision in our view is not applicable in the present case.
The Provident Fund Act has been enacted with the object of providing social security to the employees in factories and other establishments covered by the said Act, after their retirement.
In the Statement of Objects and Reasons for the said enactment it was mentioned as under: "The question of making some provision for the future of the industrial worker after he retires, or for his dependents in case of his early death, has been under consideration for some years.
The ideal way would have been provisions through old age and survivors ' pensions as has been done in the industrially advanced countries.
But in the prevailing conditions in India.
the institution of a pension scheme cannot be visualised in the near future.
Another alternative may be for provision of gratuities after a prescribed period of service.
The main defect of a gratuity scheme, however, is that amount paid to a worker or his dependents would be small, as the worker would not himself be making any contri bution to the fund.
Taking into account the various diffi culties, financial and administrative, the most appropriate course appears to be the institution, compulsorily, of Contributory Provident Fund in which both the worker and the employer would contribute.
Apart from other advantages, there is the obvious one of cultivating among the workers a spirit of saving something regularly." This indicates that the scheme of Contributory Provident Fund, by way of retiral benefit, envisaged by the Provident Fund Act, is in the nature of a substitute for old age pension because it was felt that in the prevailing condi tions in India, the institution of a pension scheme could not be visualised in the near future.
It was not the inten tion of 166 Parliament that Provident Fund benefit envisaged by the said Act would be in addition to pensionary benefits.
Section 12 of the Provident Fund Act seeks to protect the wages of an employee to whom the scheme framed under the said Act ap plies as well as the total quantum of certain specified benefits to which he is entitled under the terms of his employment.
With that end in view, Section 12 prohibits an employer from reducing, whether directly or indirectly, the wages of an employee to whom the Scheme applies or the total quantum of benefits in the nature of old age pension, gratu ity, Provident Fund or life insurance to which the employee is entitled under the terms of his employment express or implied.
The said Section proceeds on the basis that if an employee is entitled to any benefit in the nature of old age pension under the terms of his employment the said benefit would not be denied to him on the application of the Scheme.
It is not the case of the petitioners that on June 30, 1961, when the Provident Fund Scheme was made applicable to the Commission, the petitioners had become permanent and were entitled to pension.
It cannot, therefore, be said that on the date of the application of the Provident Fund Scheme to the Commissioner, the petitioners were entitled to pension under the terms of their employment.
They cannot, therefore, invoke the provisions of Section 12 of the Provident Fund Act.
In Sorn Prakash Rekhi vs Union of India & Another, (supra) on which reliance has been placed by Shri Rama murthi, the petitioner before this Court was employed as a clerk in Burmah Shell Oil Storage Ltd. The undertaking of that company was statutorily acquired by the Government of India under the Burmah Shell (Acquisition of Undertakings in India) Act, 1976, and subsequently the said undertaking was vested by the Central Government in the Bharat Petroleum Corporation Limited, a Government Company.
In the Burmah Shell, there was a voluntary retirement scheme in force which was governed by the terms of a trust deed of 1950.
The said petitioner was receiving pension under the said scheme.
Certain deductions were made from the pension paid to the petitioner on account of Employees ' Provident Fund and Gratuity paid to him.
This Court held that in view of Sec tion 12 of the Provident Fund Act, such deductions were not permissible and that the entire amount of pension should be paid to the petitioner without deduction.
This decision has no application to the instant case because in that case the petitioner before this Court was entitled to receive pension under the voluntary retirement scheme at the time when the provisions of the Provident Fund Act became applicable to Burmah Shell and the right to receive pension was part of the terms of employment of the said petitioner.
In the present case it cannot be said 167 that on the date of the application of the Provident Fund Scheme to the Commission on June 30, 1961, the petitioners were entitled to receive pension and the benefit of pension was a part of the terms of employment of the petitioners on that date.
For the reasons mentioned above, it must be held that the persons who were employed in temporary capacity with the Commission when it was being run as a Department of the Government of India prior to the enactment of the ONGC Act and who were subsequently absorbed in the Commission, as established under the said Act, are not entitled to pension in addition to the Provident Fund benefits to which they are entitled under the provisions of the Provident Fund Act.
The writ petition, therefore, fails and it is accordingly dis missed.
There will be no order as to costs.
T.N.A. Petition dismissed.
| The petitioners, employed in temporary capacity with the Oil and Natural Gas Commission when it was a Department of the Government of India, were subsequently absorbed in the said Commission when it was established as a statutory body under the .
The was made applicable to the Commission.
The petitioners opted for Contributory Provident Fund and availed the bene fit.
The petitioners filed a writ petition in this Court claiming the benefit of pension in addition to the Provident Fund contending that (i) under the relevant Rules governing their service, they were entitled to pension on their being made permanent and that the right to pension, 157 which was part of their service condition, was protected by Section 13(1) of the read with Regulation 3(2) of the Oil and Natural Gas Commission (Terms and Conditions of Appointment and Service) Regula tions 1975; and (ii) In spite of the introduction of the Contributory Provident Fund Scheme 'their right to pension was preserved by Section 12 of the Provident Fund Act.
Dismissing the writ petition, this Court, HELD: 1.
The scheme of Contributory Provident Fund, by way of retiral benefit, envisaged by the Provident Fund Act, is in the nature of a substitute for old age pension because it was felt that in the prevailing conditions in India, the institution of a pension scheme could not be visualised in the near future.
It was not the intention of Parliament that Provident Fund benefit envisaged by the said Act would be in addition to pensionary benefits.
[165G H; 166A] 2.
Section 12 of the Provident Fund Act seeks to protect the wages of an employee to whom the scheme framed under the said act applies as well as the total quantum of certain specified benefits to which he is entitled under the terms of his employment.
It prohibits an employer from reducing, whether directly or indirectly, the wages of an employee to whom the Scheme applies or the total quantum of benefits in the nature of old age pension, gratuity, Provident Fund or life insurance to which the employee is entitled under the terms of his employment express or implied.
The said section proceeds on the basis that if an employee is entitled to any benefit in the nature of old age pension under the terms of his employment the said benefit would not be denied to him on the application of the Scheme.
[166A C] 2.1 In the instant case, on the date of application of the Provident Fund Scheme to the Oil and Natural Gas Commis sion.
the benefit of pension was not a part of the terms of employment of the petitioners and they were not entitled to receive pension on that date.
Consequently, the petitioners cannot invoke the provisions of Section 12 of the Provident Fund Act.
[166D] Som Prakash Rekhi vs Union of India & Anr., ; , held inapplicable.
The petitioners were employed on temporary basis at the time when the Commission was established as a statutory body under the "and on that date they were not 158 entitled to claim pension because under the relevant Rules pension was not payable to a person employed on temporary basis.
The petitioners, therefore, cannot claim that on the date of their becoming the employees of the Commission established under the Oil and Natural (;as Commission Act in 1959, they had a right to pension which has been protected under sub section (1) of Section 13 and clause 12) of Regu lation 3 of the Regulations.
[164A B] 3.1 Under the relevant service rules applicable to petitioners, they could either claim pension or the benefit of the Contributory Provident Fund and they could not avail both the benefits.
Since the petitioners are entitled to the benefit of the Contributory Provident Fund under the Provi dent Fund Act and the Provident Fund Scheme and have availed the said benefit for the past 28 years, they should be taken to have opted for said benefit and they cannot invoke the service rules with regard to pension and claim the right to receive pension as part of their conditions of service.
I 164C D] 3.2 The persons who were employed in temporary capacity with the Oil and Natural Gas Commission when it was being run as a Department of the Government of India prior to the enactment of the and who were subsequently absorbed in the Commission, as established under the said Act, are not entitled to pension in addition to the Provident Fund benefit to which they are entitled under the provisions of the Provident Fund Act.
[167B C]
|
Appeal No. 954 of 1963.
On appeal.
from the judgment and decree dated March 9, 1964, of the Allahabad High Court in Income tax Miscellaneous Case No. 143 of 1954.
991 K. N. Rajagopala Sastri, R. H. Dhebar and R. N. Sachthey, for the appellant.
A. V. Viswanatha Sastri, Z. section Meeratwal, B. P. Singh and Naunit Lal, for the respondent.
The Judgment of the Court was delivered by Subba Rao J.
This appeal by special leave is directed against the order of a Division Bench of the High Court of Judicature at Allahabad holding that the Income tax Officer, in the circumstances of the case, went wrong in initiating proceedings under section 34(1) of the Indian Income tax Act, 1922, hereinafter called the Act, in respect of the assessment year 1942 43.
The facts may briefly be stated.
The assessee was a holder of an impartible estate in the district of Ajmer.
On March 25, 1944, the Income tax Officer assessed him to income tax for the year 1942 43.
On April 5, 1945, on the ground that two items of the assessee 's income, namely, s year (forest) income and interest income, were not included in the original assessment, a notice under section 34 of the Act was issued to him.
In response to the said notice, the assessee filed a return wherein he disclosed fully and completely the particulars of his interest income, but raised the plea that his forest income was not taxable.
The Income tax Officer, by his order dated July 12, 1945, made a revised assessment including both the incomes.
The respondent eventually,took the matter on appeal to the Income tax Appellate Tribunal, which, by it , order dated April 25, 1949, held that the Income tax Officer had no jurisdiction to initiate proceedings under section 34 of the Act in respect of the forest income on the ground that the Income tax Officer had knowledge that the assessee had such income when he made the original assessment.
Though the Tribunal only dealt with the question of forest income, by inadvertence or by mistake, it set aside the entire order of reassessment dated July 12, 1945, made by the Income tax Officer and restored the original order passed by him.
The Income tax Department did not take any steps to rectify the mistake under section 35 of the Act or make any attempt to have the question of the illegality referred to the High Court.
Having allowed the order to become final, on January 3, 1950, the Income tax Officer after obtaining the sanction of the Commissioner initiated proceedings under section 34 of the Act with respect to the interest income.
On January 19, 1950, the Income tax Officer issued to the assessee a fresh notice under the said section.
On September 25, 1950, a 992 revised assessment order was made in regard to the assessment year 1942 43 in which the respondent 's interest income was also included.
On appeal, the Appellate Assistant Commissioner confirmed the said order.
On further appeal, the 'Income tax Appellate Tribunal held that since the assessee had failed to disclose his interest income in the return filed by him under section 22(2) of the Act in connection with the original assessment the said income had escaped assessment and, therefore, the provisions of section 34 (1 ) (a) of the Act were attracted.
On application filed by the assessee, the Tribunal referred the following question to the High Court under section 66(1) of the Act: "Whether on the facts and in the circumstances of this case the provisions of section 34(1) were applicable in respect of the assessment year 1942 43 on 19th January, 1950, when the notice under that provision was issued for the purpose of assessing the escaped interest income." The High Court came to the conclusion that the Tribunal in its order dated April 25, 1949, committed a clear error in setting aside the assessment of tax on the interest income without going ,into the correctness of the imposition of tax thereon, but that order had become final; it further held that the said order ,did not invalidate the entire proceedings taken under section 34 of the Act and, therefore, the Income tax Officer could not take proceedings afresh under section 34 of the Act.
In the result the High Court answered the question in the negative.
Hence the appeal.
Mr. Rajagopala Sastri, learned counsel for the Revenue, con tended that the interest income had escaped assessment and, therefore, the Income tax Officer was competent to initiate proceedings under section 34(1) (a) of the Act for assessing the same.
Mr. Viswanatha Sastri learned counsel for the respondent, on the other hand, argued that the assessment made by the Income tax Officer pursuant to the notice issued under section 34 of the Act was in its entirety set aside by the Tribunal on the ground that there was no "discovery" within the meaning of section 34 of the Act and that order had become final and, therefore, the Income tax Officer could not initiate fresh proceedings under that section on the ,principle of res judicata.
To appreciate the contentions of the parties it is necessary to ,notice the scope of the order of the Tribunal dated April 25, 1949.
Before the Appellate Tribunal it was contended on behalf of the assessee that the Income tax Officer who issued the said notice had 993 no definite information which led to the discovery that the said income had escaped assessment within the meaning of the said section.
Adverting to the said argument the Tribunal observed: "We do not agree with the contention of the department that the Income tax Officer who made the original assessment did not apply his mind to this fact, as there is no evidence to show that at the material time such income was considered taxable by the Department.
Ordinarily one would expect that when an Income tax Officer makes the assessment he does according to law and on the facts as produced before him.
If the fact is before him he refused to take it into account thinking that it was immaterial or even inadvertently takes no notice of it, it cannot be said that the Income tax Officer came in possession of a definite information within the meaning of section 34.
We are, therefore, of the opinion that proceedings.
under section 34 could not be initiated against the assessee for the four assessment years under reference.
The orders passed by the Income tax Officer in respect of these four years are therefore set aside and the original orders under section 23(3) are restored.
" We have extracted the order in extenso as the argument really turns upon the scope of the said order.
The Appellate Tribunal in considering the validity of the notice under section 34 of the Act only discussed the question of the escape of the year income; it did not advert to the interest income at all.
It came to the conclusion, having regard to the fact that the Income tax Officer at the time he made the original assessment had knowledge of the existence of the syar income, that the Income tax Officer did not come into possession of definite information within the meaning of section 34 of the Act.
Though the finding was arrived at on the basis of the syar income alone the Tribunal set aside the entire order of reassessment and restored the original order of assessment made by the Income tax Officer under section 23 (3) of the Act.
The legal effect of the order was that the are assessment of the entire income, including the syar income and interest income, was set aside on the ground that the Income tax Officer did not come into possession of definite information leading to a "discovery" and, therefore, he could not initiate proceedings under section 34 of the Act.
It is true that the Tribunal had committed a mistake in setting aside the reassessment order in respect of the interest income 994 also; but, so long as that order stands, it comprehends both the incomes.
The Income tax Officer did not take any further proceedings by way of reference to the High Court on any question of law arising out of the order of the Tribunal; nor did he take any proceedings under section 35 of the Act to have the order corrected on the ground of mistake.
With the result the order has become final.
The question, therefore, is not whether the order of the Tribunal in so far as it related to the interest income was made by inadvertence or under a mistake, but whether the Income tax Officer could initiate proceedings over again under section 34 of the Act in derogation of the finding given by the Tribunal that the Income tax Officer did not "discover" that the income had escaped assessment.
The Income tax Act is a self contained one.
It creates a hierarchy of tribunals with original, appellate and revisional jurisdictions.
Section 31 gives, inter alia, right of appeal against some orders of the Income tax Officer to the Appellate Assistant Commissioner; section 33 provides for a further appeal to the Income tax Appellate Tribunal; and sub section
(6) of section 33 says that save as provided in section 66 orders passed by the Appellate Tribunal on appeal shall be final.
Section 66 provides for reference to the High Court on a question of law; and section 66 A provides for appeals in certain cases to the Supreme Court.
It is clear from the said provisions that the order of the Tribunal made within its jurisdiction, subject to the provisions of section 66 of the Act, is final.
Therefore, the decision of the Tribunal in respect of the subject matter under appeal before it is final and cannot be reopened by the assessee or the Department.
The Judicial Committee in Commissioner of Income tar, Bombay & Aden vs Khemchand Ramdas(1) succinctly stated the legal position thus : "But it is not true that after a final assessment under those sections (sections 23 and 29) has been made, the Income tax Officer can go on making fresh computations and issuing fresh notices of demand to the end of all time. .
But when once a final assessment is arrived at, it cannot in Their Lordships ' opinion be reopened except in the circumstances detailed in (1) , 424, 426.
995 Sections 34 and 35 of the Act and within the time limited by those sections.
" Later on the same idea is restated thus "In Their Lordships opinion the provisions of the two sections are exhaustive, and prescribe the only circumstances in which and the only time within which such fresh assessments can be made and fresh notices of demand can be issued.
" The Judicial Committee again in Commissioner of Income tax, West Punjab vs The Tribune Trust, Lahore(1), after noticing the relevant sections of the Act, reaffirmed the same position and held that assessments once made would be valid and effective until they were set aside in the manner prescribed by the Act and that, if not so set aside, they were final.
If so, it follows that the order of the Tribunal on the said question, namely, that the whole order of reassessment under section 34 of the Act was invalid as there was no "discovery" that the relevant income escaped assessment, had become final.
The only two sections that enable the Income tax Officer to reopen final assessments are sections 34 and 35.
If the Appellate Tribunal committed a mistake, under section 35 it can be rectified within four years from the date of the order.
In the present case it was a clear case of mistake, for the Tribunal set aside the order of reassessment in respect of the interest income, though its validity to that extent was not disputed.
But, for one reason or other, the Revenue did not resort to the obvious remedy and allowed the mistake to remain uncorrected.
In the se circumstances, can section 34 of the Act be resorted to ? Learned counsel for the Revenue says that section 34(1) (a), as amended in 1948, confers such a power on the Income tax Officer.
The material part of section 34, before amendment, read: "(1) If in consequence of definite information which has come, into his possession the Income tax Officer discovers that income, profits or gains chargeable to income tax have escaped assessment in any year Section 34 (1 ) (a), as amended in 1948, reads : "If the Income tax Officer has reason to believe that by reason of the omission or failure on the part of in assessee to disclose fully and truly all material facts necessary for his assessment for that year.
(1) 996 income, profits or gains chargeable to income tax have escaped assessment for that year. he may in cases falling under clause (a) at any time. . . . serve on the assessee a notice. . . " It is said that the words "has reason to believe that by reason of the omission or failure on the part of an assessee to disclose fully and truly all material facts necessary for his assessment for that year, income profits or gains chargeable to income tax have escaped assessment" are more comprehensive than the words "the Income tax Officer discovers that income etc., have escaped assessment in any year" and, therefore, though there was a finding by the Tribunal that the Income tax Officer did not "discover" that there was escape of assessment,.
the Income tax Officer under the amended section 34 can initiate proceedings in spite of that finding.
We cannot accept this argument.
It could not have been the intention of the Legislature by amending the section to enable the Income tax Officer to reopen final decisions made against the Revenue in respect of questions that directly arose for decision in earlier proceedings.
The Tribunal held in the earlier proceedings that the Income tax Officer knew all the facts at the time he made the original assessment in regard to the income he later on sought to tax.
The said finding necessarily implies that the Income tax Officer had no reason to believe that because of the 'assessee 's failure to disclose the facts income has escaped assessment.
The earlier finding is comprehensive enough to negative "any such reason" on the part of the Income, tax Officer.
That finding is binding on him.
He could not on the same facts reopen the proceedings on the ground that he had new information.
If he did so, it would be a clear attempt to circumvent the said order, which had become final.
We are not concerned in this appeal with a case where the Income tax Officer got new information which he did not have at the time when the Tribunal made the order.
The finding of the Tribunal is, therefore, binding on the Income Officer and he cannot, in the circumstances of the case, reopen the assessment and initiate proceedings over again.
If that was not the legal position, we would be placing an unrestricted power of review in the hands of an Income tax Officer to go behind the findings given by a hierarchy of tribunals and even those of the High Court and the Supreme Court with his changing moods.
The decisions: cited by the learned counsel for the Revenue do not countenance such a contention.
Chakraverti C.J., in 997 R. K. Das & Co. vs Commissioner of Income tax, West Bengal(1), speaking for the Division Bench, only decided that the Income tax Officer could not make a reassessment unless he issued the prescribed notice and issued it in a valid form.
As the notice under section 34 of the Act issued therein was held to be bad inasmuch as the Income tax Officer did not take the sanction of the Commissioner, the learned Chief Justice held that the returns filed pursuant to such notice was also bad.
We are not here concerned with that aspect of the case.
The judgment of this Court in Commissioner of Income tax, Bihar & Orissa vs Maharaja Pratapsingh Bahadur of Gidhaur(2) held that, as the earlier notice issued under section 34(1) of the Act without the sanction of the Commissioner was bad, the entire proceedings for are assessment were illegal.
There was an observation 'at the end of the judgment to the effect that "there was time enough for fresh notices to have been issued, and we fail to see why the old notices were not recalled and fresh ones issued".
The point now raised before us, viz., how far and to what extent a final order made in earlier proceedings under section 34 of the Act would be binding on the Income tax Officer in subsequent proceedings under the said section was neither raised nor decided in that case.
The said decisions, therefore, have no bearing an the question raised before us.
For the foregoing reasons we hold that the answer given by the High Court to the question referred to it is correct.
In the result, the appeal fails and is dismissed with costs.
Appeal dismissed.
| In May 1941, the respondent had entered into a contract with the appellant company for the purchase of a plot of land in a Colony Scheme.
He had paid the earnest money and had undertaken to complete the transaction within on month from the date of completion of certain development work by the appellant.
Thereafter, the land in question was requisitioned by the Government under the Defence of India Rules and the company was therefore unable to undertake the development work during the continuance of the war.
On learning that the Government proposed to de requisition the lands taken over by them, in May 1946, the respondent approached the company to ascertain when it would complete development work after the de requisitioning of the land, so that he might complete the transaction within one month thereafter.
The company claimed that the contract stood cancelled since the respondent had failed to comply with the terms of a circular letter issued by it in December 1943, offering all purchasers an option between accepting refund of the earnest money or completing the transaction immediately by accepting the land in an undeveloped state.
The respondent denied having received the circular letter and filed a suit in August 1946, which was decreed by the trial court and the decree was upheld by the High Court in appeal.
In the Supreme Court it was contended on behalf of the company that the contract was discharged by reason of frustration because its performance was rendered unlawful as a result of the requisitioning orders made by the Government, and furthermore, that the suit for specific per formance was premature,, because, under the contract the respondent did not get the right to obtain a sale deed till after the development work was complete.
HELD : (i) It cannot be said that because of the requisitioning orders which had the effect of making the entry by or on behalf of the company on the land illegal, during the subsistence of the period of requisitioning, the contract stood discharged by frustration.
[637 H] If time is of the essence of the contract, or if the time for the performance is set out in the contract, the contract would stand discharged even though its performance may have been rendered unlawful for an indeterminate time, provided unlawfulness attached to the performance at the time when the contract ought to have been performed.
[637 A C] In the present case, it could not be said that time was of the essence of the contract or that the contract had been discharged because it had not been performed in a reasonable time within the meaning of section 46 of the Contract Act.
When the parties entered into the contract, they knew the prevailing circumstances and must have borne in mind the possibility of difficulties in obtaining the necessary material or the possibility of the land being requisitioned by the Government.
[637 E H] 631 Denny Mott & Dickson Ltd. vs James B. Frasser & Co. Ltd. ; and Satyabrata Ghose and Ors.
vs Mugneeram Bangur & Co. & Anr. ; referred to.
(ii) The contention that the suit was premature could not be accepted because the development work had been completed when the appeal was heard by the High Court.
In such a case the court would be justified in taking notice of subsequent events in moulding its relief accordingly.
[638 A B]
|
Civil Appeal No 485 of 1971.
From the Judgment and order dated the 29th January, 1970 of the Delhi High Court in Letters Patent Appeal No. 8/70.
D.D. Thakur, E.C. Agarwala and V.K. Panditta for the Appellant.
Chaman Lal Itrora for the Respondent.
The Judgment of the Court was delivered by MISRA J.
The present appeal by certificate is directed against the judgment of the High Court of Delhi dated 29th January, 1970 in letters patent appeal confirming the judgment and order of the learned Single judge of the High Court dated 7th January, 1970, 765 Nanak Chand, father of the appellant was a displaced person from West Pakistan where he held left agricultural lands in village Chhota Bhukh Autar, tehsil Bahawal Nagar, district Bahawalpur.
After the partition of the country his claim bearing Index No. B/BP 3/259 was verified in his name for 26 standard acres 12.5 units.
Nanak Chand disappeared sometime in December, 1954 and a report about his disappearance was lodged by the appellant 's brother Dewan Chand, arrayed in this appeal as respondent No. 2, on 25th December, 1954 with the local police, Malhout, district Ferozepur, Punjab.
An enquiry was made by the police in the matter and ultimately the police gave out that Nanak Chand could not be traced.
In the year 1956 a notice was issued in suo moto revision in regard to the verified claim referred to above, by the Additional Settlement Commissioner, Delhi to Nanak Chand, claimant.
As Nanak Chand could not and did not appear in compliance with the notice, the eldest brother of the appellant, namely, Dewan Chand, appeared before the Additional Settlement Commissioner, Delhi on October 25, 1956 and alleged that Nanak Chand had died leaving behind three sons namely, Dewan Chand, Prabhu Dayal and Ashok Kumar (minor) as the only legal heirs of the deceased.
The learned Additional Settlement Commissioner by his order dated 27th October, 1956 allowed the application for substitution and directed Dewan Chand, Prabhu Dayal and Ashok Kumar alone to be brought on the record as legal representatives of the deceased Nanak Chand, although Nanak Chand had left behind the aforesaid three sons, three daughters, namely, Satnam Devi, Lajwanti and Smt.
Raj Rani, and his widow Smt.
Chandan Bai.
Prabhu Dayal, one of the three sons of Nanak Chand died in 1961 leaving behind his daughter Santosh Kumari.
His widow Smt.
Lajwanti applied for being substituted as an their of the deceased alongwith her minor daughter Santosh Kumari.
In 1964 the mother of the appellant also applied to the Settlement officer that she and her three daughters may also be Constituted as heirs and legal representatives of Nanak Chand deceased regarding payment of compensation in respect of the verified claim.
They also prayed for condonation of delay in filing the application for substitution and for initiating proceedings under section 9 of the .
The Settlement 766 Officer concerned recommended for condonation of delay in his report dated 24th March, 1964 to the Regional Settlement Commissioner, Rajasthan with the delegated powers of Chief Settlement Commissioner, Rajasthan, who by his order dated 6th April, 1964 condoned the delay and directed that the case may be processed and finalised according to rules.
When the relevant.
record was received by the M.O./S.O. Rajasthan, the appellants mother alleged that the previous order of substitution of heirs of Nanak Chand, deceased, had been obtained by fraud and mis representation practised by her sons inasmuch as they did not disclose in their application for substitution the existence of the appellant, her mother and sisters.
The M.O cum S.O. by his order dated November 16, 1964, dismissed the application of the mother of the appellant on the ground that the previous order dated 27th October, 1956 passed by the Additional Settlement Commissioner declaring only three sons of Nanak Chand deceased as his heirs, to the exclusion of deceased 's widow and daughter was never challenged by way of an appeal or revision, so the said order had assumed finality.
He, therefore, declined to interfere and refused to grant redress.
The mother of the appellant on her own behalf and on behalf of her three daughters, including the appellant, filed an appeal in the Court of the Regional Settlement Commissioner which came up before Shri S.S. Govilla, S.O. with delegated powers of Regional Settlement Commissioner (Rajasthan) and he by his order dated 22nd December, 1964 dismissed the same.
The mother of the appellant undaunted by the failures, filed a revision petition before the Chief Settlement Commissioner, which came up for hearing before Shri D.N. Vohra, Settlement Commissioner with delegated powers of Chief Settlement Commissioner, and he also took the view that the order dated 18th December, 1954 passed by the Additional Settlement Commissioner had become final and he had no jurisdiction to revise or amend the said order, and accordingly he dismissed the revision.
Thereafter the mother moved the Central Government under section 33 of the on her own behalf as well as on behalf of the appellant but the application was dismissed by the Central Government, Ministry of Rehabilitation.
On 30th August, 1965 the appellant also filed a revision against the order of the Additional Settlement Commissioner before the Chief Settlement Commissioner under section 5 of the Displaced Persons (Supplementary) 767 Verification of Claims Act, 1954, but this also met with the same fate on 25th September, 1965 without affording an opportunity of being heared to the appellant.
The appellant eventually filed a writ petition before the High Court of Delhi giving rise to the present appeal against the orders dated 25th September, 1965, passed by the Chief Settlement Commissioner, Delhi whereby he confirmed the order dated 27th October, 1956 passed by the Additional Settlement Commissioner, refusing to substitute the appoint as legal heir of Nanak Chand, deceased.
The writ petition was dismissed by an order dated 7th January, 1970.
The appellant unsuccessfully filed a letters patent appeal which was dismissed on 29th January, 1970 Feeling aggrieved the appellant applied for a certificate under article 133 of the Constitution, which was granted.
This is how the appellant has come to this Court.
It is contended for the appellant that on 27th October, 1956 she was a minor when the order was obtained by fraud and misrepresentation by Dewan Chand, without disclosing the names of other heirs viz the appellant and her brother and two sisters.
The appellant filed revision petition under section 5 of Claims (Supplementary) Act (12 of 1954) on 27th of November, 1964 before the learned Chief Settlement Commissioner, who without hearing the appellant and without affording her any opportunity to substantiate her pleas, dismissed the revision petition on 25th September, 1965.
This was in Violation of the principles of natural justice.
The High Court chose to rely on the deposition of Dewan Chand, respondent No. 2, to the effect that his father had been murdered and he produced a certificate of death before the Chief Settlement Commissioner certifying that Nanak Chand died one year ten months prior to 25th October, 1956 and this certificate is alleged to have been given on the application filed by Dewan Chand before the President of the Municipal Committee, Abohar.
The learned Single Judge of the High Court observed that the Additional Settlement Commissioner acted rightly in relying upon the certificate and substituting the sons of Nanak Chand as heirs of the deceased to his verified claim, on the ground that as Nanak Chand had died prior to the enforcement of the Hindu Succession Act his daughters would not be heirs and could not succeed to the property of their father.
768 Shri Thakur, learned counsel for the appellant strenuously contended that if he had been given an opportunity by the Chief Settlement Commissioner he would have been able to produce the evidence before him that on the own admission of Dewan Chand, Nanak Chand had disappeared sometime in December, 1954 and a report about his disappearance was lodged by Dewan Chand on 25th December, 1954 with the local police, Malhout, district Ferozepur and as a result of an enquiry the police gave out that Nanak Chand could not be traced.
This evidence could not be produced before the Chief Settlement Commissioner because the appellant was not heard.
The decision of this case hinges on the question whether Nanak Chand had died before or after the enforcement of the Hindu Succession Act.
If he died before the enforcement of the Hindu Succession Act obviously the daughters could not get any share in the property left by Nanak Chand.
If on the other hand he died after the enforcement of the Hindu Succession Act, the daughters would be equally entitled to a share in the property left by Nanak Chand.
In any case the widow of Nanak Chand would be entitled to a share in the property irrespective of the fact whether Nanak Chand died before or after the Hindu Succession Act.
This aspect of the case has been completely lost sight of by the High Court.
If Nanak Chand disappeared in December, 1954 on the report of Dewan Chand himself and has not been heard of for seven years by those who would naturally have heard of him if he has been alive, there could be raised presumption of death when the question arises.
But in the instant case to presumption arises as the question arose just two years after the date of disappearance.
As regards the actual date of death the High Court dealing with the death certificate observed as follows: "As an administrative office doing quasi Judicial work, the Additional Settlement Commissioner was entitled to give credence to the death.
certificate.
He was bound only to make a preliminary enquiry as to who were the heirs of Nanak Chand.
He did not hove to decide that question finally.
For a preliminary enquiry the death certificate signed by the respectable persons of the place where the family resided was sufficient.
Therefore, the Additional Settlement Commissioner was satisfied that the substitution 769 of the sons of Nanak Chand in place of the deceased would not prejudicially affect his daughter.
It was not, therefore, necessary for him to have given an opportunity to the daughter of being heard under sub section (2) of section 5 of the .
" A certificate given by respectable persons of the place where the deceased once resided, to say the least, is not admissible in evidence.
35 of the evidence Act provides that ail entry in any public or other official book, register, or record, stating a fact in issue or relevant fact, and made by a public servant in the discharge of his official duty, or by any other person in performance of a duty specially enjoined by the law of the country in which such book, register or record is kept, is itself a relevant fact.
In the instant case a certificate by certain respectable person of the place where the family once resided does not satisfy the requirements of section 35 of the evidence Act.
There is no proof that any statutory duty was cast upon the person issuing the certificate to keep a record of birth and death and therefore, the certificate of death has no evidentiary value.
It is very easy for a person to obtain death certificate from the so called respectable persons in order to grab the property.
If according to Dewan Chand, Nanak Chand had died he must also indicate where did he die and it is tho place of his death which will be relevant and not the place of his birth or residence.
The certificate obviously is not of the place where Nanak Chand died.
We are of the view the authorities have gravely erred in relying upon the certificate of death which was inadmissible evidence.
The High Court repelled the contention raised on behalf of the appellant that opportunity should have been given to the appellant under section 5(2) of the displaced Persons (Claim) Supplementary Act, 1954 merely on the assumption that Nanak Chand had died much before the enforcement of the Hindu Succession Act and, therefore, no prejudice has been caused to the daughters as they would not be an heir.
It is simply begging the question.
Whether daughters would be entitled to an interest in the property left by Nanak Chand will depend upon the death of Nanak Chand before or after the enforcement of Hindu Succession Act.
It was an important question, therefore, to decide whether Nanak Chand died before the enforce 770 ment of Hindu Succession Act or not.
For that it was absolutely essential that an opportunity should have been afforded to the appellant in accordance with the principle of natural justice.
As observed earlier, if an opportunity had been given to the appellant she would have produced the admission of Dewan Chand that his father Nanak Chand disappeared sometime in December, 1954 and as a result of an enquiry by the police, no trace of him could be found out.
The finding that Nanak Chand died before the enforcement of the Hindu Succession Act, based on the death certificate, cannot be sustained for a moment as it is based on an inadmissible piece of evidence.
If that finding is set aside, there is no escape from the conclusion that Nanak Chand died not before but after the enforcement of the Hindu Succession Act, that is, after 25th October, 1956.
There is no dispute that Nanak Chand died leaving behind his widow, three sons and three daughters.
Dewan Chand fraudulently obtained on order alleging that Nanak Chand died leaving behind only three soils If Nanak Chand died after the enforcement of the Hindu Succession Act, as round earlier, obviously his widow, three sons and three daughters would succeed to his interest in equal shares, which would work out to 1/7th.
Now the question arises what was the interest of Nanak Chand at the time of his death.
As the property in question was Mitakshara coparcenery property, his interest would be determined in accordance with the provisions of Explanation I of section 6 of the Hindu Succession Act.
It would be appropriate at this stage to read section 6 insofar as it is material for the purpose of this case: "6.
When a male Hindu dies after the commencement of this Act, having at the time of his death an interest in a Mitakshara coparcenery property, his interest in the property, shall devolve by survivorship upon the surviving members of the coparcenery and not in accordance with this Act: Provided that, if the deceased had left him surviving a female relative specified in Class I of the Schedule or a male relative, specified in that class who claims, through such female relative, the interest of the deceased in the Mitakshara coparcenery property shall devolve by testamentary 771 or intestate succession, as the case may be, under this Act and not by survivorship.
Explanation I. For the purposes of this section, the interest of a Hindu Mitakshara coparcenery shall be deemed to be the share in the property that would have been allotted to him if a partition of the property had taken place immediately before his death, irrespective of whether he was entitled to claim partition or not." The interest of Nanak Chand shall be deemed to by the share in the property that would have been allotted to him if a partition of the property had taken place immediately before his death irrespective of whether he was entitled to claim partition or not.
In view of Explanation I of section 6, Nanak Chand would have got 1/5th interest on partition between him and his wife and three sons.
If once the interest of Nanak Chand is determined to be 1/5th before his death, his interest would devolve upon his widow, three sons and three daughters equally and thus the share of each one of them would be 1/5 x 1/7, that is, 1/35th each.
The claim of these heirs cannot be denied merely because some of them have not advanced the claim.
When the question of determination of share among the heirs crops up before the Court, the Court has to see that every heir gets his due.
Shri Itrora appearing for the respondents could not successfully meet the point raised on behalf of the appellant.
For the foregoing discussion the appeal must succeed and it is accordingly allowed and the judgment of the High Court as well as of the authorities below are set aside and shares of the three sons, three daughters and the widow are determined as follows: Each of the three sons 1/35; each of the three daughters 1/35, the widow 1/35+1/5.
As the widow has inherited the interest of her husband after his death her share would be augmented by 1/5.
Therefore, her share would come to 1/35+1/5=8/35.
In the circumstances of the case we direct the parties to bear their own costs.
H.S.K. Appeal allowed.
| In a departmental inquiry conducted by the second respondent U.P. Administrative Tribunal into certain charges levelled against the appellant a Deputy Superintendent of Police, the Tribunal dismissed the application of the appellant praying for summoning 8 witnesses for being examined in his defence.
The Tribunal relied upon rule 20A(1) of the Travelling Allowances Rules (Financial Handbook Volume III) and observed that the appellant had to deposit the expenses of the witnesses, who were private person, if he wanted to have them examined in his defence within a specified time.
The appellant did not deposit the amount and the witnesses were not summoned.
Pursuant to the finding of the Tribunal the appellant was removed from service.
The appellant filed a writ petition in High Court contending that in view of G.O. No. 4197 R/VIIIA/500(146)68 travelling allowance and diet money of witnesses to be examined before the Tribunal must have been paid by the State Government but he was asked to deposit a sum of Rs. 900 for the witnesses being summoned and this was in violation of the relevant provision relating to conduct of proceeding before the Tribunal.
The High Court dismissed the writ petition in limine.
In this appeal the question was whether on this account there was non compliance with the principles of natural justice., Allowing the appeal, ^ HELD: There is no compliance with the principles of natural justice in this case.
[251C] Rule 20A(1) of the Travelling Allowances Rules (Financial Handbook Volume III) is not quite clear, for it does not say who should bear the expenses initially or whether the reference to be made by the inquiring authority under clause (c) should be made before or after the examination of the witnesses.
Clause (b) of this sub rule seems to have been considered 245 satisfied in the present case as the Tribunal had decided to summon the witnesses provided the amount was deposited by the appellant as directed.
[249B C] G.O. No. 4191 R/VIIIA 500(146) which was evidently intended to clarify Rule 20A of the Travelling Rules makes it clear that responsibility for payment of travelling allowance to defence witnesses produced in departmental inquiry conducted under section 7 of the Police Act is of the Government and that if a witness has been permitted to be produced in defence it is not open to the inquiry officer to lay down a condition that his travelling expenses should be first deposited by the delinquent officer before the witness is examined.
[250G H] In the present case, the Tribunal has considered the witnesses to be material but has insisted on the appellant depositing initially a sum of Rs. 900 for the travelling expense and daily allowance of the witnesses with an obligation to make good any shortfall in those allowances and loss of professional income of the witnesses.
The respondent State did not contend that this G.O. does not apply to the case of the appellant.
Moreover, the appellant was under suspension from 11 12 1967 and there is nothing on record to show that he was financially sound and in a position to deposit the sum of Rs. 900 and pay any further amount which may be required to next any shortfall in the travelling and daily allowances and the loss of professional income of the 8 more witnesses whom he wanted to be examined on his side.
The failure to cause the production of those witnesses at the expense of the Government might have caused prejudice to the appellant for it cannot be predicated what conclusion the Tribunal would have reached in regard to charges 1 to 3 if the evidence of those witnesses was available for its consideration.
[250H, 251 A C]
|
Appeal No. 459 of 1980.
From the Judgment and Order dated 10.1.1980 of the Punjab and Haryana High Court in C.R. No. 34 of 1980 P.K. Banerji, V.C. Mahajan, Mrs. Urmila Kapoor and Ms. A. Prabhawathy for the Appellant.
Raja Ram Agarwal, B.P. Maheshwari, S.N. Agarwal and B.S. Gupta for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal by special leave is from the decision of the Punjab & Haryana High Court dated 10th January, 1980.
The appellant is the tenant.
The appeal arises out of the summary dismissal of the revision petition filed by the tenant under section 151 of the Code of Civil 519 Procedure from the decision of the appellate authority under the Haryana Urban (Control of Rent and Eviction) Act, 1973 being Act No. 11 of 1973 (hereinafter referred to as the 'Act ').
The appellant took on rent the premises in question from the previous landlord in or about July, 1962.
On or about 11th October, 1971, the respondent purchased the premises in question being suit No. 292 of Ward No. 13, District Gurgaon from the previous landlord.
The premises hereinafter will be referred as the 'premises '.
Few months prior thereto that is to say on 10th July, 1971, the respondent had purchased another house near Kabir Bhavan, Gurgaon.
The appellant 's case was that the respond ent got vacant possession of the same.
The respondent, however, denied that assertion.
On 7th August, 1972 the respondent sold the said house near Kabir Bhavan.
It is asserted that the sale was to one Resham Devi who is alleged to be the sister in law of the respondent.
On the other hand this is disputed and it appears that she is the sister in law of the brother of the respondent.
The assertion of the appellant was that this was a benami transaction.
On 14th January, 1974, an application for ejectment was filed before the Rent Controller by the respondent on grounds of (a) non payment of rent, (b) sub letting, and (c) bona fide requirement.
So far as the grounds of non payment of rent and sub letting, are concerned, it has been held by all the courts in favour of the tenant.
Those findings are not in dispute in this appeal.
The only ground that survives is the bona fide requirement of the landlord.
The Rent Controller on 7th November, 1978 rejected the petition of the landlord on the ground that the landlord had not been able to prove all the ingredients of section 13(3)(a)(i) of the Act.
The respondent thereafter filed an appeal before the Appellate Authority.
Before the Authority, an, application was made for admission of additional evidence by the respondent/landlord.
Such additional evidence were permitted to be adduced and were recorded on various dates.
The appeal was allowed by the appellate authority on 7th December, 1979.
The appellant herein filed a revision petition as mentioned hereinbefore before the High Court under section 151 of the Code of Civil Procedure, and the same was dis missed by the High Court in limine on 10th January, 1980.
The only question that requires consideration in this appeal, is whether on the facts and in the circumstances of the case, the landlord came within the provisions of section 13(3)(a)(i) of the Act.
The Act which is an Act to control the increase of rent of certain buildings and rented land situated within the limits of urban areas, and the eviction of tenants therefrom, provides by section 13( 1 ) that a tenant in possession of a building or a rented land shall not be evicted therefrom except in accordance with the provisions of the said 520 section.
Sub section (3)(a)(i) of section 13 provides as follows: "(3) A landlord may apply to the Controller for an order directing the tenant to put the landlord in possession (a) in the case of a residential building, if (i) he requires it for his own occupation, is not occupying another residential building in the urban area concerned and has not vacated such building without sufficient cause after the commencement of the 1949 Act in the said urban area.
" Before we deal with the other contentions, it may be mentioned that on behalf of the appellant, Shri P.K. Banerji learned advocate contended that the appellate authority was in error in firstly admitting additional evidence at the appellate stage in the facts and circumstances of the case, and secondly, the appellate authority had not considered the evidence adduced by the appellant before the Rent Control ler.
We are unable to accept these submissions urged on behalf of the appellant.
The appellate authority, it must be mentioned, has normally the same jurisdiction to admit additional evidence as the trial court if the facts and circumstances so warrant.
Furthermore, in the instant case section 15 of the Act deals with the powers of the appellate and revisional au thorities under the Act.
Sub section (4) of the said section specifically provides that if necessary, after further enquiry as it thinks fit either personally or through the Controller, the appellate authority shall decide the appeal.
Therefore, the appellate authority has by express provision jurisdiction to admit additional evidence.
Indeed in this case from the written statement, it appears that the only contention that was sought to be raised was about the extent of the accommodation available to the landlord in the ances tral house of the landlord.
The allegation about the alleged sale of the premises near Kabir Bhavan was not clearly spelled out.
Therefore, if the interest of justice so demanded, the appellate authority was justified in admitting the additional evidence.
The parties in this case had ample opportunity to test the veracity and to examine and submit on the value of such additional evidence.
No prejudice could be said to have been caused by admission of such additional evidence.
In State of Kerala vs
K.M. Charia Abdullah & Co., ; this Court was dealing with similar power under Madras General Sales Tax Act, 1939 and observed at page 610 of the report that by sub section (4) of section 250 of the Income Tax Act, 1961 which is similar to section 33(4) of the Indian Incometax Act, 1922, the Commissioner was authorised for disposing of the appeal to 521 make such further enquiry or to direct the Income tax Offi cer to make further enquiry as he thought fit and report upon them.
This Court held that it could not denied that the said sub section conferred upon the appellate or revising authority power to make such enquiry as it thought fit for fair disposal of appeal.
We are, therefore, clearly of the opinion that in the facts and circumstances of a particular case, the appellate authority has jurisdiction under the Act in question to admit additional evidence.
We are further of the opinion that in this case admission of such additional evidence was warranted by the facts and the pleadings in this case.
We are satisfied that by such admission of evi dence, no prejudice has been caused to the appellant.
Indeed reading of the order of the appellate authority makes it abundantly clear that the appellate authority had adverted to all the facts recorded by the Rent Controller and further considered the additional evidence.
It is true that in referring to the findings of the Rent Controller, the appel late authority in its order had not specifically referred to the paragraphs of the order of the Rent Controller but that does not mean nor does it indicate that the appellate au thority had not considered evidence adduced before the Rent Controller.
We are, therefore, unable to sustain the objec tions urged on behalf of the appellant by Shri Banerji, on admission and consideration of the additional evidence.
The appellate authority noted that the party had led evidence before the Rent Controller and after hearing the party, the Rent Controller held in the manner he did.
The appellate authority therefore was conscious of the evidence adduced by the appellant before the Rent Controller.
The criticism that there was no consideration of the evidence adduced by the appellant before the Rent Controller by the appellate authority is, therefore, not justified in the facts and circumstances of the case.
The Rent Controller as noted hereinbefore held that the appellant had proved the bona fide requirement.
The appellate authority had noted the evidence adduced by the respondent before the appellate authority.
It is clear that the residential house of the family of the petitioner was having two rooms only and there was large number of persons occupying the two rooms.
The family of the petitioner consisted of really seven brothers and one sister.
Admittedly two brothers and their families were occupying the said premises.
The premises in question belonged to the grand father of the respondent.
The grand father was an advocate.
He died.
After his death his chamber was let out to Laxmi Commercial Bank.
It was contended that the respondent was a co parcener in the said joint family house.
It was submitted that if the said chamber which was a big room was available, then, it could not be said that there was dearth of the accommodation in the ancestral house.
It is true that the appellate authority had proceeded on the basis that the two rooms for occupation were avail able in the said house for the father and the two sons including the respondent and 522 his family in the ancestral house.
But assuming that even if we take into consideration the chamber of the late grand father which had been let out to Laxmi Commercial Bank, that will also be wholly insufficient to meet the reasonable and bona fide requirement of the respondent.
The appellate authority further held that the appellant was a licensee in respect of the ancestral house and he was staying there with the permission or the licence given by his father and he had no right and as such his interest in the ancestral house could not be considered to be "occupying another residential house" in terms of Clause (1) of sub section 3(a) of section 13 of the Act.
It was submitted before us that this is incorrect because a co parcener in respect of the ancestral house was a co owner and an owner could not be considered to be a licensee of the father in respect of a house belonging to Mitakshara joint family.
There is no dispute that the family in question is governed by the Mitakshara School of Hindu Law.
It is abundantly clear that Ashok, Isher and Jagadish being the brothers of the appellant and the family belonging to the joint family of the respondent with their children were staying in the ancestral house.
Lalit, another brother, had another house.
As mentioned hereinbefore there were other persons but about their stay there was no clear evi dence.
It is asserted by the respondent that they are seven brothers and one sister.
But even assuming that Ashok, Isher and Jagadish and the children stay in the ancestral house and assuming that the big room which had been let out to Laxmi Commercial Bank is taken into consideration, the accommodation is still very inadequate for reasonable and bona fide requirement of the landlords.
The question, there fore, whether the respondent was a licensee of his father or a co owner of the property, namely the ancestral house is not really necessary to be decided.
But it was contended on behalf of the appellant that this approach of the appellate authority had vitiated the conclusion.
It is therefore necessary to allay the grievance of the appellant on this score.
Our attention was drawn to a decision of the Judicial Committee in Rani Sartaj Kuari and Another vs Rani Deoraj Kuari, [15] Indian Appeals, 51 (Mother and Guardian of Lal Narindur Bahadur Pal).
That case was in respect of an impat ible estate governed by the Mitakshara School of Hindu Law.
There was a custom that the estate was impartible and was descendible to single heir by the rule of primogeniture.
It was held that in order to render alienations by the rejah in that case invalid as made without the consent of his son it must be shown.that the rajah 's power of alienation was excluded by the custom or by the nature of the tenure.
In such a raj the son is not a co sharer with his father.
The Judicial Committee further observed that property in ances tral estate acquired by birth under the Mitakshara law is so connected with the fight to partition that it does not exist independently of such fight.
At 523 page 64 of the report, the Judicial Committee observed that the property in the paternal or ancestral estate acquired by birth under the Mitakshara law is, in the opinion of the Judicial Committee, so connected with the fight to parti tion, that it did not exist where there was no right to it.
We are of the opinion that no much support can be sought for by the appellant from the said decision; Here in the instant case, the question is whether the respondent who undoubtedly was governed by the Mitakshara School of Law, had acquired a fight to ancestral property by his birth.
But this question has to be judged in the light of the .
Reliance was also placed on State Bank of India vs Ghamandi Ram (Dead) Through Shri Gurbax Rai at page 686 of the report, this Court observed that accord ing to the Mitakshara School of Hindu law all the property of a Hindu joint family was held in collective ownership by all the coparceners in a quasi corporate capacity.
The Court approved the observations of Mr. Justice Bhashyam Ayyanger in Sundarsanam Maistri vs Narasimhulu Maistri and Anr.
[ILR 25 Mad.
149, 154.
But the question in the instant case is the position of the respondent after coming into operation of the .
Shri Banerji drew our attention to Mulla 's 'Hindu Law ' 15th Edition at page 924 where the learned commentator had discussed effect in re spect of the devolution of interest in Mitakshara coparce nary property of the coming into operation of the .
This question has been considered by this Court in Commissioner of Wealth Tax, Kanpur and Others vs Chander Sen and Others, ; where one of us (Sabyasachi Mukharji, J) observed that under the Hindu Law, the moment a son is born, he gets a share in father 's property and become part of the coparcenary.
His fight accrues to him not on the ' death of the father or inheritance from the father but with the very fact of his birth.
Normally, therefore whenev er the father gets a property from whatever source, from the grandfather or from any other source, be it separated property or not, his son should have a share in that and it will become part of the joint Hindu family of his son and grandson and other members who form joint Hindu family with him.
This Court observed that this position has been affect ed by section8 of the and, there fore, after the Act, when the son inherited the property in the situation contemplated by section 8, he does not take it as Kar of his own undivided family but takes it in his individual capacity.
At pages 577 to 578 of the report, this Court dealt with the effect of section 6 of the Hindu Suc cession Act, 1956 and.
the commentary made by Mulla, 15th Edn.
pages 924 926 as well as Mayne 's on Hindu Law 12th Edition pages 918919.
Shri Banerji relied on the said obser vations of Mayne on 'Hindu Law ', 12th Edn.
at pages 918 919.
This Court observed in the aforesaid decision that the views expressed by the Allahabad High Court, the Madras High Court, the Madhya Pradesh High Court and the Andhra Pradesh High Court appeared to 524 be correct and was unable to accept the views of the Gujarat High Court.
To the similar effect is the observation of learned author of Mayne 's Hindu Law, 12th Edn. page 919.
In that view of the matter, it would be difficult to hold that property which developed on a Hindu under section 8 of the would be HUF in his hand vis a vis his own sons.
If that be the position then the property which developed upon the father of the respondent in the instant case on the demise of his grandfather could not be said to be HUF property.
If that is so, then the appellate authority was fight in holding that the respondent was a licensee of his father in respect of the ancestral house.
But as mentioned hereinbefore, even if we proceed on the assumption that the respondent was a member of the HUF which owned the ancestral house, having regard to his share in the property and having regard to the need of other sons of the father who were living in the ancestral house along with their families, the appellate authority was ,still fight in holding *hat the need of the respondent was bona fide.
The second aspect of the matter which was canvassed before us was that the respondent had purchased another house near Kabir Bhavan in 1971 and there were nine rooms in the said house.
It was the appellant 's contention that it was sold to Smt.
Resham Devi which was a benami transaction.
It was further his contention that in respect of the said house the respondent had got vacant possession.
Thirdly, it was contended that the respondent had within his choice to keep the said premises but he sold the said premises in question.
Therefore he does not come within the conditions stipulated in section 13(3)(a)(i) of the Act.
The appellate authority on appraisal of evidence before the Rent Control ler as well as before it came to the conclusion that vacant possession had not been obtained.
There was evidence on record to come to that conclusion.
Our attention was drawn to the document on behalf of the appellant in support of contention that the document which was registered document recited that vacant possession has been given.
The document stated 'Kabza Khan maken ka dia hai '.
It was asserted that it meant that vacant possession in fact had been given.
The oral evidence adduced indicated otherwise.
Indeed the expression aforesaid does not mean that actual physical vacant possession had been handed over to the purchaser.
In document of this type it can equally mean that the legal right of possession not the actual possession had been handed over to the purchaser.
Therefore, evidence was permissible to explain what it meant.
Reliance for this purpose was placed on a decision of the Division Bench of the Allahabad High Court in Lachhman Das vs Rent Control and Eviction Officer, Bareilly and another.
, AIR [1953] Allahabad 458 at 459, paragarph 6.
Therefore in the instant case even if the legal right of occupation had passed on which, in our opinion, was sought to be conveyed by the expression noted 525 hereinbefore, then whether the premises in question was actually vacant to be occupied by the respondent is a ques tion on which the oral evidence could be adduced.
There was ample justification on the evidence on record to come to the conclusion that it was 'not physically vacant '.
The expres sion noted above therefore on this aspect is really non sequetur and evidence would clinch the issue.
There was the evidence for the appellate authority to come to the conclu sion that the house near Kabit Bhavan was not vacant.
It acted on the same and in our opinion it did not commit any error in so doing.
The next aspect urged was that it was benami transaction because the father of the respondent has gone to the Regis tration office.
In view of the evidence discussed by the appellate authority, specially the income tax records and other records to which it is not necessary to advert in detail as well as the oral testamoney in this case, the appellate authority rejected the contention that the sale was a henami transaction by the respondent.
The most impor tant aspect, however, as was highlighted by the respondent was that the said property was purchased in July, 1971 and sold in August, 1972 because it was not in vacant posses sion.
In the instant case suit for eviction in question for the need of the landlord was filed in January, 1972.
There fore, the respondent could not be said in view of the said premises having been purchased and sold by him prior to the institution of the suit, to have occupied another residen tial building in the urban area.
It was contended that by sale the respondent has disentitled himself to the relief asked for because he had in his choice the residential building for his occupation but he sold it.
We are unable to accept this contention.
There is no evidence either before the Rent Controller or before the appellate authority that this sale to Resham Devi was with an intention or with a purpose to defeat the claim of the appellant or to take out the respondent from the purview of the limitation imposed by clause ( 1 ) (a) of sub section (3) of section 13 of the Act.
If we read in such manner the Act in question, the Act would expose itself to the vice of unconstitutionality.
It is well settled that though the Rent Act.
is a beneficial legislation, it must be read reasonably and justly.
If more limitations are imposed upon the right to hold the property then it would expose itself to the vice of unconstitutional ity.
Such an approach in interpretation of beneficial stat utes is not warranted.
It is true that one should iron out the creases and should take a creative approach as to what was intended by a particular provision but there is always,.
unless rebutted a presumption as to constitutionality and the Act should be so read as to prevent it from being ex posed to the vice of un constitutionality.
State is also presumed to act fairly.
See in this connection the observa tions in State of Karnataka and Another vs M/s. Hans Corpo ration; ; at 704 & 706 and K.P. Varghesev.
Income Tax Officer, Ernakulam and Another, [1981] 4S.C.C. 173 at 179 180 526 Paragraphs 5 & 6).
See also the observations of this Court in Kasturi Lal Lakshmi Reddv vs State of Jammu and Kashmir & Another, ; at 1357.
In fact the respondent did not have a house in his possession.
He purchase one before, but as it was not va cant, he sold away ,,before the institution of the suit.
There was no restriction by the Act on sale and alienation of property.
At the relevant time the respondent fulfilled all the requirements to maintain an action for eviction.
Shri Raja Ram Agarwala, counsel for the respondent, submit ted before us that we should take a creative, reasonable and rational approach in interpreting the statute.
We should not, he submitted, put such an interpretation as would prevent sale or mortgage of the property by the owner and in this case he was justified in saying that the landlord respondent did not have vacant possession.
As the facts of this case warrant and in fact the respondent had sold away the property 1 1/2 years before his suit for his need was instituted, it cannot be said unless there was definite evidence that it was done with the intention to defeat the appellant 's claim so as to be read that the landlord occu pied another residential house at the relevant time i.e. at the time of institution of the suit.
The appellate authority accepted the respondent 's need and found him within the purview of the Act.
The High Court did not interfere in revision, nor shall we under Article 136 of the Constitution.
The appeal, therefore, fails and is accordingly dis missed.
Interim orders are vacated.
In the facts and circum stances of the case, however, the parties will pay and bear their own costs.
M.L.A. Appeal dismissed.
| The rule of construction embodied in section 106 of the Transfer Property Act applies not only to express leases of uncertain duration but also to leases implied by law which may be inferred from possession and acceptance of rent and other circumstances.
270 The contract to the contrary contemplated by the said sec tion need not be an express contract; it may be implied, but it should be a valid contract.
If the contract is invalid the section will regulate the duration of the lease.
When the rent reserved is an annual rent, a presump tion would arise that the tenancy was an annual tenancy unless there is something to rebut this presumption.
But under section 107 of the Transfer of Property Act a tenancy from year to year or reserving an yearly rent can be made only by a registered instrument.
The defendant executed a registered kabuliyat to the Receiver who was managing an estate pending a suit, purport ing to take a plot of land on lease for a period of ten years at a rental of Rs. 46 per annum and paid the first year 's rent of Rs. 46 on the 8th March, 1925, and the next year 's rent on the 16th March, 1926.
No further rent was paid by the defendant to the Receiver or to the proprietor after that date.
The proprietor, treating the defendant as a monthly tenant served notice to quit on him on the 18th July, 1942, asking the latter to vacate on the 7th August, 1942, and instituted a suit for ejectment in July, 1943.
The kabuliyat was found to be inoperative in law and the defend ant contended that the payment and acceptance of annual rent in 1925 and 1926 did not create a monthly tenancy but two tenancies for one year each for two successive years, that the relation of landlord and tenant came to an end on the expiration of the second annual lease, and, as there was no holding over, the suit was time barred: Held (i) that from the facts a tenancy could be pre sumed to have come into existence from 1924; (ii} as the purpose of the tenancy was for building structures on the land, under sec.
106 of the Transfer of Property Act the tenancy must be presumed to be one from month to month in the absence of a contract to the contrary; (iii) a contract that the tenancy was for one year certain could not be inferred in the present case from the fact that an annual rent was paid in 1925 and 1926, inasmuch as the kabuliyat, though inoperative in law, showed that the parties never intended to create a lease for one year; (iv) on the facts of the case it was quite proper to hold that the tenancy was one from month to month since its inception in 1924 and the suit was not time barred.
Debendra Nath vs Shyama Prasanna and Sheikh Akloo vs Emaman (I.L.R. approved.
Aziz Abroad vs Alauddin Abroad (A.I.R. 1933 Pat. 485), Md. Moosa vs Jaganand and Matilal vs Darjeel ing Municipality (17 C.L.J. 167) referred to.
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