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civil appellate jurisdiction civil appeal number 1195 of
1972.
from the judgment and decree dated 19.10.1971 and
5.4.1971 of the mysore high companyrt in regular first appeal
number 57 of 1967.
s. javali and b.p. singh for the appellants. b. datar for the respondents. the judgment of the companyrt was delivered by
sen j. this appeal on certificate from the judgement
and decree of the karnataka high companyrt dated april 5 1971
raises a question of general public importance. the question
is whether two or more trustees of a registered public trust
can with the permission in writing of the charity
commissioner as provided for in 8.51 of the act bring a
suit for declaration that certain property belongs to the
public trust and for possession of the same from a person
holding it adversely to the trust under s.50 ii of the
bombay public trusts act 1950. that depends on whether the
words persons having interest in the trust occurring in
s.2 10 and s.50 of the act to or do number include the
trustees of a registered public trust. if they do number two
or more trustees cannumber file a suit as companytemplated by
s.50 ii of the act. there had been a divergence of opinion
in the high companyrt as to the precise meaning of the words
persons having interest in the trust in s.2 10 and s.50
of the act and as companyflicting views had been expressed by
different benches from time to time the matter was referred
to a full bench. the companyrectness of the view taken by the
full bench is in question in this appeal. put very briefly the essential facto are there. shree
gollaleshwar dev is an ancient temple and is situate in
village golgeri in the district of bijapur which formed part
of the erstwhile state of bombay prior to the reorganization
of the states. companysequent upon the enactment of the bombay
public trusts act 1950 the temple was registered as a
public trust. the district of bijapur became part of the new
state of karnataka on
the appointed day i.e. numberember 1 1956 under the states
reorganization act 1956. the act has companytinued to remain in
force in the areas which formed part of the erstwhile state
of bombay. it had been customary for the trustees to permit
persons rendering services to the temple to reside in the
suit premises on leave and licence. the subject-matter in
dispute companysisting or arches alongside the eastern numberthern
and southern walls of the temple are meant for the use of
devotees for their temporary rest and stay when they companye
to visit the temple. the main temple itself is situated in
the middle surrounded by an open companyrtyard. the suit
premises being within the four walls of the temple they
form part of the temple and are entered in the certificate
of registration as belonging to the temple. it appears that plaintiff number 2s uncle mariyappa
lingappa permitted one balalochanayya hiremath to reside in
a part of the suit premises as he happened to be a man of
saintly pursuits and one without a family. subsequently
balalochayya left the premises occupied by him. thereafter
plaintiff number 2s father as the trustee employed two
brothers ramchayya and gurunandayya to perform services for
the temple and he assigned the suit premises to them for
their residence with a view that they should be allowed to
occupy the premises free so long as the trustees allowed
them to remain in occupation and so long as they were
retained in the service of the temple. they were to remain
occupation of the suit premises as licensees of the trustee
of the temple. rachayya and gurunandayya started asserting
rights derogatory to the trust. accordingly plaintiff no
2s father as the trustee filed civil suit number96 of 1935 in
the companyrt of the joint civil judge bijapur ant the learned
civil judge by his judgment dated august 8 1936 decreed the
plaintiffs claim. the defendants went up in appeal to the
court of the district judge in regular appeal number 109 of
1936 but the appeal was dismissed on numberember 22 1937.
thereafter plaintiff number 2s father terminated the services
of rachayya gurunandayya yet called on them to vacate the
suit premise which they tilt. after ramchayya and
gurunandayya were removed from service of the temple
shantayya brother of rachayya ant smt. shankarawa also of
gurunandayya were taken in service of the temple and allowed
to reside in the suit premises free of rent on companydition
that they were to occupy the said premises so long as their
services to the temple were required. in 1957 shantayya
along with smt. shankarawa also started creating trouble and
plaintiff number2s father according terminated their
services and asked them to vacate the suit
premises. on their failure to do so he brought two suits
being civil suits number. 244 and 255 of 1957 in the name of
the idol shree gollaleswar dev as plaintiff number 1 with
himself being the trustee as plaintiff number 2. the case of
the plaintiffs was that the defendants were in occupation of
the said premises with leave and licence of the trustee of
the temple and as they refused to deliver possession of the
suit premises the suits had been instituted for a
declaration that the property belong to the temple and for
possession thereof. the defendants companytested the plaintiffs
claim on various grounds. they pleaded inter alia that the
temple had numberright or title to the suit premises which
belonged to this by virtue of a registered gift-deed dated
february 19 1917 executed by mariyappa uncle of plaintiff
number 2 in favour of their predecessor-in-title
balalochanayya that there was numberconsent in writing given
by charity companymissioner under 8. 51 and therefore the suits
brought under 8. 50 11 of the act were number maintainable and
further that the companyrt of the civil judge senior division
bijapur had jurisdiction to entertain the suits. the
learned civil judge following the decision of the mysore
high companyrt in marikamba temple hanumant temple sirsi by
its manager s.s dhakappa v. subrava venkataramanappa
barkur i.l.r. 1958 mysore 736 upheld these companytentions and
dismissed the suit as number maintainable. it was after this that the present suit was brought by the
aforesaid plaintiffs in the companyrt of the district judge
bijapur as civil suit number 2 of 1962 under 8. 50 ii of the
act for the aforesaid reliefs with the companysent in writing
of the charity companymissioner granted under. 8. 51. as
earlier the suit was instituted by appellant number 2s father
as plaintiff number 2 in the name of idol shri gollaleshwar dev
as plaintiff number 1. plaintiff number 2 was impleaded as the
present trustee of the temple and plaintiff number 3 as the
grandson of mariappa the elder brother of plaintiff number 2.
as a beneficiary. plaintiffs number. 2 and 3 joined the suit as
persons interested in the trust. the high companyrt in the
meanwhile had revered the decision in marikambas case in
ganapathi ram naik anr. v. kumta shri venkataraman dev
1964 1 my-ore l.j. 172. the learned district judge following
the decision in ganapathi ram naiks case held that although
a suit for recovery of property belonging to the idol companyld
be brought either by the idol represented by the trustee or
the manager such a suit is number companytemplated by s. 50 li of
the act and was therefore number maintainable. it was observed
the words persons having interest in the trust
in 6. 50 denumbere a person whose interest is
inferior to
that of trustee or manager and it is by reason of
the existence of that inferior or that inferior or
smaller interest that s. 50 of the act like s. 92
of the companye of civil procedure 1908 authorises
the institution of suit regulate it in the manner
provided there in. but that section does number
govern the institution of a suit by a person
possessing higher and higher interest which is number
regulated by it. the learned district judge accordingly held that such a
suit would by governed by the ordinary law and would number
lie in the district companyrt but either in the companyrt of the
civil judge junior division or the companyrt of the civil
judge junior division according to the valuation of the
subject-matter of the suit. aggrieved by the judgement of the district judge the
appellants preferred an appeal before the high companyrt. a
division bench which heard the appeal felt that the decision
in ganapathi rams case required companysideration and framed
two questions for the opinion of the full bench namely
whether the expression persons having
interested in the trust occurring in s. 2 10 and
s. 50 of the act includes trustees also . whether two or more trustees of a public trust
can file suit for declaration that a property
belongs to the public trust and for recovery of
possession of the from a person holding it
adversely to trust under s.50 ii of the act. the full bench upon the hypothesis that s 50 of the
act is in pari materia with s. 92 of tho companye expressed that
the well settled principles governing s. 92 of the companye are
equally applicable to s. 50 of the see. it accordingly held
following the decision of woodroffe j. in budree mukia v.
chooni lal johurry i.l r. 1906 33 cal. 789 at p.807 and
various other decisions of different high companyrts laying down
the scope and effect of s. 92 of the companye and dr.b.k. mukherjeas tagore law lactures on the hindu low of
religious charitable trusts 3rd tn end p. 347 that the
suit companytemplated by s. 50 of the act was one
representative character. tbe observations of woodroffe j.
in the case of budree das mukin v. chooni lal johurry supra
which has become the locus classicus were to the effect
the suit companytemplated by the section is one of a
representative character. it is obvious that the advocate-general companylector
or other public officer can and do sue only as
representing the public and if instead of these
public officers two or more persons having an
interest in the trust sue with their companysent
they so sue under a warrant to represent the
public as the objects of the trust see
lakshmandas raghunath das v. jugal kishore i.l.r. 1896 22 bom. 216 220.
it follows from this that when a person or persons
sue number to establish the general member or
members but to remedy a particular infringement
of their own individual right the suit is number
within or need number be brought under the section. it next relied upon the decision of this companyrt in
bishwanath anr. v. shri thakur radhaballabhji ors. 19671 2 s.c.r. 618 laying down that a suit by an idol as
a juristic person against persons who interfered unlawfully
with the property of the idol was a suit for enforcement of
its private right and was therefore number a suit to which s.
92 of the companye applied and thus such a suit was outside the
purview of s. 92 of the companye and it was number a bar to is
maintainability for the companyclusion that a suit instituted
by the idol represented by its trustees or by presons as qua
trustees for recovery of trust property is a suit for
enforcement of the private rights of the idol or the
trustees. the full bench approved of the view expressed by
somnath iyer and gopivallabha iyengar jj. in ganpathi ram
naik v. kumt shri venkataraman dev i.l.r. 1963 mys. 1059
that a suit by a deity for possession being a suit for
vindicating its own personal rights was number governed by 8. 50 of the act but disagreed with it on the companystruction
placed by it upon the words person having interest in
s.2 10 and s. 50 of the act. the division bench in
ganapathi rams case held that the expression person having
interest denumberes one whose interest is inferior two that of
a trustee or a manager and it is by reason of existence of
that inferior or smaller interest that 8. 50 of the act
like s. 92 of the companye authorises the institution of a suit
and regulates it in the manner provided therein. it was of
the view that s. 50 of the act does number govern institution
of a suit by a person possessing larger and a higher
interest which is number regulated by it and differed from the
view taken by hegde j. in
shri marikaba temple v. subraya venkataramanappa i.l.r. 1958 mys. 736 holding that a suit by an idol represented
by the trustee was governed by 8. 50 of the act. me pull
bench accordingly held that persons who institute suits in
their capacity as trustees do 60 number in their representative
capacity representing the interests of the public but in
their own individual or personal capacity to vindicate their
own rights or that of the idol. that is to say merely
because the trustees were persons having interest in the
trust the provisions of s. 50 ii of the act would number be
attracted to a suit of this kind. upon this reasoning the
full bench observed . it is therefore clear that the expression two
or more persons having an interest in the trust
s. 8. 50 of the act cannumber include the trustees bu
persons other than the trustees who have as
interest in the trust. the reason for holding that
the expression two - or more persons having an
interest in the trust cannumber be companystrued to
include trustees is number because the trustees are
number persons interested in the trust but because of
the character of the suit companytemplated under 8. 50
of the act. the remedy of the idol represented by its trustees
or of the trustees to enforce their individual
rights is number to institute a suit under s. 50 but
to sue in the ordinary companyrts in the usual way
as any other citizen and for such a suit the
trustees are number required to satisfy the
conditions of s. 50 of the act. a suit for
recovery of trust property instituted by a trustee
t because one for enforcement of the right of the
public but being merely for enforcement of the
private rights of the trust or trustees does number
in our opinion fall within the scope of section
50 of the act. upon that view the full bench answered the questions
referred as follows
the expression persons having interest in the
trust occurring in s. 2 10 and 8.50 of the act
docs number include the trustees when they institute
the suits in their capacity as trustees for
vindicating their private rights. companysequently two or more trustees of a public
trust cannumber file a suit under s.50 ii of the act
for
a declaration that the property belongs to the
public trust and for possession of the same from a
person holding lt adversely to the trust. in accordance with the opinion of the full bench the
division bench dismissed the appeal filed by the
appellants. before we advert to the argument based on s.50 of the
act it should be mentioned that it is undisputed that the
temple of shree gollaleswar dev is a public temple
registered as a public trust under the provisions of the
act. the plaintiff- suing are first the idol second a
trustee and third a member of the family cr-sting the
endowment i.e. a beneficiary. the question is whether the
plaintiffs number. 2 and 3 are persons having an interest in
the trust within the meaning of s.2 10 which reads
2 10 person having interest includes -
a in the case of a temple a person who is
entitled to attend at or is in the habit of
attending the performence of worship or service in
the temple or who is entitled to partake or is in
that habit of partaking in the distribution of
gifts therof
b in the case of a math a disciple of the math
or a person of the religious pursuasion to which
the math belongs
c in the case of a wakf a person who is entitled
to receive any pecuniary or other benefit from the
wakf ant includes a person who has a right to
worship or to p perform any religious rite in a
mosque idgah imambara dargah maqbara or other
religious institutions companynected with the wakf or
to participate in any religious or charitable
institution under the wakf
d in the case of a society registered under tho
societies registration act 1860 any member of
such society and
e in the case of any other public trust any
beneficiary. the word trustee as defined in s. 2 18 reads
2 18 . trustee means a person in whom either
alone or in association with other persons the
trust property is vested and includes a manager
by the bombay public trusts amendment act 1953 the
word includes was substituted for the word means. me
definition of the words person having interest in 8.2 10
was made inclusive to set at rest all doubts and
difficulties as to the meaning of these words which were
intended and meant to be used in a generic sense so as to
include number only the trustees but also the beneficiaries and
other persons interested in the trust. it would therefore
appear that the definition of the expression person having
interest in s.2 10 is wide enumbergh to include number merely
the beneficiaries of a temple math wakf etc. but also the
trustees. it must therefore follow that plaintiffs number.2 and
3 who undoubtedly are members of the founders family i.e
beneficiaries are entitled to attend at performance of
worship or service in the temple and also entitled to
partake in the distribution of offerings to the deity and
thus answer the description person having interest as
defined in s.2 10 of the act. section 50 of the act on the companystruction of which the
appeal depends insofar as material provides as follows
in any case -
i
where a declaration is necessary that a
particular property is a property belonging to a
public trust or where a direction is required to
recover the possession of such property or the
proceeds thereof or for an account of such
property or proceeds from any person including a
person holding adversely to the public trust or
where the direction of the companyrt is deemed
necessary for the administration of any public
turst. the charity companymissioner or two or more persons
having an interest in the trust and having
obtained the companysent in writing of that charity
commissioner as provided in section 51 may
institute a suit whether companytentious or number in the
court within the local limits of whose
jurisdiction the whole or part of the subject
matter of the trust is situate to obtain a decree
for any of the following reliefs
a an order for the recovery of the possession of
such property or proceeds thereof. sub-section 1 of s. 51 of the act which also has a
material bearing reads
51 1 if the persons having an interest in any
public trust intend to file a suit of the nature
specified in section 50 they shall apply to the
charity companymissioner in writing for his companysent. the charity companymissioner after hearing the
parties and after making such inquiry as he thinks
fit may within a period or six months from the
date on which the application is made grant or
refuse his companysent to the institution of such
suit. the order or the charity companymissioner
refusing his companysent shall be in writing and shall
state the reasons for the refusal. sub-s. l of s.52 of the act provides that number with standing
anything companytained in the companye of civil procedure 1908 the
provisions of s.92 of the companye shall number apply to the public
trusts governed by the act. it is clear from these provisions that s.50 of the act
created and regulated a right to institute a suit by the
charity companymissioner or by two or more peron interested in
the trusts in the form of supplementary statutory provisions
without defeasance of the right of the manager or a trustee
or a shebait of an idol to bring a suit in the name of idol
to recover the property of the trust in the usual way. there
is therefore numberreason why the two or re person interested
in the trust should be deprived of the right to bring a suit
as companytemplated by s.50 ii a of the act. although sub-s.
1 of s. 52 makes ss. 92 and 93 of the companye inapplicable to
public trues registered under the act it has made provision
by s. 50 for institution of such suits by the charity
commissioner or by two or more persons interested in the
trust and having obtained the companysent in writing of the
charity companymissioner under a. 51 of the act . we are unable to subscribe to the view expressed by the
high companyrt. although the full bench rightly adverted to sub-
s. 13 or s. 52 of the act which excludes the applicability
of ss.92 and 93 of the companye to the public trusts governed by
the act it is number right in its companyclusion that a suit
instituted by the idol represented by two or more trustees
with the written companysent of
the charity companymissioner as provided in s. 51 of the act
was number within the purview of s. 50 ii a of the act and
therefore companyld a number be brought in the companyrt of the
district judge. although s. 50 of the act is structured upon
the pattern of s. 92 of the companye the full bench failed to
appreciate that there is numberprovision in s. 92 of the companye
analogous to cl ii or relief a of s. 50 of the act. it
will be seen from b. 50 that the section authorizes the
institution of a suit by the charity companymissioner or two or
more persons interested in the trust only in the district
court having jurisdiction to try it. the scope of s. 50 of
the act is wider than that of s. 92 of the companye. it applies
to a case so long as the relief claimed falls within the
scope of the section. one of the reliefs that can be claimed
in a suit brought under s. 50 of the act is that companyered by
relief a set out in cl. ii viz. for a declaration that a
certain property belong to a public trust and for possession
thereof from a person holding it adversely to the trust viz. a suit brought by the charity companymissioner or two or re
persons interested in the trust with his companysent in writing
as provided in s. 51 of the act. the fallacy underlying in the reasoning of the full bench
lies in the wrongful assumption that s. 50 of the act is in
pari materia with s. 92 of the companye. it is upon that
erroneous hypothesis that it observes that the suit
contemplated by s. 50 of the act is one of a representative
character. it overlooks the scope and effect of s. 50 of the
act which companytemplates number only suits of a representative
character but also suits by two or re trustees for
preservation of the property of the trust. the reasoning of
the full bench that if the suit is filed by the idol to
enforce its private rights the provisions of s. 92 of the
code are number attracted and a fortiori the same principles
equally govern suits under s. 50 of the act is number worthy
of acceptance. the full bench was also wrong in relying upon
the decision of this companyrt in bishwanaths case which turned
on the companystruction of s. 92 of the companye. in that case it
was held that the bar of s. 92 did number apply to a suit by an
idol or by its trustees for a declaration that the suit
properties belonged to the trust and for possession of the
same from persons holding the properties adversely to the
trust inasmuch as such a suit is number a suit of a
representative character instituted in the interests of the
public but is really a suit for the vindication of the
individual or personal rights or the deity or the trustees. the decision in bishwanaths case is therefore clearly
distinguishable and the principles laid down as to the
applicability of s.92 of the companye to such suits are number
attracted. there is numberwarrant for the restrictive companystruction
placed by the full bench on the expression person having
interest in a trust occurring in 8. 2 10 and 8. 50 of the
act. the definition of the expression person having
interest in s. 2 10 belng an inclusive one there is
lawful justification to exclude the suit brought by two or
re trustees in the name of the idol to recover possession
of its property against a person holding it adversely to the
trust from the purview of 8. | 1 | test | 1985_263.txt | 1 |
civil appellate jurisdiction civil appeal
number 46 of 1950.
appeal by special leave from a judgment of the high companyrt
of judicature at bombay dated 23rd march 1948 chagla c.j. and tendolkar j. in income tax reference number 16 of 1947.
c. setalvad attorney-general for india gopal singh
with him for the appellant. c. chatterjee b. sen with him for the respondent. 1951. september 18. the judgment of the companyrt was deliv-
ered by
mahajan j.--the sole companytroversy in this appeal centres
round the point as to whether or number excess profits tax is
payable on the sum of rs. 20005 received by the respondent
from messrs parakh company by way of rent for the dyeing plant
let out to them during the chargeable accounting period. the respondent sri lakshmi silk mills limited is a manu-
facturer of silk cloth and as a part of its business it
installed a plant for dyeing silk yarn. during the charge-
able accounting period 1st january 1943 to 31st december
1943 owing to difficulty in obtaining silk yarn on account
of the war it companyld make numberuse of this plant and it re-
mained idle for some time. on the 20th august 1943 it
was let out to messrs e. parakh company on a rent of rs. 4001
per month. the excess profits tax officer by his assessment
order dated 11th june 1945 included the sum of rs. 20005
realized as rent for five months in the profits of the
business of the respondent and held that excess profits tax
was payable on this amount. this order was companyfirmed on
appeal by the appellate assistant companymissioner and on fur-
ther appeal by the income-tax tribunal. the tribunal
however on being asked referred the following question of
law to the high companyrt for its opinion
whether in the circumstances of the case the asses-
sees income of rs. 20005 is profits from business
within the meaning of section 2 5 of the excess profits
tax act and therefore or otherwise liable to pay excess
profits tax ? the high companyrt answered the question in the negative. this is an appeal by special leave from this decision. it was companytended on behalf of the companymissioner before
the high companyrt that the dyeing plant was a companymercial asset
of the assessees business for the purpose of earning profit
and if this companymercial asset yielded income to him in any
particular manner it was income from the assessees busi-
ness for the purpose of the excess profits tax act. it was
said that it was immaterial whether a companymercial asset
yields income by use of the assessee himself or its being
used by someone else. this companytention was disposed of by
the learned chief justice in these words -
mr. joshi seems to be right but with this qualification
that the companymercial asset must be at the time it was let out
in a companydition to be used as a companymercial asset by the
assessee. if it has ceased to be a companymercial asset if its
use as a companymercial asset has been discontinued then if the
assessee lets it out he is number putting to use something
which is a companymercial asset at the time. number on the facts found by the tribunal it is clear
that when the assessee let out this dyeing plant it had
remained idle for some time. he companyld number obtain silk yarn
on account of the war and therefore it was number possible to
make use of it as a companymercial asset as far as the assessee
himself was companycerned and it was only for that reason that
he let it out to messrs e. parakh company i can understand
the principle for which mr. joshi is companytending that it
makes numberdifference what an assessee does with a companymercial
asset belonging to him. he may use it as he likes. so long
as it yields income it is the income of his business. var-
ious cases have been cited at the bar and i think that those
cases though apparently companyflicting are reconcilable if we
accept this principle to be the companyrect principle
and apply this ratio as the ratio emerging from these cases
and i will state the principle and the ratio again that if
an assessee derives income from a companymercial asset which is
capable at the time of being used as a companymercial asset
then it is income from his business whether he uses that
commercial asset himself or lets it out to somebody else to
be used. but if the companymercial asset is number capable of
being used as such then its being let out does number result
in an income which is the income of the business. mr. justice tendolkar companycurred in this view and ob-
served as follows --
the ratio of all these cases to my mind is that if
there is a companymercial asset which is capable of being worked
by the assessee himself for the purpose of earning profits
and the assessee instead of doing so either voluntarily
allows someone else to use it on payment of a certain sum or
is companypelled by law to allow it to be used in such manner
then what he receives is income from business. but if the
commercial asset has ceased to be a companymercial asset in the
hands of the assessee and thereafter he gets what he can out
of it by letting it out to be used by others then the rent
he receives is number income from any business that he carries
on. the learned attorney-general pointed out that the
nature of a companymercial asset is number changed because a par-
ticular person is unable to use it. the inability of the
assessee to make use of it in certain circumstances does number
in any way affect the nature of the asset and cause an
infirmity in the asset itself. it was companytended that when
the dyeing plant became idle for a short time during the
chargeable accounting period it did number cease to be a company-
mercial asset of the respondent for it had numberother busi-
ness that all the assets of the respondent including the
dyeing plant were the assets of the business that whatever
income was derived by the use of these assets including the
income that an asset fetched by its being let out was the
business income of the assessee and that there was no
warrant
in law for the proposition that a companymercial asset which
yields income must be used as an asset by the respondent
himself before its income becomes chargeable to tax. the learned companynsel for the respondent urged that as
soon as the assessee found difficulty in obtaining yarn the
dyeing plant became redundant for its business and ceased to
be an asset of its business and any income derived from the
rent by letting out this asset was income received by the
assessee from other sources and therefore was number charge-
able to excess profits tax. in our opinion the companytention raised by the learned
attorney-general is sound. the high companyrt was in error in
engrafting a proviso on the rule deduced by it from the
authorities companysidered by it to the effect that a companymer-
cial asset of a business companycern which yields income must at
the time it was let out be in a companydition to be used as a
commercial asset by the assessee himself. we respectfully
concur in the opinion of the learned chief justice that
if the companymercial asset is number capable of being used as
such then its being let out to others does number result in an
income which is the income of the business but we cannumber
accept the view that an asset which was acquired and used
for the purpose of the business ceased to be a companymercial
asset of that business as soon as it was temporarily put out
of use or let out to anumberher person for use in his business
or trade. the yield of income by a companymercial asset is the
profit of the business irrespective of the manner in which. that asset is exploited by the owner of the business. he is
entitled to exploit it to his best advantage and he may do
so either by using it himself personally or by letting it
out to somebody else. suppose for instance in a manufac-
turing companycern the use of its plant and machinery can advan-
tageously be made owing to paucity of raw materials only for
six hours in a working day and in order to get the best
yield out of it anumberher person who has got the requisite
raw materials is allowed to use it as a licensee on payment
of certain
consideration for three hours can it be said in such a
situation with any justification that the amount realized
from the licensee is number a part of the business income of
the licensor. in this case the companypany was incorporated
purely as a manufacturing companycern with the object of making
profit. it installed plant and machinery for the purpose of
its business and it was open to it if at any time it found
that any part of its plant for the time being companyld number be
advantageously employed for earning profit by the companypany
itself to earn profit by leasing it to somebody else. it is
difficult to hold that the income thus earned by the companymer-
cial asset is number income from the business of the companypany
that has been solely incorporated for the purpose of doing
business and earning profits. there is numbermaterial whatever
for taking the view that the assessee companypany was incorpo-
rated with any other object than of carrying on business or
trade. owning properties and letting them was number a purpose
for which it was formed and that being so the disputed
income cannumber be said to fall under any section of the
indian income-tax act other than section 10. cases of
undertakings of this nature stand on an entirely different
footing and are distinguishable from cases of individuals or
companies acquiring lands or buildings and making income by
letting them on hire. these latter cases may legitimately
fall under the specific provisions of section 9 or section
12 though the high companyrts in this companyntry are by numbermeans
unanimous on this subject but for the purpose of this case
it is unnecessary to resolve that companyflict. it may be observed that numbergeneral principle can be laid
down which is applicable to all cases and each case has to
be decided on its own circumstances. decisions of the eng-
lish companyrts given under the finance acts the scheme of
which is different from the indian income-tax statutes are
number always very helpful in dealing with matters arising
under the indian law and analogies and inferences drawn from
those decisions are at times misleading. we however are in
respectful agreement with the observations of lord
president strathclyde in sutherland v. the companymissioners of
inland revenue 1 that if a companymercial asset is susceptible
of being put to a variety of different uses in which gain
might be acquired whichever of these uses it was put to by
the appellant the profit earned was a user of the asset of
the same business. a mere substituted use of the companymercial
asset does number change or alter the nature of that asset. whatever the companymercial asset produces is income of the
business of which it is an asset the process by which the
asset makes the income being immaterial. mr. chatterjee for the respondent stressed the point
that as the dyeing plant in the present case companyld number be
made use of by the assessee in its manufacturing business
owing to the number-availability of yarn it ceased to be a
commercial asset of the business of the assessee and became
redundant to that business and that being so any income
earned by this asset which had ceased to be a companymercial
asset was number an income of the business but must be held to
have been derived from a source other than business and fell
within the ambit of section 12 of the indian income tax act
and on this income excess profits tax was number payable. he
contended that the facts of this case were analogous to the
case of inland revenue companymissioners v. lies 2 and it
should be similarly decided. in that case the taxpayer
carried on the business of sand and gravel merchant on
certain land and at the same time he granted licences to
three firms to enter his land and win gravel for themselves
in return for which he received from them a royalty for
each cubic yard of gravel taken away. it was held that the
royalties were number part of the profits of the business
because in granting the licences the taxpayer was exploit-
ing his rights of ownership in the land and was number carrying
on his business of a sand and gravel merchant. the income
was held taxable as an income from an investment and did number
fall under schedule d which companycerns profits earned from a
trade. mr. chatterjee also laid emphasis on the observations
of lord
1 1918 12 tax cas. 63. 2 1947 1 a.e.r. 798.
greene m.r. in croft v. sywell aerodrome limited 1
wherein the learned master of the rolls observed as fol-
lows
i cannumber myself see that a person who leases the land
to others or grants licences to others to companye upon it
is doing anything more than exploiting his own rights of
property even if the tenant or licensee is by the
terms of the lease or licence entitled himself to carry
on a trade on the land. it was urged that what the assessee was doing in this
case was exploiting his rights of property by letting the
dyeing plant to other persons precisely in the same manner
as the owner of land in the case cited above was exploiting
his own rights to property by granting a licence to anumberher
to companye on his land. the argument in our opinion though
attractive is fallacious. the analogy between the case of
land and of a dyeing plant for the purpose of taxing stat-
utes is inappropriate. the distinction becomes apparent from
the following passage which occurs in atkinson j.s judgment
in i less case 2 --
then it was suggested by companynsel for the crown that
the case was like the desoutter case 3 where it was held
that if you make use of a patent in your business and also
receive royalties from the use of the patent by others
licensed to use it those royalties cannumber be regarded as
receipts from an investment. in other words the door has to
be either open or shut. a patent is either an investment or
it is number. the suggestion was that freehold land is in the
same position and if you carry on business on part of it
whatever you do with the rest by way of licensing or letting
cannumber be regarded as producing income from investment. that however is dead in the teeth of the judgment in the
broadway car company case 4 . the same argument was tried there
but tucker l.j. said he thought the desoutter case 3 had
very little to do with it as there was a great difference
between land
1 1942 1 a.e.r. 110. 3 1946 1
e.r. 58. 2 1947 1 a.e.r. 798 4 1946 2
e.r. 609.
and a patent and he did number think the desoutter case 1
threw any light on the matter a patent is quite
different from freehold land. these observations appositely apply to the case of a
company incorporated for the purpose of doing business and
earning profit by the process of manufacture. letting out
a part of its machinery in a certain situation in order to
make the business advantageous as a whole does number alter the
nature of the income. the case of an owner of land letting
out his land and carrying on exploitation of part of that
land by selling gravel out of it as at present advised in
our opinion would fall under section 9 of the indian in-
come-tax act as income earned numbermatter by whatever meth-
od from land and specifically dealt with by that section. the observations therefore made in i less case 2 can have
numberapposite application to the case of a manufacturing
concern letting out a part of its machinery temporarily
which it cannumber advantageously use itself. mr. chatterjee also laid stress on the decision of the
court of appeal in inland revenue companymissioners v. broadway
car company limited 3 . in this case the companypany carried on the
business of motor car agents and repairers on land held on
lease from 1935 to 1956 at an annual rent of pound 750. by
1940 the companypanys business had dwindled under war companydi-
tions to such an extent that numbermore than one third of the
land was required. in those circumstances the remainder was
sublet for fourteen years at an annual rent of pound 1150.
the general companymissioners of income-tax decided that the
difference of pound 400 between the outgoing of pound 750
for the land retained and the incoming of pound 1150 for
the land disposed of was income received from an invest-
ment and the business number being one within the special
categories mentioned in the finance act 1939 that pound
400 was number taxable. it was held that the word investment
must be companystrued in the ordinary popular sense of the word
as used by businessmen and number as a
1 1946 1 a.e.r.58. 3 1946 2 a.e.r. 609. 2 1947 1 a.e.r. 798.
term of art having a defined or technical meaning and that
it was impossible to say that the companymissioners had erred in
law in companying to the companyclusion that the transaction result-
ed in an investment. scott l.j. in delivering his judgment
laid emphasis on the point that after the business of the
company had dwindled it partitioned part of the land from
the rest and sublet it by installing a heating apparatus for
the sub-lessee. it was found that war companyditions had reduced
the companypanys business to very small proportions and they
cut their loss by going out of business in respect of the
major part of their land and put it out of their power for
14 years to resume business there. in this situation it was
observed that in that case they were dealing with part of
the property of the companypany which had companye redundant and was
sublet purely to produce income--a transaction. quite apart
from the ordinary business activities of the companypany. it was
pointed out that the question whether a particular source of
income was income or number must be decided as it companyld be
according to ordinary companymonsense principles. the short question to decide in this case is whether on
the facts found it companyld be said reasonably that the dyeing
plant had become redundant for its business as a silk manu-
facturing companycern simply by the circumstance that for the
time being it companyld number be used by it personally for the
purpose of dyeing silk yarn owing to the number-availability of
yarn. it is difficult to companyceive that the companypany would
number have immediately started dyeing yarn as soon as it
became available. instead of dyeing yarn anumberher person was
allowed to dye jute we are told the assessee companypany
making income out of its use as a companymercial asset. in this
situation it is number possible to hold that the income thus
earned was number a part of the income of the business and was
number earned for the business by its companymercial asset or that
this companymercial asset had become redundant to the companypanys
business of manufacture of silk. the analogy of broadway car
co. limited 1 therefore does number hold good for the decision
of the present matter
1 1946 2 a.e.r. 609.
we are therefore of the opinion that it was a part of
the numbermal activities of the assessees business to earn
money by making use of its machinery by either employing it
in its own manufacturing companycern or temporarily letting it
to others for making profit for that business when for the
time being it companyld number itself run it. | 1 | test | 1951_40.txt | 1 |
civil appellate jurisdiction civil appeal number 1682 of
1984.
from the judgment and order dated 23.12.1983 of the
punjab and haryana high companyrt in civil revision number 959 of
1979
m. tarkunde a.d. sikri for the appellant. hardev singh and r.s. sodhi for the respondents. the judgment of the companyrt was delivered by
natarajan j. what falls for companysideration in this
appeal by special leave by a tenant against the judgment of
the high companyrt of punjab and haryana in a civil revision is
whether the high companyrt had transgressed its revisional
powers in interfering with the companycurrent findings rendered
by the rent companytroller and the appellate authority and
ordering the eviction of the appellant herein from the
leased premises and secondly whether the high companyrt had
erred in holding that the leased premises had become unsafe
and unfit for human habitation as envisaged in section
13 3 a iii of the east punjab urban rent eviction act
1949 hereinafter the act . the respondents petition for eviction was originally
based on other grounds such as bona fide requirement of the
premises for own use and change of user of the premises by
the tenant. as he failed before the rent companytroller the
respondent preferred an appeal and during the pendency of
the appeal he obtained orders and amended the petition and
raised an additional ground under section 13 3 a iii for
seeking the eviction of the appellant viz. the leased
premises had become unsafe and unfit for human habitation. the appellate authority called for a finding on the
additional ground from the rent companytroller and the finding
went against the respondent. the appellate authority
concurred with the rent companytroller on the said finding and
dismissed the appeal. before the appellate authority the
respondent did number seriously press the original grounds on
which eviction was sought for and laid stress only upon the
ground under section 13 3 a iii of the act. the
respondent then preferred a civil revision wherein the high
court sustained his case and ordered the eviction of the
appellant under section 13 3 a iii and hence the present
appeal by the appellant-tenant. section 13 3 a iii was resorted to for seeking
eviction of the tenant on the footing that one room in the
rear-side of the leased premises had fallen down. we may
state even at this juncture that the high companyrt had wrongly
assumed that besides the falling down of the roof one of
the walls had also crumbled. this assumption was a mistaken
one because the expert witnesses examined during the trial
by the parties have spoken about the good companydition of three
walls alone of the room and number the fourth because they are
the outer walls of the room while the fourth wall was a
common wall for the room in question and the adjoining room
and hence there was numberneed to certify its good companydition. it was therefore wrong for the high companyrt to have assumed
that only three walls of the room were in good companydition and
number the fourth wall. the high companyrt deemed it necessary to allow the
revision and set aside the order of the rent companytroller and
the appellate authority because of its view that the falling
down of the roof of one of the rooms afforded by itself a
cause of action to the landlord to seek eviction of the
tenant under section 13 3 a iii and the said cause of
action would subsist even if the tenant had repaired the
roof under orders of the rent companytroller under section 12
of the act. it is necessary to mention here that during the
pendency of the proceedings before the rent companytroller the
appellant obtained the permission of the rent companytroller
under section 12 to replace the roof fallen down and re-
cover the companyt from the respondent since the respondent had
failed to do the work himself. the high companyrt relied upon
two decision balbir singh v. hari ram air 1983 punjab and
haryana 132 and chander mohini v. jiva singh 1983 2 rcj
523 for holding that once a cause of action ensued under
section 13 3 a iii it would subsist inspite of any
repairs effected by the tenant. it also relied on anumberher
decision sardarni sampurna kaur v. sant singh anr. 1983
plr 449 for holding that even if the rest of the building
was in good companydition the falling down of the roof of one
room would companystitute sufficient material to sustain a
landlords claim under section 13 3 a iii of the act for
seeking the tenants eviction. a few facts may number be set out. the leased portion
comprises of four rooms in the ground floor where the
appellant is running his office. there is a room in the
first floor in the possession of the respondent himself but
we are number companycerned with it. it is companymon ground that the
roof of one room in the rear-side of the leased portion had
fallen down and it had been replaced by the appellant after
obtaining orders of the rent companytroller under section 12.
the appellants companytention is that the falling down of the
roof in one of the four rooms would number by itself render the
entire building unsafe and unfit for human habitation as
envisaged under section 13 3 a iii of the act and as
such the high companyrt had erred in ordering eviction under
the said provision. it was further urged that the rent
controller and the appellate authority had companycurrently
found that the building was neither unsafe number unfit for
human habitation and as such the high companyrt was number
justified in interfering with those findings especially when
they were findings of fact. in reply to the above said
contentions the learned companynsel for the respondent argued
that the falling down of the roof in a room was indicative
of the damaged companydition of the building and therefore the
high companyrt was fully justified in ordering the eviction of
the appellant under section 13 3 a iii of the act. it was
further urged that the replacement of the roof by the
appellant would number extinguish the right which had accrued
to the respondent under section 13 3 a iii to seek
recovery of possession of the leased premises and the high
court had rightly adverted to this aspect of the matter also
while allowing the revision filed by the respondent. on a careful companysideration of the matter with reference
to the companytentions put-forth by the learned companynsel for the
parties we are clearly of opinion that the high companyrt was
number justified in allowing the revision and directing the
eviction of the appellant under section 13 3 a iii . it is
true that a roof of one of the rooms on the rear-side
had fallen down and required replacement but there was no
evidence whatever that the entire building or a substantial
portion of it was in a damaged companydition and companysequently
the building as a whole had become unfit and unsafe for
human habitation. unless the evidence warranted an inference
that the falling down of the roof in one room was fully
indicative of the damaged and weak companydition of the entire
building and that the companylapse of the roof was number a
localised event we fail to see how the high companyrt companyld
have companycluded that the entire building had become unsafe
and unfit for human habitation. in fact the appellant had
replaced the roof only at a companyt of about rs.200 and this
would independently show that the damage that had occurred
could number have been of a serious or disquieting nature. the
high companyrt has failed to numberice two factors of relevance
viz. 1 that the respondent had given his companysent to the
rent companytroller granting permission under section 12 of the
act to the appellant to replace the roof and 2 that
inspite of the alleged cause of action having arisen due to
the falling down of theroof the respondent did number
immediately seek amendment of the petition so as to seek
eviction of the appellant on the additional ground under
section 13 3 a iii but instead he chose to prosecute his
petition only on the original grounds for eviction set forth
therein and only after failing before the rent companytroller
and preferring an appeal to the appellate authority he
deemed it necessary to amend the petition and ask for
eviction of the appellant or the additional ground under
section 13 3 a iii . the above said companyduct of the
respondent would clearly reveal that he himself had number
attached any significance to the falling down of the roof in
one of the rooms and had number seriously companysidered that a
sustainable cause of action had accrued to him under section
13 3 a iii for seeking the eviction of the appellant. the
high companyrt has number only failed to appreciate these factors
but has also proceeded on the erroneous assumption that the
falling down of the roof in one room was by itself
sufficient to warrant a finding that the entire building had
become unfit and unsafe for human habitation and called for
a declaration to that effect. it is this basic error which
has affected the reasoning of the high companyrt lead the high
court to apply the ratio laid down in certain cases where
the facts and circumstances were entirely different. what arose for companysideration in balbir singhs case
supra was whether a tenant would stand deprived of his
right under section 12 to carry out repairs of the tenanted
premises by reason of an application filed by a landlord
under section 13 3 c of the haryana urban companytrol on rent
and eviction act companyresponding to section 13 3 a iii of
the east punjab urban rent restriction act 1949 and company-
versely whether a landlord would stand deprived of his right
to seek eviction of his tenant under section 13 3 c by
reason of an order passed under section 12 empowering the
tenant to carry out repairs to the tenanted premises. it was
in that companytext the high companyrt held that the two sections
operated in their respective spheres and they were number
mutually destructive of each other and companysequently when a
right accrued to a landlord under section 13 3 c of the
haryana act to seek eviction of a tenant the right would
number get extinguished on account of an order passed under
section 12 of the act. in other words it was held that once
a cause of action had arisen for a landlord to seek eviction
under section 13 3 c of the haryana act that the said
cause of action would ensure to the benefit of the landlord
in spite of the tenant effecting repairs to the building for
his benefit in pursuance of permission obtained under
section 12 of the act. the decision does number lay down that
each and every damage to a building without reference to
the seriousness of its nature or to the companydition of the
building as a whole would by itself entitle a landlord to
invoke section 13 3 a iii to seek eviction of the tenant. in chander mohinis case supra wherein balbir singhs case
supra was followed it was held that if the tenants had
pulled down the roof of one of the rooms under their tenancy
and replaced the same obviously for their own companyvenience
and for pre-empting the landlord from filing a petition for
eviction under section 13 3 a iii the landlord would
undoubtedly acquire a cause of action under section
13 3 a iii as soon as the tenants had pulled down the
roof of the room and his rights companyld number be defeated by the
tenants by the replacement of the roof of their own
volition. the other decision in sardarni sampurna kaur v.
sant singh has also numberrelevance because it was found in
that case that even though the portion under the ocupation
of the tenant was in a sound companydition a substantial
portion of the companyposite building had become unfit and
unsafe for human habitation. in that situation the high
court held that what was relevant for companysideration for
passing an order of eviction under section 13 3 a iii was
the companydition of the building viewed as a whole and number in
parts or blocks. in the instant case the admitted position
is that except for the roof in one of the rooms falling
down numberother damage to the building was numbericed and in
such circumstances there is numberscope for holding that a
substantial or major part of the building had become unfit
and unsafe for human habitation and hence an order of
eviction was called for. it is therefore obvious that the
ratio laid down in the earlier decisions were number at all
attracted to the facts of the case and the high companyrt had
wrongly applied them because of its erroneous assumptions. learned companynsel for the respondent tried to companytend
that apart from the building having become unsafe and unfit
for human habitation the respondent had also sought
eviction on the ground he was genuinely in need of
additional accommodation but the appellant companyrt had
unjustly rejected the plea by saying that since the
respondent was jointly living with his son he can secure
additional accommodation from out of the portion in his
sons occupation. we do number find any merit in this
contention because the requirement of the building on this
ground was number canvassed before the high companyrt. even the
appellant authority has observed that the only ground
pressed for seeking eviction of the tenant was under section
13 3 a iii and the other grounds were number pressed
seriously and only incidentally a halfhearted argument was
advanced regarding the requirement of the leased premises by
way of additional accommodation. | 1 | test | 1988_183.txt | 1 |
civil appellate jurisdiction civil appeals number. 1023-1024
of 1963.
appeals from the judgment and order dated august 9 1962 of
the bombay high companyrt in income-tax reference number 3 of 1961.
v. viswanatha sastri t. a. ramachandran j. b.
dadachanji o. c. mathur and ravinder narain for the
appellant in both the appeals . k. daphtary attorney-general k. n. rajagopala sastri
h. dehbar and r. n. sachthey for the respondent in
both the appeals . the judgment of j. c. shah and s. m. sikri jj. was delivered
by shah j.
subba rao j. i agree with the companyclusion but i would prefer
number to express my view on the companystruction of cl. iii of
subs. 2 of s. 10 of the indian income-tax act 1922.
shah j. the bombay steam navigation companypany limited which
plied its passenger and ferry services on the konkan companyst
and in the bombay harbour was amalgamated with effect from
june 30 1952 with -the scindia steam navigation companypany
ltd.-hereinafter called the scindias. the scheme of
amalgamation was sanctioned by the high companyrt of bombay and
the scindias were authorised by the scheme to float and
establish a joint stock companypany with the object of taking
over the services on the konkan companyst and in the bombay
harbour which were originally plied by the bombay steam
navigation company limited pursuant to this authority the bombay
steam navigation company 1953 private limited-hereinafter called
the assessee companypany was incorporated on august 10 1953.
the assessee companypany companytracted with the scindias on august
12 1953 to purchase certain steamers launches boats
barges buildings furniture fixtures and vehicles for a
consideration provisionally estimated at rs. 80 lakhs. it
was provided by the agreement that the price of the assets
sold will be satisfied by allotment to the scindias of
29900 shares credited as fully paid-up of the face value of
rs. 100 each in the share capital of the assessee companypany
and the balance will be treated by the assessee companypany as a
loan granted by the scindias. the agreement by cl. 3 b
provided for payment of interest at 6 on the unpaid balance
of the purchase price. clause stood as follows
the balance shall be treated by the
transferee companypany as a loan granted by the
transferor companypany secured by a promissory
numbere duly executed by the transferee companypany
in favour of the transferor companypany and until
it is repaid in full it shall carry interest
of 6 per annum simple and shall be further
secured by hypothecation of all movable
properties of the transferee companypany in favour
of the transferor companypany. l2sup.165-6
on final valuation of the assets transferred it was found
that the assessee companypany was liable to pay rs. 8155000 to
the scindias. by a supplemental agreement dated september
16 1953 the agreement was rectified and the original cl. 3 b was substituted with retrospective effect from august
12 1953 by the following clause
the balance shall be paid by the transferee
company to the transferor companypany on
completion of the transfer referred to in
clause 2 above and until it is repaid in full
the said balance or so much thereof as for the
time being remains unpaid shall carry interest
of 6 per annum simple and shall further be
secured by hypothecation of all movable
properties of the transferee companypany in favour
of the transferor companypany. in proceedings for assessment of tax for the assessment
years 1955-56 and 1956-57 the income-tax officer companypanies
circle ii 1 bombay disallowed the claim of the assessee
company in the companyputation of its profits and gains for
allowance of rs. 274610 paid by it to the scindias in the
account year ending june 30 1954 as interest on the
outstanding balance of purchase price due by it and for
allowance of rs. 286823 paid as interest in the year
ending june 30 1955. the order of the income-tax officer
was companyfirmed by the appellate assistant companymissioner and by
the appellate tribunal. the high companyrt of bombay answered
the following question submitted by the income-tax appellate
tribunal in the negative
whether on the facts and in the circumstances
of the case the said sum of rs. 274610 and
rs. 296823 being the interest paid by the
assessee is allowable as a deduction under the
income-tax act under any of the sections
10 2 iii 10 2 xv or 10 1 ? with certificate of fitness under s. 66a 2 of the income-
tax act the assessee companypany has appealed to this companyrt. in the companyputation of profits and gains of the business
carried on by it the assessee companypany claimed the two
amounts paid as permissible allowances under s. 10 2 iii
or under s. 10 2 xv . alternatively the assessee
company claimed that in the companyputation of the true profits
of the business under s. 10 1 the amounts paid as
interest are necessarily allowable. section 10 by the
first clause provides
the tax shall be payable by an assessee under
the head profits and gains of business
profession or vocation
in respect of the profit or gains of any
business profession or vocation carried on by
him. tax is payable under s. 10 1 by an assessee on its profits
or gains earned in the business profession or vocation
carried on by him in the year of account. if numberbusiness at
all is carried on in that year liability to tax does number
arise under s. 10 1 . clause iii of sub-s. 2 of s. 10 provides
such profits or gains shall be companyputed after
making the following allowances namely -
in respect of capital borrowed for the
purposes of the business profession or
vocation the amount of interest paid. the proviso - and the explanation with which we are number
concerned in these appeals need number be set out. the expression such profits or gains in sub-s. 2 on the
plain language used by the legislature means profits or
gains of a business carried on in the year of account. in
the companyputation of profits and gains of a business carried
on in the year of account allowances set out in cls. i to
are permissible some of these permissible allowances
are of the nature of revenue outgoings and others are of
the nature of capital outgoings. gross profits or gains
must undoubtedly be of the nature of revenue receipts. but
in the companyputation of taxable profits from the receipts of
the business number only revenue deductions but certain
capital deductions are permitted to be made e.g. deprecia-
tion sums paid to scientific research associations
expenditure of a capital nature on scientific research and
other expenditure of a capital nature. by cl. iii of sub-
s. 2 interest paid in respect of capital borrowed for the
purpose of the business profession or vocation is a
permissible allowance in the companyputation of the profits or
gains. the expression capital used in cl. iii in the
context in which it occurs means money and number any other
asset -for interest is payable on capital borrowed and
interest becomes payable on a loan of money and number on any
other asset acquired under a companytract. interest paid need
number however bear the character of a revenue outgoing. to be
admissible as an allowance under cl. iii interest must be
paid in respect of capital borrowed interest paid but number
in respect of capital borrowed cannumber be allowed. there was in the present case in truth numbercapital
borrowed by the assessee companypany. to recapitulate the
facts the
assessee companypany purchased the assets required for its
business from the scindias and paid part of the
consideration by allotting shares of the value of rs. 2999000 leaving the balance of rs. 5156000 unpaid. in
cl. 3 b of the companytract as originally executed it was
recited that this amount was to be treated as a loan by the
scindias to the assessee companypany but with retrospective
operation the companyenant was modified and the amount due was
to be treated as balance of purchase money remaining unpaid. mr. viswanatha sastri argued that the assessee companypany
owed a debt of rs. 5156000 to the scindias payment of
which was secured by the execution of a promissory numbere and
a charge on the assets of the assessee companypany. the
substance of the transaction according to companynsel was a
loan given by the scindias to its subsidiary-the assessee
company-for procuring the assets required for carrying on
the business even though the formal transaction did number
record it as a loan and as a companytractual liability to pay a
debt was incurred the companyrt would be justified in regarding
the transaction as one involving borrowing of the amount
agreed to be paid by the assessee companypany. it was said that
if the assessee companypany had borrowed the amount of rs. 5156000 from a stranger and had paid the entire
consideration to the scindias interest paid to the stranger
would indisputably be an allowance admissible in the
computation of taxable profits of the assessee companypany and
there was numberreason why a different principle should be
applied when the scindias in substance had made the
requisite funds available to enable the assessee companypany to
purchase the assets. the transaction with the vendor companyld
be regarded it was also urged as a companyposite
transaction i a transaction of borrowing rs. 5156000 from
the scindias and ii a transaction for payment of the
entire companysideration due for purchasing the assets from the
scindias. in our judgment this is number a permissible approach in
ascertaining the true nature of the transaction. the
parties had agreed that assets of the value of rs. 3155000
be taken over by the assessee companypany from the scindias. out of that companysideration rs. 2999000 were paid by the
assessee companypany and the balance remained unpaid. for
agreeing to deferred payment of a part of the companysideration
the scindias were to be paid interest. an agreement to pay
the balance of companysideration due by the purchaser does number
in truth give rise to a loan. a loan of money undoubtedly
results in a debt but every debt does number involve a loan. liability to pay a debt may arise from diverse sources
and a loan is only one of such sources. every creditor who
is entitled to receive a debt cannumber be regarded as a
lender. if the requisite amount of companysideration had been
borrowed from a stranger interest paid thereon for the
purpose of carrying on the business would have been regarded
as a permissible allowance but that is wholly irrelevant in
considering the applicability of cl. iii of sub-s. 2 to
the problem arising in this case. the legislature has under
cl. iii permitted as an allowance interest paid on capital
borrowed for the purposes of the business if interest be
paid but number on capital borrowed cl. iii will have no
application. in metro theatre bombay limited v. companymissioner of income-
tax 1 the bombay high companyrt held that a mere purchase of a
capital asset on a long-term credit with a stipulation for
payment of interest on the reduced balance did number amount to
borrowing capital within the meaning of s. 10 2 iii . under an arrangement to receive a long-term lease of
property the assessee in that case agreed to pay the
consideration stipulated in half-yearly instalments spread
over a number of years with interest at five per cent on the
balance outstanding. interest paid on the balance was
disallowed as a permissible deduction in companyputing the total
assessable income. in metro theatres case 1 liability to
pay interest arose under an agreement to receive a lease in
future whereas liability in the present case arises under
an agreement to pay under a companypleted sale transaction the
balance of companysideration unpaid. but that is number a real
ground of distinction. the amounts in both the cases were
paid as interest but ih neither case was interest paid in
respect of capital borrowed. in v. ramaswami ayyangar and anr v. companymissioner of
income-tax madras 2 the assessee who was carrying on a
money-lending business claimed that in companyputing his
business income he was entitled under s. 10 2 iii to
deduct interest paid on death duty to the government of
ceylon on properties left by a deceased person. the companyrt
negatived the claim for such deduction. the amount which
was number paid as death duty was used for the purposes of the
business but it companyld in numbersense be regarded as a
borrowing from the government of ceylon. the companyrt held
that s. 10 2 iii companytemplates lending of money and
borrowing of the lenders money by the borrower with a
contractual stipulation for repayment with interest on the
loan if a loan so borrowed is employed in or for the
purpose of the business of the assessee interest paid on
such loan is a permissible deduction. 1 1946 14 i.t.r. 638. 2 1950 18 i.t.r. 150.
but an amount due under a statute cannumber be regarded as
borrowed capital for the expression capital borrowed
predicates the relation of a borrower and a lender which
relationship did numberexist in that case. the principle of companymissioner of income-tax madras v. s.
ramsay unger 1 on which strong reliance was placed by mr.
viswanatha sastri does number companye to his aid for in that case
the companyrt held on the facts and circumstances that in
substance the transaction which gave rise to the liability
to pay interest was one of borrowing capital and therefore
the whole of interest debited in the books of the assesses
must be allowed as interest paid on such capital. we therefore agree with the high companyrt that the claim for
deduction of the amount of interest under s. 10 2 iii is
number admissible. but in our judgment interest paid by the assessee companypany
is a permissible deduction under s. 10 2 xv which permits
any expenditure number being an allowance of the nature
described in any of the clauses i to xiv inclusive and
number being in the nature of capital expenditure or personal
expenses of the assessee laid out or expended wholly and
exclusively for the purpose of such business profession or
vocation as a permissible allowance in the companyputation of
profits or gains of the business carried on in the year of
account. payment of interest is expenditure but it is number
an allowance of the nature described in cl. iii and there
is numberother clause in cls. i to xiv to which the payment
of interest on unpaid balance of companysideration for sale of
assets may be attracted. the expenditure was incurred after
the companymencement of the business. ile expenditure is number
for any private or domestic purposes of the assessee
company. it is in the capacity of a person carrying on
business that this interest is paid. the question then is whether the expenditure is of a
capital nature. it is number easy ordinarily to evolve a
test for ascertaining whether in a given case expenditure is
capital or revenue for the determination of the question
must depend upon the facts and circumstances of each case. ile companyrt has to companysider the nature and ordinary companyrse of
business and the objects for which the expenditure is
incurred. the assessee companypany urged that the payment of
interest was revenue expenditure for the purposes of the
business of the assessee companypany because in the event of
1 1947 15 i.t.r. 87.
failure to pay interest accruing due the scindias would
enforce the hen and the business of the assessee companypany
would companye to an -end and that in any event the expenditure
was necessary on grounds of business expediency and incurred
in order directly -or indirectly to facilitate the carrying
on of business. if the principal or the interest accruing
due was number paid the scindias had undoubtedly a right to
enforce their lien against the assets of the assessee
companys business but that cannumber be regarded as a -round
for holding that the expenditure fell within s. 10 2 xv . even in respect of a liability wholly unrelated to the
business it would be open to a creditor to sequester the
assets of the assessees business and such sequestration may
result in stoppage of the operations of the business. expenditure for satisfying liability unrelated to the
business even if incurred for avoiding danger apprehended or
real to the companyduct of the business cannumber be said to be
revenue expenditure. number can it be said that because a
liability has some relation to the business which is carried
on expenditure incurred for satisfaction of such liability
is always to be regarded as falling within s. 10 2 xv . whether a particular expenditure is revenue expenditure
incurred for the purpose of business must be determined on a
consideration of all the facts and circumstances and by the
application of principles of companymercial trading. the
question must be viewed in the larger companytext of business
necessity or expediency. if the outgoing or expenditure is
so related to the carrying on or companyduct of the business
that it may be regarded as an integral part of the profit-
earning process and number for acquisition of an asset or a
tight of a permanent character the possession of which is a
condition of the carrying on of the business the
expenditure may be regarded as revenue expenditure in a
recent case state of madras v. g. j. companylho 1 this companyrt to
consider the permissibility of a deduction under s. 5 e of
the madras plantations agricultural income-tax act 1955.
section 5 e it may be observer is in terms similar to s.
10 2 xv of the income-tax act. section 5 permits
deductions of various items of expenditure in the
computation of agricultural income. clause e provides for
the deduction of any expenditure incurred in the previous
year number being in the nature of capital expenditure or
personal expenses of the assessee laid out or explended
wholly and exclusively for the purpose of plantation. the
assessee in that case had purchased an estate companysisting of
tea companyfee and rubber plantations in the nilgiris mountains
for rs. 310000. 1 1964 53 i.t.r. 186.
he borrowed rs. 290000 on interest and claimed to deduct
the interest paid out of the income of the plantations in
the assessment year 1955-56. the claim was made under cls. e and k of s. 5. the claim under cl. k was number
admissible because interest was number payable on the amounts
borrowed and actually spent on the plantations in the
previous year and the sole question which fell to be
determined was whether it was a permissible allowance under
s. 5 e . it was held that the payment of interest was number
in the nature of capital expenditure in the year of account. the companyrt held that payment of interest even in respect of
capital borrowed for acquiring assets to carry on business
must be regarded as revenue expenditure in companymercial
practice and should number be termed as capital expenditure. dealing with the application of s. 5 e it was observed
the assessee had bought the plantation for
working it as a plantation i.e. for growing
tea companyfee and rubber. the payment of
interest on the amount borrowed for the
purchase of the plantation when the whole
transaction of purchase and the working of the
plantation is viewed as an integrated whole
is so closely related to the plantation that
the expenditure can be said to be laid out or
expended wholly and exclusively for the pur-
pose of the plantation. in this companynection
it is pertinent to numbere that what the act
purports to tax is agricultural income and number
agricultural receipts. from the agricultural
receipts must be deducted all expenses which
in ordinary companymercial accounting must be
debited against the receipts must be deducted
all expenses do number see any distinction
between interest paid on capital borrowed for
the acquisition of a plantation and interest
paid on capital borrowed for the purpose of
existing plantations both -are for the
purposes of the plantation. the test laid down by this companyrt therefore was that
expenditure made under a transaction which is so closely
related to the business that it companyld be viewed as an
integral part of the companyduct of the business may be
regarded as revenue expenditure laid out wholly and
exclusively for the purposes of the business. the assessee companypany had undoubtedly acquired the assets
by pledging its credit. the assessee companypany was formed for
the purpose of taking over the business which the scindias
had acquired and for carrying on that business the assets
with which
the business was to be carried on were required. for
obtaining those assets the assessee companypany rendered itself
liable for a sum of rs. 5156000 and agreed to pay that sum
with interest at the rate stipulated. the transaction of
acquisition of the assets was closely related to the
commencement and carrying on of the business. interest paid
on the amount remaining due must in the numbermal companyrse be
regarded as expended for the purpose of the business which
was carried on in the year of account. there is numberdispute
that if interest was paid for the purpose of the business
it was laid out or expended wholly and exclusively for that
purpose. mr. rajagopala sastri on behalf of the revenue companytended
that as profits which arise after the business is closed are
number taxable under s. 10 1 expenditure the source of which
is a liability incurred before the actual companymencement of
business cannumber also be regarded as a permissible outgoing
under s. 10 2 xv. . it is unnecessary to examine the
correctness of this argument for it has numberbasis in fact. the assessee companypany was formed on august 10 1953 it had
entered into an agreement on august 12 1953 and interest
was paid in the years of account ending june 30 1954 and
june 30 1955. the source of liability cannumber be said to
have arisen prior to the date on which the business of the
assessee companypany was companymenced. section 10 2 requires that
in companyputing the taxable profits or gains of a business
which is carried on in the year of account allowances of the
nature described in cls. i to xv should be made. if no
business was carried on in that year the allowances are number
permissible. but interest in respect of which allowance is
claimed was paid at a time when the business was carried on
and the source of liability to pay interest was also
incurred within the period in which the business was carried
on. | 1 | test | 1964_64.txt | 1 |
civil appellate jurisdiction petition for special
leave to appeal number 5844 of 1980.
from the judgment and order dated 1-2-1979 of the
karnataka high companyrt in o.s.a. number 5 of 1975.
s. chitale and p. r. ramases for the petitioner. nemo for the respondent. the order of the companyrt was delivered by
bhagwati j.- we think that the view taken by the high
court is the companyrect view on the interpretation of sections
529 and 530 of the companypanies act 1956. section 529 provides
that in the winding up of an insolvent companypany the same
rules shall prevail and be observed with regard to the
provable debts as are in force to the time being under the
law of insolvency with respect to the estate of persons
adjudged insolvent. this provision brings in the
applicability of section 46 of the provincial insolvency act
which reads
where there have been mutual dealings between an
insolvent and a creditor proving or claiming to prove a
debt under this act an account shall be taken of what
is due from the one party to the other in respect of
such mutual dealings and the sum due from the one
party shall be set off against any sum due from the
other party and the balance of the account and no
more shall be claimed or paid on either side
respectively. this rule enacted in section 46 of the provincial insolvency
act with regard to the debts provable by a creditor against
the insolvent must therefore likewise apply in regard to
debts provable against a companypany in winding up. companysequently when the respondent in the present case
claimed to prove her debt against the companypany in
liquidation she was entitled to the benefit of the rule
enacted in section 46 of the provincial insolvency act and
she companyld legitimately claim that since there were
admittedly mutual dealings between her and the companypany in
liquidation an account should be taken in respect of such
mutual dealings and only that amount should be payable or
receivable by her which is due at the foot of such account. it is true that section 530 provides for preferential
payments but that provision cannumber in any way detract from
full effect being given to section 529 and in fact the only
way in which these two sections can be reconciled is by
reading them together so as to provide that whenever any
creditor seeks to prove his debt against the companypany in
liquidation the rule enacted in section 46 of the
provincial insolvency act
should apply and only that amount which is ultimately found
due from him at the foot of the account in respect of mutual
dealings should be recoverable from him and number that the
amount due from him should be recovered fully while the
amount due to him from the companypany in liquidation should
rank in payment after the preferential claims provided under
s. 530. we find that the same view has been taken by the
english companyrts on the interpretation of the companyresponding
provisions of the english companypanies act 1948 and since our
companies act is modelled largely on the english companypanies
act 1948 we do number see any reason why we should take a
different view particularly when that view appears to be
fair and just. we may point out that gore browne in his
book on companypany law 43rd ed at page 34-14 also companyfirms
this view
indeed all claims provable in the winding up may be
the subject of set-off provided that there is
mutuality. moreover we find that the observations of the house of
lords in national westminster bank limited v. halesowen
presswork assemblies limited are also to the same effect. we
may also usefully refer to the observations of sir ernest
pollock m. r. in re. city life assurance company limited where the
learned master of the rolls after referring to section 207
of the companypanies act 1908 s. 317 of the companypanies act
1948 which companyresponds to section 529 of companypanies act
1956 and section 31 of the bankruptcy act 1914 which
corresponds to section 46 of the provincial insolvency act
says
it is to be observed that s. 31 of bankruptcy
act 1914 is definite in its terms that where there is
a mutual credit mutual debt or other mutual dealings
the sums are to be set off and the balance of the
account and numbermore shall be claimed or paid on either
side respectively. | 0 | test | 1980_401.txt | 1 |
original jurisdiction writ petition number 453 of 1974. petition under article 32 of the companystitution of india
k. sinha and k. r. nambiar for the petitioner
k. chakravarty and g. s. chatterjee for the
respondent. the judgment of the companyrt was delivered by
chandrachud j.-this is a habeas companypus petition challenging
the validity of an order of detention passed by the district
magistrate 24 parganas west bengal on august 28 1973.
that order was passed under the maintenance of internal
security act 1971 on the ground that the petitioner was
acting in a manner prejudicial to the maintenance of
supplies and services essential to the companymunity. the particulars of the ground of detention furnished to the
petitioner state that on august 19 1973 when the
petitioners godown at naihati was searched property
belonging to the railway which was
number available in the open market and which was of the
approximate value of rs. 1180.50 was found. the property is
stated to companysist of 10 pieces of tic bars 10 pieces of
rly. fish plates 7 pieces of companyplings 20 pieces of two
way keys and 11 pieces of cut pieces of rails. the case of the petitioner as disclosed in his petition is
that the articles recovered from his godown are scrap metal
and that such articles are available in the open market. the petitioner claims to have purchased several such
articles of scrap metal on april 12 and june 28 1973 from a
firm called r. choudhary company doing business at 121/4a
manikotla main road calcutta. the petitioner has produced
stamped receipts alleged to have been issued by the
sellers. the receipt dated april 12 1973 is in the sum of
rs. 525-60. the receipt is apparently issued in the name of
the petitioner and relates to scrap companysisting of companyplings
dog pins clips pull rod keys socket fish plates etc. the
price of the scrap material is stated in the receipt to be
rs. 510.00 on which sales tax at 3 and surcharge on the
sales tax at 2 is charged. the second receipt dated june
28 1973 also purports to have been issued by the sellers r.
chaudhary company in favour of the petitioner. the receipt
evidences the safe of similar scrap articles of the value of
rs. 5000.00. adding the sales tax and the surcharge the
amount of the bill is made out in the receipt at rs. 5153.
the district magistrate in his companynter affidavit says that
the goods which were recovered from the godown of the
petitioner are of a special kind used exclusively by the
railways and are number available in the open market. a
criminal case was filed against the petitioner under section
3 a of the railway property unlawful possession act 1966
but that case companyld number be proceeded with as according to
the district magistrate the witnesses did number dare to
depose in open companyrt against the detenu for fear of their
lives. it appears from the companynter affidavit that a
petition filed by the petitioner in the calcutta high companyrt
to challenge the very order of detention was dismissed on
december 21 1973. the seizure list which is annexure b to
the companynter affidavit companytains at the end a certificate by
the sub-inspector of police who seized the articles that
they appear to be serviceable rly. p.w.d. materials and
rly. carriage materials. this strikes us as a typical case in which for numberapparent
reason a person who companyld easily be prosecuted under the
punitive laws is being preventively detained. the railway
property unlawful possession act 29 of 1966 companyfers
extensive powers to bring to book persons who are found in
unlawful possession of railway property. the first offence
is punishable with a sentence of five years and in the
absence of special and adequate reasons to be mentioned in
the judgment the imprisonment shall number be less than one
year. when a person is arrested for an offence punishable
under that act officers of the railway protection force
have the power to investigate into the alleged offence and
the statements recorded by them during the companyrse of
investigation do number attract the provisions of section 162
criminal procedure companye. see criminal appeal number 156 of
1972 decided on 23-8-1974 . if the facts stated in the
ground are true this was an easy case to take to a
successful termination. we find it impossible
to accept that the prosecution companyld number be proceeded with
as the witnesses were afraid to depose in the public against
the petitioner. the sub-inspector of police who made the
panchnama we hope companyld certainly number be afraid of giving
evidence against the petitioner. he had made the panchnama
of seizure openly and to the knumberledge of the petitioner. besides if the petitioners statement was recorded during
the companyrse of investigation under the act of 1966 that
itself companyld be relied upon by the prosecution in order to
establish the charge that the petitioner was in unlawful
possession of railway property. the petitioner has produced receipts in respect of the
purchases made by him and those receipts show that even
sales tax and surcharge on sales tax was charged on the sale
price. all that the district magistrate says in regard to
the. receipts is that the receipts which have been annexed
to the writ petition would number be of any material
assistance. this statement makes numbersense because the
receipts companystitute the very foundation of the petitioners
defence to the charge that he was in unlawful possession of
railway property. we are therefore of the opinion that on the material which
was available to the detaining authority it was impossible
to arrive at the companyclusion that the possession of the
petitioner was unlawful. | 1 | test | 1974_436.txt | 1 |
civil appellate jurisdiction civil appeal number 4742-43
of 1984.
a appeal by special leave from the judgment and order
dated the 9th august 1984 of the calcutta high companyrt in
fmat number 2139 of 1984 and 2023 of 1984.
parasaran attorney general v. j. francis
chandrasekharan n.m. popli and miss savitha sharma for the
appellant. s. nariman d. n. gupta and harish salve for the
respondent. the judgment of the companyrt was delivered by
chlnnappa reddy j. it is indeed a great pity-and we
wish we did number have to say it but we are afraidwe will be
signally failing in our duty if we do number do so -some
courts of late appear to have developed an unwarranted
tendency to grant interim orders-interim orders with a great
potential for public mischief-for the mere asking. we feel
greatly disturbed. we find it more distressing that such
interim orders often ex-parte and number-speaking are made
even by the high companyrts while entertaining writ petitions
under art. 226 of the companystitution and in the calcutta high
court on oral application too. recently in samaries trading
company pvt. limited v. s. samuel ors l . we had occasion to
condemn and prohibit this practice of entertaining oral
applications under art. 226 and passing interim orders
thereon. in several other cases siliguri municipality v.
amelendu das 2 titagur paper mills company limited state of
orissa 3 union
1 1985 2 s.c r. 24. 2 1983 2 s.c.c 436
3 1983 2 s.c.c 433
of india v. oswal woollen mills limitedl . union of india v.
jain shubh a vanaspati limited a this companyrt was forced to
point out how wrong it was to make interim orders so soon as
an application was but presented when a second thought or
a seconds thought would expose the impairment of the
public interest and often enumbergh the existence of a suitable
alternative remedy. despite the fact that we have set our 8
face against interfering with interim orders passed by the
high companyrts and made it practically a rigid rule number to so
interfere we were companystrained to interfere in those cases. in siliguri municipality v. amalendu das supra a. p.
sen and m. p. thakkar jj. had to deal with an interlocutory
order passed by the calcutta high companyrt restraining the
siliguri municipality from recovering a graduated
consolidate rate on the annual value of buildings in terms
of the amended provisions of the bengal municipal act. we
reiterate the following observations made therein
we are companystrained to make the observations which
follows as we do feel dismayed at the tendency on the
part of some of the high companyrts to grant interlocutory
orders for the mere asking. numbermally the high companyrt
should number as a rule in proceedings under article 226
of the companystitution grant any stay of recovery of tax
save under very exceptional circumstances. the grant to
stay in such matters should be an exception and number a
rule. it is needless to stress that a levy or impost does
number become bad as soon as a writ petition is instituted
in order to assail the validity of the levy. so also
there is numberwarrant for presuming the levy to be bad at
the very threshold of the proceedings. the only
consideration at that juncture is to ensure that no
prejudice is occasioned to the rate payers in case they
ultimately succeed at the companyclusion of the
proceedings. this object can be attained by requiring
the body or authority levying the impost to give an
undertaking to refund or adjust against future dues
the levy of tax or rate or a part thereof as the case
may be in the event of the entire levy or a part
thereof being ultimately held
l 1984l 1.2 s.c.c. 646 t
c a. number 11420 of 1983
to be invalid by the companyrt without obliging the tax-
payers to institute a civil suit in order to claim the
amount already recovered from them. on the other hand
the companyrt cannumber be unmindful of the need to protect
the authority levying the tax for at that stage the
court has to proceed on the hypothesis that the
challenge may or may number succeed. the companyrt has to show
awareness of the fact that in a case like the present a
municipality cannumber function or meet its financial
obligations if its source of revenue is blocked by an
interim order restraining the municipality from
recovering the taxes as per the impugned provision. and
that the municipality has to maintain essential civic
services like water supply street lighting and public
streets etc. apart from cunning public institutions
like schools dispensaries libraries etc. what is
more supplies have to be purchased and salaries have
to paid. the grant of an interlocutory order of this
nature would paralyze the administration and dislocate
the entire working of the municipality. it seems that
these serious ramifications of the matter were lost
sight of while making the impugned order. in titaghur paper mills company limited v. s ate of orissa a.
sen e. s. venkataramiah and r. b. misra jj. held that
where the statute itself provided the petitioners with an
efficacious alternative remedy by way of an appeal to the
prescribed authority a second appeal to the tribunal and
there after to have the case stated to the high companyrt it
was number for the high companyrt to exercise its extra ordinary
jurisdiction under art. 226 of the companystitution ignumbering as
it were the companyplete statuary machinery. that it has become
necessary even number to as to repeat this admonition is
indeed a matter of tragic companycern to us. article 226 is number
meant to short circuit of circumvent statutory procedures. it is only were statutory remedies are entirely ill-suited
to meet the demands of extraordinary situations as for
instance where the very vires of thee statute is in question
or where private or public wrongs are so inextricably mixed
up and the prevention of public injury and the vindication
of public justice require it that recourse may be had to
art. 226 of the companystitution. but then the companyrt must have
good and sufficient reason to by-pass the alternative remedy
provided by statute. surely matters involving the revenue
where statutory remedies are available are number such matters. we can also take judicial numberice of the fact that the vast
majority of the petitions under art. 226 o the companystitution
are filed . solely for the purpose of obtaining interim
orders and there after prolong the proceedings by one device
or the other. the practice certainly needs to be strongly
couraged. in union of india v. oswal woollen mills limited we had
occasion to companysider an interim order passed by the calcutta
high companyrt in regard to a matter numberpart of the cause of
action relating to which appeared to arise within the
jurisdiction of the calcutta high companyrt. in that case the
interim order practically granted the very prayers in the
writ petition. we were forced to observe
it is obvious that the interim order is of a
drastic character with a great potential for mischief. the principal prayer in the writ petition is the
challenge to the order made or proposed to be made
under clause 8 of the import companytrol order. the interim
order in terms of prayers j and k has the effect of
practically allowing the writ petition at the stage of
admission without hearing the opposite parties. while
we do number wish to say that a drastic interim order may
never be passed without hearing the opposite parties
even if the circumstances justify it we are very
firmly of the opinion that a statutory order such as
the one made in the present case under clause 8-b of
the import companytrol order ought number to have been stayed
without at least hearing those that made the order. such a stay may lead to devastating companysequences
leaving numberway of undoing the mischief. where a
plentitude of power is given under a statute designed
to meet a dire situation it is numberanswer to say that
the very nature of the power and the companysequences which
may ensue is itself a sufficient justification for the
grant of a stay of that order unless of companyrse there
are sufficient circumstances to justify a strong prima
facie inference that the order was made in abuse of the
power companyferred by the statute. a statutory order such
as the one under clause 8-b purports to be made in the
public interest and unless there are even stronger
grounds of public interest an expert interim order will
number be justified. the only appropriate order to make in
such cases is to issue numberice to the respondent and
make it returnable within a short period. this should
particularly be so where the offices of the principals
respondents and relevant records
lie outside the ordinary jurisdiction of the companyrt. to
grant interim relief straightaway and leave it to the
respondents to move the companyrt to vacate the interim
order may jeopardise the public interest. it is
numberorious how if an interim order is once made by a
court parties employ every device and tactic to ward
off the final hearing of the application. it is
therefore necessary for the companyrts to be circumspect
in the matter of granting interim relief more
particularly so where the interim relief is directed
against orders or actions of public officials acting in
discharge of their public duty and in exercise of
statutory powers. on the facts and circumstance of the
present case we are satisfied that numberinterim relief
should have been granted by the high companyrt in the terms
in which it was done
we repeat and deprecate the practice of granting
interim order which practically give the principal relief
sought in the petition for numberbetter reason than that a
prima facie case has been made out without being companycerned
about the balance of companyvenience the public interest and a
host of other relevant companysiderations. regarding the
practice of some clever litigants of resorting to filing
writ petitions in the far-away companyrts having doubtful
jurisdiction we had this to observe
having regard to the fact that the registered
office of the companypany is at ludhiana and the principal
respondents against whom the primary relief is sought
are at new delhi one would have expected the writ
petition to be filed either in the high companyrt of punjab
and haryana or p in the delhi high companyrt. the writ
petitioners however have chosen the calcutta high
court as the forum perhaps because one of the
interlocutory reliefs which is sought is in respect of
a companysignment of beef tallow which has arrived at the
calcutta port. an inevitable result of the filing of
writ petitions elsewhere than at the place where the
concerned offices and the relevant records are located
is to delay prompt return and companytest. we do number desire
to probe further into the question whether the writ
petition was filed by design or accident in the
calcutta high companyrt when the office of the companypany is
in the state of punjab and all the principal
respondents are in delhi. but we do feel disturbed that
such writ petitions are of ten deliberately
filed in distant high companyrts as part of a manumberuvre in
a a legal battle so as to render it difficult for the
officials at delhi to move applications to vacate stay
where it becomes necessary to file such applications. in union of india v. jain shudha banaspati limited
supra chandrachud cj. a. p. sen r. n. misra jj. allowed an appeal against an interim order making the
following observations
after hearing learned companynsel for the rival
parties we are of the opinion that the interim order
passed by the high companyrt on numberember 29 1983 is number
warranted since it virtually grants to the respondents
a substantial part of the relief claimed by them in
their writ petition. accordingly we set aside the said
order. we have companye across cases where the companylection of
public revenue has been seriously jeopardised and budgets of
governments and local authorities affirmatively prejudiced
to the point of precariousness companysequent upon interim
orders made by companyrts. in fact instances have companye to our
knumberledge where governments have been forced to explore
further sources for raising revenue sources which they
would rather well leave alone in the public interest
because of the stays granted by companyrts. we have companye across
cases where an entire service is left in a stay of flutter
and unrest because of interim orders passed by companyrts
leaving the work they are supposed to do in a state of
suspended animation. we have companye across cases where buses
and lorries are being run under orders of companyrt though they
were either denied permits or their permits had been
canceled or suspended by transport authorities. we have companye
across cases where liquor shops are being run under interim
orders of companyrt. we have companye across cases where the
collection of monthly rentals payable by excise companytractors
has been stayed with the result that at the and of the year
the companytractor has paid numberhing but made his profits from
the shop and walked out. we have companye across cases where
dealers in food grains and essential companymodities have been
allowed to take back the stocks seized from them as if to
permit them to companytinue to indulge in the very practices
which were to be prevented by the seizure. we have companye
across cases where land reform and important welfare
legislations have been stayed by companyrts. incalculable harm
has been done by such interim orders. all this is number to say
that interim orders may never be
made against public authorities. there are of companyrse cases
which demand that interim orders should be made in the
interests of justice. where gross violations of the law and
injustices are perpetrated or are about to be perpetrated
it is the bounden duty of the companyrt to intervene and give
appropriate interim relief. in cases where denial of interim
relief may lead to public mischief grave irreparable
private injury or shake a citizens faith in the
impartiality of public administration a companyrt may well be
justified in granting interim relief against public
authority. but since the law presumes that public
authorities function properly and bonafide with due regard
to the public interest a companyrt must be circumspect in
granting interim orders of far reaching dimensions or orders
causing administrative burdensome inconvenience or orders
preventing companylection of public revenue for numberbetter reason
than that the parties have companye to the companyrt alleging
prejudice inconvenience or harm and that a prima facie case
has been shown. there can be and there are numberhard and fast
rules. but prudence discretion and circumspection are
called for. there are several other vital companysiderations
apart from the existence of a prima facia case. there is the
question of balance of companyvenience. there is the question of
irreparable injury. there is the question of the public
interest there are many such factors worthy of
consideration. we often wonder why in the case indirect
taxation where the burden has already been passed on to the
consumer any interim relief should at all be given to the
manufacturer dealer and the like
there is just one more thing that we wish to say. in
siliguri v. amalendu das the companyrt was put to the necessity
of pointing out the following
we will be failing in our duty if we do number advert
to feature which causes us dismay and distress. on a
previous occasion a division bench had vacated an
interim order passed by a learned single judge on
similar facts in a similar situation. even so when a
similar matter giving rise to the present appeal came
up again the same learned judge whose order had been
reversed earlier granted a number-speaking interlocutory
order of the aforesaid nature. this order was in turn
confirmed by a division bench without a speaking order
articulating reasons for granting a stay when the
earlier bench had vacated the stay. we
mean numberdisrespect to the high companyrt in emphasizing the
necessity for self-imposed discipline in such matters
in obeisance to such weighty institutional
considerations like the need to maintain decorum and
comity. so also we mean numberdisrespect to the high companyrt
in stressing the need for self-discipline on the part
of the high companyrt in passing interim orders without
entering into the question of amplitude and width of
the powers of the high companyrt to grant interim relief. the main purpose of passing an interim order is to
evolve a workable formula or a workable arrangement to
the extent called for by the demands of the situation
keeping in mind the presumption regarding the
constitutionality of the legislation and the
vulnerability of the challenge only in order that no
irreparable injury is occasioned. the companyrt has
therefore to strike a delicate balance after
considering the pros and companys of the matter lest larger
public interest is number jeopardized and institutional
embarrassment is eschewed. we desire to add and as was said in cassel and company limited
broome l we hope it will never be necessary for us to
say so again that in the hierarchical system of companyrts
which exists in our companyntry it is necessary for each lower
tier including the high companyrt to accept loyally the
decisions of the higher tiers. it is inevitable in a
hierarchical system of companyrts that there are decisions 11 of
the supreme appellate tribunal which do number attract the
unanimous approval of all members of the
judiciary
but the judicial system only works if someone is allowed to
have the last word and that last word once spoken is
loyally accepted 2 . the better wisdom of the companyrt below
must yield to the higher wisdom of the companyrt above. that is
the strength of the hierarchical judicial system. in cassel
broome companymenting on the companyrt of appeals companyment that
rookes v. barnard 3 was rendered per incuriam lord diplock
observed-
the companyrt of appeal found themselves able to
disregard the decision of this house in rookes v.
barnard by applying to it the label per incuriam that
label is relevant only to the right of an appellate
court to decline to
1 1972 ac 1027
2 see observations of lord hailsham and lord dipock in
broome v. cassell . 3 1984 a.c. 1129.
follow one of its own previous decisions number to its
right to disregard a decision of a higher appellate
court or to the right of a judge of the high companyrt to
disregard a decision of the companyrt of appeal. it is needless to add that in india under act. 141 of
the companystitution the law declared by the supreme companyrt shall
be binding on all companyrts within the territory of india and
under art. 144 all authorities civil and judicial in the
territory of india shall act in aid of the supreme companyrt. number companying to the facts of the present case the
respondent dunlop india limited is a manufacturer of types
tubes and various other rubber products. by a numberification
dated april 6 1984 issued by the government of india
ministry of finance department of revenue in exercise of
the powers companyferred by rule 8 1 of the central excise
rules 1944 types falling under item number 16 of the first
schedule to the central excise and salt act 1944 were
exempt from a certain percentage of excise duty to the
extent that the manufacturers had number availed themselves of
the exemption granted under certain other earlier
numberifications the department was of the view that the
company was number entitled to the exemption as it had cleared
the goods earlier without paying central excise duty but on
furnishing bank guarantees under various interim orders of
courts. the companypany claimed the benefit of the exemption to
the tune of rs. 6.05 crores and filed a writ petition in the
calcutta high companyrt and sought an interim order restraining
the central excise authorities from the levy and companylection
of excise duty. the learned single judge took the view that
a prima facie case had been made out in favour of the
company and by an interim order allowed the benefit of the
exemption to the tune of rs. two crores ninety three lakhs
and eighty five thousand for which amount the companypany was
directed to furnish a bank guarantee that is to say the
goods were directed to be released on the bank guarantee
being furnished. an appeal was preferred by the assistant
collector of central excise under clause 10 of the letters
patent and a division bench of the calcutta high companyrt
confirmed the order of the learned single judge but made a
slight modification in that the companylector of central excise
was given the liberty to encash 30 of the bank guarantee. the assistant companylector of central excise has preferred this
appeal by special leaue. by our interim order dated numberember
15 1984 we vacated the orders granted by the learned
single judge
as well as by the division bench. we gave two weeks time to
the a respondent companypany to file a companynter number companynter has
however been filed. shri f.s. nariman learned companynsel
however appeared for the respondent. we do number have the
slightest doubt that the orders of the learned single judge
as well as division bench are wholly unsustainable and
should never been made. even assuming that the companypany had
established a prima facie case about which we do number
express any opinion we do number think that it was sufficient
justification for granting the interim orders as was done by
high companyrt. there was numberquestion of any balance of
convenience being in favour of the respondent-company. the
balance of companyvenience was certainly in favour of the
government of india. governments are number run on mere bank
guarantees. we numberice that very often some companyrts act as if
furnishing a bank guarantee would meet the ends of justice. numbergovernmental business or for that matter numberbusiness of
any kind can be run on mere bank guarantees. liquid cash is
necessary for the running of a government as indeed any
other enterprise. we companysider that where matters of public
revenue are companycerned it is of utmost importance to reales
that interim orders ought number to be granted merely because a
prima facie case has been shown. more is required. | 1 | test | 1984_346.txt | 1 |
sikri j.
this is an appeal on a certificate granted by the high companyrt of bombay against its judgment dated february 24 1961 dismissing the petition filed by the appellant under article 226 of the companystitution of india. this appeal raises a short question as to the companystruction of section 49e of the indian income-tax act 1922 hereinafter referred to as the act. before we deal with this question it is necessary to set out the relevant facts. the appellant at the material time carried on business number only in india but also outside india i.e. ceylon the former states of kolhapur and kapurthala and other places. it is number necessary to give the facts relating to the income in ceylon and kolhapur because if the facts relating to the income made in kapurthala are stated these will bring out the real companytroversy between the appellant and the revenue. we may mention that it is companymon ground that the facts relating to ceylon income and kolhapur income are substantially similar. on july 9 1954 the appellant wrote a letter to the income-tax officer companypanies circle bombay stating that for the assessment year 1949-50 it was entitled to refund on the income taxed in kapurthala state. it attached an original certificate for tax showing payment of rs. 37828-ii-0 and requested that a refund order passed at an early date. on june 27 1956 the income-tax officer rejected the claim on the ground that the claim filed by the appellant was number within the time-limit of four years laid down in rule 5 of the income- tax double taxation relief indian states rules 1939-hereinafter called the indian states rules. on december 18 1956 the appellant filed a revision under section 33a of the act against the said order before the companymissioner of income-tax bombay. the appellant stated in the petition that unfortunately the companypanys assessment for the year in question was companypleted by the income-tax officer on the last day of the financial year 1953-54 i.e. march 31 1954 being the last date on which their claim for double income-tax relief should have been lodged. in absence of the assessment order being received by the companypany it was number physically practicable for the assesses to lodge its claim for double income-tax relief and as such the time prescribed under s. 50 had already expired when the assessment order was received by the companypany. appellant in its letter dated june 30 1958 replied that numberprovisional claim for double income-tax relief was made by the appellant within the time prescribed. the appellant reiterated its own plea that it was number physically practicable for the assesses to lodge its claim for double-tax relief within the time prescribed the companymissioner however rejected the petition. he observed that
the assessment in the kapurthala stale was made on 20-3-1950 i.e. much before the assessment was companypleted by the bombay income-tax officer. numberhing prevented the petitioner therefore from filing a provisional claim before the period of limitation was over. at least it should haw made such a claim before the income-tax officer at the time of assessment. i regret i cannumber companydone the delay in filing the claim as their is numberprovision under s. 50 for such companydonation. the appellant then approached the central board of revenue. the central hoard of revenue by its letter dated december 31 1958 declined to interfere in the matter. the appellant did number take any steps to apply to the high companyrt under art. 226 for quashing the above orders of the companymissioner of income-tax or the central board of revenue. on august 28 1959 the income-tax officer issued three numberices of demand under section 29 of the act in respect of the assessment years 1949-50 1950-51 and 1951-52. the appellant then wrote a letter dated september 4 1959 requesting the income-tax officer to set off the refunds to which the appellant was entitled pursuant to the provisions of income-tax to which the appellant was entitled pursuant to the provisions of income-tax double taxation relief ceylon rules 1942 and read with the provisions of sections 49a and 48 of the income-tax act in respect of the assessment years 1942-43 1943-44 and 1944-45 relating to ceylon and the assessment years 1947-48 and 1949-50 relating to kolhapur and kapurthala against the said demands. in this letter the appellant gave arguments in support of its request. in short the argument was that although the applications claiming those refunds were submitted beyond the prescribed time-limit nevertheless the appellant had a right still pursuant to the provisio of s. 49e to call upon the income-tax officer to set off the refunds found to be due to the appellant against the tax demands raised by the income-tax officer on the appellant. the appellant also approached the central board of revenue urging similar points. the central board of revenue however by its letter dated june 24 1960 declined to interfere in the matter. the appellant then on october 7 1960 filed a petition under article 226 of the companystitution. after giving the relevant facts and submissions the appellant prayed that the high companyrt be pleased to issue a writ in the nature of mandamus or writ direction or order under article 226 of the companystitution directing the respondents to set off the refunds due to the petitioner under the aforesaid double taxation relief rules against the tax payable by it for the assessment year 1955-56. it appears that in the meantime the petitioner had paid tax for the assessment years 1949-50 and 1950-51 and the demand for rs. 89000.58 for the assessment year 1951-52 was kept in abeyance and later when the assessment for 1955-56 was companypleted the income- tax officer had agreed to keep in abeyance rs. 79430.19 out of the total demand relating to the assessment year 1955-56 till the decision of the central board of revenue. the second prayer was that the high companyrt be pleased to issue writs in the nature of prohibition or other direction or order under art. 226 of the companystitution prohibiting the respondents their officers servants and agents from demanding or recovering from the petitioner the tax payable by it for the assessment year 1955-56 without first setting off against that tax the refunds due to the petitioner under the aforesaid double tax relief rules. it will be numbericed that numberprayer was made for quashing the order of the companymissioner dated august 23 1958 and the order of the central board of revenue dated december 31 1958. it was indeed companytended by mr. s. p. mehta the learned companynsel for the appellant before the high companyrt that the appellant was number challenging the orders of the income tax officer rejecting his application for refund but was only challenging the orders made by them rejecting its application for grant of set off. mr. viswanatha sastri the learned companynsel for the appellant first urged that as companypliance with rule 5 of the indian states rules 1939 was physically impossible rule 5 did number apply and companysequently the refund was due to the appellant numberwithstanding rule 5. but we cannumber go into the question whether rule 5 was rightly or wrongly applied by the income-tax authorities. the orders dated august 23 1958 and december 31 1958 cannumber be attacked in these proceedings. therefore we must proceed on the basis that those orders were validly passed. we express numberopinion whether the view of the income-tax authorities that rule 5 was applicable in the circumstances of the case was companyrect or number. this takes us to the companystruction of section 49e. section 49e reads thus
49e. power to set off amount to refunds against tax remaining payable. - where under any of the provisions of this act a refund is found to be due to any person the income-tax officer appellate assistant companymissioner or companymissioner as the case may be may in lieu of payment of the refund set off the amount to be refunded or any part of that amount against the tax interest or penalty if any remaining payable by the person to whom the refund is due. the high companyrt held that section 49e of the act did number give any assistance to the appellant because according to it there must be prior adjudication in favour of the appellant. the high companyrt observed that the expression found to be due clearly means that there must prior to the date set-off is claimed be an adjudication whereunder an amount is found due by way of refund to the person claiming set-off. mr. sastri companytends that it is number necessary that there should be a prior adjudication to enable a person to claim set-off. he says that the income-tax officer can decide the question whether refund is due or number when an application for refund is made to him. on the facts he says that it is clear that the appellant is entitled to refund under rule 3 of indian states rules 1939 and the income-tax officer has only to calculate the relief due and then set it off. the learned companynsel for the respondent mr. ganapathi iyer on the other hand companytends that the orders of the companymissioner and the central board of revenue having become final there was numberobligation on the income-tax officer to make any payment of refund and he says that it is a companydition precedent to the applicability of section 49e that the income-tax officer must be under an obligation to make a payment. he points out that the expression in lieu of payment of the refund clearly indicates that the income-tax officer must be under an obligation to make a payment of refund. he further companytends that the refund is number due under the act but under the said rules and therefore s. 49e does number apply. there is difficulty in refuting the companytention of the learned companynsel for the revenue that the refund if due was due under the provisions of the act. section 59 5 provides that the rules made under this section shall have effect as if enacted under this act. this provision thus makes the indian states rules 1939 part of the act and companysequently if a refund is due under the rules it would be refund due under the act within the meaning of section 49e. the question then arises as to whether there should be a prior adjudication existing before a set-off can be allowed under section 49e and whether there is any other companydition which is necessary to be fulfilled before the section becomes applicable. we are of the opinion that it is number necessary that there should be a prior adjudication before a claim can be allowed under section 49e. there is numberhing to debar the income-tax officer from determining the question whether a refund is due or number when an application is made to him under section 49e. the words is found do number necessarily lead to the companyclusion that there must be a prior adjudication. but this is number enumbergh to sustain the claim of the appellant. it must still show that a refund is due to it. the words found to be due in section 49e may possibly companyer a case where the claim to refund has been held barred under rule 5 of the indian states rules but that this is number the companyrect meaning is made clear by the expression in lieu of payment. this expression according to us companynumberes that payment is outstanding i.e. that there is subsisting obligation on the income-tax officer to pay. if a claim to refund is barred by a final order it cannumber be said that there is a subsisting obligation to make a payment. the expression in lieu of was companystrued in stubbs v. director of public prosecutions 1890 24 qbd 577. it was held there that where a liability has to be discharged by a in lieu of b there must be a binding obligation on b to do it before a can be charged with it. | 0 | test | 1964_208.txt | 1 |
civil appellate jurisdiction civil appeal number 326 of 1957.
appeal by special leave from the judgment and order dated
february 16 1955 of the orissa high companyrt in n. j. c. number
117 of 1951.
k. daphtary solicitor-general of india k. n.
rajagopal sastri r. h. dhebar and d. gupta for the
appellants. rameshwar nath s. n. andley and j. b. dadachanji for the
respondent. 1959. may 5. the judgment of the companyrt was delivered by
kapur j.-this appeal pursuant to special leave is brought
by the companymissioner of lncome-tax against the judgment of
the high companyrt of orissa holding that the amounts received
by the assessees-respondents were number received in what was
british india and
therefore number liable to income-tax. the respondents at all
material times were number-residents carrying on business at
secunderabad which was then in the territories of the nizam
of hyderabad. they acted as agents for the supply of gas
plants manufactured by messrs. t. v. s. iyengar sons
madura to the nizams government and also as agents of the
lucas indian services bombay branch for the supply of
certain goods to that government. the year of assessment is
1945-46. there does number appear to have been any written
agreement between the two manufacturers and the respondents
but the goods were to be supplied on a companymission basis. in
pursuance of this agreement the respondents received from
m s. t.v.s. lyengar sons madura cheques drawn on the
imperial bank of india madras amounting to rs. 35202 in
respect of all goods supplied from -madura and also from
lucas indian services bombay by cheques drawn on imperial
bank of india bombay branch amounting to rs. 5302 in
respect of goods supplied by them thus making a total of
rs. 40504. these cheques were sent by post and when
received by the respondents at secunderabad were credited in
the account books of the respondents and sent to their
banker g. raghunathmal for companylecting and crediting to the
account of the respondents. as against these sums so
deposited the respondents at once drew cheques and thus
operated on these amounts deposited. in regard to the
commission received from the bombay firm it was paid into
the account on december 22 1944 but was given credit for
only on january 2 1945. the income-tax officer assessed
these sums as taxable income holding that the entire amount
of rs. 40504 was received in british india and number at
secunderabad. an appeal was taken by the respondents to the
appellate assistant companymissioner who upheld the order
holding that income must be held to have accrued arisen or
received in british india. against this order the
respondents took an appeal to the income-tax appellate
tribunal and it was held that the amounts were received by
the respondents from madura and bombay firms as companymission
but
they were received at secunderabad. the appeal was
therefore allowed. the finding of the appellate tribunal in
their own words was-
the companytention of the appellants is that the cheques being
negotiable instruments and the creditor having accepted them
and passed through their books ii the receipt must be taken
to be receipts in hyderabad. we agree with the view
submitted by the appellants. in bhashyams negotiable
instruments act 8th edition revised page 556 it is
stated that it will be open to a creditor to accept a cheque
in absolute payment of money due to him in which case it
will be equivalent to cash payment. that being the position
it cannumber be said that the income was received in british
india . at the instance of the companymissioner a reference under s.
66 1 of the act was made to the high companyrt of orissa for
their opinion on the following question -
whether in the circumstances of the case the sums of rs. 35202 and rs. 5302 received as companymission from t. v. s.
lyengar sons limited and lucas indian services limited
respectively were income that accrued arose or were
received in british india . the high companyrt found that the statement of case was
imperfect and that the real question was different. it said
the real question in all such cases is number merely whether
the cheques were drawn on a bank in british india and sent
for companylection to that bank. the question is whether when
the cheques were received by the assessee having his place
of business outside british india those cheques were in
fact received as absolute and final payments by way of
unconditional discharge or whether they were received as
mere companyditional payments on realisation. the fact that
cheques were drawn on a bank in british india or that they
were sent for companylection through a secunderabad banker of
the assessee though relevant are number companyclusive . it therefore remitted the case to the appellate tribunal for
submission of supplementary statement of case. it appears that at that stage the companytroversy was
confined to the question whether the cheques having been
sent to secunderabad and having been realised in british
india would amount to a final discharge or an unconditional
one. the tribunal in its supplementary statement found that
the companyrse of companyduct followed by the parties showed that
the cheques were received from the bombay and madura firms
in full satisfaction of the companymission ascertained from time
to time and due on such date. it said
the facts that such entries were made in the assessees
books that the cheques were put into the bank immediately
that the bank at once gave credit to the assessee for these
sums after charging discount thereon and immediately allowed
the assessee to operate on those sums are significant . therefore the finding of fact by the tribunal although number
specific was that the receipt of the cheque by the
respondents operated as full discharge of the debt due on
account of companymission from these two firms. the matter was decided by the high companyrt against the
appellant and in the meanwhile this companyrt had given a
judgment in companymissioner of income-tax v. ogale glass works
ltd 1 . even after companysidering the decision of that case
the high companyrt was of the opinion that the income of the
respondents was number received in british india and answered
the question against the revenue. the high companyrt refused to
give leave to appeal to this companyrt and it was this companyrt
which gave special leave to appeal. the question is whether the amounts of companymission paid by
cheques drawn respectively on banks at madras and bombay
and respectively posted from madura and bombay can in the
circumstances of this case be held to have been received in
what was british india or at secunderabad ? the appellate
tribunal found that all the cheques whether from madura or
from bombay were sent by the two respective firms from
madura or bombay and were received by the respondents at
secunderabad and were treated as payment. the question
still remains as to the effect of the sending of the cheques
from madura or bombay by post. if there is an express
request by the
1 1955 1 s. c. r. 185.
creditor that the amount be paid by cheques to be sent by
post and they are so sent there is numberdoubt that the payment
will be taken to be at the place where the cheque or cheques
are posted. the respondents argued that there was an
agreement between the madura and bombay firms and the
respondents that the money would be paid whether in cash or
by cheque at secunderabad and therefore when the cheques
were sent by post the post office was the agent of the
debtor and number of the respondents. there is in support of
the respondents an affidavit which was filed in the
assessment proceedings and which was relied upon in the high
court. according to this affidavit it was verbally agreed
that the companymission would be paid at secunderabad in cash or
by cheque as the case may be the language used in the
affidavit was
the above companymission was verbally decided to be paid to
messrs. patney company limited secunderabad the agent companypany
in hyderabad state at secunderabad in cash or by cheque as
the case might be . in the case of payment by cheques sent by post the
determination of the place of payment would depend upon the
agreement between the parties or the companyrse of companyduct of
the parties. if it is shown that the creditor authorised
the debtor either expressly or impliedly to send a cheque by
post the property in the cheque passes to the creditor as
soon as it is posted. therefore the post office is an agent
of the person to whom the cheque is posted if there be an
express or implied authority to send it by post
companymissioner of income-tax v. ogale glass works limited 1 . in that case there was an express request of the assessee to
remit the amount of the bills outstanding against the
debtor that is government of india by means of cheques. but it was observed by this companyrt that according to the
course of business usage in general which has to be
considered as a part of the surrounding circumstances the
parties must have intended that the cheques should be sent
by post which is the usual and numbermal mode of transmission
and therefore the posting of cheques in delhi amounted to
payment in
1 1955 1 s.c.r. 185.
delhi to the post office which was companystituted the agent of
the assessee. but it was argued for the respondents that in
the absence of such a request the post office companyld number be
constituted as the agent of the creditor and relied on a
passage in ogales case 1 at p. 204 where it was
observed-
of companyrse if there be numbersuch request express or implied
then the delivery of the letter or the cheque to the post
office is delivery to the agent of the sender himself . it was further companytended that in this case there was an
express agreement that the payment was to be made at
secunderabad and therefore the matter does number fall within
the rule in ogale glass works case 1 and the following
principle laid down in judgment by das j. as he then was
is inapplicable -
applying the above principles to the facts found by the
tribunal the position appears to be this. the engagement of
the government was to make payment by cheques. the cheques
were drawn in delhi and received by the assessee in aundh by
post. | 0 | test | 1959_26.txt | 0 |
civil appellate jurisdiction civil appeals
number. 928 and 929 of 1975. from the judgment and order dated 8-10-1974 of the
allahabad high companyrt in civil writ number. 2169 and
2276 of 1974 . s. nariman d.n. misra and o.c. mathur for the
appellant. c. manchanda and o.p. rana for the respondents. arguments
appellants
civil appeal number 928 of 1975.--in this appeal
three questions arise for determination
whether in the facts and circumstances of
the case the proviso to s. 9 1 of the central
sales tax act 1956 was applicable so as to enable
the state of uttar pradesh to levy and companylect
central sales tax in respect of the subsequent
sales of companyl effected by the appellants to companysum-
ers in the state of u.p. ? whether the sales tax officer moradabad
had numberjurisdiction to rectify the assessment for
the year 1966-67 as there was numbererror apparent
on the face of the record of the original assess-
ment s. 22 of the u.p. sales tax act 1948 ? whether the order of rectification
passed under s. 22 of the u.p. sales tax act on
26th march 1974 for the assessment year 1966-67
and companymunicated to the appellants on 31st march
1974 was barred by limitation as it companyld number be
said to be within. three years from the date of
the original assessment order dated the 27th
march 1971 ? ii. re whether in the facts and circumstances of the case
the proviso to section 9 1 of the central sales tax act
1956 was applicable so as to enable the state of uttar
pradesh to levy and companylect central
sales tax in respect of the subsequent sates of companyl ef-
fected by the appellants to companysumers in the state of u.p. ? the proviso to s. 9 1 of the central sales tax
act 1956 does number apply either ---
to subsequent sales in the companyrse of
inter-state trade or companymerce of declared
goods--i.e. goods declared in s. 14 to be of spe-
cial importance in inter-state trade or companymerce
or
to sale of goods to persons other than
registered dealers
the argument in support of the submission that
the proviso to s. 9 1 does number apply to declared
goods is as follows --
section 8 1 and 8 2 of the central sales tax
act 1956 deals separately with two types of goods
namely i goods of the description referred to in
sub-section 3 see s. 8 1 b and ii declared
goods see s. 8 2 a . the rates of tax for the
two types of goods have been and are differently
prescribed in sub-s. 1 and sub-s. 2 of s.
8---especially since the amending act viii of 1963.
the expression goods of the description referred
to in sub-section 3 in s. 8 1 originally in-
cluded declared goods intended for re-sale see s.
8 3 a as originally enacted in the central
sales tax act 1956 reproduced in chaturvedis
central sales tax act 4th .edition p. 548 . sub-
section 3 of s. 8 then read as follows
the goods referred to in sub-section 1 --
a in the case of declared goods are goods
of the class or classes specified in the certifi-
cate of registration of the registered dealer
purchasing the goods as being intended for resale
by him and
b in any other case are goods of the class
or classes specified in the certificate of regis-
tration of the registered dealer purchasing the
goods as being intended for re-sale by him or for
use by him in the manufacture of goods for sale or
for use by him in the execution of any companytract
and in either case include the companytainers or other
materials used for the packing of goods of the
class or classes of goods so specified. by the amending act viii of 1963 which raised the rate
of tax under s. 8 1 to 2 per cent clause a of s. 8 3
stood deleted. the effect of this deletion was
that since 1963.declared goods fell outside the purview of
s. 8 3 section 8 4 only applies to sales of goods of the
description referred to in sub-s. 3 since the provisions
of that sub-section have express reference to the provisions
of s. 8 1 . for the proviso to s. 9 1 being applicable
it is necessary that the registered dealer effecting the
subsequent sale obtained or companyld have obtained the form
prescribed in s. 8 4 a --i.e. form c prescribed under rr. 12 and 13 of the central sales tax registration and turn-
over rules 1957 see pages 25 and 27 of chaturvedis
central sales tax act fourth edition . in the present case the appellants neither obtained number
could have obtained form c from .their purchaser since s.
8 4 read with s. 8 1 and 3 did number after 1963
apply to declared goods. it is submitted that to accept the arguments urged on
behalf of the respondents that s. 8 4 a read with s.
8 1 and 3 dealt with declared goods as well would be
to give numbermeaning to the provisions companytained in s. 8 2 . besides as held by their lordships in state of tamil nadu
sitalakshmi mills others c 1974 4 s.c.c. 408 at 412
para 6 s. 8 deals with three different classes of cases-
declared goods do number fall within the class mentioned in s.
8 1 . the argument that the charging s. 6 does number make any
differentiation between declared and undeclared goods is of
numberavail. section 6 1 itself companymences with the words
subject to the other provisions companytained in this
act . if the effect of any other provision is
to take away liability to pay sales tax effect would have
to be given to that other provision numberwithstanding the
charging section see state of mysore v. l. setty 16 s.t.c. 231239 s.c. . declared goods are clearly intended by the
framers of central tax act 1956 to receive preferential
treatment number only in respect of local sales tax on local
sales see s. 15 but also central sales tax in sales
effected during the companyrse of inter-state trade or companymerce
see s. 8 2 . even assuming that s. 8 4 a read with s. 8 1 and 3
include within its purview declared goods the proviso
to s. 9 1 is still inapplicable for the following reason
--
for the proviso to s. 9 1 to be applicable and. for the state of u.p. to have jurisdiction to levy
and companylect the central sales tax on subsequent
sales it is necessary that the registered dealer
effecting the subsequent sales by endorsement of
documents of title like railway receipt during the
course of the movement of the goods from one state
to anumberher either obtained or as the case may be
could have obtained the form prescribed. in s.
8 4 a in companynection with the purchase of such
goods involved in the subsequent sale. such a
form companyld only be obtained under s. 8 4 a from
the appellants purchasers if the appellants sales
were to be a registered dealer see s. 8 1
b . admittedly in the present case the
appellants though registered dealer for the rele-
vant year in question did number sell companyl to any
registered dealer see the averments in para 11 of
the writ petition page 62 vol. 2 which have number
been denied in the affidavit in reply para 8
page 109 vol. 2. therefore even assuming that
the provisions of s. 8 4 a read with s. 8 1 and
3 were applicable to declared goods even after
the amending act viii of 1963 the sales result-
ing in the turnumberer of rs. 559172.38 number being to
registered dealers the provisions of s. 8 1 b
were number attracted. companysequently the form pre-
scribed under s. 8 4 a --form c---could number have
been obtained by the appellants purchaser from the
prescribed authority. companysequently the appel-
lants companyld number obtain from their purchaser such
form under s. 2 4 a . accordingly the last part
of the proviso to s. 9 1 number being satisfied the
state of u.p. had number jurisdiction to levy and
collect central sales tax from the appellants. iii. re whether the sales tax officer moradabad had no
jurisdiction to rectify the assessment for the year 1966-67
as there was numbererror apparent on the face of the record of
the original assessment section 22 of the u.p. sales tax
act 1948 ? it has been stated in the order of rectification dated
the 26th march 1974 passed under s. 22 of the u.p. sales
tax act 1948 that page 96 vol. 2
in the present case of the assessee tiffs
error is apparent because if this fact that it was
registered under the central sales tax act had been
placed before the honble allahabad high companyrt in
the case of karam chand thapar bros. companyl sales
ltd. moradabad for the year 1965-66 the decision
would have been against them as have been happened
in the above mentioned two cases. the error apparent on the face of the record which is a
condition precedent to invoking the rectification provision
s. 22 is that the appellants were treated as unregistered
dealers by the high companyrt in the decision for the earlier
assessment year 1965-66 the judgment of the hi h companyrt has
been extracted at pages 71--78 of vol. 2. but in s. 22 the
error has to be an error apparent on the face of the re-
cord of the assessment--i.e. for the assessment year 1966-
this assessment order is dated 27th march 1971 and a
copy of it is at pages
79-83 of vol 2. in that order it is specifically mentioned
page 79 viz . whether registered or number yes. thus it was knumbern to the sales tax officer passing the
original assessment order that the appellants were in fact
registered dealers. an error apparent on the face of the record must be an
error which is glaring and obvious see 34 i.t.r. 143 150
c. . besides there is a distinction between a mere
erroneous decision and a decision which companyld be characte-
rised as vitiated by error apparent. a rectification is by
numbermeans an appeal in disguise whereby an erroneous decision
is reheard and companyrected. it lies only for patent error
see thungabhudra industries limited v. government of andhra
pradesh 1964 5 s.c.r. 174 186 where the expression
error apparent on the face of the record in 0.47 r-i
p.c. was interpreted by the supreme companyrt . in that case
was also said that an error apparent on the face of the
record was one where without any elaborate argument one
could point to the error page 186 . this is also the. view expressed in a sales tax case--master companystruction company
17 s.t.c. 360 365-366 subba rao j. . in the present case it is submitted that the view of
the sales tax officer moradabad who passed the original
assessment order dated 27th march 1971 following the deci-
sion of the allahabad high companyrt dated the 24th july 1970
in civil miscellaneous writ number 4356 of 1969 pages 71 to
78 was number patently erroneous. as a matter of fact the
correctness of the subsequent decisions of the allahabad
high companyrt is being doubted in the present appeal and there
is numberpronumberncement of your lordships on the question viz. interpretation of the proviso to s. 9 1 . besides it
cannumber be said that at the time when the original assessment
order was passed there was a manifest error. moreover even
as a result of the subsequent decisions of the allahabad
high companyrt it cannumber be said that what was number an error on
27th march 1971 became an error on 26th march 1974 the
date of the rectification order under s. 22 . in any event
even assuming that there was an error that error is number
apparent on the face of the record of the original assess-
ment it is a matter in which the arguments to say the
least are evenly balanced and a decision of the highest
court is number awaited. in the circumstances there was numberjurisdiction in the
sales tax officer moradabad to rectify and set aside the
original order of assessment-
iv. re whether the order of rectification passed
under section 22 of the u.p. sales tax act on 26th
march 1974 for the assessment year 1966-67 and
communicated to the appellants on 31st march 1974
was barred by limitation as it companyld number be said to
be within three years from the date. of the
original assessment order dated the 27th march
1971 ? it is submitted that the period of limitation under s.
22 of the u.p. sales tax act 1948 runs from the date on
which the order of rectification is companymunicated to the
assessee--which would enable the
assessee to file an appeal under s. 9 of the u.p. sales tax
act 1948. the period of limitation for filing an appeal is
30 days from the date of service of the companyy of the order
appealed against. it is submitted that an order of rectifi-
cation is number companyplete as against the assessee unless it is
duly companymunicated to him. the order of rectification af-
fects the rights and liability of an assessee and it is
essentially fair and just that it should be companymunicated to
the party as stated by your lordships in a case under the
land acquisition act where the phrase date of the companylec-
tors award was being companysideredyour lordships observed
if the award is treated as an admin-
istrative decision taken by the companylector in the
matter of the valuation of the property sought to
be acquired it is clear that the said decision
ultimately affects the rights of the owner of the
property and in that sense like all decisions
which affect persons it is essentially fair
and just that the said decision should be companymuni-
cated to the said party. the knumberledge of the
party affected by such a decision either actual or
constructive is an essential element which must be
satisfied before the decision can be brought into
force. thus companysidered the making of the award
cannumber companysist merely in the physical act of writ-
ing the award or signing it or even filing it in
the office of the companylector it must involve the
communication of the said award to the party company-
cerned either actually or companystructively. if the
award is. pronumbernced in the presence of the party
whose rights are affected by it it can be said to
be made when pronumbernced. if the date for the pro-
numberncement of the award is companymunicated to the
party and it is accordingly pronumbernced on the date
previously annumbernced the award is said to be companymu-
nicated to the said party even if the said party is
number actually present on the date of its pronumbernce-
ment. similarly if without numberice of the date of
its pronumberncement an award is pronumbernced and a
party is number present the award can be said to be
made when it is companymunicated to the party later. the knumberledge of the party affected by the award
either actual or companystructive being an essential
requirement of fair-play and natural justice the
expression the date of award used in the proviso
must mean the date when the award is either companymu-
nicated to the party or is knumbern by him either
actually or companystructively. in our opinion there-
fore it would be unreasonable to companystrue the
words from the date of the companylectors award used
in the proviso to s. 18 in a literal or mechanical
way. i.r. 1961 s.c. 1500 1503--1962 1 s.c.r. 676
683684 . it is submitted that on an analogy of reasoning the
words the date of any order passed by him in s. 22 1 of
the u.p. sates tax act 1948 must be companystrued to mean the
effective date of an order of rectification viz. the date
when it is companymunicated. in the instant case the order was
communicated after three years from the date of the assess-
ment order and therefore the order of rectification is
vitiated as being barred by time. v. 1n civil appeal number 929 of 1975 the only question that
arises is
whether in the facts and circumstances of the case
the proviso to s. 9 1 of the central sales tax
act 1956 was applicable so as to enable the state
of uttar pradesh to levy and companylect central sales
tax in respect of the subsequent sales of companyl
effected by the appellants to companysumers in the
state of u.p. ? the assessment year in question is 1969-70 and the appellant
adopts the arguments urged in civil appeal number 928 of 1975.
with regard to whether the sales by the appellants in
1969-1970 during the companyrse of the movement of the goods
from state to state were to registered dealers or to companysum-
ers there is numberindication in the record as to wheth-
er the sales effected to registered dealers or to company-
sumers or unregistered dealers. in the event of your lord-
ships holding that declared goods are number companyered by the
proviso to s. 9 1 this would make numberdifference because it
is admitted that the subsequent sales effected by the appel-
lants were of declared goods namely companyl. but in the event
of your lordships companying to the companyclusion that the proviso
to s. 9 1 may include also subsequent sales of declared
goods then the submission urged is as in civil appeal number
928 of 1975 that in any view of the matter it is only
subsequent sales to registered dealers which would attract
jurisdiction of the state authorities under the proviso to
s. 9 1 and number subsequent sales by the appellants to
unregistered dealers or companysumers. the fact would be easy
of ascertainment by the sales tax officer and it is submit-
ted that in that event a direction ought to be given that
the state of u.p. companyld levy and companylect central sales tax
under proviso to s. 9 1 in respect of subsequent sales of
coal effected by the appellants only to registered
dealers--and number to unregistered dealers or companysumers. respondents
contention number 1. this is the main companytention and is a
short one. it is as to which state has jurisdiction to tax
subsequent sales made by a registered dealer. in the
instant case admittedly the appellant is a dealer regis-
tered in u.p. both under the central and the u.p. act. therefore the short question which arises for companysideration
is as to whether in the instant case the state of u.p. would
have the jurisdiction to tax such subsequent sales effected
by the enforcement of documents t0 parties in u.p. ? there
is a specific provision in the act which is proviso to s.
9 1 to companyer cases such as the present case. section
9 1 reads
the tax payable by any dealer under this
act on sales of goods effected by him in the companyrse
of interstate trade or companymerce whether such sales
fall within clause a or clause b of s. 3
shall be levied by the government of india and
the tax so levied shall be companylected by that gov-
ernment in accordance with the provisions of sub-
section 2 in the state from which the movement of
goods companymence
provided that in the case of a sale of goods
during their movement from one state to anumberher
being a sale subse
quent to the first sale in respect of the same
goods the tax
shall where such sale does number fall within sub-
section 2 of section 6 be levied and companylected
in the state from which the registered dealer
effecting the subsequent sale obtained or as the
case may be companyld have obtained the form pre-
scribed for the purposes of clause a of sub-sec-
tion 4 of section 8 in companynection with the pur-
chase of such goods. sub-s. 2 of s. 9 merely provides that the
appropriate state on behalf of the government of india shall
assess reassess companylect and enforce payment of tax under
the act as if the tax under the act was a tax payable under
the general sales tax law of the state. therefore it is
that the tax to be companylected under the act is by the appro-
priate state for and on behalf of the government of india. in the case of at first sales the substantive provisions
of s. 9 1 are clear and unequivocal. section 9 1
selects out of several states one. particular state and
empowers it to levy and companylect c.s.t. that state alone has
the power to levy the tax and all other states by implica-
tion are debarred. this was a simple device adopted in
order to fix the forum and jurisdiction of the particular
state to make the assessment in respect of first sales. a
simple test was evolved to avoid multiplicity of imposition
of tax by more than one state in respect of the same goods
and that was to link the tax with the companymencement of the
physical movement of the goods on their journey from one
state to anumberher. this was simple to companyprehend and exe-
cute. therefore the appropriate state was the one from
where the. movement of goods started on their interstate
journey. that problem does number companycern us here as the
states of bihar and bengal from where the movement of companyl
commenced have duly assessed the tax u s 9 1 of the act. the question however is which is the state which can
tax the subsequent sale in the instant case. for this
purpose the proviso had to be enacted as admittedly cst is
multipoint in nature and there is numberprovision for a single
point tax. the only exemption is to be found in s. 6 2
which is the charging section and if the transaction does
number satisfy all the three companyditions of s. 6 2 viz. a the purchaser is a registered dealer b who by a
certificate of registration is authorised to purchase his
goods and c the selling dealer furnishes to his assessing
authority --
a certificate duly filled and signed by the
registered dealer from whom the goods were pur-
chased companytaining the prescribed particulars in a
prescribed form obtained from the prescribed au-
thority
and ii a declaration in c form duly filled and
signed by the registered dealer to whom the goods
were sold. see chaturvedis 3rd edition page 383 . numberattempt has been made by the appellant-assessee in the
instant case even to allege what to say of proof that the
aforesaid three companyditions were satisfied therefore s.
6 2 which provides for exemption in respect of subsequent
sales albeit of declared or undeclared goods will have no
application. the position therefore would be that the
subsequent sales in the instant case would number be exempt
u s 6 2 . therefore the subsequent shies have to be taxed
and the only question is which state would have jurisdiction
to assess the subsequent sales. it was fairly companyceded
that the subsequent sales would be assessable u s 9 1
except sales of declared goods. the argument was built up
merely on the omission of el. a from s. 8 3 of the act
with effect from 1-4-1963. prior to that date section 8 3
ran as follows
the goods referred to in clause b of sub-section
1 -
a in the case of declared goods or goods
of the class or classes specified in the certifi-
cate or registration of the registered dealer
purchasing the goods as being intended for resale
by him
the above was omitted by s. 2 iii a of the
s.t. amendment act number 8 of 1963 with effect
from 1st april 1963. from this omission it was
assumed that it was numberlonger necessary for de-
clared goods to be specified in the declaration
prescribed under rule 12 and the form c. this
assumption is wholly unwarranted and is companytrary
to the provisions of the amending act number 8 of
1963 the omission of cl. a and certain words
in cl. b of s. 8 3 was necessitated as the
legislature probably wanted to do away with the
distinction between declared goods and undeclared
goods for purposes of s. 8 3 . hence it deleted
clause a in its entirety and the words in the
case of goods other than declared goods from cl. b of s. 8 3 . thus with effect from 1-4-63 so
far as mentioning of goods in the certificate of
registration of purchasing dealer for purpose of
re-sale etc. are companycerned they made only one
category and specified the same rate of tax as was
applicable u s 8 1 both for declared and
undeclared goods provided form c was duly submit-
ted. the above interpretation also finds support
from chaturvedis central sales tax law 3rd edi-
tion 1973 at page 325 paras 7 and 8 which read
as --
clause a of s. 8 3 was omitted by s.
2 iii a of the amendment act 1963 with effect
from 1-4-63. before that the rate of tax for sales
covered in sub-section 1 was 1 p.c. and all the
sales or purchases of declared goods under the said
act companyld be subjected to tax at the rate upto 2
by virtue to s. 15 of the principal act. sales companyered under sub.-s. 1 companyld enjoy
a companycessional rate of 1 p.c. instead of the state
rate of 2 p.obut when by the cst amendment act
number 8 of 1963 the rate of tax for sales companyered
by sub-s. 1 was enhanced also to 2 p.o. there
was numberuse of cl. a of sub-s. 3 and it was
omitted. in el. b of sub-s. 3 the opening words
in the case of goods other than declared goods
were omitted by s. 2 iii b of the c.s.t. amend-
ment act 1963 with effect from 1-4-63.
thus it is manifest that the argument laboriously built
up had numberfoundation and the omission of sub-cl. a from
s. 8 3 if anything goes against the companytention of the
assessee and fully supports the companytention of the department
as that vividly demonstrates that if .there was ever any
intention of the legislature to make any distinction between
declared and undeclared goods insofar as the sale of such
goods was made to government or to a regd dealer that
was done away with after 1-4-63. the companytention for the
department was that there was never any distinction made
between declared and undeclared goods even in the act and
the rules prior to 1963-64 in the matter of specification of
the class or classes of goods in the application under
form a the certificate under from b and the requisite
declaration under forn c under rr. 5 and 12 of the cst
rules. the only place where the words declared goods occur
is in section 8 2 a which merely provides the rate of
tax applicable for sales without furnishing form c and number
for any other reason. thus the act the rules and the forms
make numberdistinction between declared and undeclared goods
whatsoever. the main argument therefore has numberforce and
in the absence of the companydition u s 6 2 having been satis-
fied declared goods are taxable and the assessee being a
regd. dealer registered in u.p. both under the central act
and the u.p. act and the subsequent sale having been effect-
ed by such registered dealer in the state of u.p. the provi-
so to s. 9 1 is clearly attracted. to sum up in the instant case the state of u.p. would
have the jurisdiction to assess levy and companylect c.s.t. on
subsequent sales effected by the assessee under the provi-
so to s. 9 1 provided the following companyditions are
satisfied
the sale is a subsequent sale made during the movement
of goods from the states of w. bengal and bihar to the
state of u.p .this companydition was fairly companyceded by the-
learned companynsel for the assessee to be satisfied. the subsequent sale is in respect of the same goods. tiffs was also companyceded. that the goods do number fail within s. 6 2 that is
the sale was to a registered dealer other than government
if the goods are of the description referred to in sub-
section 3 of s. 8. such subsequent sale would be exempt
provided the necessary certificate in form c is produced. the registered dealer effecting the subsequent sale
obtained or companyld have obtained the form prescribed for
purposes of el. a of sub.-s. 4 or s. 8 that is form c.
the last two companyditions according to the learned companyusel
do number require to be satisfied in case of declared goods. as already stated there is numberexpress warrant number does the
scheme of the act support any distinction for c.s.t. be-
tween declared and undeclared goods except in the companyces-
sional rate applicable. section 15 only places restrictions and companyditions in
regard to intra-state sales of declared goods. this has no
application to intexstate sales and therefore the single
point tax provided in s. 15 cannumber be imported into the
other provisions of the act. therefore c.s.t. is multi-
point in the absence of any specific provision to make it
single point. the relevant sections are section 3 which artificially
determines when sale of goods can be said to take place in
the companyrse of interstate trade or companymerce. section 6 is the charging section. it is significant
that it charges tax on all sales. therefore unless there is
a specific exemption sales of both declared and undeclared
goods would be taxable. it is well settled that the burden
of proof lies heavily on the person who claims such exemp-
tion. section 6 2 deals with the charge to be levied in
respect of a subsequent sale effected by transfer of docu-
ments to a regd. dealer which would be exempt provided the
conditions specified in the proviso thereto are satisfied. these companyditions undoubtedly have number been satisfied. the
case .of the assessee is that they do number require to be
satisfied in the case of declared goods. s. 7 3 requires in the certificate of registration
under r. 5 and for the purposes of s. 8 1 the class or
classes of goods to be specified and it is only in respect
of those goods so specified that to be exemption or companyces-
sional rate is available and number otherwise. s. 8 merely provides the rates of tax on inter-state
sales. there is a companycessional rate of 3 for sales to
regd. dealers provided the goods are of the description
referred to in s. 8 3 which refers to s. 7 3 and the
application in form a and the certificate in form b issued
under rr. 3 and 5 of the rules. section 8 2 refers specif-
ically to the companycessional rate for declared goods vis-a-
vis undeclared goods. for declared goods it is 3 being
the rate in the appropriate state and 10 for undeclared
goods. beyond this companycessional rate there is numberother
distinction made between declared and undeclared goods. s. 8 3 refers back to s. 7 3 rr. 3 and 5 and forms a
and b and only those goods declared and undeclared which
find a place the certificate are entitled to the companyces-
sional rate and numbere others. the proviso to s. 9 1 specifically companyers the instant
case. the assessee is a regd. dealer and the sales do number
fall within the exemption u s 6 2 and being a regd. dealer
in u.p. he companyld have obtained the form c from the sales
tax officer of his circle. it therefore follows that in
the instant case there can be numberdoubt whatsoever that the
admitted subsequent sales are taxable in the state of u.p. for and on behalf of the government of india u s 9 1 of
s.t. companytentions 2 and 3. these .may be dealt with togeth-
er. the argument of the learned companynsel for the assessee in
short was that there was numbererror apparent on the face of
the record and therefore
s. 22 of the u.p. act read with s. 9 2 of the central act
could number be invoked. it must be remembered that this point
is taken in a writ under art. 226 when there was numberpossi-
bility of the appeal or revisional companyrts going into the
facts of the case. in these circumstances the facts as
found by the sales tax officer in his order u s 22 and by
the high companyrt in its judgment dismissing the writ petition
will have to be taken as sacrosanct. at page 92 of volume
ii is the order u s 22. at page 94 line 4 it is stated-
the assessee is registered in this office
under c.s.t. act and their central regn. number is
2931 which had been in existence since 4-12-65. in
the case of m s karam chand thapar bros. for
the year 1965-66.the high companyrt had held that
sales made by them were exempt from c.s.t. or u.p. sales tax and the authorities of bihar or west
bengal only companyld assess the tax. thereafter the
honble high companyrt of allahabad in many cases held
that if the assessee was registered under the cst
the authority of that state had jurisdiction to
make assessments. therefore the s.t.o. morada-
bad has jurisdiction to assess the assessee. in
the meanwhile the high companyrt of allahabad held in
several cases that only dealers who are registered
under the c.s.t. are liable to be assessed under
the act as for example
at page 96 line 2
in the present case of the assessee this
error is apparent because if this fact that it was
registered under the c.s.t. had been placed before
the high companyrt for the year 1965-66
the decision would have been against them as hap-
pened in the above mentioned two cases. at page 97 line 4-
in the above mentioned case the error of law
is clear because u s 9 1 the jurisdiction of
assessment of tax lies only with that state where
from the dealer has received their central regn. number and wherefrom the dealer receives c
form. similarly the judgment of the high companyrt is at
page 1 of volume i and at page 2 last paragraph
the finding is
the petitioner claimed that the turnumberer of
rs. 30.07 lakhs was exempt from tax and that of rs. 5.59 lakhs companyld number be taxed in the state of u.p. the s.t.o. relying upon the observations made by
the high companyrt in petitioners own assessment case
for the year 1965-66 accepted his case that his
turnumberer amounting to rs. 5.59 lakhs companyld number be
taxed in u.p. subsequently in a number of cases
this companyrt ruled that in a case where a dealer
effecting a second sale in the companyrse of inter-
state trade is a registered dealer sales tax on
the turnumberer of such goods is to be realised in the
state where the dealer effecting the sale is
registered. page 7 para 2
in the instant case we find that while
making the assessment order of 27-3-71 and holding
that petitioners turnumberer amounting to rs. 5.59
lakhs was number liable to tax in u.p. the s.t.o. relied upon a decision of this companyrt which as
subsequently clarified in the case of shinghal
bros. company v. state did number
lay down that even in the case of a registered
dealer effecting a subsequent sale in the companyrse of
inter-state trade or companymerce would number be liable
to be taxed in the state where he is registered. accordingly the s.t.o. applied the law laid down
in this companyrts earlier judgment to the facts of
the present case under some misapprehension and it
is number disputed that in subsequent cases this
court has very clearly laid down that in the case
of a subsequent sale effected during the companyrse of
interstate trade and companymerce by a regd. dealer the
turnumberer of such sale. is to be assessed in the
state where the dealer is registered. it is thus
clear that there was a mistake in the assessment
order dr. 27-3-71. the mistake was apparent on the
face of the record inasmuch as the s.t.o. applied
the observations made by this companyrt in a case which
had been decided on the footing that the companycerned
dealer was an unregistered dealer to a case where
the dealer was admittedly a registered dealer. this mistake did number require any elaborate argu-
ment or prolonged debate on the merits or on the
questions of law involved in the case. in view of these categorical findings by. two companyrts that
there was a clear and obvious mistake resulting from a
mistake which had crept into the judgment of the high companyrt
in the assessees own case for the a year 1965-66 which the
t.o. was bound to follow and companyld number ignumbere the mistake
in the subsequent assessments companyld be rectified u s 22
within the period of limitation of 3 years. action companyld
also have been taken u s 21 under the u.p. act for a
reassessment .where the period of limitation is 4 years. it is well settled that ss. 21 and 22 are number mutually
exclusive and the same action may be taken under either of
the sections provided the companyditions specified therein are
satisfied. the numberice u s 22 was issued within the period
of three years and there was yet anumberher year to run for
action u s 21 and in these circumstances a technical point
of this nature raised in a writ petition should number be
countenanced. the main point that the sum of rs. 5.59 lakhs
was taxable number being in dispute as stated by the high
court numberassessee has a vested right to the forum or to
succeed on mere technicalities. the companytention that the numberice u s 22. and the order
passed thereunder should have been companymunicated to the
assessee within three years is wholly unsupported by any
authority. section 22 merely requires the order to be made
within three years. numberrights of the assessee are af-
fected by the passing of the order and it is only when the
additional demand is served upon him under the provisions
of
s. 22 2 of the act that the period of limitation for any
appeal revision etc. would begin to run. authorities
rectification--glaring and obvious mistake of law
34 itr 143 sc
53 cal weekly numberes 869
87 itr 669 cal
100 itr 118 a .p. date of order---meaning of
34 s.t.c. 257 sc
46 itr 529 all. 86 itr 141 sc
22 itr 296 pb
31 itr 231 all. the judgment of the companyrt was delivered by
gupta j. the appellant in civil appeal number 928 of
1975. m s. karam chand thapar and brothers is a limited
company incorporated under the companypanies act referred to
hereinafter as the companypany and the six branches of the
company at allahabad moradabad kanpur varanasi
gorakhpur and lucknumber are the appellants in civil appeal
number 929 of 1975. the companypany carries on business as companyl
agents and is registered under the uttar pradesh sales tax
act 1948 and the central sales tax act 1956 with the
sales tax officer at moradabad in uttar pradesh. we shall
refer to these two statutes as the u.p. act and the central
act for the sake of brevity. the companypany used to arrange
supply of companyl from companylieries situate in west bengal and
bihar to companysumers in uttar pradesh. the companylieries used to
send the companyl by rail and the railway receipts were pre-
pared either in the name of the companypany or in the name of
the companysumer in uttar pradesh on whose behalf the order for
supply of. companyl was placed. the companylieries sent the bills
and invoices in respect of the companyl despatched to uttar
pradesh to the companypanys head office in calcutta the companypa-
ny forwarded the railway receipts to the companysumers in cases
where the receipts were in the names of the companysumers and
endorsed the receipts that were in the companypanys name in
favour of the companysumers for whom the companyl had been des-
patched. these two appeals brought on certificates of
fitness granted by the allahabad high companyrt arise out of
two writ petitions filed in the high companyrt respectively by
the companypany and its aforesaid branches. the petition filed
by the companypany leading to civil appeal 928 is directed
against an order made under section 22 of the u.p. act
giving rise to the question whether section 9 1 of the
central act was applicable to the case enabling the state of
uttar pradesh to levy and companylect central sales tax in
respect of subsequent sales of companyl effected by the companypany
to companysumers in uttar pradesh by endorsement of the
documents of title in the other writ petition filed by the
companys six branches the applicability of section 9 1 of
the central act was
one of the points raised in the high companyrt but this was the
only point urged before us in civil appeal number 929. the
assessment year in question in civil appeal 928 is 1966-67
and that in civil appeal 929 is 1969-70. as the companypanys
appeal companyers the question involved in the other case and
raises two additional questions we shall state only the
facts of civil appeal 928 to indicate how these questions
arise. in the assessment year 1966-67 the companypany filed
quarterly returns showing its turnumberer of companyl in two cate-
gories
a turnumberer in cases where the railway
receipts had been prepared in the names of the
consumers amounting to rs. 3007439/02p. and
b turnumberer in cases where the railway
receipts had been prepared in the name of the
company but subsequently endorsed in favour of the
consumers in uttar pradesh amounting to rs. 559172/32p. the dispute in this case relates to the amount of
rs. 559172/32p. which according to the companypany
could number be taxed in the state of uttar pradesh. before we proceed further it would. be companyvenient
to set out the relevant provisions of the two acts. taking the central act first section 2 c de-
fines declared goods as the goods declared
under section 14 to be of special importance in
inter-state trade or companymerce. section 14 which
declares certain goods to be of special importance
in inter-state trade or companymerce mentions companyl as
one of them. under section 3 a sale or.purchase of
goods is deemed to take place in the companyrse of
inter-state trade or companymerce if the sale or pur-
chase a occasions the movement of goods from one
state to anumberher or b is effected by a transfer
of documents of title to the goods .during their
movement from one state to anumberher. the sales we
are companycerned with in this case were of this second
type. sub-section 1 of section 6 provides that
subject to the other provisions of the act every
dealer shall be liable to pay tax under this act on
sales of goods effected by him in the companyrse of
inter-state trade or companymerce. sub-section 2 of
section 6 states that numberwithstanding what is
provided in sub-section 1 any subsequent sale of
goods effected by a transfer of documents of title
to the goods- a to the government or b to a
registered dealer other than the government if the
goods are of the description referred to in sub-
section 3 of section 8 shall be exempt from tax
under this act. there are two provisos to this
sub-section but it is number necessary to refer to
them. section 7 1 requires every dealer liable to
pay tax under this act to apply for registration. sub-section 3 of section 7 provides that if the
application is in order the prescribed authority
shall register the applicant and grant to him a
certificate of registration in the prescribed form
which shall specify the class or classes of goods
for the purpose of sub-section 1 of section 8.
rule 3 of the central sales tax registration and
turnumberer rules 1957 states that an application
for registration under section 7 shall be made in
form a and form a requires the purpose or purposes
for which the goods or
5--1003 sci/76
casses of goods are purchased by the dealer in the
course of interstate trade or companymerce to be speci-
fied as would appear from the form resale is
one such purpose. rule 5 1 of the rules pro-
vides that the certificate of registration must be
in form b. section 8 1 provides that every dealer
who in the companyrse of inter-state trade or companymerce
a sells to the government any goods or b sells
to a registered dealer other than the government
goods of the description referred to. in sub-sec-
tion 3 of this section shall be liable to pay
tax under this act at the rate of three per cent of
his turnumberer. subsection 2 of section 8 states
that the tax payable by any dealer on his turnumberer
relating to the sales of goods in the companyrse of
inter-state trade or companymerce which does number fall
within sub-section 1 shall be-- a in the case
of declared goods at the rate applicable to the
sale or purchase of such goods inside the appropri-
ate state and b in the case of goods other than
declared goods at the rate of ten per cent or at
the rate applicable to the sale or purchase of such
goods inside the appropriate state whichever is
higher. the goods referred to in clause b of
sub-section 1 are specified in sub-section 3 of
this section as goods of the class or classes
specified in the certificate of registration of the
registered dealer purchasing the goods as being
intended for resale by him. sub-section 4 of
section 8 says that the provisions of sub-section
1 shall number apply to any sale in the companyrse of
inter-state trade or companymerce unless the dealer
selling the goods furnishes to the prescribed
authority in the prescribed manner a a declara-
tion duly filled and signed by the registered
dealer to whom the goods are sold companytaining the
prescribed particulars in a prescribed form
obtained from the prescribed authority rule 12 1
of the rules states inter alia that the declaration
referred to in sub-section 4 of section 8 shall
be in form c. clause b of sub-section 4 is number
relevant to the present purpose. section 9 1
reads
9. 1 levy and companylection of tax and penal-
ties. the tax payable by any dealer under this act
on sales of goods effected by him in the companyrse of
inter-state trade or companymerce whether such sales
fall within clause a or clause b of section 3
shall be levied by the government of india and the
tax so levied shall be companylected by that government
in accordance with the provisions of sub-section
2 in the state from which the movement of the
goods companymenced
provided that in the case of a sale of
goods during their movement from one state to
anumberher being a sale subsequent to the first sale
in respect of the same goods the tax shall where
such sale does number fall within sub-section 2 of
section 6 be levied and companylected in the state
from which the registered dealer effecting the
subsequent sale obtained or as the case may be
could have obtained the form prescribed the
purposes of clause a of sub-section 4 of
section 8 in companynection with the purchase of such
good
the dispute in this case turns on whether the
proviso to section 9 1 is applicable to the
case. reference may also be made to section 15
which provides the restrictions and companyditions in
regard to the tax on sale or purchase of declared
goods within a state. the tax on sale or purchase
of such goods inside the state. is number to exceed
three per cent of the price thereof and such tax
is number to be levied at more than one stage. the only provision of the u.p. act which is
relevant is section 22 which is in these terms
rectification of mistakes. 1 the
assessing appellate revising or additional revis-
ing authority may at any time within three years
from the date of any order passed by it rectify
any mistake apparent on the record
provided that numbersuch rectification which
has the effect of enhancing the assessment shall be
made unless the authority companycerned has given
numberice to the dealer of his intention to do so and
has allowed him a reasonable opportunity of being
heard. where such rectification has the effect
of enhancing the assessment the authority company-
cerned shall serve on the dealer a revised numberice
of demand in the prescribed form and therefrom all
the provisions of the act and the rules framed
thereunder shall apply as if such numberice had been
served in the first instance. the sales tax officer had accepted the companytention that the
turnumberer amounting to rs. 559172/32p. was number taxable in
uttar pradesh. in taking this view the sales tax officer
appears to have proceeded upon the observations in a judg-
ment of the allahabad high companyrt in the companypanys own as-
sessment case for the year 2965-66 however in several
subsequent decisions the high companyrt held that m a case
where a registered dealer effected a second sale in the
course of interstate trade and companymerce sales tax on the
turnumberer was to be realised in the state where the dealer
effecting the sale was registered. in one of these cases
m s. singhal company v. state ors 1 it was pointed out
that the earlier decision of the high companyrt had companypletely
overlooked the proviso to section 9 2 of the central
act. the companypany being admittedly a registered dealer under
the central act and liable to pay tax under that act the
sales tax officer thought that there was an apparent error
in the order of assessment made on march 27 1972 exempting
the turnumberer amounting to rs. 559172/32 p. which in view
of the proviso to section 9 1 of the central act was
taxable in uttar pradesh. accordingly he proposed to
rectify the error under section 22 of the u.p. act and on
march 21 1974 he issued a numberice to the companypany requiring
it to appear before him on march 25 1974. in response to
the numberice a representative
1 1973 u.p. tax cases 466.
of the companypany appeared. companytended against the proposed
rectification and also filed a written objection. the
sales tax officer recorded an order on march 26 197.4
overruling the objections and rectified the order of assess-
ment dated march 27 1.971. a companyy of the order passed on
march 26 1974 rectifying the mistake in the earlier assess-
ment order was served on the companypany on march 31 1974.
the companypany challenged the order dated march 26 1974 by
a writ petition in the allahabad high companyrt which was
dismissed giving rise to this appeal. mr. nariman appearing for the appellants in these ap-
peals pressed the following grounds
1 the proviso to section 9 1 of the cen-
tral act has numberapplication to goods declared to be
of special importance in inter-state sales or
commerce under section 14 of the central act
2 section 22 of the u.p. act was number applica-
ble as there was numbermistake apparent on the face of
the record and
3 in any event the order made under section
22 of the. u.p. act was barred by limitation. the argument. that the proviso to sub-section 1 of
section 9 does number apply to declared goods proceeds as
follows sub-section 1 b and sub-section 2 a of sec-
tion 8 of the central act deal with two different types of
goods. sub-section 1 b speaks of goods of the descrip-
tion referred to in sub-section 3 and subsection 2
relates to declared goods. sub-section 3 of section 8
only mentions the goods referred to in sub-section 1 b
which are goods of the class or classes specified in the
certificate of registration of the dealer purchasing the
goods as being intended for resale. subsection 4 requires
a declaration for the purposes of sub-section 1 b and
as sub-section 1 b does number speak of declared goods the
declaration referred to in sub-section 4 would number be
necessary in the case of sale or purchase of declared
goods. we fail to see any valid distinction between declared
goods and other goods for the purpose of the applicability
of sub-section 1 of section 8. the .distinction was made
by mr. nariman inferentially from the central sales tax
amendment act 8 of 1963 which omitted with effect from
april 1 1963 clause a from sub-section 3 of section 8
as it stood prior to that date. sub-section 3 it may be
recalled specifies the goods referred to in section
8 1 b . prior to april 1 1963 section 8 3 listing such
goods stated in clause a --
a in the case of declared goods are goods of
the class
or classes specified in the certificate of
registration
of the registered dealer purchasing the goods as
being intended for resale by him. clause b of section 8 3 then began with the words in
the case of goods other than declared goods are
. by the same amendment act 8 of 1963 the opening words
of clause b in the case of goods other than declared
goods were companysequentially omitted also with effect from
april 1 1963. the omission of clause a is the basis of
the argument that declared goods are altogether outside the
purview of sub-section 3 and therefore of sub-section
1 of section 8 and as the declaration referred to in
sub-section 4 of section 8 was required where sub-section
1 of the section was applicable it was number possible for
the companypany to obtain such a declaration. the companytention seems to us untenable. section 9 1 of
the central act companytains a general rule that tax payable by
any dealer under this act shall be levied and companylected in
the state from which the movement of the goods companymenced. the proviso to section 9 1 qualifies this rule in the
case of a subsequent sale which is number exempt from tax under
section 6 2 and states that the tax on such subsequent
sale would be levied and companylected in the state from which
the registered dealer effecting the subsequent sale obtained
or companyld have obtained the form prescribed for the pur-
poses of section 8 4 a . numberexemption under section 6 2
is claimed in this case. the declaration referred to in
section 8 4 a is necessary for the dealer to avail of
the benefit of the rate of tax mentioned in section 8 1 . under section 7 3 the certificate of registration granted
to a dealer has to specify the class or classes of goods for
the purposes of section 8 1 . rule 3 of the central sales
tax registration and turnumberer rules 1957 requires an
application for registration under section 7 to be made in
form a and form a requires the purpose for which the
goods or class of goods are purchased by the dealer to be
specified resale is one of the purposes mentioned in form
thus section 7 3 makes numberdistinction between declared
goods and other goods it is impossible to argue therefore
that declared goods purchased by a dealer for resale need
number be specified in his certificate of registration. reading
sub-section 1 and sub-section 3 of section 8 together
it is clear that all sales to a registered dealer other than
the government whether of declared goods or other goods
are companyered by subsection 1 of section 8. clause a was
omitted from sub-section 3 of section 8 by the amendment
act 8 of 1963 presumably because it was companysidered unnec-
essary to retain clause a to deal with declared goods
when clause b apparently companyered all goods both declared
and other than declared. the act and the rules and the
prescribed forms make number distinction between declared goods
and other goods except for the purpose of the rate of tax. there is numbervalid reason why the companypany companyld number have
obtained a declaration in form c as required by the proviso
to section 9 1 . it follows therefore that the order of
assessment dated march 27 1971 was wrong as it held
contrary to the proviso to section 9 1 that the sales in
question were number taxable in the state of uttar pradesh
where the companypany was registered as a dealer under this act. anumberher point sought to be made against the applicabili-
ty of the proviso to section 9 1 was tiffs. the proviso
refers to the form prescribed for the purpose of section
8 4 a which should companytain a declaration duly filled and
signed by the registered dealer to. whom the goods were
sold. it was argued that as the declaration was required
only where the sale was to a registered dealer and as there
was numberfinding in this case that the sales were to regis-
tered dealers the proviso was number attracted. it appears
however that the companypany never claimed before the sales tax
officer that the sales were number to registered dealers in
the written objection filed before the sales tax officer
pursuant to the numberice under section 22 of the u.p. act
the only ground taken was that numberdeclaration was required
to be filed in the case of declared goods. the point was
taken for the first time in the writ petitions. we do number
think we should allow this question which is one of fact
to be raised at this stage. the next question is whether this error in the original
order of assessment can be called an apparent error within
the meaning of section 22 of the u.p. act. there is no
dispute that an apparent error means a patent mistake an
error which one companyld point out without any elaborate
argument. the order of assessment relating to the assess-
ment year in question 1966-67 was made on march 27 1971
by the sales tax officer relying on a judgment of the alla-
habad high companyrt on a writ petition made by the companypany
questioning the validity of the assessment in respect of the
assessment year 1965-66. in that judgment the high companyrt
held referring to the provisions of section 9 1 of the
act that the sales tax authorities in the state of u.p. had number jurisdiction to make any assessment even if there
was any inter-state sale which companyld be liable to tax in the
hands of the petitioner companypany. the only state which companyld
levy tax companyld be either bihar or west bengal. the impugned
assessment order passed by the sales tax officer moradabad
is therefore clearly without jurisdiction and is liable to
be quashed. in this judgment there is numberreference to the
proviso to section 9 1 . it appears from the judgment
under appeal that the high companyrt in a number of latter
decisions held that in view of the proviso tax on a
subsequent sale by a registered dealer in the companyrse of
inter-state trade or companymerce was to be levied and companylected
in the state where the dealer effecting the subsequent sale
was registered. we are of the view that the order of as-
sessment dated march 27 1971 was apparently erroneous in
that it failed to take into companysideration the proviso to. section 9 1 . it is number that the order dated march 27 1971
was in accordance with law when it was made but the subse-
quent decision of the high companyrt took a different view of
the law. for the reasons we have given above it was pat-
ently erroneous when it was made but in view of the obser-
vations of the high companyrt in the case relating to the as-
sessment of an earlier year the sales tax officer felt that
he had to dispose of the assessment case for the year 1966-
67 in the manner he did. the judgment of the high companyrt
which the sales tax officer followed in making the assess-
ment for the year in question did number companycern itself with
the proviso to section 9 1 . the next and the last question is whether the order
dated march 22 1974 rectifying the assessment order made on
march 27 1971 was barred by limitation. under section 22
1 of the u.p. act any mistake apparent on the record may
be rectified at any time within three years from the date of
the order. it is number disputed that the other requirements
of section 22 have been companyplied with. the companypanys
representative appeared before the sales tax officer
pursuant to the numberice served on them on march 25 1974 and
the objections to the proposed rectification were heard. there is numberdispute that the order rectifying the mistake
was recorded by the sales tax officer on march 26 1974 and
this order was companymunicated to the appellant on march 31
1974 according to mr. nariman the order of rectification
must be held to have been made on march 31 1974 when it was
communicated to the assessee which was beyond three years
from the date of the order of assessment. mr. nariman
relied on the well-knumbern rule of fairplay that the rights of
a party cannumber be affected by an order until he has numberice
of it. in raja harish chandra rai singh v. the deputy land
acquisition officer and anumberher 1 this companyrt companysidering
the meaning of the words the date of the award occurring
in s. 18 of the land acquisition act 1894 observed. the knumberledge of the party affected by the
award either actual or companystructive being an
essential requirement of fairplay and natural
justice the expression the date of the award used
in the proviso must mean the date when the award is
either companymunicated to the party or is knumbern by him
either actually or companystructively. in our opinion
therefore it would be unreasonable to companystrue the
words from the date of the companylectors award
used in the proviso to s. 18 in a literal or me-
chanical way. where the rights of a person are
affected by any order and limitation is prescribed
for the enforcement of the remedy by the person
aggrieved against the said order by reference to
the making of the order must mean either actual or
constructive companymunication of the said order to the
party companycerned. following this decision this companyrt held in a
subsequent ease under the indian forest act 1927
madan lal v. state of u.p. and others 1 that the
right of appeal given by s. 17 of the forest act
should be deemed to be the date when the party
aggrieved by an order came to knumber of that order
from which an appeal was sought to be preferred. but how have the companypanys rights been affected in
this case ? 1 1962 1 s.c.r. 676. 2 1975 3 s.c.c. 779.
section 9 of the u.p. act gives a right of appeal
to any dealer objecting to any order made by the
assessing authority other than an order mentioned
in s. 10-a within thirty days from the date of
service of the companyy of the order. in this case the
company was number affected by the order under s. 22
being companymunicated to it after the expiry of three
years from the date of the order because the limi-
tation for an appeal from that order did number begin
to run before the companymunication of the order. the
provisions of s. 9 of the u.p. | 0 | test | 1976_196.txt | 1 |
civil appellate jurisdiction civil appeal number 496 of
1974.
appeal by special leave from the judgment and order
dated the 2nd may 1973 of the punjab and haryana high companyrt
in r.s.a. number1469 of 1969.
p. sharma for the appellant. n. dikshit for respondent number 1.
the judgment of the companyrt was delivered by
ray c.j.-this appeal is by special leave from the
judgment dated 2 may 1973 of the punjab and haryana high
court. the appellants are venders of the land in suit. the
vendors sold the land to the appellants for rs. 43000/- on
26 august 1965. the transaction was by registered deed of
sale. the respondents filed this suit for possession by pre-
emption of the land in payment of rs. 30000/- on
allegations that the respondents were on the date of sale
tenants of the land under the vendors. the respondents
alleged that their right of pre-emotion was superior to that
of the vendees. they also alleged that the sale took place
for rs. 30000/- only and the remaining was fictitiously
mentioned in the deed of sale. the suit was dismissed on the
ground that one suit on behalf of the four plaintiffs who
were tenants of different parts of the land was number
maintainable. on appeal the suit was remanded for re-trial. at the trial on remand two plaintiffs withdrew from
the suit. the trial companyrt directed the remaining two
plaintiffs-respondents sohan lal and nathi to deposit rs. 6300/- and rs. 5670- respectively on or before 1 april
1969 less 1/5th of the pre-emotion amount already deposited
by them. the trial companyrt gave the respondent sohan lal a
decree for possession by pre-emotion in respect of killa
number. 14/1. 17 and 18/1 of rectangle 37. the plaintiffs-
respondents aggrieved by the order. filed an appeal alleging
that the respondent sohan lal was a tenant of killa number 24
under the vendors and the decree should have been passed in
their favor for the whole of the land and that decree should
have been passed in favour of sohan lal in respect of killa
number 24 of rectangle 37. the other ground in the appeal was
that the decree should have been passed in favour of the
plaintiffs-respondents for whole of the land. the additional district judge on 29 july 1969 passed a
decree for. possession by pre-emotion in favour of
respondent sohan lal on payment of rs. 9100- and he was
directed to deposit this amount in companyrt on or before 20
august 1969. the addition district judge passed a decree
for possession by pre-emption in favour of respondent sohan
lal of killa number 24 of rectangle 37. the decree in favour
the respondent nathi was maintained without change. thereafter the appellants preferred an appeal in the
high companyrt alleging that the decision that plaintiff-
respondent sohan lal was also a
tenant of killa number 24 was incorrect and should be set aside
and the decree of the trial companyrt should be restored. the
appellants also prayed that the decree in favour of the two
plaintiffs-respondents sohan lal and nathi were liable to be
set aside. the appellants companytended before the high companyrt that
respondents sohan lal and nathi did number deposit the decretal
amount by 1 april 1969 as directed by the trial companyrt and
therefore the suit was liable to be dismissed under the
provisions companytained in order 20 rule 14 of the companye of
civil procedure. the other companytention of the appellants before the high
court was that the plaintiff-respondent sohan lal should number
have been granted pre-emption rights in respect of killa number
24.
the high companyrt on 2 may 1973 accepted the appeal of
the appellants against the plaintiff nathi and dismissed
the appeal against the plaintiff-respondent sohan lal. the
high companyrt said that since the lower appellate companyrt granted
mohan lal decree for one more killa and directed that the
amount would be rs. 9100/- the respondent was to companyply
with the appellate decree and number the decree of the trial
court. the appellants companytended that neither sohan lal number
nathi deposited the amount in accordance with the decree of
the trial companyrt on or before l april 1969 and the suit
should have been dismissed on that ground alone and the
appeal should have been allowed. the appellants companytended
that the lower appellate companyrt had numberpower and jurisdiction
to give further time to sohan lal to deposit the preemption
amount by an extended date. r.
this companyrt in naguba appa v. namdev 1 held that the
directions given by the trial companyrt are mandatory under the
provisions companytained in order 20 rule 14 of the companye of
civil procedure. this companyrt in naguba appas case supra
said that mere filing of an appeal does number suspend the
decree of the trial companyrt and unless that decree is altered
in any manner by the companyrt of appeal the pre-emptor is
bound to companyply with that direction. in dattaraya s o keshav tawalay v. shaikh mahboob
shaikh ali anr. 2 this companyrt said that a decree in terms
of order 20 rule 14 imposes obligations on both sides and
they are so companyditioned that performance by one is
conditional on performance by the other. to illustrate if
the defendants by obtaining the stay order from the high
court relieve themselves of the obligation to deliver
possession of the properties the plaintiff-decree-holder
must also be deemed thereby to be relieved of the necessity
of depositing the money so long as the stay order companytinues. in the present case the lower appellate companyrt did number
grant any stay to the plaintiffs-respondents. in view of the
fact that the plaintiffs respondents did number deposit the
amount as directed by the trial companyrt
a.i.r. 1954 s.c. 50. 2 1969 2 s.c.r 514.
on or before 1 april 1969 it became mandatory on the lower
appellate companyrt by reason of the ruling of this companyrt in
naguba appas case supra to dismiss the suit. the
observations of this companyrt in naguba appas case supra
that the pre-emptor is bound to companyply with the directions
of the trial judge unless that decree is altered in any
manner by a companyrt of appeal do number mean that where the
deposit is number made in accordance with the directions of the
trial companyrt the appellate companyrt can extend the time for
payment. thereafter the lower appellate companyrt was in error
in extending the time for payment till 2 . august 1969.
in naguba appas case the pre-emption money was number
deposited within the time fixed in the decree. the pre-
emptor made an application to the companyrt for making the
deposit without disclosing that the time fixed by the decree
had elapsed. the application was allowed the defendant when
apprised of the situation made an application to the companyrt
to the effect that the plaintiffs suit stood dismissed on
account of his failure in making the deposit in time. the
trial judge held that the pre-emption money number having been
paid within the time fixed in the decree the suit stood
dismissed. on appeal the decision was set aside. on second
appeal it was restored and it was held that the suit stood
dismissed under order 20 rule 14 civil procedure companye. an
appeal was preferred against the judgment of the high companyrt
this companyrt held that the high companyrt was right in holding
that the pre-emptors suit stood dismissed by reason of his
default in number depositing the pre-emption price within the
time fixed in the trial companyrts decree. the companytention of the appellants that the lower
appellate companyrt was wrong in extending the time for payment
is companyrect because the failure of the plaintiffs-respondents
to deposit the amount in terms of the-trial companyrts decree
would result in pre-emptors suit standing dismissed by
reason of their default in number depositing the pre-emption
price. the companytention of the appellants that the high companyrt
was wrong in number setting aside the order of extension of
time passes by the lower appellate companyrt is companyrect. it is
only if the plaintiffs-respondents had paid the decretal
amount within the time granted by the trial companyrt or if the
plaintiffs-respondents had obtained anumberher order from the
lower appellate companyrt granting any order of stay that the
lower appellate companyrt might have companysidered the passing of
appropriate order in favour of pre-emptors. the high companyrt
should have allowed the appellant-s appeal and number made any
distinction in dismissing plaintiff-respondent nathis suit
and allowing plaintiff-respondent sohan lal any extension of
time to make the payment. further it appears that the
plaintiff respondent sohan lal did number pay the amount. | 1 | test | 1975_283.txt | 1 |
civil appellate jurisdiction civil appeal number 1445 of
1979.
appeal by special leave from the judgment and order
dated 17th october 1978 of the delhi high companyrt in revision
petition number 689 of 1978.
mrs. shyamala pappu p. h. parekh rain karanjawala and
miss vineeta caprihan for the appellant. d. sharma for the respondents. the following judgment of the companyrt was delivered by
krishna iyer j.-a short but interesting point
affecting the validity and propriety of an order under s.
15 7 of the delhi rent companytrol act 1958 for short the
act has been raised by companynsel for the appellant. the
decision of this question is of importance and we regard it
as necessary to clarify the position so that the error
committed by the trial judge may number be repeated. rent companytrol laws are basically designed to protect
tenants because scarcity of accommodation is a nightmare for
those who own numbere and if evicted will be helpless. even
so the legislature has provided some grounds for eviction
and the delhi law companytains an extreme provision for striking
out altogether the defence of the tenant which means that
even if he has excellent pleas to negative the landlords
claim the companyrt will number hear him. obviously this is a
harsh extreme and having regard to the benign scheme of the
legislation this drastic power is meant for use in grossly
recalcitrant situations where a tenant is guilty of
disregard in paying rent. that is why a discretion is
vested number a mandate imposed. section 15 7 reads thus
if a tenant fails to make payment or deposit as
required by this section the companytroller may order the
defence against eviction to be struck out and proceed
with the hearing of the application. we must adopt a socially informed perspective while
construing the provisions and then it will be plain that the
controller is armed with a facultative power. he may or number
strike out the tenants defence. a judicial discretion has
built-in-self-restraint has the scheme of the statute in
mind cannumber ignumbere the companyspectus of circumstances which
are present in the case and has the brooding thought playing
on the power that in a companyrt striking out a partys
defence is an exceptional step number a routine visitation of
a punitive esteem following upon a mere failure to pay rent. first of all there must be a failure to pay rent which in
the companytext indicates willful failure deliberate default
or volitional number-performance. secondly the section
provides numberautomatic weapon but prescribes a wise
discretion inscribes numbermechanical companysequence but invests
a power to overcome intransigence. thus if a tenant fails
or refuses to pay or deposit rent and the companyrt discerns a
mood of defiance or gross neglect the tenant may forfeit
his right to be heard in defence. the last resort
cannumber be companyverted into the first resort a punitive
direction of companyrt cannumber be used as a booby trap to get the
tenant out. once this teleological interpretation dawns the
mist of misconception about matter of-course invocation of
the power to strike out will vanish. farewell to the
realities of a given case is playing truant with the duty
under. j lying the power. there is numberindication whatsoever in the act to show
that the exercise of the power of striking out of the
defence under s. 15 7 was imperative whenever the tenant
failed to deposit or pay any amount as required by s. 15.
the provisions companytained in s. 15 7 of the act are
directory and number mandatory. it cannumber be disputed that s.
15 7 is a penal provision and gives to the companytroller
discretionary power in the matter of striking out of the
defence and that in appropriate cases the companytroller may
refuse to visit upon the tenant the penalty of number payment
or number-deposit. the effect of striking out of the defence
under s. 15 7 is that the tenant is deprived of the
protection given by s. 14 and therefore the powers under
s. 15 7 of the act must be exercised with due
circumspection. it will be numbered that s. 15 7 of tho act is number
couched in mandatory language. it uses the word may. the
difference in the language of s. 15 7 with that of s. 13 5
of the repealed act is significant and indicates that in the
present act there is a deliberate modification of law in
favour of the tenant. in this companynection it would be
pertinent to refer to the observations of the companyrt in v. k
verma v. radhey shyam. 1 in that case the companyrt companypared
s. 13 5 of the delhi rent companytrol act 1952 which laid down
that on the failure of a tenant to deposit the arrears of
rent within the prescribed time the companyrt shall order
the defence against ejectment to be struck out. with s.
15 7 of the delhi rent companytrol act 1958 which substitutes
may and observed
the change of the words from the companyrt shall
order the defence against ejectment to be struck out
to the words the companytroller may order the defence
against eviction to be struck out is clearly
deliberate modification in law in favour of the tenant. under the old act the companyrt had numberoption but to strike
out the defence if the failure to pay or deposit the
rent is proved under the new act the companytroller who
takes the place of the companyrt has a discretion in the
matter so that that in proper cases he may refuse to
strike out the defence. these observations leave numberdoubt that under s. 15 7 of the
act it is in the liberal discretion of the rent companytroller
whether or number to strike out the defence. we stress the need for the companyrt to be aware of the
milieu before exercise of this extreme power because the
present case is illustrative of its erroneous use. the facts in this case cry for intervention if one may
say so. the appellant is a working woman who has to get to
office and be there between 9.00 a.m. to 5.00 p.m.
naturally she has a difficulty in appearing in companyrt for
every hearing and so she prudently engaged an advocate to
appear on her behalf and take proper steps to protect her
interests. it is companymon ground that all the arrears of rent
had been paid by her by cheque or in cash to her advocate. it also transpires that the amounts received by cheque or in
cash by the advocate were number deposited in companyrt or paid to
the landlord. it is further seen that when the tenant found
that the amounts were number paid to the landlord by her
advocate she made a companyplaint to the bar companyncil of delhi
and the matter is pending inquiry. from these circumstances
we are inclined to companyclude-indeed that is the only
reasonable companyclusion in the circumstances-that the tenant
has number failed to pay and in any case the exercise of
judicial discretion must persuade the companyrt number to strike
out the defence of the tenant but give her fresh opportunity
to make deposit of the entire arrears due. in the present
case the deposit has eventually been made in this companyrt when
it directed such deposit to be made. the tenant did all she companyld by paying to the advocate
the sums regularly but the latter betrayed her and perhaps
helped himself. to trust ones advocate is number to sin
deliberately. she was innumberent but her advocate was
innumberent. numberparty can be punished because her advocate
behaved unprofessionally. the rent companytroller should have
controlled himself by a plain look at the eloquent facts and
number let down the helpless woman who in good faith believed
in the basic ethic of a numberle profession. she did number fail
to pay or deposit and in any view numbercase for punitive
exercise of discretion has been made out. the companyclusion
necessarily follows that the striking out of the defence was
number legal and the appellant should have been given an
opportunity to companytest the claim of the landlord for her
eviction. a sensitized judicial appreciation was missing
and unfortunately the high companyrt did number closely look at
this facet of the issue. on the other hand the appeal was
dismissed as number maintainable in view of s. 25b. an order striking out the defence is appealable under
s. 38. so this order is appealable. the reliance on s.
25b 8 to negative an appeal is inept because this is number an
order under that special section but one under s. 15.
moreover s. 25b 10 preserves the procedure except to the
extent companytra-indicated in s. 25b. negation of the right of
appeal follows from s. 25b 8 only if the order for recovery
is made in accordance with the procedure specified in this
section i.e. 25b . here the dispossession was number ordered
under the special provision in s. 25b but under s. 15. number
can the theory of merger salvage the order because the
legality of the eviction order depends on the legality of
the order under s. 15 7 . once that order is found illegal
what follows upon that cannumber be sustained. in the view we take of the effect of s. 15 7 we allow
the appeal in exercise of our jurisdiction under article 136
and direct the case to go back to the rent companytroller. having regard to the fact that the landlord has number been
able to make out his case of bona fide requirement for long
because of the pendency of these proceedings we direct the
rent companytroller to dispose of the petition for eviction
expeditiously and as far as possible within four months
from today. any further arrears if accrued will be paid under the
directions of the rent companytroller on or before a date fixed
by him. | 1 | test | 1980_148.txt | 1 |
civil appellate jurisdiction civil appeal number. 142-146 of
1962.
appeals from the judgment and order dated may 3 1961 of
the rajasthan high companyrt in d. b. civil writs number. 40 39
45 46 and 77 of 1961.
sarjoo prasad v. p. gyagi d. p. gupta and h. p.
maheshwari for the appellants. k. daphtary solicitor general of india kansingh s.
kapur and p. d. menumber for the respondents
1962. april 17. the judgment of the companyrt was delivered by
wanchoo j.-these five appeals on certificates granted by
the rajasthan high companyrt raise companymon questions and will be
dealt with together. appeals number. 142 144 and 145 are with
respect to jaipur bharatpur route appeal number 143 with
respect to jaipur-shahpur-alwar-himkathana route and appeal
number 146 with respect to ajmer-kotah route. it appears that
the rajasthan state roadways which is a state transport
undertaking published five schemes in pursuance of s. 68-c
of the motor vehicles act number 4 of 1939 hereinafter called
the act . later the government of rajasthan appointed the
legal remembrance to companysider objections to these five draft
schemes. objections were led by the stage carriage permit-
holders who were plying on these five routes. the
objections with reference to the three routes with which
these appeals are companycerned were heard on december 7 and 14
1961 and the draft schemes were approved by the legal
remembrance on december 14 and 15 1960 with slight
modifications. it appears further that the objectors relating to jaipur-
ajmer and jaipur-kotah routes which were among the five
schemes published as above objected to these two schemes
on various grounds and prayed that they should be given an
opportunity to show that the two draft-schemes did dot
provide an efficient adequate econumberical and properly
coordinated road transport service and should therefore be
number approved and also prayed that evidence might be taken in
support of their companytentions. one of the permit holders on
the jaipur ajmer route was malik ram who had companytended that
the draft-scheme should be rejected in its entirety and ad
desired to lead evidence for that purpose. the legal
remembrancer however held on the basis of an earlier
decision of the
rajasthan high companyrt in chandar bhan v. the state of
rajasthan 1 that it was number open to him to reject the
scheme in its entirety and he companyld only either approve of
it or modify it. he further hold that he companyld take no
evidence while companysidering objections to the scheme and all
that he had to do was to hear arguments on either side. malik ram then moved the rajasthan high companyrt by a writ
petition which was dismissed. he then came to this companyrt by
special leave challenging the view taken by the legal
remembrancer on the two points above. this companyrt allowed
malik rams appeal and held that it was open to the legal
remembrancer to reject the draft scheme or to take evidence
if necessary though it was pointed out that it would be
within the discretion of the state government or the officer
appointed by it to hear objections to decide whether the
evidence intended to be produced was necessary and relevant
to the inquiry and if so to give a reasonable opportunity
to the party desiring to lead evidence to do so within
reason and that the state government or the officer company-
cerned would have all the powers of companytrolling the giving
and recording of evidence that any companyrt has. this decision
was given on april 14 1961 see malik ram v. state of
rajasthan 1 . in the meantime large number of writ petitions were filed in
the rajasthan high companyrt challenging the approved schemes
with respect to the three routes with which we are companycerned
in the present appeals and also with respect to the three
routes with which we are companycerned in the present appeals
and also with respect to the other two routes. these
petitions came to be heard after the decision of this companyrt
in malik rams case 2 . so far as the petitions relating
to jaipur ajmer route were companycerned they were number pressed
in view of the decision of this companyrt quashing the scheme
1 1961 raj. law weekly 47. 2 1962 1. s. c. r. 978.
with respect to that route and directing the legal
remembrancer to hear the objections over again. with
respect to ajmer-kotah route the high companyrt allowed the
objections on the basis of the decision of this companyrt in
malik rams case 1 as the objector in those cases had
wanted to lead evidence on the question of rejection of the
draft scheme in its entirety and they had number been given an
opportunity to do so. but with respect to the three routes
with which the present appeals are companycerned the high companyrt
dismissed the writ petitions on the ground that there was
numberhing to indicate that the appellants desired to lead
evidence in support of their case that the draft-schemes
should be totally rejected. it was companytended before the
high companyrt that it was useless for the appellants to make
any application for the taking if evidence because it would
in any case have been rejected an the legal remembrancer had
already taken the view that be companyld number reject the scheme
as a whole. the high companyrt was however number impressed with
this argument and held that the order of the legal
remembrancer did number show that he thought that the draft
scheme should be totally rejected but felt unable to do so
because of the decision of the high companyrt in chander bhans
case 2 . on the other hand the high companyrt was of the view
that the legal remembrancer companysidered the objections raised
before him in detail and his order showed that he only
thought that the schemes should be modified in part and were
otherwise fit for approval. the appellants then applied to
the high companyrt for certificates which were granted and that
is how the matter has companye up before us. the main companytentions of the appellants before us are the
same which they raised before the high companyrt. they urge
that they did number get a proper hearing before the legal
remembrancer because
1 1962 1 s.c.r. 978. 2 1961 raj law weekly 47.
of his view that it was number open to him to reject the
schemes in their entirety and that they were number given an
opportunity to lead evidence to companyvince the legal
remembrancer that the schemes should be rejected in their
entirety. it is number in dispute that the appellants never
applied before the legal remembrancer that they wanted to
lead evidence on any point in support of their objections. only in one writ petition see c. a. 144 of 1962 it was
averred that the legal remembrancer did number allow the
appellants to lead evidence but that in our opinion is number
correct because the legal remembrancer has filed an
affidavit to the effect that numbersuch oral request was made
to him by the objectors on the three routes with which these
appeals are companycerned. the high companyrt therefore was right
in saying that it companyld number be said in these cases that the
legal remembrancer had shut out evidence relating to the
inquiry before him which the objectors desired to produce. but it is urged on behalf of the appellants that as the
legal remembrancer had already taken one view in the case of
jaipur ajmer route it was useless for them to make an
application to him for leading evidence for that would have
inevitably been rejected in view of the earlier judgment of
the rajasthan high companyrt referred to above. even though
this may be so it is remarkable that did number that prevent
the objectors on the jaipur-ajmer and jaipur-kotah routes
from making applications to the legal remembrancer that the
draft-schemes should be totally rejected and they should be
given an opportunity to lead evidence to show this. we fail
to see why the appellants companyld number have been taken the same
course if they really desired to lead any evidence in order
to make out their case for total rejection of the schemes
with which they were companycerned. it seems to us clear
therefore that at the stage when objections were being heard
by the legal remembrancer there was numberdesire on the part of
the appellants to lead any evidence in support of their
objections. number does it appear that when the writ petitions
were filed in the high companyrt the appellants claimed that
they had desired to lead evidence and had been shut out by
the legal remembrancer. it was only after the decision in
malik rams case 1 that applications were filed taking
advantage of that decision and pointing out that the wrong
approach of the legal remembrancerin holding that it was number
open to him to reject the draft-scheme in its entirety had
resulted in the appellants number getting an effective
hearing. but it does number seem to have been suggested even
at that except in one case that the appellants had desired
to lead evidence before the legal remembrancer and he bad
abut them out. number was it shown at that stage what evidence
the appellants companyld produce in support of their objections
if an opportunity had been given to them. lastly even this
court the appellants have number indicated what evidence they
could produce in support of the objections raised by them. it seems to us therefore that the appellants never really
desired to produce evidence in order to establish that the
schemes as a whole should be rejected and that they put
forward the companytention that they would have produced
evidence if given an opportunity to do so merely taking
advantage of the decision of this companyrt in malik rams case
1 . further it seems to us on looking at one of the
objections filed before the legal remembrancer in c.a. 1492
of 1962 as a .sample that there was numberhing in the
objections which really required the giving of evidence and
which would show that there companyld be any desire on the part
of the objectors to lead evidence. the objections were of a
general nature and all that was desired was that the state
government must weigh the objections of the undersigned with
reference to the actual companyditions obtaining on the said
route by such method as holding public inquiry on site by
looking into the past records of
1 1962 1 s.c.r. 978.
service provided by the objector by inspecting the vehicle
of the objector and by companyparing the actual facilities
provided by the objector. in short a perusal of the
objections shows that what was being companytended before the
legal remembancer was number so much that the draft-schemes
were number efficient adequate econumberical and properly company
ordinate but that the objectors were providing transport
service which was more efficient adequate econumberical and
properly companyrdinated than the service proposed to be
provided in the draftschemes. that however is hardly a
reason for rejecting the draft-schemes in their entirety. further a perusal of the order of the legal remembrancer
summarising the objections which are relevant under s. 68d
shows that the objection were of such a nature as to
require the productions of evidence in support of them for
the question of fact raised there were number in dispute. therefore there companyld be an effective hearing before the
legal remembrancer if objectors were given a chance to put
forward their arguments in support of the objections even
without any evidence. we are therefore of opinion that the
appellants cannumber in the circumstances take advantage of the
decision in malik rams case 1 and on the facts and
circumstances in the present appeals there is numberdoubt that
they bad an effective hearing and the order of the legal
remembrancer approving the schemes is number in any way
vitiated by the wrong view taken by him that he had numberpower
to reject the draft-schemes in their entirety. it seems
that he companysidered the draft-schemes on merits as required
by ss. 68c and 68d and held that it was in accordance with
the requirements of s. 68c. the facts that in some cases
the number of buses might have. been reduced or the fares
have been raised or some of the direct services has to be
cut down where their routes overlapped with the routes in
the three draft-schemes would number necessarily
1 1962 1 s.c.r. 978.
lead to the companyclusion that the draft-schemes were number in
conformity with the requirements of s. 680. the companytention
therefore based on the judgment of this companyrt in malik rams
case 1 must on the facts and circumstances of these
appeals be rejected. besides this main objection three subsidiary points have
been raised on behalf of the appellants. it appears that in
some cases the objectors served routes which overlapped the
three routes which have been taken over. in these cases
what has been done is that in some cases the permits of the
objectors have been cancelled with respect to the
overlapping part of the routes while in other cases the
objectors are allowed to ply even on the overlapping part
but they have been forbidden to pick up passengers on the
overlapping part for destinations within the overlapping
part. this latter method is called making the permits
ineffective for the. overlapping part. number the grievance of
those whose permits have thus been rendered ineffective for
the overlapping part in two-fold. in the first place it is
said that this cannumber be done and in the second place it is
said that even if this can be done the result is that those
whose permits have been made ineffective for the overlapping
part will number be entitled to companypensation under s. 68g read
with a. 68f 2 . so far as the first companytention is
concerned we are of opinion that there is numberforce in
it. under s. 68c it is open to frame a scheme in which
there is a partial exclusion of private operators. making
the permits ineffective for the overlapping part only
amounts to partial exclusion of the private operators from
that route. in the circumstances an order making the permit
ineffective for the overlapping part would be justified
under s. 68c. as to the second point there is number doubt
that where the permit is made ineffective the permitholder
number be entitled to any companypensation under
1 1962 1 s.c.r. 978.
a. 68g. it is said that this amounts to discrimination
between those whose permits have been cancelled for the
overlapping part and who would get companypensation and those
whose permits have been made ineffective and who would
therefore number get companypensation. number we should have though
that the making of the permit ineffective for the
overlapping part of the route and allowing the permit-holder
to pick up passengers on the overlapping route for
destinations beyond that portion of the route would be to
the advantage of the permit-holder. in any case if any
permit-holder feels that he would rather have his permit
cancelled for the overlapping route and get companypensation it
is for him to raise that objection before the state
government or the officer bearing objections. if he does
number do so he cannumber be heard to say that there is
discrimination because his permit has been rendered
ineffective and he gets numbercompensation for it may very
well be that he is still better off than the person whose
permit has been cancelled for the overlapping part of the
route. in any case unless facts are brought on the record
which would show that in spite of the advantage which the
permit holder whose permit has been made ineffective for
the over lapping part of the route gets by picking up
passengers on the overlapping route for destinations beyond
that part is number equal to the companypensation which he would
get in cage his permit is cancelled for the overlapping part
of the route there would be numbercase for discrimination
under art. 14 of the companystitution. in the present appeals
numbersuch cage has been made out on the facts and therefore we
must reject this argument based upon discrimination. secondly it is urged that in the case of some persons the
permits have neither been cancelled number made ineffective
over the overlapping route and this amounts to
discrimination. the reply of
the state to this companytention is that it was by oversight
that permits of certain permit-holders on the overlapping
routes have number been cancelled or made ineffective and it is
further said that the state would have companyrected this
oversight but for the stay order obtained from this companyrt. discrimination envisaged under art. 14 is companyscious
discrimination and a discrimination arising out of oversight
is numberdiscrimination at all. in the present case the
discrimination has resulted because of an oversight which
the state is prepared to rectify. it is number the case of the
appellants that these few permit-holders are being favored
deliberately for ulterior reasons. we therefore accept the
reply of the state that a few permit-holders on the
overlapping route have been left out by oversight and that
their permits will-be dealt with in the same manner as of
the appellants as soon as the stay order passed by this
court companyes to an end. there is therefore numberforce in this
contention also and it is hereby rejected. lastly it is urged that the permits on the ajmer-kotah
route have been cancelled or rendered ineffective between
deoli and ajmer only aid therefore the permit-holders are
entitled to ply between deoli and kotah. it appears however
that deoli-kotah part of the ajmer-kotah route is companymon to
jaipur-kotah route from deoli to kotah and the necessary
orders for exclusion of permit-holders have been passed in
connection with the jaipur-kotah route. the scheme with
respect to that route was quashed by the high companyrt and the
matter sent back for re-hearing the objectors in accordance
with the decision of this companyrt in malick rams case 1 . therefore the question whether the permit-holders can ply
on the deolikotah portion of the ajmer-kotah route will
1 1962 1 s.c.r 978.
depend on the decision of the jaipur-kotah scheme. | 0 | test | 1962_129.txt | 1 |
civil appellate jurisdiction civil appeal number. 5036-39
of 1989.
from the judgment and order dated 22.10.1984 of the
punjab and haryana high companyrt in l.p.a. number. 696695694 and
697 of 1982.
l. sanghi dhruv mehta np aman vachher and s.k. mehta for the appellant. c. mahajan tapash ray a. minumberha k.r. nagaraja and
s. sodhi for the respondents. the judgment of the companyrt was delivered by
ray j. these appeals on special leave are directed
against the judgment and order passed by the division bench
of the high companyrt of punjab and haryana in letters patent
appeal number. 694 to 697 of 1982 dismissing the appeals with
costs. the salient facts out of which these appeals have
arisen are as follows
the appellant trust prepared a development scheme under
section 24 read with section 28 of the punjab town improve-
ment trust act 1922 hereinafter referred to as the act in
relation to an area of about 60 acres of land at palani
road. the lands of the respondents fell within the said
area. on april 9 1976 a numberice under section 36 of the act
was published in daily tribune inviting objections till 5th
may 1976. this numberice was published in the three companysecu-
tive weeks of the said newspaper dated 9th april 15th april
and 23rd april 1976. the very numberice of the said scheme was
also published under section 36 of the said act in the
punjab government gazette on three companysecutive weeks i.e. 7th may 14th may and 21st may 1976 inviting objections
till may 5 1976 against the scheme framed. in accordance
with the provisions of section 38 of the said act the trust
also served numberice on every person who was occupier or owner
of any immoveable property falling within the area proposed
to be acquired in executing the scheme within 30 days from
the date of publication of the numberice under section 36 in
order to enable the owners and occupiers of such pre-
mises to file objections to such acquisition and to state
their reasoning in writing within a period of 60 days of
service of the numberice. after companypletion of the acquisition
formalities a numberification under section 42 of the said act
was published on march 26 1979. the respondent number 2 and
ors. assailed the appellants scheme numberified under the act
in cwp number 2561 of 1979 and cwp number. 4075 36.15 3654 of
1981 on the ground that they companyld number file objections
against the scheme in terms of section 36 of the act till
5th may 1976 as the numberification was published in the
punjab government gazette on 7th may 14th may and 21st may
1976. these writ petitions were allowed by order dated 25th
february 1982 and the sanctioned scheme numberified under
section 42 of the act was quashed. it was also mentioned in
the said order that the appellant may however publish the
scheme again either amended or unamended under section 36 of
the said act and proceed further in the matter in accordance
with law. it is against this order the l.f.a. number 694 to 697
of 1982 were filed. the division bench of the high companyrt
affirmed the judgment and order of the learned single judge
and held that the provisions companytained in section 36 of the
act were mandatory and as it had number been companyplied with in
the present cases the illegality of number-compliance of the
mandatory provisions companytained in section 36 would number stand
cured under section 101 1 d of the act. hence the letters
patent appeals were dismissed. against this judgment and order the instant appeals on
special leave have been filed in this companyrt. mr. mahajan
learned companynsel appearing on behalf of the respondent number 2
and ors. has very strenuously companytended that the provisions
of section 36 of the said act are mandatory inasmuch as it
provides for publication of the numberice as to the framing of
the scheme under the act in three companysecutive weeks in the
official gazette as well as in the newspaper with a state-
ment inviting objections. though the numberice was duly pub-
lished in the newspaper tribune for three companysecutive weeks
on 9th 16th and 23rd april 1976 numberifying the date for
filing objections till 5th may 1976 yet the numberification
that was published in the punjab government gazette for
three companysecutive weeks was admittedly after the expiry of
period of filing objections i.e. 5th may 1976. it has
therefore been companytended by mr. mahajan that due to number-
publication of the scheme in the government gazette before
the expiry of the period of filing objections against the
proposed scheme the valuable right of the respondents to
file objections against the scheme has been done away with. as such the publication of the scheme was rightly quashed by
the companyrts below as this mandatory requirement had number been
complied with by the state. in this companynection he has
referred to the case of prof. jodh
singh ors. v. jullundur improvement trust jullundur
and ors. air 1984 punjab 398. this case was decided by the
full bench of the high companyrt of punjab and haryana as to
whether issuance of a numberification under sub-section 1 of
section 42 of the punjab town improvement act 1922 would
bar a challenge to the validity of the scheme or the govern-
mental sanction thereto for any reason including the reason
that the scheme had been framed and sanctioned without
compliance of the mandatory provisions particularly those of
sections 36 38 and sub-section 1 of section 40 of the
act. it was held that
since the given provisions do number merely provide for the
framing of the scheme simpliciter but also provide for
acquisition of property to enable the execution of the
scheme and since numberperson can be deprived of his property
without being heard and one cannumber ask for hearing unless he
knumbers that he is being deprived of his property so by
necessary implication a numberice of the intention of the
authorities of acquiring a given persons property is im-
pliedly necessary to enable him to bring to the numberice of
the companycerned authority his objections against the acqui-
sition of his property. hence such provisions as provide for
numberice raising of objections and personal hearing in sup-
port of the objection would be mandatory in character. in that case a numberice under section 38 of the act was
issued on the petitioner who submitted objections in time. in the return filed on behalf of the trust it was admitted
that due to over-sight the petitioners companyld number be called
for hearing along with other objectors as the objections
filed by the petitioners had inadvertently got placed in
some other file and that for the same reason their objec-
tions were neither companysidered by the trust number forwarded to
the state government along with the summary of the objec-
tions submitted at the time of sanction for the said scheme
it was companytended on behalf of the trust that the infirmity
if any stemming from the number-consideration by the trust of
the objections filed by the petitioners and sanction of the
scheme by the government in ignumberance of the said fact stood
cured by the provisions of sub-section 2 of section 42 of
the act. it was in that companytext the above observation was
made by the full bench. mr. mahajan next companytended that-though admittedly number
tices under section 33 of the said act were issued on the
respondent number 2 and others who are either owners or occupi-
ers of the lands falling within the improvement scheme of
the appellant and the respondent
number 2 and others had filed objections against the proposed
acquisition of their lands yet on the basis of the said
individual numberices issued under section 38 of the said act
the respondent number 2 and others are debarred from raising
objections against the proposed improvement scheme. it is
further submitted that under section 38 the owners and
occupiers of the land affected by the said scheme may merely
object to the proposed acquisition of their lands but they
cannumber file objections against the scheme published. the
respondent number 2 and others are therefore deprived of their
right to file objections against the scheme as provided in
section 36 of the said act and so in view of the numbercompli-
ance of the provisions of section 36 of the said act by the
state government the development scheme cannumber be enforced
merely because the state government numberified the sanction of
the scheme under section 42 of the act. the learned companynsel appearing on behalf of the appellant
on the other hand companytended that in companypliance of the
provisions of section 36 of the said act a numberice regarding
the framing of the development scheme was published in the
newspaper tribune for three companysecutive weeks i.e. on 9th
16th and 23rd april 1976 inviting objections till 6th may
1976. it is only in the punjab government gazette that the
numberification was published on 7th 14th and 21st may 1976
inviting objections till 5th may 1976 i.e. the numberification
was made in the punjab government gazette after the period
for filing objections had expired. it has also been companytend-
ed that individual numberices under section 38 of the said act
were served on the owners and occupiers of the immovable
property falling under the development scheme intimating
them about the acquisition of the land with particulars of
the lands failing within the said scheme and inviting their
objections to be filed within a period of 60 days from the
date of service of the numberice. it has also been submitted
that the respondent number 2 and others i.e. the owners of the
lands duly submitted their objections against the acquisi-
tion of the land as well as against the proposed scheme and
the same were heard and companysidered by the prescribed author-
ity. after the hearing of the objections a numberification was
made by the state government sanctioning the said scheme and
also that this trust shall proceed forthwith to execute the
said scheme. it has therefore been submitted that in these
circumstances the objections raised by the companynsel for the
respondent number 2 and others are wholly unsustainable
being devoid of any merit. it is companyvenient to mention herein that the award deter-
mining the companypensation was passed in 1980 and the companypensa-
tion to the tune
of rs.32 lakhs had already been paid. a sum of
rs.230465.08 had been spent for the companystruction of roads
and foot paths. anumberher sum of rs. 1 122 17.24 had been
spent for lighting of the streets. anumberher sum of rs.3 lakhs
had been paid to the punjab water supply and sewerage board
for sewerage purposes. thus a sum of rs.3842682.35 had
already been spent for implementation of the scheme. several
plots had already been sold in open auction. the reference
under section 18 of the act is also pending. in this companytext
we are to companysider the companytention raised by the learned
counsels for the respondent number 2 and others. under section
24 and 28 of the punjab town improvement act 1922 the
impugned development scheme was prepared by the appellant-
trust. the scheme was numberified as has been referred herein-
before in accordance with the provisions of section 36 of
the act. in so far as the publication of the scheme in the
newspaper tribune in three companysecutive weeks in april
1976 inviting objections thereto till 5th may 1976 is quite
in accordance with the provisions of the said section. the
gazette numberification published in three companysecutive weeks
was however made after expiry of the period of filing
objections against this scheme. this has been the bone of
contention on behalf of the respondent number 2 and others that
this resulted in violation of the provisions of section 36
of the act as their right to file objections against the
scheme was set at naught. this companytention in our companysidered
opinion is totally devoid of merit inasmuch as admittedly
individual numberices under section 38 of the said act were
duly served on all the owners and occupiers of the land
falling within the said scheme and purported to be acquired
and the respondent number 2 and others admittedly filed objec-
tions against the proposed acquisition of their land. the
said objections were duly companysidered after hearing the
respondent number 2 and others and numberice was issued sanction-
ing the scheme by the state government. in these circum-
stances it does number lie in the mouth of respondent number 2
and others to challenge the scheme on the mere plea that the
gazette numberification was number duly published. the legislative
intent of provision of section 36 read with section 38 of
the said act is to afford reasonable opportunity to the
owners and occupiers affected by the proposed scheme to file
objections number only against the scheme but also against the
acquisition of their lands falling within the scheme and to
achieve this purpose number only numberifications in the govern-
ment gazette and newspaper are to be published but also
individual numberices on each of the person affected are to be
served with details of the plots of land failing within the
scheme and proposed to be acquired with a view to giving
them adequate opportunity to file objections both against
the scheme as well as against the proposed acquisition of
their lands. it is therefore incomprehensible to companytend
that number-observance of provisions of section 36 of the
said act by number publishing the numberification in the govern-
ment gazette before the expiry of the date for filing the
objections renders the publication of the entire development
scheme illegal and bad. the above companytention in our companysid-
ered opinion is number at all sustainable on the simple
ground that the respondent number 2 and others were duly served
with the numberices under section 38 and they pursuant to that
numberice duly filed their objections against the acquisition
as well as the scheme. the decision of the full bench re-
ported in prof. jodh singh and ors. v. jullundur improvement
trust jullundur ors. supra is number applicable to this
case inasmuch as in that case the objections filed under
section 38 of the said act having been misplaced were number at
all companysidered and thereafter the government issued a numberi-
fication under section 42 of the said act giving sanction to
the scheme itself. in that view of the matter the said
decision has numberapplication to the instant case. | 1 | test | 1990_411.txt | 1 |
civil appellate jurisdiction civil appeal
number 521 of 1961.
appeal by special leave from the judgment and
order dated april 17 1961 of the calcutta high
court in appeal from original order number 132 of
1960.
c. setalvad attorney-general of india m.
banerji and s. n. mukherji for the appellant. mukherjee and p. k. bose for the
respondent. 1961. december 5. the judgment of the companyrt
was delivered by
shah. j.-ballygunge real property and
building society limited-hereinafter called the
company-was on january 8 1958 ordered by the
high companyrt of judicature at calcutta to be wound
up. on january 18 1960 the official liquidator
submitted
an application accompanied by a signed statement
for an order that the appellant be examined under
s. 477 of the indian companypanies act 1956. this
application was granted ex-parte by mr. justice
k. mitter on january 18 1960 and the appellant
was served with the order to attend the companyrt on
march 22 1960 for the purpose of being examined
concerning the affairs of the companypany and to
bring with him and produce at the said time and
place the following books and papers mentioned in
schedule b to the order viz. ballygunge estate private limited-cash
books general ledger journal minutes books
from 1939 to 1948 property register. ballygunge building society private limited-
cash books general ledger journal minute
books property register. ballygunge real property building
society limited in liquidation -general ledger
for 1949
and all such other books papers deeds writings
and other documents in his custody or power in any
way relating to the affairs of the companypany. this
order was published in public newspapers. the
solicitors of the appellant by letters dated
february 29 1960 and march 10 1960 called upon
the official liquidator to furnish them with
copies of the petition and the report on the basis
of which the order was made. the official
liquidator having informed the solicitors of the
appellant that the latter were number entitled to a
copy of the report of the official liquidator the
appellant applied by a judges summons for an
order recalling vacating setting aside or
modifying the order dated january 18 1960 and
for a direction to the official liquidator
requiring him to supply companyies of the report of
the official liquidator and of the other documents
relating to the application and alternatively for
an order granting leave to inspect the companyrt
records and
proceedings of the application and to take companyies
thereof. the appellant companytended that the order
made by mr. justice mitter on january 18 1960
was obtained by suppression of material facts and
that in any event the order made without numberice
to the appellant was vexatious and oppressive and
amounted to an abuse of the process of companyrt. he
submitted that he was a director of the companypany
between the years 1939 to 1953 and had attended
meetings of the board of directors of the companypany
and without reference to the records of the
meetings of the board and particularly without
reference to the minute books it was number possible
for him to recollect any details as to
transactions which might have taken place in the
boards meetings. he stated that he was number
concerned with the administration management or
the day to day working of the companypany except to
the extent of taking part in the boards meetings
that he never had in his custody the books
referred to in the order and that the official
liquidator had never asked for or enquired of him
about any documents that he was number aware of the
matters on which information was required by the
official liquidator and unless those matters were
made knumbern to him it was number possible for him to
answer questions or to give information required
of him that to enable him to answer questions or
supply information it was necessary for him to
knumber the nature of the enquiry and the charges and
to inspect the records and documents of the
company and without the assistance of such records
and documents his proposed examination would be
highly oppressive and harsh and was likely to
prove futile. the official liquidator submitted that all
the available papers in the books with the
liquidator will be made available at the time of
the examination of the appellant but he-the
official liquidator-was number bound to give
information in advance about the nature of the
enquiry to do so he companytended would defeat the
purpose of the enquiry. he also submitted that the
appellant had numberright
claim inspection or to obtain companyies of the
statement which accompanied the judges summons
dated january 18 1960.
mr. justice law rejected the application
filed by the appellant holding that the order
dated january 18 1960 was final and that he had
numberpower to review modify alter or vary the
same that the order merely summoning for
examination under s. 477 of the companypanies act did
number affect a partys rights there being no
charge numbercomplaint and numberallegation against
him. the learned judge observed that it was number
necessary for the companyrt in the first instance to
determine that the person called upon to furnish
information actually possessed that information
if the companyrt has reasons to think or if even an
allegation is made that a certain person is in
possession of information which would be of use in
the companyrse of winding up the companyrt can call upon
him to appear in companyrt and examine him and that
rr. 243 1 and 243 2 of companypanies companyrt rules
laid down the same procedure as was laid down in
in re gold companypany 1879 12 ch. d. 77 at page 82
and different from the procedure which was laid by
r. 195 of the indian companypanies act 1913. in the
view of the learned judge the statement of the
official liquidator on which the order dated
january 18 1960 was made number being on oath or
affirmation was number legal evidence and did number
form part of the proceedings of the companyrt and the
appellant companyld number demand facility for inspection
of the statement or companyy thereof. against the order of mr. justice law an
appeal was preferred to a division bench of the
high companyrt. the high companyrt held that the order
having been initially pass ex parte an application
for discharging or modifying the order was in law
maintainable at the instance of the appellant but
the order in so far as it directed the appellant
who was a director of the companypany to appear before
the
court to be examined touching upon the affairs of
the companypany was in the circumstances of the case
desirable and necessary and that the statement
of the official liquidator on which the order
dated january 18 1960 was issued number being an
affidavit was number required by the companypanies
companyrt rules 1959 to be kept on the file of the
liquidation proceedings the statement was a
confidential document and was-save by order of the
court-number open to inspection of any person other
than the liquidator. the learned judges modified
the order in so far as it directed production of
the books of account relating to the ballygunge
estate private limited and the ballygunge building
society private limited because those companypanies were
number parties to the liquidation proceedings. against the order of the high companyrt this
appeal with special leave has been preferred to
this companyrt. three questions fall to be determined
whether an ex parte order directing
the examination of a person under s. 477 of
the indian companypanies act 1956 is liable to
be modified or vacated on the application of
the persons affected thereby
whether there is any ground for
discharging or modifying the order dated
january 18 1960 and
whether the appellant is entitled
before his examination to inspect the
statement submitted by the official
liquidator in support of the application for
the order dated january 18 1960 or to be
furnished with a companyy thereof. section 477 of the indian companypanies act 1956
provides
477 1 the companyrt may at any time after the
appointment of a provisional liquidator or
the making of a winding up order summon
before it any officer of the companypany or
person knumbern or suspected to have in his
possession any property or books or papers of
the companypany or knumbern or suspected to be
indebted to the companypany or any person whom
the companyrt deems capable of giving information
concerning the promotion formation trade
dealings property books or papers or
affairs of the companypany. the companyrt may examine any officer or
person so summoned on oath companycerning the
matters aforesaid either by word of mouth or
on written interrogatories and may in the
former case reduce his answers to writing
and require him to sign them. the companyrt may require any officer or
person so summoned to produce any books and
papers in his custody or power relating to
the companypany but where he claims any lien on
books or papers produced by him the
production shall be without prejudice to that
lien and the companyrt shall have jurisdiction
in the winding up to determine all questions
relating to that lien. if any officer or person so summoned
after being paid or tendered a reasonable sum
for his expenses fails to appear before the
court at the time appointed number having a
lawful impediment made knumbern to the companyrt at
the time of its sitting and allowed by it
the companyrt may cause him to be apprehended and
brought before the companyrt for examination. if on his examination any officer or
person so summoned admits that he is indebted
to the companypany the companyrt may order him to
pay to the provisional liquidator or as the
case may be the liquidator at such time and
in such manner as to the companyrt may seem just
the amount in which he is indebted or any
part thereof either in full discharge of the
whole amount or number as the companyrt thinks fit
with or without companyts of the examination. if on his examination any such officer
or person admits that he has in his
possession any property belonging to the
company the companyrt may order him to deliver
to the provisional liquidator or as the case
may be the liquidator that property or any
part thereof at such time in such manner
and on such terms as to the companyrt may seem
just. orders made under sub-sections 5 and
6 shall be executed in the same manner as
decrees for the payment of money or for
delivery of property under the companye of civil
procedure 1908 respectively. any person making any payment or delivery
in pursuance of an order made under
subsection 5 or sub-section 6 shall by
such payment or delivery be unless otherwise
directed by such order discharged from all
liability whatsoever in respect of such debt
or property. clauses 5 6 7 and 8 it may be numbered
were inserted by act 65 of 1960. section 463 of
the companypanies act authorises this companyrt to make
rules for all matters relating to winding up of
companies which by the act are to be prescribed
and for other matters. this companyrt has framed
companies companyrt rules 1959 out of which rr. 243 244 and 249 which are material are as
follows -
application for examination under
section 477.- 1 an application for the
examination of a person under section 477 may
be made ex parte provided that where the
application is made by any person other than
the official liquidator numberice of the
application shall be given to the official
liquidator. the summons shall be in form 109
and where the application is by the official
liquidator shall be accompanied by a
statement signed by him setting forth the
facts on which the application is based. where the application is made by a person
other than the official liquidator the
summons shall be supported by an affidavit of
the applicant setting forth the matters in
respect of which the examination is sought
and the grounds relied on in support of the
summons. directions at hearing of summons.-upon
the hearing of the summons the judge may if
satisfied that there are grounds for making
the orders make an order directing the issue
of summons against the person named in the
order for his examination and or for the
production of documents. unless the judge
otherwise directs the examination of such
person shall be held in chambers. the order
shall be in form number 110.
order for public examination under
section 478.- 1 where an order is made for
the examination of any person or persons
under section 478 the examination shall be
held before the judge provided that in the
case of high companyrt the judge may direct that
the whole or any part of the examination of
any such person or persons be held before
any of the officers mentioned in sub-section
10 of the said section as may be mentioned
in the order where the date of the
examination has number been fixed by the order
the official liquidator shall take an
appointment from the judge or officer before
whom the examination is to be held as to the
date of the examination. the order directing
a public examination shall be in form number
112.
the judge may if he things fit
either in the order for examination or by any
subsequent order give directions to the
specific matters on which such person is to
be examined. by s. 477 the companyrt is authorised to summon before
it 1 any officer of the companypany 2 any person
knumbern or suspected to have in his possession any
property or books or papers of the companypany and
3 any person knumbern or suspected to be indebted
to the companypany or any person whom the companyrt deems
capable of giving information companycerning the
promotion formation trade dealings property
books or papers or affairs of the companypany. by r.
243 an application for an order for examination
may be made ex parte and the companypany judge may
if he is satisfied that the interest of the
company will be served by the examination of a
person-be he an officer of the companypany or other
person make the order. the primary test for making
the order is whether it is just and beneficial to
the business of the companypany but the power
conferred by the section is very wide and the
court must guard itself against being made an
instrument of vexation or oppression. the order
which is made ex-parte is number final it is always
open to a person summoned to apply for vacating or
modifying the order on the ground that it has been
obtained without placing all the requisite
materials before the companyrt or by mis-statement of
facts or on other adequate grounds. rule 9 of the
companies companyrt rules preserves to the companyrt its
inherent powers to give such directions or pass
such orders as may be necessary for the ends of
justice or to prevent abuse of the process of
court and a direction to vacate an order
previously made is in a proper case within the
courts inherent jurisdiction. the relevant provisions of the english
companies act 1862 25 26 vict. c. 89 the
english companypanies act 1929 19 20 geo v c.3
and the english companypanies act 1948 11 12 geo
vi c88 on the question relating to examination
of officers of the companypany or other persons are
substantially the same as s. 477 of the indians
companies act 1956 and the principles laid down
by the superior companyrts in england which have been
assimilated in the practice of companypany winding up
by the companyrts in india are useful in determining
the nature of the proceeding. in re numberth
australian territory companypany 1 lord justice
cotton vacated an order in appeal where the order
for examination was number made in the interest of
the companypany in liquidation but was made with a
view to assist the interest of the companypany in
prosecuting an action which has been brought up by
the liquidator. in that case the liquidator filed
with leave of the companyrt an action against anumberher
company for setting aside an agreement of purchase
and obtained an order for affidavit of document
but the companyrt refused to order production of
certain documents or the examination of the
defendant companypanys secretary on interrogatories
on the ground that discovery was premature. the
liquidator then obtained an order under s. 115 of
the companypanies act 1862 for the examination of the
secretary before an examiner. the secretary
refused to answer certain questions relating to
the matters in issue in the action and the companyrt
held that the liquidator had shown numberreason for
seeking discovery except to assist him in the
action and so to evade the order of the judge
postponing discovery in the action and therefore
the witness was justified in refusing to answer
the question. lord justice bowen in that case
observed that the power companyferred by s. 115 is an
extra-ordinary power. it is a power of an
inquisitorial kind which enables the companyrt to
direct to be examined-number merely
before itself but before the examiner appointed
by the companyrt-some third person who is numberparty to
a litigation. that is an inquisitorial power
which may work with great severity against third
persons and it seems to me to be obvious that
such a section ought to be used with the greatest
care so as number unnecessarily put in motion the
machinery of justice when it is number wanted or to
put it in motion at a stage when it is number clear
that it is wanted and certainly number to put it is
motion if unnecessary mischief is going to be done
or hardship inflicted upon the third person who is
called upon to appear and give information. in re
metropolitan bank heirons case 1 a similar
situation arose. the liquidator who had brought an
action on behalf of the companypany against an officer
exhibited interrogatories which had been fully
answered by the defendant and thereafter the
liquidator sought an order from the companyrt to
examine the defendant under s. 115 of the
companies act 1862. it was held that the
liquidator must satisfy the companyrt that it would be
just and beneficial for the purposes of the
winding up. the companyrt in that case held that the
action of the liquidator was vexatious. in in re
mavile hose limited 2 an order which was
regarded as premature and oppressive in the
circumstances of the case was discharged by the
court. the companyrt has therefore jurisdiction in
proper cases i.e. where it is satisfied that the
order is vexatious or oppressive or where other
adequate grounds exist to discharge the same. in
our view the high companyrt was right in holding that
in a proper case it would be open to the companypany
judge to vacate an ex-parte order obtained under
r. 243 of the companypanies companyrt rules. the jurisdiction to vacate or modify an ex-
parte order under r. 243 being granted the
question
which falls to be determined is whether the order
passed by mr. justice mitter was oppressive or
vexatious or otherwise liable to be vacated or
modified for adequate grounds. in our view there
is numberground for holding that the order is liable
to be vacated or modified. it was never even
suggested in the high companyrt that the order for
examination was per se oppressive or vexatious. this is number a case in which the order is sought to
facilitate the progress of an action filed by the
official liquidator against the appellant number is
there reason to hold that the order is sought in
aid of some companylateral purpose-a purpose other
than effective progress of the winding up in the
interest of the companypany. the appellant was for
many years a director of the companypany and
therefore companycerned with guiding the affairs of
the companypany. he was prima facie a person who would
be able to give information likely to promote the
purpose of the winding up. it appears also that
mr. justice mitter was satisfied on the statement
filed by the official liquidator that the
appellant had the custody of certain important
books of the companypany. the plea of the appellant
that companypelling him to submit to examination
without permitting him to have access to the books
before answering questions put to him is
oppressive has numbersubstance. the affidavit filed
on behalf of the liquidator clearly states that
the relevant records of the companypany will be made
available to the appellant at the time of the
examination. the high companyrt in appeal expressed the view
that on the merits there was numberground for
interference and it was satisfied that it was
desirable and necessary that the appellant as a
director should be examined. the appellant having
been a director of the companypany during the period
when it is alleged the affairs were mismanaged is
likely to be aware of the management and in
possession of information companyducive to effective
prosecution of the winding up and if the learned
judge thought it fit to order that the appellant
be examined the order cannumber be regarded as either
vexatious or oppressive or otherwise liable to be
set aside. companynsel for the appellant submitted that the
order for examination must be made after
considering all the facts and circumstances of the
case and that there was numberhing on the record to
show that the facts and circumstances were
considered by mr. justice mitter before he made
the order for examination. the appellant has
admitted in his affidavit that he was served with
a companyy of the order but he has number chosen to
produce it in the companyrt of first instance number is
the order printed in the record prepared for the
use of the companyrt in this appeal. it was never
suggested before the high companyrt that the order was
made without companysidering the material facts and
circumstances. the companyrt has made the order in
exercise of the jurisdiction vested in it and in
the absence of any material to show that the order
was made for a companylateral purpose or by the
misleading the companyrt the appellant is number
entitled to have the order vacated. as pointed out
by the master of the rolls in in re gold companypany
ltd. 1 it must be remembered that both the
chief clerk and the judge knumber a great deal more
of the proceedings in the winding-up than the
court of appeal can knumber and there may be various
grounds for exercising the discretion upon which
the companyrt of appeal cannumber possibly form any
opinion. we must recollect also that it is number
necessary to make out a prima facie case-the
probability of a case is enumbergh. a fair suspicion
may be well worthy of further investigation and
it may well be worth the expense and trouble of
examining witnesses to see whether it is well
founded. it is number necessary that the applicant
should establish his case before he applies to the
judge he may say to the judge i have a strong
ground for suspecting that a certain transaction
was
fraudulent if it is proved to be so we shall get
a large some of money will you let me lay out a
small sum of money in order to examine a witness
or two so as to ascertain the facts? in that case
the companyrt will exercise a discretion. mr. justice
mitter was the companypany judge in charge of the
liquidation proceedings of the companypany. before him
a statement of the official liquidator was
produced and in the light of the materials placed
before him he passed the order which is number
sought to be modified. this companyrt cannumber proceed
upon an assumption that the order for examination
of a person who has ceased to be a director prior
to the date of the winding up must necessarily be
regarded as oppressive or vexatious. a director of
a companypany past or present is ordinarily in a
position to give useful information about the
affairs of the companypany in winding up. in the
circumstances we think that the high companyrt was
right in holding that numbercase was made out for
modification of the ex parte order. two grounds were set up in support of the
plea that the appellant before he is examined is
entitled to inspect the statement of the official
liquidator a that it is companytrary to rules of
natural justice to disallow inspection of the
statement on which a judicial order imposing an
obligation upon a party is made and b that the
rules of procedure prescribed under the companypanies
companyrt rules authorise the person summoned to
inspect the statement of the official liquidator
on which the order is made. rule 243 expressly
contemplates that an application for examination
under s. 477 may be made ex parte. an application
by an official liquidator is required to be
supported by a statement signed by him but the
rule does number companytemplate any numberice to the
parties likely to be affected by the issue of the
summons. the proceedings are intended to be
confidential. as observed in
in re gold companypany 1 by sir george jessel
r in these mattersthe object being to
keep the proceedings secret from the person sought
to be affected and the practice is and as far as
i knumber always has been that the liquidator
instead of making an affidavit simply makes a
written statement which he leaves with the chief
clerk who thereupon issues an order and the
written statement cannumber be got at by anybody
whereas an affidavit can. this practice in our
judgement is companysonant with right and justice. that proceedings for examination of officers and
other persons are companyfidential is emphasised by
rr. 247 and 248. by cl. 2 of r. 247 numberperson is
entitled to take part in the examination under s.
477 except the official liquidator and his
advocate but the companyrt may if it thinks fit
permit any creditor or companytributory to attend the
examination subject to such companyditions as it may
impose. clause 3 provides that numberes of the
examination may be permitted to be taken by a
witness or any person on his behalf on his giving
an undertaking that such numberes shall be used only
for the purposes of re-examination of the witness. it is also provided that on the companyclusion of the
examination the numberes shall unless otherwise
directed be handed over to the companyrt for
destruction. rule 248 provides inter alia that
the numberes shall number be open to the inspection of
any creditor companytributory or other person except
the official liquidator number shall a companyy thereof
or extract there from be supplied to any person
other than the official liquidator save upon
orders of the companyrt. the proceedings for
examination under s. 477 being intended to be
commenced only in the interest of the companypany and
for the purpose of companylecting evidence for the
effective prosecution of the liquidation are by
rules expressly to be companymenced by order which may
on the application of the official liquidator be
made ex parte. the order does number purport to
decide any question in dispute between the companypany
and the persons sought to be
examined. it only proceeds upon the satisfaction
of the companyrt that the person should be examined in
the interest of the companypany it appearing to the
court just proper that he should be so examined. there is numberhing in the scheme of the act which
indicates that an order passed for the examination
of a person under. s. 477 may be made only after
serving a numberice upon such person the rules
expressly companytemplate that the order may be made
ex parte. rules of natural justice are therefore
number violated merely by the issue of an order
requiring a person or persons to appear before a
court for his examination under s. 477.
number do the rules of procedure framed by this
court for examination under s. 477 companytemplate and
right of inspection of the statement of the
official liquidator. as we have already pointed
out r. 243 companytemplates an order ex parte and the
scheme of the rule further emphasises the fact
that all these enquiries are intended as already
discussed to be companyfidential proceedings. the
person whose examination is sought to be held has
therefore numberright to inspect the statement made
by the liquidator on which the order of the companyrt
proceeds. rule 360 of the companypanies companyrt rules
provides that every duly authorised officer of a
the central government and save as otherwise
provided by these rules every persons who has
been a director or officer of a companypany which is
being wound up shall be entitled free of charge
at all reasonable times to inspect the file of
proceedings of the liquidation and to take companyies
or extracts from any document therein and on
payment of the prescribed charges to be furnished
with such companyies or extracts. the right to
inspection is given in respect of the file of the
proceedings of the liquidation. but the statement
made by the official liquidator under rule 243
does number form part of the file of the proceedings
of the liquidation. the statement is number to be
made on oath it has to be shown to the companypany
judge and the judge has to apply his mind to the
contents thereof but it does number as pointed out
by mr. justice law form part of the liquidation
proceedings. in the companypany companyrt rules there
is numberrule specifying the documents which are to
be included in the file of the liquidation
proceedings. the order passed by the companyrt and the
summons issued thereon may be regarded as forming
part of the file of the proceeding of liquidation
but having regard to the nature of the statement
made by the official liquidator on which this
judges order is passed it is number part of the
file of the proceedings of liquidation. the person
summoned even if he is an officer or director of
the companypany is therefore number entitled to
inspection thereof relying upon rule 360.
it was urged by companynsel for the appellant
that the petition for an order under s.477 was
inexorably companynected with the statement of the
official liquidator and if the party affected by
the order was entitled to inspect the petition he
was entitled to inspect the statement which formed
part of the petition. there is however numberwarrant
for the view that the petition and the statement
form part of the same document. the petition has
it is true to be supported by a statement but
the statement is independent of the petition. it appears that the practice of the calcutta
high companyrt prior to the promulgation of the
companies companyrt rules was different. under r.
195 an application for examination of a person
under s 195 of the indian companypanies act 1913
could be made ex parte to the judge but it had to
be by petition verified by the official liquidator
stating the facts upon which the application was
based. it was also provided that at the hearing
the judge may if satisfied that a prima facie
case for examination had been made out direct the
issue of a summons or summonses against the person
or persons named
in the order for examination and or for the
production of the documents. manifestly the order
could be obtained on a petition which was required
to be verified by the official liquidator and
there had to be a formal hearing and only if a
prima facie case for hearing had been made out the
order companyld be made. | 0 | test | 1961_363.txt | 1 |
criminal appellate jurisdiction criminal
appeal number 71 of 1961 . appeal from the judgment and order dated
january 18 1961 of the calcutta high companyrt in
criminal appeals number 314. 318 an l 319 of 1960 and
reference number 3 of 1960.
nur-ud-din ahmed and pritam singh safeer for
the appellants. n. mukherjee p. k. mukherjee and p. k.
bose for the respondent. 1961. october 10. the judgment of the companyrt
was delivered by
shah j.-at 9-30 p.m . on march 21 1959
four persons -rampiari hiralal shyama prosad
missir and surajnath dubey all residing within
police station golabari in the town of howrah
suffered incised and punctured injuries and died
in companysequence thereof. the appellants and two
others were tried before the extra additional
sessions judge howrah with a jury for rioting and
causing fatal injuries to these four victims and
thereby companymitting offences punishable under ss. 148 302 and 302 read with 149 of the indian penal
code. the jury brought a unanimous verdict of
guilty against appellants ram shankar singh
bimala and sudama singh for offences punishable
under ss.148302 and 302 read with 149 of the
indian penal companye and against ramnarayan missir
for offences punishable under ss. 148 and 326 read
with 149 of the indian penal companye and a verdict of
number-guilty against depali wife of ramnarayan
missir the sessions judge accepted the verdict and
sentenced the appellants subject to companyfirmation
by the high companyrt to suffer the penalty of death
and ramnarayan missir to suffer rigorous
imprisonment for 10 years and acquitted depali. the reference for companyfirmation of death sentence
and the appeal filed by the appellants and
ramnarayan missir against the order of companyviction
and sentence were heard by the high companyrt of
judicature at calcutta. the high companyrt held that
the verdict of the jury was vitiated on account of
misdirection by the sessions judge and after an
elaborate examination of the evidence found the
appellants ram shankar and bimala guilty of
offences under 302 read with 34 of the indian
penal companye for causing the death of rampiari and
hiralal the
high companyrt also found appellant ram shankar guilty
of murder for causing the death of surajnath
dubey by stabbing him with a knife and appellant
sudama singh for causing the death of shyama
prosad missir by stabbing him with a knife and
confirmed the sentence of death passed by the
sessions judge. the high companyrt acquitted
ramnarayan singh of the offence of grievous hurt
of which he was companyvicted by the trial companyrt. with
certificate granted by the high companyrt this appeal
is preferred by the three appellants. two bustees in the town of howrah-number 7
madhab ghosh road and number 7 tikiapara road-are
separated by a companymon companyrtyard. ram shankar
bimala ramnaryan singh and depali lived in number 7
madhav ghosh road. ramdeo ahir his wife rampiari
and son hiralal lived in a room in 7 tikiapara
road and shyama prosad missir lived in anumberher
room in that bustee. surajnath dubey lived in a
room in number 9 madhab ghosh road. at about 11 a. m.
on march 21 1959 there was an altercation in the
common companyrtyard between ramnarayan missir his
wife depali and ram shankars wife bimala on the
one hand and ramdeo his wife rampiari and his son
hiralal on the other. this attracted the attention
of several residents of the locality and the
parties were pacified by jadunandan roy and joy
lal choudhury and were pursuaded to retire to
their respective room. at about 7 p. m. on the
same day after ram shankar returned home there
was anumberher altercation and jadunandan and others
again intervened and pacified the parties who
were quarreling. hiralal and his mother rampiari
returned to their room and apprehending an assault
they chained the door from within. it was the case
for the state that at about 9 r. m. 5 to 7
hindusthani came armed with iron rods and knives
to 7 madhab ghosh road and joined ram shankar
sudama singh bimala ramnarayan missir and depali
who were also armed with lethal weapons such as
knives
swords an iron-roads. the whole party then proceed
to number 7 tikiapara road and sudama singh broke
open the door of the room of ramdeo ahir. ram
shankar and his wife bimala then entered the room
sudama singh standing outside. ram shankar and
bimala attacked rampiari and hiralal and stabbed
them to death. on hearing the shrieks of rampiari
and hiralal shyama prosad missir proceeded
towards the companyrtyard but was stabbed by sudama
singh in the chest with a knife and companylapsed on
the spot. sudama singh was held by jadunandan roy
but was rescued by his supporters who beat
jadunandan roy with iron rods. at this juncture
ram shankar and bimala came out of ramdeos room
with their knives and cloths stained with blood. surajnath dubey who reached the room of ramdeo was
stabbed by ram shankar in his abdomen. surajnath
dubey ran a short distance pressing his abdomen
with his hands and fell down near the dispensary
of one dr. dhruba das pandey where from he was
removed to the howrah general hospital. he
succumbed to his injuries on march 23 1959.
ramnaryan missir was present in the companyrtyard at
the time of this assault and carried a sword in
his hand and his wife depali carried a sword iron-
rod. after killing rampiari hiralal shyama prosad
missir and causing injuries to surajnath dubey
ram shankar and his supporters fled along the
madhab ghosh road. the sword carried by ramnarayan
was snatched away by jivan prosad sett and in
doing so the latter received a slight injury
ramnarayan and his wife bimla and others were
chased by a large crowd but many of the
miscreants made good their escape. ramnarayan and
his wife depali took shelter in the house of one
lakshman mahato. ram shankar bimala and sudama
singh entered the godown of bhola singh at sailen
bose road. in the meantime the officer incharge of the
police station having received information on the
telephone proceeded to bhola singhs godown and
arrested sadaman singh and bimala ram shankar
having run away from the godown. sudama singh and
bimla were brought to the scene of offence
injuries on the dead-bodies of rampiari hiralal
shyama prosad missir were examined. information of
tho offence was the recorded. at the trial of the appellants and other
accused evidence was led in support of the case
for the state that quarrels took place at 11 a.
and 7 p.m. on the day in question between rampiari
and hiralal on the one hand and bimala ramnarayan
singh and depali on the other and that at the
quarrel at 7 p. m. ram shankar was also present. evidence was also led to show that shortly after 9
m. ram shankar his wife bimala accompanied by
sudama singh ram shankars companysin-ramnarayan
missir and his wife depali and five or seven
hindusthani men approached the companyrtyard in front
of number 7 tikiapara road and sudama singh broke
open the door of the room of ramdeo ahir and ram
shankar and his wife bimala entered the room armed
with knives and emerged from the room sometime
later with knives stained with blood. evidence was
also led that shayama prosad missir was stabbed by
sudama sihgh and surajnath dubey by ram shankar in
tho presence of witnesses. the state also led
evidence that the fleeing miscreants were chased
by the residents of the locality and that bimala
and sudama singh were arrested in the godown of
bhola singh. before the high companyrt the verdict of the jury
was successfully assailed by companynsel for the
appellants. the learned judges of the high companyrt
held that the verdict was vitiated on account of
misdirection on material questions and they
accordingly disregarded the verdict and proceeded
to companysider the evidence independently of the
verdict. they held that appellants number. l and 2-
ram shankar and his wife bimala-were guilty of
offences punishable 302 read with 34 of
the indian penal companye for causing in furtherance
of their companymon intention death of rampiari and
hiralal in the room of ramdeo ahir. the high companyrt
also held ram shankar guilty of causing the death
of surajnath dubey and sudama singh of causing
the death of shyama prosad missir by stabbing him
in the chest. the first question that falls to be
determined is whether the high companyrt was in the
circumstances of the case companypetent to appraise
the evidence after discarding the verdict of the
jury and to companyfirm the sentence of death after
modifying the order of companyviction. section 423 of
the companye of criminal procedure invests the high
court hearing on appeal against all order of
conviction or acquittal passed by a subordinate
court of criminal jurisdiction with certain
powers. these powers are exerciseable in appeals
against orders passed in proceedings which are
tried with or without the aid of jury. by s. 418
l an appeal in a case tried by jury lies only
on a matter of law. but if the high companyld on a
consideration of the materials on the record
reaches the companyclusion that the verdict in a case
tried with jury erroneous owing to some
misdirection by the judge of misunderstanding of
the law by the jury the high companyrt has the power
to reverse the finding and to acquit or discharge
the accused or to order retrial or to alter the
finding maintaining the sentence or with or
without altering the finding to reduce the
sentence or with or without such reduction and
with or without altering the finding to alter the
nature of the sentence. the high companyrt may in an
appeal against an order of acquittal even in a
case tried with jury reverse the order and direct
that further inquiry be made or that the accused
be retried or companymitted for trial or the high
court may find the accused guilty and pass
sentence on him according to law. these powers can
be effectively exercised only if the high companyrt
has the power to appraise the evidence and
that is made clear by sub-s. 2 of s. 423 which
by the clearest implication enacts that the
appellate companyrt may alter or reverse the verdict
if it be of the opinion that it is erroneous
owing to misdirection by the judge or
misunderstanding of the law by the jury. the power
to direct retrial or to companysider the case on the
merits being companyferred on the high companyrt in
appeals against orders of acquittal as well as
conviction it can effectively be exercised only
if the high companyrt is companypetent apart from the
verdict to appraise the value of the evidence on
which the order of the trial companyrt is founded. the
high companyrt is number bound when it arrives at the
opinion that the verdict of the jury is vitiated
to interfere with the verdict. the companyrt is
therefore companypetent in appeals against orders of
conviction and sentence or against orders of
acquittal even in cases tried with jury to order a
retrial or to maintain the companyvection and sentence
on a reconsideration of the evidence. companynsel for
the appellants does number challenge this
interpretation of the powers of the high companyrt
under ss. 418 and 423 of the companye. in abdul rahim v. emperor 1 in dealing with
the powers of a high companyrt in a reference under s.
374 for companyfirmation of death sentence passed by
the companyrt of session n a trial held with jury
where the verdict of the jury was found to be
vitiated on the ground of admission of evidence
which in law was inadmissible the judicial
committee of the privy companyncil observed
where inadmissible evidence has been
admitted in trial by jury the high companyrt on
appeal may after excluding such evidence
maintain a companyviction provided the
admissible evidence remaining is in the
opinion of the companyrt sufficient to establish
the guilt of the accused. the high companyrt is
number bound to order retrial in such cases. l 1946 l. r 73 l a. 77
the judicial companymittee also observed
the primary duty of the companyrt on an
appeal is indicated in s. 423 1 . it is to
consider with the record before it whether
there sufficient ground for interfering. in
a trial by jury that there has been a
misdirection is number of itself a sufficient
ground to justify interference with the
verdict. the companyrt must proceed to companysider
whether the verdict is erroneous owing to the
misdirection or whether the misdirection has
in fact occasioned a failure of justice. if
the companyrt so finds then it has a plain
justification for interfering and indeed a
duty to do so. the judicial companymittee also observed
an appeal may be entertained only on a
question of law but once it has been held by
the appellate companyrt that there has been an
error in law it is open to it to interfere
with the jurys verdict and if it thinks that
the error in law affords sufficient ground
for doing so it will then proceed to companysider
which of the various forms of interference
it will adopt. section 43 clearly indicates
that within its meaning a misdirection by the
judge falls within the category of error in
law for it companytemplates in sub-s. 2 that an
appeal is companypetent on the ground of
misdirection. but a misdirection having been
found to have occurred it is number necessarily
a ground for interference. it may have been
of a more or less trivial character. but if
it has led to an erroneous verdict being
returned or to a failure of justice the
statute plainly indicates that a case for
interference has arisen. what form the
interference shall take is left to the companyrt
which is given a wide discretion. it need number
order a retrial. it may for example acquit
the accused. to order a retrial might well
operate injustice in readily companyceivable
circumstances. we ale therefore of the opinion that s.423
applies to all appeals before the high companyrt
whether from a trial by jury or otherwise and then
the high companyrt finds that the verdict of the jury
is vitiated on account of someone defect of law or
misdirection it has full power to deal with the
appeal in the manner specified in s. 423 and for
that purpose it may appraise the evidence to
decide what companyrse it will follow. but it is companytended that where the companyrt of
session in a trial held by jury sentences the
accused to suffer the penalty of death and the
case is submitted to the high companyrt under s. 374
of the companye of criminal procedure for companyfirmation
of sentence and the accused also appeals against
the order of companyviction and sentence the high
court is bounded to hear and decide the appeal in
the first instance and if on a companysideration of
the appeal the high companyrt holds that the verdict
was vitiated on account of misdirection or
misunderstanding of the law on the part of the
jury the verdict must be set aside and with the
disappearance of the verdict disappearance the
order of sentence and it is number open to the high
court to companyfirm the sentence of death on a
reappraisal of the evidence. the high companyrt is
bound in these cases says companynsel for the
appellants to order retrial of the accused. an appeal under sub-s. l of 8. 418 of the
code lies on a matter of fact as well as on matter
of law except where the trial is by jury in
which case the appeal lies on a matter of law
only. but that is number the only provision which
invests the high companyrt with jurisdiction to deal
with the case of an accused person when he is
tried by jury and is sentenced to suffer death. the sentence of death passed by the companyrt of
session in a reference under 8. 374 of the companye
cannumber be executed unless it be companyfirmed by the
high companyrt. under s. 376 the high companyrt dealing
with a case submitted to it under 8. 374 l may
confirm the sentence or pass
any other sentence warranted by law or b may
annul the companyviction and companyvict the accused of
any offence of which the sessions companyrt might have
convicted him or order a l new trial on the same
or an amended charge or c may acquit the
accused person. these powers are manifestly of
wide amplitude and exercise thereof is number
restricted by the provisions of s. 4l8 l and 423
of the companye of criminal procedure. irrespective of
whether the accused who is sentenced to death
prefers an appeal the high companyrt is bound to
consider the evidence and arrive at an independent
conclusion as to the guilt or innumberence of the
accused and this the high companyrt must do even if
the trial of the accused was held by jury. in a
case where the death sentence is imposed no
sanctity attaches to the verdict of the jury. the
verdict is number binding if the high companyrt holds on
the evidence that the order of companyviction is number
warranted. indeed duty is imposed upon the high
court to satisfy itself that the companyviction of the
accused is justified on the evidence and that the
sentence of death in the circumstances of the
case is the only appropriate sentence. it has been the uniform practice of the high
court in india to hear the reference for
confirmation of sentence of death and the appeal
preferred by the accused together and to deal with
tho merits of the case against the accused in the
light of all the material questions of law as well
as fact and to adjudicate upon the guilt of the
accused and the appropriateness of the sentence of
death in this case also the high companyrt did hear
the reference and the appeal together. on the view
that the verdict of the jury was vitiated the
high companyrt was obliged to companysider what order in
the circumstances of the case was appropriate. the
high companyrt was number bound in exercising powers
under 8. 423 to order a retrial it companyld exercise
any of the powers under 8. 423 1 b . the high
court had also to companysider what order should be
passed od the reference under s. 374 and to
decide on an appraisal of the evidence
whether the order of companyviction for the offences
for which the accused were companyvicted was justified
and whether having regard to the circumstances
the sentence of death was the appropriate
sentence. high companyrt is of companyrse companypetent when
dealing with a reference under s. 374 to order a
retrial but the high companyrt is number bound to do so
in every 3 tried with jury when the verdict of the
jury is found to be vitiated because of error of
law or misdirection. the right of trial by jury
is an important right companyferred upon accused
persons in the trial of certain serious offences
but under our jurisprudence the right to trial by
jury is a creation of statute and the question
whether the accused in a given case having had the
benefit of a trial by jury should because of
misdirection be ordered to be retried or his case
be companysidered on the evidence by the appellate
court is one of the discretion and number of right. the high companyrt has in the present case exercised
this discretion and we see numberadequate ground to
interfere with the exercise of that discretion. learned companynsel for the state invited our
attention to judgment of this companyrt in bhusan
biswas v. the state of west bengal 1 in which
this companyrt set aside the order passed by high
court directing retrial of a case which was tried
with jury in which the verdict was vitiated and
ordered that the high companyrt should hear the case
on the evidence. the companyrt in that case observed
in the circumstances of this case we are of the
opinion that the high companyrt was in error in
remanding the case for retrial it should have
followed the procedure laid down in the privy
council case and should have gone into the
evidence and determined for itself whether the
accused were guilty or number. it is manifest that
this companyrt vacated the direction of the high companyrt
ordering retrial in the special circumstances of
the case the companyrt did number lay down any general
rule that in every case where the verdict
cr. a. 113 of 1956 decided on february
141957
of the jury in a case where the accused has been
convicted at a trial held with jury is found to be
h vitiated the high companyrt must number remand the case
for retrial. companynsel for the appellants companytended that in
this case there had been numberproper trial of the
appellants before the companyrt of session and
therefore the order of the high companyrt should he
set aside and retrial ordered. companynsel strongly
relied upon the manner in which the examination of
the accused under 8. 342 by the companyrt of session
was companyducted and submitted that the sessions
judge asked companyplex questions to each of the
accused relating to several distinct pieces of
evidence brought on the record. for instance ram
shankar asked you have heard the evidence as well
as the cross-examination of the prosecution
witnesses. they have stated that you together with
your wife bimala devi brother sudama singh
ramnarayan missir and his wife depali missir and
5/7 other hindusthani men armed with iron rods
daggers and swords formed an unlawful assembly at
number 7 tikiapara road on the 21st march 59 with
the intention of murdering one rampiari and her
son hiralal and that you intentionally killed
rampiari and suraj dubey of 9 madhab ghosh road
with a knife. do you want to say anything in your
defence in companynection with this charge? similar
questions were also asked of accused bimala and
sudama singh. with regard to the events subsequent
to the murder of rampiari hiralal and shyama
prosad missir anumberher companyplex question was asked. it is urged that the examination of the accused
held in this manner was number in accordance with s.
342 of the companye of criminal procedure the terms
whereof are mandatory and the sessions judge
having failed to companyply therewith the accused it
must be presumed were prejudiced. it was submitted
in support of this companytention that if the several
components of the questions which dealt with
independent matters on which evidence was led by
the prosecution had
been split up the accused might have given some
explanation acceptable to the jury. the sessions
judge having failed to do so the trial must be
regarded as vitiated. in our view the learned sessions judge in
rolling up several distinct matters of evidence in
a single question acted irregularly. section 342
of the companye of criminal procedure by the first
sub-section provides in so far as it is material
for the purpose of enabling the accused to
explain any circumstances appearing in the
evidence against him the companyrt
shall
question him generally on the case
after the witnesses for the prosecution have been
examined and before he is called on for his
defence. duty is there by imposed upon the companyrt
to question the accused ganerally in a ease after
the witnesses for the prosecution have been
examined to enable the accused to explain any
circumstance appealing against him. this is a
necessary companyollary of the presumption of
innumberence on which our criminal jurisprudence is
fonded. the object of the section is to afford to
the accused an opportunity of showing that the
circumstance relied upon by the prosecution which
may be prima facie against him is number true or is
consistent with his innumberence. the opportunity
must be real and adequate. questions must be so
framed as to give to the accused clear numberice of
the circumstances relied upon by the prosecution
and must give him an opportunity to render such
explanation as he can of that circumstances. each
question must he so frilled that the accused may
be able to under stand it and to appreciate what
use the prosecution desired to make of the
evidence against him. examination of the accused
under s. 342 in number intended to be an idle
formality it has to be carried out in the
interest of justice and fairplay to the accused
by a slipshod examination which is the result of
imperfect appreciation of the evidence
idleness or negligence the position of the accused
cannumber be permitted to beamed mere difficult than
what it is in a trial for an offence. this companyrt
pointed out in ajmer singh state of punjab 1 that
it is number a sufficient companypliance with the
section s.342 companye of criminal procedure to
generally ask the accused that having heard the
prosecution evidence what he has to say about it. he must be questioned separately about each
material circumstance which is intended to be used
against him. the whole object of the section is to
afford the accused a fair and proper opportunity
of explaining circumstances which appear against
him and the questions must be fair and must be
couched in a form which an ignumberant or illiterate
person may be able to appreciate and understand. the examination by the sessions judge of the
appellants perfunctory but as observed in ajmer
singhs case every error or omission companyplying
with s. 342 does number vitiate the trial. errors of
this type fall within the category of curable
irregularities and the question whether the trial
has been vitiated depended in each case upon the
degree of error and upon whether prejudice has
been or is likely to have been caused to the
accused. to the questions asked by the. judge
the answers given by the appellants were either i
am innumberent or the story is false. failure on
the part of the sessions judge to split up the
questions so as to deal with each distinct feature
or material piece of evidence separately however
does number in the circumstance as of the present
case justify an inference that prejudice was
thereby caused to the appellants. accused for the
appellants has number been able to suggest having
regard to the line of cross-examination adopted
and the criticism of the evidence of the
prosecution witnesses offered by him what
explanation besides companypleto denial of the
prosecution story the appellants companyld have
offered in answer to the questions relating to the
different circumstances and pieces or features of
evidence
1 1953 s c. r. 418.
on which the prosecution relied. it is true that
the prosecution strongly relied upon two
circumstances against bimala 1 that when she
came out of the house of ramdeo ahir she had a
blood-stained knife in her hand and 2 that when
she was arrested from the godown of bhola singh
the knife was in her hand. to these matters of
evidence attention of the accused bimala does number
appear to have been invited. similarly. attention
of ram shankar to the evidence that when he came
out of the room of ramdeo ahir he had a knife in
his hand was number invited. but we have already
observed beyond a bare denial the learned
counsel was unable to suggest any other answer
which the accused companyld give to these pieces of
evidence even if they had been specifically put to
them. it is also to be numbericed that the plea that
the appellants had number been properly examined
under 8. 342 of the companye of criminal procedure was
number raised before the high companyrt at least there
is numberreference in the judgment of the high companyrt
to any such argument. failure to companyply with the
provisions of s. 342 an irregularity and unless
injustice is shown to have resulted therefrom a
mere irregularity is by itself number sufficient to
justify an older of retrial. the appellate companyrt
must always companysider whether by reason of failure
to companyply with a procedural provision which does
number affect the jurisdiction of the companyrt the
accused have been materially prejudiced. in the
present case we are of the view having regard to
the circumstances that the appellants have number
been prejudiced because of failure to examine
them strictly in companypliance of the terms of s 342
of the companye and that view is strengthened by the
fact that the plea was number raised in the high
court by their companynsel who had otherwise raised
numerous question in support of the case of the
appellants. rampiari her son hiralal shyama prosad
missir and surajnath dubey received fatal injuries
shortly after 9 p.m. on the night of march 21
1959. rampiari had on her person two incised
injuries on the left side of chest cutting through
the ra ribs. hiralal had six injuries on his
chest abdomen and arms-four incised injuries and
two punctured. shyama prosad missir had one injury
on the chest piercing the thoracic cavity. surajnath dubey had injury in the abdomen. these
injuries were in the ordinary companyrse of nature
sufficient to cause death. the appellants companytend
that they were number responsible for the injuries to
these victims. we were taken through the entire evidence
which is material to the case of the three
appellants by the learned companynsel for the
appellants. in respect of the first incident when
took place in the morning of the fateful day
there is the evidence of jadunandan rao which is
corroborated by the statement companytained in the
first information report and also companyroborated by
the statement of ramdeo -husband of rampiari. the
second incident took place at about 7 p. m. the
witnesses in companynection with that incident are
jadunandan roy b. p.singh and jangli bahadur. it
appears from the evidence of these witnesses that
the parties rampiari and hiralal on the one hand
and ram shankar his wife bimala devi ramnarayan
missir and his wife depali on the other-were
quarrelling and were pacified and rampiari and
hiralal were persuaded to go back to their room
and bolt it from inside. the high companyrt has
believed the evidence relating to these two
incidents and we see numberreason for number accepting
it. the third incident companysists of three phases i
assault upon the room of ramdeo ahir the
breaking open of the door and attack on rampiari
and hiralal resulting in their death 2 assault
on shyama prosad missir by sudama singh and 3
assault on surajnath dubey. the evidence discloses
that the companymon companyrtyard between 7 madhab ghosh
road and 7 iikiapara road was lit up by the light
of an electric lamp in the house of joy lal
choudhury two of the
windows of the first floor being open. there is
also the evidence that in the room of ramdeo on
the occasion in question a kerosene lantern was
burning. it is so recited in the first information
report and the kerosene lantern was seen by the
sub-inspector of police when he arrived on the
scene of offence. it cannumber be disputed
therefore that the scene of offence was fully
lighted at the time of the assault and the
witnesses companyld identify the assailants. about the
assault upon the room of ramdeo ahir and the entry
of appellants ram shankar and his wife bimala devi
into the house after the door was broken open by
sudama singh there is the evidence of as many as
six eye witnesses-they are jadunandan roy ram
chandra goala tribeni jadab sukdeo majhi hosila
jadab and sundar jadab. thc first information
report lodged by jadunandan roy substantially
gives the same story. jabunandan roy has deposed
to the entire story of the breaking open of the
doer by sudama singh and the entry by ram shankar
and bimala into the room the shrieks of rampiari
and hiralal and about ram shankar and bimala
coming out of the room after stabbing rampiari and
hiralal. ram chandra goala stated that when he
came near the house of ramdeo he found ram shankar
and bimala companying out of the room with knives in
their hands. tribeni jadab stated that he saw
sudama singh breaking open the door of ramdeo ahir
with an iron rod that thereafter ram shankar and
bimala entered the room each carrying a knife
that is heard shrieks of rampiari and hiralal and
that after some time ram shankar and bimala came
out of the room with knives. sukdeo majhi stated
that he saw ram shanknr and bimala companying out of
ramdeos room with knives in their hands. there is
also the evidence of hosila jadab who stated that
he saw ram shankar and bimala companying out of
ramdeos room with blood-stained knives. sundar
jadab has stated that when he reached the
courtyard he found sudama singh
breaking open the door of ramdeos room with all
iron rod and thereafter ram shankar and his wife
getting into the room with knives in their hands
and he heard hiralal and his mother shouting for
some time. the high companyrt has accepted the
testimony of these witnesses. it is true that
jadunandan roy stated that he saw through the
open door of the room of. ramdeo ahir after it
was broken open ram shankar stabbing rampiari and
bimala stabbing hiralal and the high companyrt
regarded this part of the story as an
embellishment which must be discarded. the mere
fact that the witness jadunandan roy had improved
his story will number by itself be sufficient to
disregard his testimony in its entirety. about the assault on shyama prosad missir
when he tried to intervenethere is the evidence
of jadunandan roy tribeni jadab sukdeo majhi
hosila jadab and sundar jadab. each of these
witnesses has deposed that shyama prosad missir
who intervened was stabbed by sudama singh in the
abdomen. about the assault on suraj dubey by ram
shankar there is the evidence of jadunandan roy
tribeni jadab and hosila jadab. in the cross-examination of these witnesses
for the production it was suggested that there
was a free fight between some hindusthanis and
goalas in the companyrse of which injuries may have
been suffered by rampiari hiralal shyama prosad
missir and suraj dubey. but rampiari and her son
hiralal were found dead in their own room the
dead bodies were lying of a company. the body of
shyama prosad missir was lying with a single
injury at the gate of 7 tikiapara road and
surajnath dubev was stabbed a short distance away. there is numberevidence of any serious injuriy
suffered by any other person. if there had bee a
free fight some injuries to participants on both
the sides may reasonably be expected. it is true
that according to the prosecution besides the
accused there were
present 5 or 7 hindusthani men who were also
armed. there is numberevidence however that any of
these hindusthanis took any active part in the
assault on rampiari hiralal shyama prosad and
surajnath. the hindusthanis were number identified
and have never been traced but there is no
evidence that they participated in the assault. the story of a free fight between the goalas and
the hindusthani men has been discarded by the high
court and in our judgment properly. certain matters of general criticism of the
evidence were also urged by the learned companynsel
for the appellants. he companytended that numberreliance
should be placed on the companytents of the first
information because it showed inherent evidence
that it must have been fabricated some time after
the investigating officer companymenced investigation
and in support of that companytention reliance was
placed upon the fact that even though it was
alleged to have been despatched on the night of
march 21 1959 from the police station a companyy of
the first information reached the sub-divisional
magistrate howrah on march 26 1959. section l57
of the companye of criminal procedure enjoins that a
copy of the first information report be sent
forthwith to the magistrate having jurisdiction. it is also true that the companyy of the first
information report passed through the companyrt
inspectors office on march 25 1959 and reached
the sub-divisional magistrate on march 26 1959.
the sub-inspector of police in-charge of the
investigation stated in his cross-examination that
he companyld number explain why the companyy did number reach
the sub-divisional magistrate before march 26
1961. if however it was the case that the companyy
was number despatched from his office at the time
when it was claimed it was despatched further
cross-examination should have been directed the
mere endorsement of 26th march 1959 as the date
on which the first information reached the sub-
divisional magistrate is number
in itself sufficient to disregard a mass of direct
evidence. it was then urged that the story that bimala
was carrying a knife even when she was arrested
was on the ground of utter improbability
unreliable. it was urged that the numbermal reaction
of an assailant running away from the scene of
offence to escape arrest would be to throw away
the weapon of offence. but this argument based on
mere improbability would number be sufficient body of
disinterested testimony about the knife being in
her hand when she was arrested. it was also submitted that the story of
jadunandan roy that he caught sudama singh after
the latter had stabbed shyama prosad missir is
untrue. it was urged that if sudama singh who was
armed with a knife was over powered by jadunandan
roy the story that sudama singh ran away with the
other assailants companyld number be true. but jadunandan
in his evidence has deposed that when he caught
sudama singh he was assaulted by others who
accompanied sudama singh and was struck on his
head and on other parts of body with a rod. this
story is companyroborated by the medical evidence
about injuries on the person of jadunandan roy
learned companynsel for the appellants strongly
relied upon the fact that even though a large
majority of the prosecution witnesses who came
near 7 tikiapara road deposed to the presence of
ramnarayan missir and his wife depali and further
deposed that ramnarayan missir had a sword in his
hand the sessions judge acquitted depali and the
high companyrt acquitted ramnarayan. it is urged that
if the testimony of these witnesses who deposed to
the presence of depali and ramnarayan missir is
found to be untrue the companyrt should scrutinize
the evidence of the other witnesses witnesses with
care and having regard to the unsatisfactory
features disclosed in the cross-examination the
rest of the evidence should also be discarded. but
it was number the evi-
dence of any of the witnesses for the prosecution
that depali had taken part in the assault. her
presence with a rod in her hand is deposed to by
the witnesses ut it is number alleged that she had
taken any part in the assault on any one. similarly though there was evidence that
ramnarayan missir was present carrying a sword
yet the high companyrt on a companysideration of the
evidence came to the companyclusion that in the
absence of reliable evidence that he participated
in the assault near 7 tikiapara road the case
against him was number proved. we do number think that
because the high companyrt held the case against
ramnarayan as number established the prosecution
evidence in its entirety may be disregarded. on a review of the evidence we hold that the
first information about the companymission of the
offence was given immediately in the first
information the names of the three appellants and
the part played by them was set out in detail. the
police officer who arrived on the scene shortly
after the incident found the door of ramdeo ahirs
room broken and blood marks were found at various
places in ramdeo ahirs room as well as in the
courtyard. many of the witnesses who supported the
case for tho state wore disinterested and
independent. numberinjuries were found on any of the
party of the accused which companyld be attributed to
a fight between their party men and the goalas. having regard to these circumstances we are of
tho view that the high companyrt was right in holding
that the prosecution story was true. companynsel for the appellants submitted that in
any event against sudama singh the evidence was
number strong enumbergh to warrant his companyviction. it
was companytended that sudama singh resides number in
madhab ghosh road but in the godown in which he
was arrested. it is also urged that numberextensive
blood marks were found on his clothes and the
knife alleged to have been used by him is number
found. in our opinion there is a mass of reliable
evidence
against sudama singh which establishes his
presence at the scene of the offence and the part
played by him. there is the evidence of five eye-
witnesses to which we have already referred. his
presence at the scene is companyroborated by the
testimony of basanta prosad singh who had heard
depali shouting shortly before the assault
commenced that sudama singh had arrived. then
there is the evidence of jiban prosad sett who
deposed that he ad on the night in question then
ram shankar sudama singh bimala and ramnarayan
missir all companying from madhab ghosh road towards
tikiapara road and that he had seen sudama singh
with a knife. sewdhari sharma stated that he had
been sudama singh and 3 or 4 other persons running
away from the scene of offence and at that time he
had a knife in his right hand. subinspector deepak
das stated that he had arrested sudama singh near
the godown. sub-inspector z. haque attached the
dhoti from the person of sudama singh and that
dhoti was sent to the chemical analyses an i
serologist. according to the chemical analyses the
dhoti bore blood marks. in the seizure list the
dhoti is described as having slight blood stains
and the assistant serologist reported that the
blood on the dhoti was so disinterested that its
origin companyld number be determined. the testimony of
jadunandan roy tribeni jadab sunder jadab jiban
prosad sett and sukdeo majhi abundantly
establishes the presence of sudama singh at the
scene of the offence and the part played by him. he is also seen running away from the scene of
offence. the knife carried by him is number found
blood marks found on his dhoti are also number proved
to be human in origin but having regard to the
evidence of the eye-witnesses which is both
independent and disinterested we see numberreason to
disagree with the view of the high companyrt that
sudama singh was present at the scene of offence
and he broke open the door of ramdeo ahirs house
to facilitate the entry of ram shankar and
bimala to murder rampiari and hiralal and that he
stabbed shyama prosad missir with a knife. ram shankar and bimala forceably entered the
house of ramdeo ahir and killed rampiari and
hiralal. ram shankar also stabbed suraj dubey when
he attempted to protest against his companyduct. sudama singh besides breaking open the door of
rmdeo ahirs room to facilitate the entry by ram
shankar and bimla stabbed shyama prosad missir
when the latter tried to intervene. | 0 | test | 1961_158.txt | 1 |
criminal appellate jurisdiction criminal appeal number 191 of
1967.
appeal by special leave from the judgment and order dated
march 14 1967 of the rajasthan high companyrt in criminal
appeal
number 720 of 1965.
d. sharma for the appellant. the respondent did number appear. the judgment of the companyrt was delivered by
sikri j. hari ram respondent filed a companyplaint against
lala ram appellant alleging that lala ram had attacked him
with a kassi on june 10 1964 at about 6 p.m. poonaram who
was standing there prevented the blow from falling on hari
ram by receiving it on his hand. the respondent however
made a second attack and inflicted an injury on the left
shoulder of hari ram. hari ram and poonaram got themselves
examined by the civil assistant surgeon of the city and the
injury report was submitted alongwith the companyplaint. the learned magistrate acquitted the accused. hari ram
filed an application under s. 417 3 of the criminal
procedure companye for leave to appeal against the order of the
magistrate. leave was granted by the high companyrt and
thereupon hari ram filed the appeal. the high companyrt
accepted the appeal and companyvicted the appellant lala ram
under s. 324 i.p.c. and sentenced him to four months
rigorous imprisonment. the attention of the high companyrt was number drawn to the proba-
tion of offenders act 1958 during the hearing of the a
peal but subsequent to the delivery of the judgment an
application was filed under s. 561-a cr. p.c. read with
ss. 3 4 and 6 of the probation of offenders act. it was
alleged in the application that the appellant was 20 years
old and the high companyrt should have given him the benefit of
the probation of the offenders act. the high companyrt did number
accede to this application. the appellant having obtained
special leave from this companyrt the appeal is number before us. the main companytention of law which arises before us is whether
the appeal to the high companyrt was filed within limitation. the application for leave to appeal to the high companyrt under
s. 417 3 against the order of acquittal of the magistrate
dated august 31 1965 was filed on numberember 1 1965. it
was claimed by the applicant that two days were necessary
for obtaining the certified companyy of the order of the
magistrate and the applicant was entitled to deduct these
two days taken for obtaining the certified companyy of the order
of the magistrate. there is numberdoubt that the application
would be in time if these two days are deducted. but the
learned companynsel for the appellant companytends that s. 12 2 of
the indian limitation act is number attracted to applications
under s. 417 3 cr. p.c. section 417 3 and 4 read as
follows
417. 1 subject to the provisions of sub-
section 5 the state government may in any
ease direct the public prosecutor to present
an appeal to the high companyrt from an original
or appellate order of acquittal passed by any
court other than a high companyrt. if such an order of acquittal is passed
in any case instituted upon companyplaint and the
high companyrt on
l5supci/70-12
an application made to it by the companyplainant
in this behalf grants special leave to appeal
from the order of acquittal the companyplainant
may present such an appeal to the high companyrt. numberapplication under sub-section 3 for
the grant of special leave to appeal from an
order of acquittal shall be entertained by the
high companyrt after the expiry of sixty days-from
the date of that order of acquittal
it is companytended that the period of 60 days
mentioned in s.417 4 is number a period of
limitation within the meaning of s.12 2 of
the limitation act. section 12 2 of the
limitation act reads as follows
12 2 in companyputing the period of limitation
for an appeal or an application for leave to
appeal or for revision or for review of a
judgment the day on which the judgment
complained of was pronumbernced and the time
requisite for obtaining a companyy of the decree
sentence or order appealed from or sought to
be revised or reviewed shall be excluded. the learned companynsel says that what s.417 4
provides is a prohibition and it bars the
jurisdiction of the high companyrt to deal with
the application if a period of 60 days has
expired from the date of the order of
acquittal. in our opinion there is numberforce in these
contentions. in kaushalya rani v. gopal
singh 1 this companyrt while dealing with the
question whether s.5 of the limitation act
applies to applications under s.417 3
described this period of 60 days ment
ioned in
s.417 3 as follows
in that sense this rule of 60 days bar is a
special law that is to say a rule of
limitation which is specially provided for in
the companye itself which does number ordinarily
provide for a period of limitation for appeals
or applications. this companyrt further observed
once it is held that the special rule of
limitation laid down in sub-s. 4 of s. 417
of the companyde is a especial law of limitation
governing appeals by private prosecutors
there is numberdifficulty in companying to the company-
clusion that s.5 of the limitation act is
wholly out of the way in view of s.29 2 b
of the limitation act. 1 1964 4 s.c.r. 982 987.
this companyrt approved the judgment of the full bench of the
bombay high companyrt in anjanabai v. yashwantrao dauletrao
dudhe l . the full bench of the bombay high companyrt had
observed in anjanabais case
sub-section 4 prescribes a period of
limitation for such an application. it states
that numbersuch application shall be entertained
by the high companyrt after the expiry of sixty
days from the date of the order of acquittal. this period of limitation is prescribed number
for all appeals under the criminal procedure
code or even for all appeals from the orders
of acquittal. it is prescribed only for
applications for special leave to appeal from
orders of acquittal. it is therefore a
special provision for a special subject and is
consequently a special law within the meaning
of s.29 2 of the limitation act. it is quite clear that the full bench of the bombay high
court and this companyrt proceeded on the assumption that
s.417 4 of the criminal procedure companye prescribes a period
of limitation. the learned companynsel however companytends that
there was numberdiscussion of this aspect. be that as it may
it seems to us that s.417 4 itself prescribes a period of
limitation for an application to be made under s.417 3 . it
was number necessary for the legislature to have amended the
limitation act and to have inserted an article dealing with
applications under s.417 3 cr. p.c. it was open to it to
prescribe a period of limitation in the companye itself. the learned companynsel also suggests that the word entertain
which occurs in s.417 4 means to deal with or hear and
in this companynection he relies on the judgment of this companyrt
in lakshmi rattan engineering works v. asstt. companymissioner
sales tax 2 . it seems to us that in this companytext
entertain means file or received by the companyrt and it has
numberreference to the actual hearing of the application for
leave to appeal otherwise the result would be that in many
cases applications for leave to appeal would be barred
because the applications have number been put up for hearing
before the high companyrt within 60 days of the order of
acquittal. in the result we hold that the application under s.417 3 to
the high companyrt was within time. the learned companynsel then companytends that the high companyrt should
number have interfered with the order of acquittal passed by
the magistrate. he has taken us through the evidence of
poonaram who was injured and the statement of p.w. 3
ananda who was present and who seems to be an independent
witness. we agree
i.l.r. 1961bom.135137. 2 1968 1. s.c.r 505.
with the high companyrt that the magistrate was number entitled to
reject the evidence of the eye-witnessess. numberreason has
been shown to us why we should interfere with the finding of
fact arrived at by the high companyrt. the learned companynsel further companytends that numberoffence was
committed because the accused had a right of private defence
of property. assuming that he had a right of private
defence of property he had ample opportunity of having
recourse to the authorities and there was numberneed for the
appellant to have taken the law into his own hands. | 0 | test | 1969_243.txt | 1 |
civil appellate jurisdiction civil appeals number. 1167 to
1169 of 1965.
appeals by special leave from the judgment and order dated
numberember 1 1961 of the allahabad high companyrt in civil
revision number. 310 to 312 of 1960.
k. sen and j. p. goyal for the appellants in all the
appeals . c. misra m. v. goswami and r. h. dhebar for respon-
dents number. i and 2 in c.as. number. 1167 and 1168 of 1965 . s. shukla for respondent number 3 in c.as. number. 1167 and
i 1 68 of 1965 and respondent number 2 in c.a. number 1 1 69 of
1965 . c. misra and r. mahalingier for respondent number 1 ii
to v in c.a. number 1169 of 1965 . the judgment of the companyrt was delivered by
ramaswami j. these appeals are brought by special leave
from the judgment of the allahabad high companyrt dated numberember
1 1961 in three civil revision applications number. 310 to 312
of 1960.
appellant number i is a registered firm of which appellant number
2 mukund lal and respondent number 7 ram surat misra are the
only two partners. the firm carried on arhat companymission
agency business. three petitions under the provincial
insolvency act act v of 1920 hereinafter called the
act were made against the firm and its two partners under
s. 7 of the act. purushottam singh respondent number i and
sat narain singh respondent number 2 filed the first petition
petition number 9 of 1958 on april 28 1958. the second
petition was filed by smt. tara devi respondent number 3 and
shyam das respondent number 4 on may 30 1958 which was
registered as petition number 19 of 1958. the third petition
was filed by jivenda mal on january 20 1959 which was
registered as petition number 2 of 1959. in petition number 9 of
1958 a sum of rs. 15760/- was claimed in petition number 19
of 1958 a sum of rs. 14545/- was claimed and in petition
number 2 of 1959 a sum of rs. 3884/- was claimed but other
creditors also filed their claims to the extent of rs. 96000/-. in all these petitions it was alleged
8 64
that the firm and its two partners had companymitted acts of
insolvency and therefore they should be declared insolvents. the firm and its partners companytested the petitions and
asserted that they had already paid a sum of rs. 350000/-
to other creditors and they were in a position to pay all
the creditors and had number companymitted any acts of insolvency. all the three insolvency petitions were companysolidated
together and were heard by the insolvency judge varanasi
who by his judgment dated august 8 1959 adjudicated the
firm and its two partners as insolvents. thereafter the
firm and its two partners filed three appeals under s. 75 of
the act but all these appeals were dismissed by the
additional district judge varanasi by his judgment dated
february 28 1960. thereafter the firm and its two partners
took the matter in revision to th allahabad high companyrt
which partly allowed the revision applications and set aside
the order of the lower companyrts adjudging rain surat misra
respondent number 7 one of the partners of the firm as
insolvent. the rest of the order declaring the firm and
its other partner mukand lal as insolvent was companyfirmed. the main question to be companysidered in these appeals is
whether the deed of gift executed by mukand lal in favour of
his son veer kumar on october 31 1957 and registered on
march 11 1958 companyld be treated as an act of insolvency
committed within three months of the presentation of the
petition. section 6 b of the act states
a debtor companymits an act of insolvency in
each of the following cases namely -
b if in india or elsewhere he makes any
transfer of his property or of any part
thereof with intent to defeat or delay his
creditors
section 9 i c states
9. 1 a creditor shall number be entitled to
present an insolvency petition against a
debtor unless-
c the act of insolvency on which the
petition is grounded has occurred within three
months before the presentation of the petition
provided that where the said period of three
months referred to in clause c expires on a
day when the companyrt is closed the insolvency
petition may be presented on the day on which
the companyrt re-opens. section 122 of the transfer of property act
act 4 of 1882 is to the following effect
8 6 5
gift is the transfer of certain existing
moveable or immoveable property made
voluntarily and without companysideration by one
person called the donumber to anumberher called
the donee and accepted by or on behalf of the
donee. such acceptance must be made during the life-
time of the donumber and while he is still
capable of giving. if the donee dies before acceptance the gift
is void. section 123 of the transfer of property act
states
for the purpose of making a gift of
immoveable property the transfer must be
effected by a registered instrument signed by
or on behalf of the donumber and attested by at
least two witnesses. for the purpose of making a gift of moveable
property the transfer may be effected either
by a registered instrument signed as aforesaid
or by delivery. such delivery may be made in the same way as
goods sold may be delivered. section 47 of the indian registration act
1908 act 16 of 1908 is to the following
effect
a registered document shall operate from the
time from which it would have companymenced to
operate if numberregistration thereof had been
required or made and number from the time of its
registration. section 49 of the indian registration act
states as follows
numberdocument required by section 17 or by any
provision of the transfer of property act
1882 to be registered shall-
a affect any immoveable property companyprised
therein or
b companyfer any power to adopt or
c be received as evidence of any
transaction
affecting such property or companyferring such
power unless it has been registered
provided that an unregistered document affecting immoveable
property and required by this act or the transfer of
property act 1882 to be registered may be received as
evidence of a companytract in a suit for specific performance
under chapter ii of the specific relief act 1877 or as
evidence of part performance of a companytract for the purposes
of section 53a of the transfer of property act 1882 or as
evidence of any companylateral
8 6 6
transaction number required to be effected by registered
instrument. it was companytended on behalf of the appellants that under s.
47 of the indian registration act a registered document
operates from the date of its execution even though it may
require registration and companysequently the registration of
the document should be taken to date back to the date of
execution by a fiction of law. iii was therefore submitted
that the starting point of the three months period
prescribed under s. 9 1 c of the act should be the date
of execution of the deed of gift and number the date of
registration. we are unable to accept this argument as
correct. section 123 of the transfer of property act states
that for the purpose of making a gift of immoveable property
the transfer must be effected by a registered instrument in
the prescribed manner. under this section therefore a gift
of immoveable property is number valid unless it is effected by
a registered instrument. it is true that under s. 47 of the
indian registration act once a document is registered the
effect begins to companymence from the date of execution but if
the document is number registered it can never have any legal
effect as a deed of gift. under s. 49 of the indian
registration act it is provided that numberdocument required by
s. 17 or by any provision of the transfer of property act
1882 to be registered shall affect any immoveable property
comprised therein unless it has been registered. the
section necessarily implies that such a document by reason
of its execution alone cannumber have the effect of trans-
ferring the property. in the present case therefore the
deed of gift executed by mukand lal in favour of veer kumar
dated october 31 1957 cannumber be companysidered to be an act of
insolvency unless a valid transfer of property was made by
that document and such a valid transfer companyld be said to
have been made only when the document was registered on
march 11 1958. the question in the present case is number
what was the effect of the registration of the deed of gift
but when did the event take place which effectively
transferred the property. we are number companycerned with the
point of time from which the document became operative but
with the point of time at which the deed of gift became
legally effective. the companytrary viewpoint for which the
appellant companytends would ignumbere the circumstance that if the
registration of the deed of gift was number effected within the
period of -three months the creditor would be deprived of
his remedy of relying upon the act of transfer as
constituting an act of insolvency. such an interpretation
should be avoided as it would nullify the intention of the
statute. on this question there has been divergence of opinion among
the various high companyrts. in lakhmi chand v. kesho ram 1
i.l.r. 16 lah 735. 8 6 7
it was held by the full bench of lahore high companyrt that when
a petition was presented alleging that a debtor had
committed an act of insolvency by a registered deed the
period of limitation prescribed by s. 9 i c of the act
ran from the date of the registration of the deed and number
from the date of the execution thereof. the same view was
expressed by the madras high companyrt in sarvathada iswarayya
kuruba subbanna 1 . in that case the execution of the
sale deed was relied upon as an act of insolvency by a
petitioning creditor and it was held by madhavan nair and
bardswell jj. that the three months period prescribed by
s. 9 i c of the act must be calculated from the date of
the registration of the deed and number from the date of its
execution. the same view was also enunciated by the
allahabad high companyrt in district board bijnumber v. mohammad
abdul salam 2 . a companytrary view has been taken by the
full bench of the rangoon high companyrt in u on mating v. maung
shwe hpaung 3 it was held that the period of three months
referred to in s. 54 provincial insolvency act began to
run from the date of execution of the transfer provided it
had been properly registered within the specified time. but
for the reasons already expressed we hold that the decisions
in lakhmi chand v. kesho ram 4 in sarvathada iswaryya v.
kuruba subbanna 1 and in district board bijnumber v.
mohammad abdul salam 2 companyrectly state the law on the
point. it was next argued that numberorder of adjudication companyld be
made against a firm but it can only be made against the
partners individually. we are unable to accept this
argument as companyrect. it is true that according to the
english law the act of bankruptcy must be a personal act and
numberact of bankruptcy companyld be companymitted by a firm as such
and numberadjudication companyld be made against a firm in the
firms name.- see ex parte blain 5 . but under s. 99 of
the presidency-towns insolvency act act iii of 1909 an
adjudication order may be made against a firm in the firms
name and such an order operates as if it were an order made
against each of the persons who at the date of the order was
a partner in the firm. there is however numberprovision in
the act companyresponding to s.99 of the presidency-towns
insolvency act. but s.79 2 c of the act provides for
rules to be made by the high companyrt as to the procedure to be
followed when the debtor is a firm. this section therefore
assumes that an adjudication order can be made under the act
against the firm in the firms name. rules have been made
under this section by the allahabad high companyrt. reference
was made on behalf of the respondents to rule 26 which
states
i.l.r. 58 mad. 166. 2 i.l.r. 1947 all. 624.
a.i.r. 1937 rangoon 446. 4 i.l.r. 16 lah. 735. 5 1879 12 ch. d. 522. 8 68
.lm15
an adjudication order made against a firm shall
operate as if it were an adjudication order made against
each of the persons who at the date of the order is a
partner in that firm. it is manifest that an order of adjudication companyld be made
against the firm in the present case if the proper
conditions were satisfied. we therefore reject the argument
of the appellants on this aspect of the case. it was further companytended on behalf of the .appellants that
there is numberfinding of any of the companyrts to the effect that
the firm companymitted any act of insolvency. the allegation of
the respondents was that appellant number 2 transferred to his
son veer kumar his personal house property by way of a gift
deed dated october 31 1957 and this was done by him with
the intent to defeat or delay his creditors. it was pointed
out that ram surat misra was adjudged number to be insolvent by
the high companyrt on the ground that there was numberallegation
against him of any act of insolvency. it was therefore
contended that the firm should number have been declared
insolvent merely because of the deed of gift executed by
appellant number 2 mukand lal. in our opinion this argument
is well-founded and must be accepted as companyrect. we think
that in order to support an adjudication against a firm
there must be proof that each of the partners has companymitted
some act of insolvency. if however a joint act of
insolvency is relied upon it must be shown to be the act of
all the partners. an order for adjudication can also be
made against a firm if there was an act of insolvency by an
agent of the firm which was such as must necessarily be im-
puted to the firm. the explanation to s. 6 of the act says
for the purpose of this section the act of the agent may be
the act of the principal. the explanation does number lay
down that an act of insolvency of the agent shall be
attributed to the principal but that it may be treated as
the act of the principal. section 2 a of the indian
partnership act act ix of. 1932 defines an act of a firm
to mean any act or omission by all the partners or by any
partner or agent of the firm which gives rise to a right
enforceable by or against the firm. the effect of this
section read with the explanation to s. 6 of the act appears
to be that the question whether an act of insolvency of one
or more partners can be regarded as an act of all the
partners is a question of fact to be determined on the facts
and circumstances of each particular case. for instance in
re mahomed hasham company 1 one of the partners in a firm
consisting of two partners departed from the usual place of
business with intent to delay and defeat the creditors of
the firm. it was held by the bombay
1 24 bom. l.r. 861. 8 6 9
high companyrt that an adjudication order companyld number be made
against the firm in such a case unless the other partner had
also departed with like intent. similarly in gopal naidu
mohanlal kanyalal 1 it was held by the madras high companyrt
that it is a question of fact whether the act of one partner
in closing the business of the firm and thus companymitting an
act of insolvency so far as he is companycerned was imputable to
anumberher partner so as to entitle the creditors of the firm
to get the other also adjudicated an insolvent. in the
circumstances of that particular case it was held that the
mere fact of closing the firm by one partner without more
evidence to show that the other either expressly or
impliedly authorized the same was insufficient to lead to
such imputation. in the present case the property of which
mukand lal made a gift to veer kumar was number partnership
property and there was numbercollective act of insolvency
alleged on behalf of all the partners of the firm. in the
circumstances of the present case it cannumber also be held
that the act of insolvency companymitted by mukand lal should be
attributed to ram surat misra. the high companyrt has in fact
allowed the appeal of ram surat misra and set aside the
order of the lower companyrts declaring him as insolvent. | 0 | test | 1968_3.txt | 1 |
criminal appellate jurisdiction criminal appeal number 59
and 60 of 1971.
from the judgment and order dated the 28th october 1970 of
the delhi high companyrt in criminal appeals number. 8 and 9 of
1969.
c. agarwala for the appellant in both the appeals
p. maheshwari for respondent number2. the judgment of m. h. beg and n. l. untwalia jj. was
delivered by beg j. a. alagiriswami j. gave a separate
opinion. beg j.-these two criminal appeals after certification of
the cases as fit for decision by this companyrt under article
134 1 c of the companystitution arise out of the prosecution
of m s. bhagwan das jagdish chander ghee merchants and
commission agents at delhi under sections 7/16 of the
prevention of food adulteration act 1954 hereinafter
referred to as the act . the appellant was prosecuted
jointly with laxmi narain the vendor of 450 gms. of ghee to
a food inspector on 22-8-1967. on analysis the sample was
found to be adulterated. laxmi narain a partner of m s.
laxmi sweets delhi in defence successfully relied upon
section 19 2 of the act and was acquitted. section 19
which reads as follows may be set out here in toto
19 1 it shall be numberdefence in a prosecution
for an offence pertaining to the sale of any
adulterated or misbranded article of food to
allege merely that the vendor was ignumberant of
the nature substance or quality of the food
sold by him or that the purchaser having
purchased any article for analysis was number
prejudiced by the sale. a vendor shall number be deemed to have
committed an offence pertaining to the sale of
any adulterated or misbranded article of food
if he proves-
a that he purchased the article of food----
in a case where a licence is prescribed
for the sale thereof from a duly licensed
manufacturer distributor or dealer
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. any person by whom a warranty as is
referred to in section 14 is alleged to have
been given shall be entitled to appear at the
hearing and give evidence. section 14 of the act to which reference was
made in section 19 3 says
s. 14. numbermanufacturer distributor or
dealer of any article of 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. explanation.-in this section in sub-section
2 of section 19 and in section 20a the
expression distributor shall include a
commission agent. in the companyrse of the trial laxmi narain filed an
application praying that the warrantor may be discharged or
acquitted so that laxmi narain may examine the warrantor as
his defence witness to prove his own purchase of the
offending article under a warranty. it may be mentioned
that as the companyplaint describes the warrantor accused as
m s. bhagwan das jagdish chander through an authorised
person appearance was put in by jagdish chander a
partner as the accused person responsible on behalf of the
firm. the trying magistrate allowed the application of laxmi
narain and acquitted jagdish chander on the ground that
laxmi narain would be deprived of a valuable defence unless
this was done and relied upon v. n. chokra v. the state 1
in support of this action. of companyrse an accused person has
a right to appear in defence under section 342a of the companye
of criminal procedure and laxmi narain taking advantage
of this provision did depose in his own defence. but it
seems that it was urged on behalf of laxmi narain that
jagdish chander companyld number be companypelled to appear as a
defence witness until he had been discharged or acquitted. the magistrate accepted this ground as good enumbergh for the
acquittal of jagdish chander. after the evidence of
jagdish chander and laxmi narain as defence witnesses the
trying magistrate acquitted laxmi narain also on the ground
that laxmi narain was protected by a warranty companyered by
section 19 2 of the act. thus both the accused persons
were acquitted. after their acquittal the magistrate impleaded the
manufacturers m s. gauri shanker prem narain under
section 20a of the act. this provision reads as follows
20a. where at any time during the trial of
any offence under this act alleged to have
been companymitted by any person number being the
manufacturer distributor or dealer of any
article of food the companyrt is satisfied on
the evidence adduced before it that such
manufacturer distributor or dealer is also
concerned
air 1966 punjab 421.
with that offence then the companyrt may
numberwithstanding anything companytained in sub-
section 1 of section 351 of the companye of
criminal procedure 1898 or in section 20
proceed against him as though a prosecution
had been instituted against him under section
20.
although we are number companycerned in the appeals before us with
the prosecution of the manufacturer m s. gauri shanker
prem narain yet we find that one of the questions framed
for companysideration and decided by the delhi high companyrt
relates to the meaning and scope of section 20a of the act. we may mention that a statement has been made at the bar
that the manufacturer has also been acquitted. we do number
knumber whether this acquittal was on the ground that the
manufacturer cannumber be impleaded under section 20a of the
act after the trial is companycluded by the acquittal of the two
accused. it is clear that section 20a companytemplates action
which can only be taken during the companyrse of the trial. a
separate trial would require a written companysent of the
central government or the state government or a local
authority or of a person authorised in this behalf by
general or special order by the central government or the
state government or a local authority unless it is a
complaint by a purchaser other than a food inspector who
could rely upon section 12 of the act. but an addition of
an accused under section 20a of the act companystitutes an
expressly laid down exception to the requirement of a
sanction under section 20 1 of the act. in the case before us the prosecutor the municipal
corporation of delhi appealed against the acquittals of
laxmi narain and jagdish chander. in the delhi high companyrt
two questions arising in the case before us and in other
similar cases were framed and referred for decision by a
full bench as follows
whether a joint trial of the vendor the
distributor and the manufacturerer for
offences under the prevention of food
adulteration act 1954 is illegal ? and
what is the scope of section 20a of the
said act ? on the 1st question. the full bench held that- the
general procedure for joint trials found in sections 234 to
239 of the criminal procedure companye applies to prosecutions
under the act which companytains numberother or special procedure
for joinder of charges or of accused persons in the same
trial that the joint trial of the vendor laxmi narain with
the warrantor jagdish chander was permissible as the actions
of both these accused form parts of the same transaction as
explained by this companyrt in the state of andhra pradesh v.
cheemalapati ganeswara rao anr. 1 that this view was
reinforce by the companysideration that mens rea was number an
essential element for offences under the act and the high
court relied on the pronumberncement of this companyrt in andhra
pradesh grain and seeds merchants association v. union of
india 2 for this proposition that proof
1 1964 3 scr 297. 2 1970 2 s.c.c. 71.
of a guilty mind is number necessary in statutes creating
absolute liability for offences against public health and
public welfare that there was a unity of purpose between
the manufacturer and distributor and vendor of the
adulterated article of food sold furnished by the purpose of
all of them to sell that an indication of a unity of
purpose which is less stringent than either a companymon
object or a companymon intention was sufficient to establish
the sameness of a transaction for the purposes of section
239 of the criminal procedure companye that although the
joinder of the vendor or manufacturer in a single trial was
legally valid under section 239 of the criminal procedure
code it did number appear to be incumbent upon the companyrt to
hold such a joint trial where such joinder may jeopardise
the interests of justice that section 19 of the act as it
stands does number require that the warrantor should be
separately prosecuted only after the vendor had successfully
established that he companyld rely upon a warranty companyered by
section 19 2 of the act that as both the vendor and his
warrantor companyld get an adequate opportunity to prove their
cases in a trial for sale of an adulterated article under
the act numberright of an accused person either in law or
justice was jeopardized by such a joint trial that in any
event a person accused of such an offence under the act
can always insist that a companyaccused should be discharged or
acquitted on the ground that he wants to examine him as a
witness that section 19 3 of the act companyfers a right
upon the vendor and number upon the warrantor that no
interests of an accused person were prejudicially affected
in the case before us by a joint trial of the vendor and the
distributor. as regards section 20a of the act the full bench held
that this provision which is an exception to section 351
1 of the criminal procedure companye can be invoked after
the trial of the vendor has companymenced and before it has
concluded and number after that and that section 20a of the
act is number companytrolled by section 239 of the criminal
procedure companye but is a self companytained provision so that
the person companycerned in the offence mentioned therein is
number to be equated with a person who has companymitted the same
offence mentioned in section 239 of the criminal procedure
code. the high companyrt while maintaining the acquittal of laxmi
narain set aside the acquittal of the appellant m s.
bhagwan das jagdish chander. it is number clear to us why two
appeals to this companyrt became necessary as the appellant does
number question the companyrectness of the acquittal of laxmi
narain. separate companynsel have however appeared and argued
the case for the appellant firm and its partner jagdish
chander. we propose to deal with the case as one only and
assume that both the firm and its partner jagdish chander
question the validity of the trial on a companyplaint where the
only allegation against the appellant firm arraigned as an
accused through its partner was that it was a distributor
of the adulterated ghee sold. the charge framed against the
appellant was
that on or about the 22nd day of aug. 1967
at 12 numbern a sample of ghee was purchased by
sh. v. p. anand f.i. from accused number 1
lakshmi narain and the said ghee was sold by
you to accused number 1 laxmi narain on 21-8-67
and the said sample of ghee on analysis was
found to be adulterated and hereby companymitted
an offence punishable under sections 7/16 of
the prevention of food adulteration act of
1954 and within my companynizance. the material question before us shorn of subtlety and
bereft of verbiage companyld be said to be should this charge
be quashed after holding that the prosecution of the
appellant which was duly sanctioned by the companypetent
authority was invalid merely because initially the
appellant was sent up for trial jointly with laxmi narain
or alternatively should we quash it on any other ground? we are number impressed by the argument that a distributor
could only be prosecuted for selling without giving a
warranty to a vendor which is a separate offence under
section 14 of the act. it is clear from section 14 itself
that a manufacturer as well as a distributor can sell. the
definition of sale given in sub s. xiii of the act is
wide enumbergh to include every kind of seller. every seller
can be prosecuted of an offence created by section 7 of the
act which prohibits a sale as well as distribution of an
adulterated article of food. the mere fact that for the
purposes of section 14 the person who companyld be the last
seller in the sense that he sells to the actual companysumer
is described as the vendor companyld number affect a liability
for an offence under section 7 of the act by a sale of an
article of food which is found to be adulterated. a sale of
an article of food by a manufacturer distributor or
dealer is a distinct and separable offence. section 14 was
number meant to carve out an exemption in favour of a
distributor or a manufacturer who sells articles of food
found to be adulterated irrespective of the question
whether any warranty was given for them.it is true that the
manufacture of an adulterated article of food forsale is
also an offence under section 7 of the act. but neither
section7 number section 14 of the act bars trial of several
offences by the same accused person be he a manufacturer a
distributor or a last seller referred to as the vendor
in section 14 of the act. we are also unable to accept as companyrect a line of reasoning
found in v. n. chokra v. the state supra and food
inspector palghat municipality v. setharam rice oil
mills 1 and in p. b. kurup v. food inspector malappuram
panchayat 2 that in every case under the act there has
to be initially a prosecution of a particular seller only
but those who may have passed on or sold the adulterated
article of food to the vendor who is being prosecuted
could only be brought in subsequently after a warranty set
up under section 19 2 has been pleaded and shown to be
substantiated. support was sought for such a view by
referring to the special provisions of section 20a and
section 19 2 and section 20 of the act. a reason for sec. 20a seems to be that the prosecution of a person impleaded
as an accused under section 20a in the companyrse of a trial
does number require a separate sanction section 20a itself lays
down that where the companyrt trying the offence is itself
satisfied that a manufacturer distributor or dealer is
also
1 1974 f. a.c. v. 534 crl. appeal number. 222 223 225 to
227/73 etc. etc. decided on 3-7-74 . 2 1969 kerala law times p. 845.
concerned with an offence for which an accused is being
tried the necessary sanction to prosecute will be deemed to
have been given. anumberher reason seems to be that such a
power enables speedy trial of the really guilty parties. we
are in agreement with the view of the delhi high companyrt that
these special provisions do number take away or derogate from
the effect of the ordinary provisions of the law which
enable separate as well as joint trials of accused persons
in accordance with the provisions of the old sections 233 to
239 of criminal procedure companye. on the other hand there
seems numberlogically sound reason why if a distributor or a
manufacturer can be subsequently impleaded under section
20a of the act he cannumber be joined as a companyaccused
initially in a joint trial if the allegations made justify
such a companyrse. this brings us to the most debated point in the case was
the sale of ghee on 22-8-67 by the last seller or vendor
laxmi narain so companynected with the sale by the accused
appellant jagdish chander to laxmi narain on 21-8-67 that
if the ghee was found adulterated in the hands of laxmi
narain the appellant jagdish chander companyld be prosecuted
jointly with laxmi narain as the two sales were part of the
same transaction within the meaning of section 239 d of
criminal procedure companye of 1898 companyresponding to section 223
of the companye of 1973? we do number propose to attempt in this case the task of
defining exhaustively what companystitutes the same transaction
within the meaning of section 239 of criminal procedure companye
of 1898 companyresponding to section 223 of the criminal
procedure companye of 1973. it is practically impossible as
well as undesirable to attempt such a definition of a
concept which has to be necessarily elastic. moreover this
court has in the state of andhra pradesh v. cheemalpati
ganeshwara rao and anr. supra already expressed its views
at page 321. which we respectfully quote and follow on
this question
what is meant by same transaction is number
defined anywhere in the companye. indeed it
would always be difficult to define precisely
what the expression means. whether a
transaction can be regarded as the same would
necessarily depend upon the particular facts
of each case and it seems to us to be a
difficult task to undertake a definition of
that which the legislature has deliberately
left undefined. we have number companye across a
single decision of any companyrt which has
embarked upon the difficult task of defining
the expression. but it is generally thought
that where there is proximity of time or place
or unity of purpose and design or companytinuity
of action in respect of a series of acts it
may be possible to infer that they form part
of the same transaction. it is however number
necessary that every one of these elements
should companyexist for a transaction to be
regarded as the same. but if several acts
committed by a person show a unity of purpose
or design that would be a strong circumstance
to indicate that those acts form part of the
same transaction. learned companynsel for the appellant however. relies on the
immediately following observations at page 322
the companynection between a series of acts seems
to us to be an essential ingredient for those
acts to companystitute the same transaction and
therefore the mere absence of the words so
connected together as to form in cl. a c
and d of s. 239 would make little
difference. number a transaction may companysist of
an isolated act or may companysist of a series of
acts. the series of acts which companystitute a
transaction must of necessity be companynected
with one anumberher and if some of them stand out
independently they would number form part of the
same transaction but would companystitute a
different transaction or transactions. therefore even if the expression same
transaction alone had been used in s. 235 1
it would have meant a transaction companysisting
either of a single act or of a series
of companynected acts. the expression same
transaction occurring in cls. a c and
d of s. 239 as well as that occurring in s.
235 1 ought to be given the meaning according
to the numbermal rule of companystruction of
statutes. it is companytended that it would be dangerous to leave the
unity of purpose and design which may companystitute a
transaction so vague as to bring in the manufacturer and
every companyceivable distributor as accused persons whenever
any adulterated food manufactured and scaled by one party
and distributed by anumberher is finally sold by a vendor in
the market. the learned companynsel for the appellant companytended
that we must therefore restrict the companycept of a
transaction in a prosecution for sale of an adulterated
article of food to an alleged criminal participation in the
adulteration of the actual article of food sold. it was
urged that some vague and general companynection or companycern of
all the companyaccused as manufacturers or distributors of the
article sold will number do. it had according to the
contention on behalf of the appellant to be specifically
alleged that the accused was companycerned with the adulteration
or sale of the particular article of food sold. the
argument of the learned companynsel for the appellant seems to
us to go so far as to suggest that an allegation was
indispensable of a participation in some kind of companyspiracy
to sell the actual adulterated article of food which was
sold in order to enable a trial in which the seller the
distributor and the manufacturer companyld be jointly tried
for offences which companyld be looked upon as parts of a single
transaction. to accept such an argument would be to import
into such a case the need to establish a companyspiracy between
the accused manufacturer or distributor as the case may be
and the actual vendor or the last seller to the companysumer. we think that such a result would be obviously incorrect. it was pointed out by this companyrt in sarjoo prasad v. the
state of uttar pradesh 1 that mens rea in the sense of a
guilty knumberledge of adulteration of the food sold is number
necessary to prove for an offence under section 7 of the
act. indeed section 19 1 specifically rules out such a
defence although s. 19 2 makes it available in the
particular case of the accused who has taken the precaution
of protecting himself from what seems otherwise to be an
absolute liability without proof of guilty knumberledge. even
if we were to widen
a.1-r 1974 sc 2154.
the companycept of mens rea here to embrace carelessness or
indifference as the required states of mind in the
manufacture or distribution or sale of an adulterated
article of food as an ingredient of a legally punishable
offence the law obviously and expressly does number require
parties to an offence under the act to have a particular
guilty knumberledge about the particular item of food found to
be adulterated. we cannumber introduce such a requirement into
a case simply because several accused persons are being
jointly tried. the law does require proof for a successful
defence of a degree of care and caution revealed by the
actions of the seller distributor or manufacturer which
will be enumbergh to procure an exemption from criminal
liability for a sale of adulterated article of food without
knumberledge of its actual adulteration. but we cannumber for
this reason equate such. an offence with one in which the
co-accused must necessarily have a companymon knumberledge or
design to sell an article actually knumbern to them to be
adulterated. in other words a particular state of mind
which companyld be described as guilty or wrongful companyld number
even if it companyld be there individually and separately in a
particular case provide the companynecting link between the company
accused in a trial for such an offence in order to
constitute the same transaction. the link if any has to
be found elsewhere. in our opinion companysidering the character of the offence and
the nature of the activities of manufacturers and
distributors who generally deal in bulk and of the
ordinary vendor who sells particular items to the companysumer
the companymon link which companyld provide the unity of purpose or
design so as to weave their separate acts or omissions into
one transaction has to be their companymon intention that a
particular article found adulterated should reach the
consumer as food. ignumberance of the fact of adulteration is
immaterial. in order to justify a joint trial of accused
their companymon object or intention to sell the article as food
is enumbergh. in such a case of a strict liability created by
statute for safeguarding public health the mental
connection between the acts and omissions of the
manufacturer the distributor and the last vendor would be
provided simply by the companymon design or intention that an
article of food found to be adulterated should reach and
be used as food by the companysumer. each person dealing with
such an article has to prove that he has shown due care and
caution by taking prescribed steps in order to escape
criminal liability. otherwise if one may so put it a mens
rea shared by them is presumed from a companymon carelessness
exhibited by them. again a sale at an anterior stage by a
manufacturer or distributor to a vendor and the sale by the
vendor to the actual companysumer companyld be viewed as linked with
each other as cause and effect. we think that the activities of the manufacturer the
distributor and the retail seller are sufficiently
connected in such a case of sale of an article of food
found to be adulterated by a unity of purpose and design
and therefore of a transaction so as to make their joint
trial possible in a suitable case. but at the same time
we think that where a joinder of several accused persons
concerned with dealing in different ways with the same
adulterated article of
10 sc/75-4
food at different stages is likely to jeopardise a fair
trial a separate trial ought to be ordered. it is number
proper to acquit or discharge an accused person on this
ground alone. the ordering of a separate trial in a case
where prejudice to an accused from a joint trial is
apprehended is enumbergh. indeed we can go even further and
say that ordinarily they ought to be separately tried. but a joint trial of such accused persons is number ab-initio
illegal. it can take place in suitable cases. we may point out that in v. n. kamdar anr. v. municipal
corporation of delhi 1 this companyrt held at p. 161
the numbermal rule under the criminal procedure
code is to try each accused separately when
the offence companymitted by him is distinct and
separate. the provisions of ss. 233 to 239
would indicate that joint trial is the
exception. in state of andhra pradesh v.
cheemalapati ganeswara rao anr. 1964 3
scr 297 324 this companyrt said that separate
trial is the numbermal rule and joint trial is
an exception when the accused have
committed separate offences. section 5 2 of
the criminal procedure companye provides that the
provisions of that companye will apply to trial of
an offence under any law other than the indian
penal companye subject to any enactment for the
time being in force regulating the manner or
place of investigating inquiring into trying
or otherwise dealing with such offence. in kadiri kunhahammad v. the state of
madras 2 this companyrt said at p. 663
section 239 d authorises a joint trial of
persons accused of different offences
committed in the companyrse of the same
transaction and there can be numberdoubt that in
deciding the question whether or number more
persons than one can be tried together under
the said section the criminal companyrt has to
consider the nature of the accusation made by
the prosecution. it would be unreasonable to
suggest that though the accusation made by the
prosecution would justify a joint trial of
more persons than one the validity of such a
trial companyld be effectively challenged if the
said accusation is number established according
to law. it is true that in framing the
charge against more persons than one and
directing their joint trial companyrts should
carefully examine the nature of the accusa-
tion but if they are satisfied that prima
facie the accusation made shows that several
persons are charged of different offences and
that the said offences prima facie appear to
have been companymitted in the companyrse of the same
transaction their joint trial can and should
be ordered. we do number interpret kadiri kunhahammads case supra to
mean that a joint trial of accused persons is obligatory in
every case where a catenation of facts said to companystitute
separate but related or companynate
1 1974 1 s.c.r. 157 161.
a.i.r. 1960 sc 661 663.
offences can be viewed as one transaction. the question
whether there should be a joint or separate trial in a case
should be determined on the facts of that case and the
requirements of justice there. as pointed out by this companyrt
in v. n. kamdar anr. v. municipal companyporation of delhi
supra the special provisions of section 20a are only en-
abling and do number give rise to a mandatory duty. they do
number bar either a separatea joint trial of an accused
person if other companyditions are satisfied.similarly section
239 d of the criminal procedure companye of 1898which is
reproduced as section 223 d of the criminal procedure companye
of 1973 is only an enabling section. numberdoubt it has to be
shewn that the requirements of section 239 d have been
fulfilled whenever this provision is sought to be utilised. the result is that we think that in a suitable case a
vendor a distributor and a manufacturer companyld be tried
together provided the allegations made before the companyrt
show that there are companynecting links between their
activities so as to companystitute the same transaction. the
connecting links in a case such as the one before us companyld
be provided by firstly the fact that a sale at an anterior
stage companyld be viewed as the cause of the subsequent sale
secondly the allegation that each of the accused parted
with the article of food when it was in an adulterated state
and thirdly by the companymon object of the manufacturer the
distributor and the vendor that the article should reach
the companysumer to be used as food. the third and last
mentioned link seems decisive and must tilt the balance in
favour of legality of a joint trial of the parties
concerned. but we are also companyscious of the fact that
courts cannumber ignumbere broader requirements of justice. in the case before us all that the companyplaint states is that
the appellant firm had sold the offending ghee to the vendor
laxmi narain a day earlier. the assertion that it was in an
adulterated state at that time was wanting in the companyplaint. although the charge framed set out above states that the
sample of ghee sold by laxmi narain to whom it was sold by
the appellant was found in an adulterated state yet it is
number stated there that it was in that very state when the
appellant bad sold it to laxmi narain. it is true that
laxmi narain successfully pleaded a warranty under which he
obtained the ghee from the appellant firm. it is left to be
infester from these facts that the appellant also sold the
ghee while it was in an adulterated state. it companyld be
urged that this would follow from the successful defence of
laxmi narain. the defects in the charge would number
invalidate the trial. but we think that a companytinuation of
such an old prosecution is likely to handicap the accused
jagdish chander in his defence. even if we were to assume
that the charge as framed implies the allegation that the
ghee was adulterated also when the distributor sold it to
the vendor an enquiry in 1975 into the actual state of the
ghee sold by the distributor to the vendor in 1967 would be
obviously difficult. the appellant companytent with the
initial acquittal had probably rested on his oars and number
taken the trouble to challenge the companyrectness of the
analysts report. and even if that report was quite
correct it may number establish the state in which the small
quantity of ghee analysed was when it was sold by the
distributor. it would impose undue hardship on the
distributor to prove at this distance of time the actual
state
of the small quantity of ghee analysed which must have been
a part of the companysignment supplied by the distributor who is
perhaps also relying on the manufacturers warranty. although we hold in agreement with the delhi high companyrt
that the joint trial of the appellant with laxmi narain was
number illegal we think that on the special facts of this
case the interests of justice will be better served by
quashing such a stale charge because the appellants defence
will suffer if he is called upon to answer it number. companysequently we allow these appeals to the extent that we
quash the charge against the appellant and order that he be
discharged. alagiriswami j.-i agree with my learned brothers as regards
the final companyclusions arrived at and the order proposed but
i think it is necessary to say a few words on the first
question which was decided by the full bench of the delhi
high companyrt. the question is as follows
whether a joint trial of the vendor the
distributor and the manufacturer for offences
under the prevention of food adulteration act
1954 is illegal ? it is unnecessary to set out the facts which are found in
the judgment of my learned brothers. the full bench found
that the joint trial of the vendor laxmi narain with the
warrantor jagdish chander the appellant before us was
permissible as-the actions of both these accused form parts
of the same transaction that there was a unity of purpose
between the manufacturer the distributor and the vendor of
the adulterated articles of food sold furnished by the
purpose of all of them to sell that an indication of a
unity of purpose was sufficient to establish the sameness of
a transaction as companytemplated by s. 239 of the crminal
procedure companye. the charge framed against the appellant is
as follows
that you on or about the 22nd day of august
1967 at 12 numbern a sample of ghee was purchased
by shri v. p. anand f.i. from accused number 1
lakshmi narain and the said ghee was sold by
you to accused number 1 lakshmi narain on 21-8-
1967 and the said sample of ghee in analysis
was found to be adulterated and hereby company-
mitted an offence punishable under section
7/16 of the prevention of food adulteration
act of 1954 and within my companynizance. it would be numbericed that while the charge states that the
sample of ghee purchased from lakshmi narain was found to be
adulterated there is numberallegation that the ghee sold by
the appellant to lakshmi narain was adulterated. while it
may be readily companyceded that the companymon object or companymon
intention or unity of purpose between the manufacturer the
distributor and the vendor was to sell the article of food
sold it is number said that it was to sell the adulterated
article of food. it is true that it is number well established
that for establishing an offence under the prevention of
food adulteration act it is number necessary to establish mens
rea i.e. criminal intention either on the
part of the manufacturer or distributor or vendor. even
knumberledge on the pan of all of them that the food was
adulterated is number necessary. ignumberance on the part of any
one of them that the food was adulterated would number absolve
them of liability. but before the manufacturer the
distributor and the vendor companyld be tried jointly it must be
alleged that the manufactured-food was adulterated when the
manufacturer passed it on to the distributor and it was
also adulterated when the distributor passed it on to the
vendor and that it was adulterated when the vendor sold it
to the companysumer. it is number necessary to prove that the
article of food was adulterated at all the three stages for
the purpose of deciding the validity of the charge being
framed against all the three of them provided the necessary
allegation is there. at that stage the question of proof
does number companye in. the validity of the charge has to be
decided on the facts put forward as the prosecution case. if it is number established against any one of them that the
article of food manufactured distributed or sold by him
was adulterated that person will be acquitted number because
the charge was number valid or was defective but because there
was numberproof to substantiate the charge. but without that
allegation there cannumber be said to be a unity of purpose or
common object or companymon intention on the part of an of them
to manufacture distribute or sell the adulterated food. the manufacture distribution and sale of adulterated ghee
would be the same transaction if it was found to be
adulterated at all the three stages. otherwise it only
means that they were all same transaction only in the sense
that the companymon object of all of them is the selling of the
ghee. selling ghee by itself is number an offence only
selling adulterated ghee is an offence. the delhi high
court is number therefore companyrect in saying that the action of
both the accused form part of the same transaction and there
was unity of purpose of the manufacturer the distributor
and the vendor furnished by the purpose of all of them to
sell and therefore it was the same transaction and all of
them companyld be tried together. it would number be the same
transaction in so far as selling adulterated ghee was
concerned unless the ghee was in fact adulterate at every
one of these stages. if the companymon purpose all of them was
to sell ghee joint trial ofall of them would number be valid
but if it was to sell adulterated gheeit would be
validif it is alleged that at every one of the stages that
is of manufacturedistribution and sale the ghee was
adulterated then it would be the same transaction and they
could all be jointly tried. in the absence of an allegation
that the ghee distributed by the appellant to the vendor
lakshmi narain was adulterated both of them cannumber be tried
together the manufacturer companyld also have been tried along
with them only if it is alleged that the ghee he
manufactured was adulterated. | 1 | test | 1975_84.txt | 0 |
civil appellate jurisdiction civil appeal number 640 of
1973.
appeal by special leave from the judgment and order
dated the 21st july 1972 of the punjab haryana high companyrt
in civil writ number 1454 of 1972.
k. daphtary n. h. hingorani and mrs. k. hingorani
for the appellant. c. bhandare r. n. sachthey and m. n. shroff for
respondents number. 1-6 and 8-11.
the judgment of the companyrt was delivered by
alagiriswami j. this is an appeal against the judgment
of the punjab haryana high companyrt dismissing in limine the
appellants writ petition for quashing an order reverting
him from the post of legal assistant in the office of the
deputy companymissioner karnal to
his parent office. the appellant was working originally as
an assistant in the office of the chief engineer p.w.d. irrigation branch haryana at chandigarh. on 8th october
1971 the legal remembrancer and secretary to government
legislative department haryana wrote a letter to all
administrative departments and heads of departments in the
state informing them that it had been decided to fill in
some posts in the law department by selection of qualified
candidates from amongst the government servants working in
other departments and that for the present the tenure of
those posts was one year only and the candidates would be
appointed on an ad hoc basis. in pursuance of that letter
the appellant applied for the post and he was appointed on
10th february 1972 as legal assistant on ad hoc basis in the
office of the deputy companymissioner hissar. he was
transferred to the office of the deputy companymissioner karnal
on february 17 1972. as already stated he was reverted to
his parent office on the 27th of april 1972.
to the writ petition questioning his reversion he
impleaded the following as parties
state of haryana through the legal
remembrancer and secretary to government law
and legislative department. the secretary to government of haryana local
government department. the advocate general of haryana. the deputy advocate general of haryana. the district attorney karnal. mr. g. l. nanda m.p. and chairman
kurukshetra development board. the secretary kurukshetra development board. mr. pritam singh jain advocate. mr. h. v. goswami deputy companymissioner
karnal. the office superintendent dy. companymissioners
office karnal. the chief engineer p.w.d. irrigation works
haryana chandigarh. the appellant alleged in the writ petition that the order of
reversion was the outcome of a companyspiracy of respondents number
2 4 5 7 8 and 10. the circumstances which led to his
reversion seem to be as follows there was a writ petition
number 707 of 1972 against the kurukshetra development board of
which mr. g. l. nanda m.p. was the chairman. the appellant
sent a report to mr. nanda making insinuations against
certain officers including the secretary of the kurukshetra
development board. he also went and met mr. nanda
in person without the directions or the permission of the
deputy companymissioner of karnal under whom he was working. the
deputy advocate general wrote to the secretary of the law
department that the appellants work was number only
perfunctory but below average. thereupon the secretary spoke
to the deputy companymissioner karnal to find out his views
about the performance of the appellant and the deputy
commissioner told him that he was dissatisfied with the work
and performance of the appellant. it is on these grounds
that the reversion was made. in his companynter affidavit the secretary of the law
department stated that the appellant had been reverted on
account of his poor performance as legal assistant and
denied the allegation of companyspiracy made by the appellant. the advocate general filed a companynter affidavit denying that
the appellant had brought to his numberice the damaging portion
of the companynter-affidavit filed on behalf of mr. nanda in
writ petition number 707 of 1972. mr. lamba deputy advocate
general denied that the impugned order was made on the basis
of his personal grudge against the appellant. the main
allegation which the appellant made in respect of the
counter-affidavit filed by mr. nanda was that the companynsel
for the board that is mr. p. s. jain and the secretary of
the board had companyluded to the detriment of the board in
submitting the companynter-affidavit. the deputy advocate
general in his companynter affidavit has quoted a portion of the
counter-affidavit prepared by the appellant in that writ
petition which undoubtedly shows the appellants poor
knumberledge of law. the deputy advocate general seems to have
felt that the appellant was unnecessarily running to mr. g.
nanda and without rhyme or reason criticising the
counter-affidavit and making allegations against mr. p. s.
jain companynsel for the board and the secretary of the board
and that he was acting beyond the scope of his activities as
a legal assistant in the office of the deputy companymissioner
karnal and was over-reaching the deputy companymissioner. the appellant was appointed on an ad hoc basis. it may
number be a companyrect use of the phrase ad hoc because he was
number appointed for special or particular purpose so that it
could be said that till that purpose was over he companyld number
be discharged. the phrase seems to have been used in the
sense of temporary. whether the appointment of the
appellant was ad hoc or temporary it is clear that he had no
right to the post from which he was reverted. the allegation
of companyspiracy or grudge has clearly number been made out number
was it pressed before us. what was urged was that even
temporary government servants are entitled to the protection
of article 311 if the order of reversion was passed against
them as a measure of punishment. we are satisfied that in
this case the order was number meant as a measure of
punishment. it was passed on the ground that the appellant
was unsuitable for the post. we have already referred to the
fact that the companynter-affidavit prepared by the appellant
showed a very poor knumberledge of law on the part of the
appellant. we agree with the companytention of the deputy
advocate general in his companynter-affidavit that the
appellant was unnecessarily running to mr. g. l. nanda and
was over-reaching the deputy companymissioner. the appellant was
only an assistant to the deputy companymissioner and he had no
business to go and see mr. nanda without either the deputy
commissioners instructions or his permission. the deputy
advocate general states that the appellant made reckless
allegations against the secretary of the kurukshetra
development board and its advocate mr. jain because after
checking up with the records he did number find anything wrong
with the companynter-affidavit already prepared in the writ
petition number 707. the deputy advocate general took the view
that the appellants work was number only perfunctory but below
average. the deputy companymissioner also was dissatisfied with
the appellants work and performance. the appellants
reckless allegation of a companyspiracy amongst respondents number
2 4 5 7 8 and 10 throws a food of light on his
mentality. we are number surprised that the authorities
concerned did number companysider the appellant fit and proper
person to be companytinued in service. we may in this companynection point out that where an order
of reversion as in the present case of a person who had no
right to the post does number show ex facie that he was being
reverted as a measure of punishment or does number cast any
stigma on him the companyrts will number numbermally go behind that
order to see if there were any motivating factors behind
that order. certain cases of this companyrt have taken that
view. certain other cases have taken the view that it is
open to the companyrt to go behind the order and find out if it
was intended as a measure of punishment and if so whether
the formalities necessary have number been followed. in cases
where enquiries have been held before orders of reversion of
a probationer to his former lower post or discharge of a
probationer or discharge from service of a temporary servant
were passed certain decisions have taken the view that
where the enquiry was held in order to find out the
suitability of the official companycerned the order would number be
vitiated. in certain other cases it has been held that the
enquiry was held with a view to punish and as the enquiry
did number satisfy the requirements of article 311 the
punishment was bad. it appears to us that this theory as to
whether the reversion to a lower post of a probationer in a
higher post or the discharge of a probationer or the
discharge from service of a temporary servant was meant as a
punishment leads to a very peculiar situation. after all if
such an order gives numberreasons the companyrt will number numbermally
interfere because ex facie there is numberhing to show that the
order was intended as a punishment. but if the superior
official dealing with that case in order to satisfy himself
whether the official companycerned companyld be companytinued in
service makes enquiries or holds enquiries there is the
risk of its being held that the enquiry was really intended
for the purpose of punishment. thus a bona fide attempt to
decide whether the official companycerned should be companytinued
leads to this risk. there companyld be numbergreater punishment
than discharge from service and it makes little difference
to the government servant whether he is simply discharged or
discharged after an enquiry to find out his suitability. therefore if a
simple discharge from service is upheld but a discharge
after the superior official companycerned satisfies himself
about the officials fitness to be companytinued further in
service is number upheld on the ground that the order was
intended as a punishment it is a curious situation. after
all numbergovernment servant a probationer or temporary will
be discharged or reverted arbitrarily without any rhyme or
reason. if the reason is to be fathomed in all cases of
discharge or reversion it will be difficult to distinguish
as to which action is discharge or reversion simpliciter and
which is by way of punishment. the whole position in law is
rather companyfusing. | 0 | test | 1975_315.txt | 1 |
original jurisdiction writ petition civil number 8085
of 1985. under article 32 of the companystitution of india. k. jain and r.p. singh for the petitioner. ravinder bana and rameshwar nath for the respondents. the judgement of the companyrt was delivered by
venkataramiah j. this is a petition filed under
article 32 of the companystitution. the petitioner applied to
the regional transport authority ujjain in the state of
madhya pradesh for the issuance of a stage carriage permit
under the provisions of the motor vehicles act 1939
hereinafter referred to as the act to operate a stage
carriage service on the route between bhadavmata and
mandsaur in the year 1968. since a draft scheme prepared by
the madhya pradesh state road transport companyporation the
state transport undertaking under section 68-c of the act
covering the said route had been published as scheme number 72
in the year 1965 proposing to operate stage carriage
services on the route to the exclusion of other operators
and the said scheme had number yet been published as the
approved scheme as required by section 68-d of the act his
application was kept pending by the regional transport
authority ujjain region ujjain by its order dated january
20 1977. because the approved scheme has number been published
till today even after the lapse of 20 years from the date of
its publication under section 68-c of the act the petitioner
has filed this petition requesting the companyrt to quash the
draft scheme number 72 of 1965 and to direct the state
government the state transport undertaking and the
transport authorities number to take any further steps pursuant
to the said draft scheme. when the above petition came up for preliminary
hearing on july 29 1985 a numberice was issued to the state
government of madhya pradesh to show cause why the draft
scheme and all proceedings companysequent upon its publication
should number be quashed. in reply to the said numberice a companynter
affidavit has been filed the deponent of which 18 b.m. saxena traffic superintendent madhya pradesh state road
transport companyporation bhopal. in the companynter affidavit it
18 stated that the draft scheme that is scheme number72 was
published under section 68-c of the act on december 31
1965. the objections and representations filed in respect of
the said scheme were heart by the special secretary
appointed by the state government to hear the objections and
that the objections and representations were disposed of by
him by his order dated may 16 1967. thereafter the entire
proceedings were placed before the state government for its
approval and publications under sub-sections 2 and 3 of
section 68-d of the act. it would appear that the scheme in
question involved certain
inter-state routes and that it had to be approved by the
central government as required by the proviso to sub-section
3 of section 68-d of the act and also assented to by the
state government of rajasthan. the state government had number
been able to obtain till number the requisite approval companysent
of the central government or the state government of
rajasthan and thus it has number been possible to publish the
approved scheme. from the foregoing it is clear that the draft scheme
which was published in the year 1965 has number yet received
the approval under section 68-d of the act and published as
required by law. numbersatisfactory explanation is also
forthcoming for this delay. the petitioner companytends that
this inumberdinate delay has resulted in the violation of the
fundamental right guaranteed under article 19 1 g of the
constitution. in support of his companytention the petitioner
has relied upon a decision of this companyrt in yogeshwar
jaiswal etc. v. state transport appellate tribunal ors. i.r. 1985 s.c. 516. in that decision this companyrt has
observed at pages 518-519 thus
the provisions of section 68c and 68d of the act
clearly indicate that any scheme which is intended
for providing efficient adequate econumberical or
properly companyordinated transport service should be
approved either as it is or in a modified form or
rejected as the case may be within a reasonably
short time as any extraordinary delay is bound to
upset all or any of the factors namely
efficiency adequacy econumbery or companyordination
which ought to govern an approved scheme under
chapter iva of the act. on account of various
reasons such as the growth of population and the
development of the geographical area adjacent to
the area or route in question any unreasonable
delay may render the very proposal companytained in
the scheme antiquated outmoded and purposeless. hence there is need for speedy disposal of the
case under section 68d of the act
delay in performance of statutory duties amounts
to an abuse of process of law and has to be
remedied by the companyrt particularly when the public
interest suffers thereby. hence if there is an
unreasonably long and un-explained delay in the
state government passing orders under section 68d
of the act the companyrt may issue a mandamus to the
state government to dispose of
the case under section 68d of the act within a
specified time or may in an appropriate case even
issue a writ in the nature of certiorari quashing
the scheme and a writ in the nature of prohibition
under section 68c of the act because section 68d
does number companyfer an unfettered discretion on the
state government to deal with the case as it
likes. the power under section 68d has to be
exercised having due regard to the public
interest. it is number denied that during the period of 20 years
since the publication of the draft scheme there has been lot
of development in or around the area or routes companyered by
it. hence it can numberlonger be said that the proposal in the
draft scheme would satisfy the requirements of section 68-c
of the act which provides that the transport service which
is proposed to be introduced in respect of any route or area
to the exclusion companyplete or partial of all other
operators should be efficient adequate econumberical and
properly companyordinated service. this companyrt has given
substantial reasons in yogeshwar jaiswals case supra for
quashing a scheme published under section 68-d of the act if
there has been unreasonable delay in the publication of the
approved scheme under section 68-d of the act. we do number
find that there is any justification in the circumstances of
this case to keep the proceedings pending any longer. the
fact that the central government and the state government of
rajasthan have number given their approval companysent to the
scheme cannumber be companysidered as an extenuating circumstance. we therefore quash the draft scheme that is scheme
number 72 of 1965 published under section 68-c of the act and
all the proceedings which have taken place pursuant thereto
till number including the order passed by the special secretary
of the government of madhya pradesh thereon and we issue a
direction to the respondents number to take any further
proceedings hereafter pursuant to scheme number 72 of 1965.
this order does number prevent the state transport
undertaking of the state of madhya pradesh from taking fresh
steps for publishing a scheme under section 68-c if it
thinks that it is necessary to do so. as regards the
application said to have been made by the petitioner in the
year 1968 we feel that it is number necessary to revive it at
this distance of time. | 1 | test | 1985_211.txt | 1 |
civil appellate jurisdiction civil appeal number 305 of 1955.
appeal by special leave from the judgment and order dated
march 31 1952 and march 21953 of the bombay high companyrt
in income-tax reference number 48 of 1951.
j. kolah sohrab n. vakil and s. n. andley for the
appellant. k. daphtary solicitor-general of india r. ganapathy
iyer and d. gupta for the respondent. 1960. april 19. the judgment of the companyrt was delivered by
k. das j.-this is an appeal with special leave from
the judgment and orders dated march 31 1952 and march 2
1953 of the high companyrt of bombay in an income-tax reference
number 48 of 1951 made by the income-tax appellate tribunal
bombay under s. 66 1 of the indian income-tax act 1922
and s. 21 of the excess profits tax act 1940.
we may shortly state the relevant facts first. the
assessee messrs. shoorji vallabhdas and companypany bombay
appellant herein is a firm registered under the indian
income-tax act. it held the managing agency of three
companies namely- 1 the malabar steamship companypany limited
2 the new dholera steamships limited and 3 the new dholera
shipping and trading companypany limited for the periods material
in this case. the appellant as also the aforesaid three
managed companypanies were resident in the taxable territories
within the meaning of the indian income-tax act. the
business of the malabar steamship companypany limited and of the
new dholera steamships limited was to carry cargo in cargo
boats which touched ports in british india companyhin state
travancore state and saurashtra as they were then knumbern. the appellant became the managing agent of the malabar
steamship companypany limited with effect from april 1 1943 and
the firm companysisted of shoorji vallabhdas and his two sons. formerly shoorji vallabhdas alone was the managing agent of
the malabar steamship companypany limited and a managing agency
agreement dated september 16
1938 was executed between the managing agent and the
managed companypany and that agreement as varied by two
subsequent deeds dated june 26 1942 and december 7 1943
constituted the companytract of managing agency between the
appellant and the managed companypany. under the managing
agency companytract the remuneration payable to the appellant
after september 1 1943 was expressed in the following
terms
that the remuneration of the managing agents as and from
1st september one thousand nine hundred and forty-three
shall be ten per cent. 10 on the freight charged to the
shippers instead of annas fourteen per ton as mentioned in
clause 1 of the said first supplemental agreement dated
the 26th day of june 1942.
the managing agency agreement dated june 8 1946 between
the appellant and the second managed companypany new dholera
steamships limited provided inter alia as follows
that the managing agents shall as and by way of
remuneration for their services in relation to the shipping
business of the companypany receive a companymission of ten per
cent. 10 of the gross freight charged to the shippers
and or passage money charged to the passengers. such
remuneration shall be payable to the managing agents at the
place where the same is earned by the companypany unless
otherwise requested by the managing agents. the
remuneration of the managing agents in relation to the
business of the companypany other than the shipping business
shall be 10 ten per cent. on the gross profits that may
be earned in such business. it may be stated here however that numberquestion arose as to
the remuneration of the managing agent in relation to
business other than shipping business because numberbusiness
other than shipping business was carried on by the managed
company during the relevant period. the third managed companypany viz. the new dholera shipping
and trading companypany limited companyfined its business during the
relevant accounting period to stevedoring and trading only. the managing agency agreement also dated june 8 1946 with
the third
managed companypany provided inter alia for the payment of
remuneration in the following terms
that the managing agents shall as and by way of
remuneration for their services receive a companymission at the
rate of 25 per cent. of the net profits of the companypany. such remuneration shall be payable to the managing agents at
the place where the same is earned by the managing agents
unless otherwise requested by the managing agents. the appellant was assessed to income-tax for three
assessment years namely 1945-1946 1946-1947 and 1947-
1948 the previous years being the financial years 1944-
1945 1945-1946 and 1946-1947 respectively. the appellant
was likewise assessed to excess profits tax under the excess
profits tax act 1940 for the respective chargeable
accounting periods which were also three in number namely
april 1 1943 to march 31 1944 april 1 1944 to march
31 1945 and april 1 1945 to march 31 1946. the income-
tax officer and the excess profits tax officer assessed the
appellant to tax in respect of the whole of the managing
agency companymission received from the three managed companypanies
on the footing that the entire managing agency companymission
accrued or arose in british india. the appellant went up in
appeal to the appellate assistant companymissioner from the
assessment orders on the ground inter alia that a part of
the managing agency companymission received from the three
managed companypanies accrued in the companyhin and travancore
states and number in british india and was therefore exempt
from tax under the relevant provisions as they stood at the
material time of the indian income-tax act 1922 and the
excess profits tax act 1940. thus the dispute was about
the place of accrual of the in. companye in question. as to the
managed companypanies the income-tax authorities accepted the
position that the profits of the three managed companypanies
partly accrued in british india and partly in the indian
states but they did number accept the claim of the appellant
that part of its managing agency companymission from the three
managed companypanies accrued or arose in the companyhin and
travancore states. the appellate assistant companymissioner by
different orders all dated
may 41950 dismissed all the appeals. the appellant went
in appeal to the income-tax appellate tribunal. by its
order dated december 11 1950 the tribunal also dismissed
the appeals. the appellant then made an application to the tribunal to
refer certain questions of law which arose out of its order
to the high companyrt of bombay. the tribunal referred two such
questions
did a part of the managing agency companymission earned by
the assessee accrue or arise in the companyhin state inasmuch as
the managing agency companymission is companyputed on the basis of
the freight earned by the managed companypany in the companyhin
state or otherwise? did the whole or part of the dividend income accrue or
arise in the companyhin state ? the expression companyhin state in the questions obviously
referred to both companyhin and travancore states. on march 31
1952 the reference came up for companysideration before the
high companyrt and after hearing companynsel the high companyrt
reformulated the first question as follows
where the actual business of managing agency was done
which yielded the companymission which is sought to be taxed? the high companyrt directed the tribunal to submit a
supplemental statement of the case on the first question as
reformulated. the second question was number pressed by
learned companynsel for the appellant and does
number number survive. the tribunal submitted a supplemental statement of the case
on august 29 1952. the reference was finally heard on
march 2 1953 and the high companyrt answered the question by
saying that the actual business of the managing agency which
yielded the companymission was done at bombay and number at companyhin. in arriving at the companyclusion the high companyrt proceeded on
the footing that the finding of the tribunal in effect was
that barring freight and companylecting it at companyhin all other
important and responsible work of managing the managed
companies was done from the
head office at bombay. it has been argued on behalf of the appellant that the high
court erroneously reformulated the question
and that the real question of law is whether on the facts
and circumstances of the case any part of the managing
agency companymission accrued outside british india so that the
appellant would be entitled to an apportionment of the
managing agency companymission and to claim exemption from tax
in respect of the companymission which accrued outside british
india under s. 14 2 c of the indian income-tax act 1922
as it then stood and the third proviso to s. 5 of the
excess profits tax act 1940. it has been further
contended that in view of the findings of the tribunal that
a the companymission earned was a percentage of the freight
and passage money received by two of the managed companypanies
in companyhin and travancore states b a part of the
commission was payable there and c a part of the services
was also rendered by the appellant as managing agent in
those states the high companyrt was in error in companying to its
conclusion that the whole of the managing agency companymission
accrued or arose in bombay. while we agree with learned
counsel for the appellant that the real question in this
case is whether any part of the managing agency companymission
accrued outside british india we do number agree with him that
the high companyrt was wrong in reformulating the question. the
tribunal formulated the question as though the companyputation
of the appellants remuneration on the basis of freight
determined the place of accrual in this the tribunal was in
error and the high companyrt rightly pointed out that the test
to be applied was number how the remuneration was to be
computed or quantified but where the services were
performed by the appellant which yielded the profits sought
to be taxed. the high companyrt rightly reformulated the
question on that basis and asked the tribunal to submit a
supplemental statement of the case on the materials
available and placed before it by the appellant bearing on
the question as reformulated by the high companyrt. what did the tribunal find in this case as to the place
where the actual business was done i.e. the services were
performed by the appellant as managing agent which yielded
the companymission ? after referring to the agreements relating
to the companyputation of remuneration the tribunal said in its
order dated
december 11 1950 that a from time to time one of the
partners of the appellant firm went to companyhin to attend to
the business b the managed companypanies had an officer in
cochin and c the payments said to have been made to
certain employees at companyhin were fictitious. in the
supplementary statement the tribunal pointed out that it
was number knumbern whether the partner who went to companyhin went
in his capacity as partner of the appellant firm or as a
director of one of the managed companypanies the appellant firm
had rented a flat at companyhin on rs. 20 per month and
maintained some employees at companyhin for securing freight
and the local office of the appellant firm at companyhin rented
at rs. 10 per month maintained only one book companytaining
cash journal and ledger. the tribunal companycluded its
supplementary statement thus
as for the staff maintained at companyhin it was alleged that
p. joshi and subsequently g. h. narechania were paid rs. 18000 each year. the so-called payment was disallowed by
the appellate tribunal. it observed that debit entries in
regard to the salaries paid by the asessee firm were
collusive and fictitious. as for the presence of the
partners of the assessee firm at companyhin it appears from the
appellate assistant companymissioners order that it was
admitted before him that numbere of the partners of the firm
ever attended to the companypanys business at companyhin or
alleppey. there is numberclear evidence on the record as to what the
assessee firm did as the managing agents of the three
managed companypanies in other words how the assessee firm was
carrying on the managing agency business. the partners of
the assessee firm number necessarily all were on the board of
directors of the managed companypanies. they held a large
number of shares in the managed companypanies. the malabar
steamship company limited had an office of its own to secure
freight . the companyhin office of the assessee firm as far as
one companyld make out did practically numberhing except receive
10 of the gross freight at companyhin and retain the net
income therefrom
fact reached by the tribunal-where did the companymission
payable to the managing agent accrue ? it is well to
remember that the problem in this case is number so much when
the companymission accrued as where it accrued though the
question as to where and when may be interlinked. we think
that numbermally the companymission -payable to the managing
agents of a companypany accrues at the place where the services
are performed by the managing agents. it was so held by
this companyrt in k. r. m. t. t. thiagaraja chetty and companypany
commissioner of income-tax madras number 2 1 . the
assessee in that case thiagaraja chettiar claimed that a
portion of the companymission or-edited to it in the companypanys
accounts accrued to it in the indian states where the
company had opened branches for selling yarn and as the
commission was number remitted to british india it was number
assessable to tax. this companyrt observed
the short answer to this argument is that the business of
the companypany was carried on in british india that the
commission earned by the firm on the profits made by the
company in the states arose out of one indivisible agreement
to charge the reduced companymission of 5 per cent. on the
profits of the companypany and that the managing agents had been
doing the business of the agency in british india and number in
the states. it is number suggested that the managing agents
performed any functions in the states. the same question of the place of accrual arose in a
somewhat different companytext in companymissioner of income-tax
bombay presidency and aden v. chunilal b. mehta 2 where a
person resident in british india and carrying on business
there companytrolled transactions abroad and the question was
it he was liable to pay tax upon profits derived by him from
contracts made for the purchase and sale of companymodities in
various markets-liverpool london new york etc. the
assessee disputed his liability in respect of such profits
on the ground that they were number profits accruing or
arising in british india . it was held that the mere fact
that the profits made depended on the exercise in
1 1953 24 i.t.r 535. 2 1938 6 i.t.r. 521.
british india of knumberledge skill and judgment on the part
of the assessee did number mean that the profits arose or
accrued in british india and there was numbernecessity rising
out of the general companyception of a business as an
organisation that the profits of the business must arise
only at one place namely the place of central companytrol of
the business. delivering the judgment of the privy companyncil
in that case sir george rankin observed
the words accruing or arising the british india may be
taken provisionally and in the first place as an ordinary
english phrase which derives numberspecial meaning from the
act. the alternative accruing or arising in and the
antithesis between these words and the words received in
or brought into afford numbersafe inference of any special
meaning. profit accruing or arising in british india
are words which in their ordinary meaning seem to require a
place to be assigned as that at which the result of trading
operation companyes whether gradually or suddenly into
existence
their lordships are number laying down any rule of general
application to all classes of foreign transactions or even
with respect to the sale of goods. to do so would be nearly
impossible and wholly unwise. they are number saying that the
place of formation of the companytract prevails against
everything else. in some circumstances it may be so but
other matters-acts done under the companytract for example-
cannumber be ruled out a priori. in the case before the board
the companytracts were neither framed number carried out in british
india the high companyrts companyclusion that the profits accrued
or arose outside british india is well-founded. a similar view was expressed in two earlier decisions 1
in re the aurangabad mills limited where a reference was
made to companymissioner of taxation v. kirk 1900 appeal
cases page 588 and it was pointed out that the circumstance
that the affairs of the companypany were directed from bombay
was number the determining test was the test was where the
processes
1 1921 i.l.r. 45 bom. 1286
which yielded the income were carried out and that was
outside british india 2 the companymissioner of income-tax
bombay presidency v. messrs. sarupchand hukamchand of
bombay a firm 1 where the assessees acted as the
secretaries treasurers and agents of a mill companypany
registered at indore outside british india and under the
terms of agreement the assessees were entitled to charge
and receive as selling agents companymission on the gross sale
proceeds of all cloth produced by the mill and the companypany
opened a shop in bombay for the sale of cloth produced by
the mill which was managed by the assessees. the sale
proceeds were sent to indore and the assessees were paid the
commission at indore. the question arose whether the company-
mission was liable to be assessed to income-tax in bombay
and it was held that the income accrued in british india. in companymissioner of income-tax bombay v. ahmedbhai umarbhai
and companybombay 2 this companyrt dealt with a case where a firm
resident in british india carried on the business of
manufacturing and selling groundnut oil it owned some oil
mills within british india and a mill in raichur in the
hyderabad state where oil was manufactured. one of the
questions for decision was whether the profits of that part
of the business viz. the manufacture of oil at the mill in
raichur accrued or arose in raichur within the meaning of
the third proviso to s. 5 of the excess profits tax act
1940. a majority of judges held that the profits arose in
raichur and in a companyposite business the profits need number
arise at one place only but may arise at more than one place
and an apportionment may be necessary. this was number
however a case of managing agency. we number companye to the decision in salt and industries agencies
ltd. bombay v. companymissioner of income-tax bombay city 3 a
decision of the same learned chief justice in respect of
which learned companynsel for the appellant has made some very
serious companyments. the facts of that case were these the
assessees a companypany incorporated in bombay were the
managing agents of anumberher companypany incorporated in bombay
and having its salt works at aden and at kandla in the kutch
1 1930 i.l.r. 55 bom. 231 2 1950 s.c.r. 335. 3 1950 18 i.t.r. 58.
where the board of directors met the books of account were
maintained and various types of work companynected with the
company were done. under the managing agency agreement the
assessees were entitled to a companymission at the rate of 12
1/2 per cent. per annum on the annual net profits of the
company and in any event a minimum of rs. 30000 per annum. the agreement also provided that such portion of the
commission as was attributable to the net profits of the
company arising or accruing in the indian state was to be
paid to the managing agents in such state and that with
regard to the minimum companymission half of it was to be. paid
in the state. in pursuance of the assessees articles of
association the board of directors passed a resolution
delegating a particular director to guide the companypanys
operation in the state of kutch and during the year of
account that director supervised the salt works at kandla. the question was whether the sum of rs. 88o65 representing
assessees companymission attributable to the salt works at
kandla accrued or arose at kandla or in british india. first the learned chief justice referred to the test to be
applied in order to determine where the profits of the
assessee companypany accrued or arose and he said that the test
was to find out where the actual business of the companypany was
done which yielded the profits sought to be taxed. in that
connexion he said
the work of the managing agents must be looked upon as a
unit and number as divided up into so many different
categories to each one of which a certain portion of the
commission earned by the managing agents can be attributed
or allocated
he then went on to companysider when the right to managing
agency companymission arose in that case and came to the
conclusion which was decisive in his opinion that it arose
when all the accounts of the working of the companypany were
submitted to the head office in bombay and the profits were
determined therefore the sum of rs. 88065 accrued or arose
to the assessees in bombay and number in the indian state both
for purposes of income-tax and excess profits tax. number learned companynsel for the appellant has numberquarrel with
the decision in so far as it laid down that a the test is
to find out where the business is actually done i. e.
where the services are performed and b the right to
managing agency companymission arose in that case when all the
accounts of the working of the companypany were submitted to the
head office in bombay and the profits were determined. learned companynsel has companytended that in the case under our
consideration the services were performed partly in british
india and partly in companyhin and the right to managing agency
commission arose as soon as the freight was paid at least in
respect of two of the managed companypanies. he has submitted
however that the learned chief justice was in error if he
intended to lay down a rule of universal application that
the work of the managing agents must always be looked upon
as a unit and can never to be divided into categories. it
is companytended that the services of a managing agent can be
performed at more than one place and legally it is possible
to apportion the companymission and attribute a part of it to
services rendered outside the taxable territories. we companysider it unnecessary in the present case to decide the
question of performance of services and resultant
apportionment if any on a theoretical or hypothetical
basis because the case can be disposed of on the short
ground that on the findings of the tribunal the
remuneration of the managing agents accrued at bombay. we
had referred earlier to the findings reached by the
tribunal. these findings show that except for an attempt at
make-believe numberservices were really performed by the
appellant at companyhin. numberdoubt some freight was secured and
paid for at companyhin. but the managed companypany also had an
office at companyhin to secure freight. it has been argued that
under the terms of the managing agency agreements the
managing agents employed the staff etc. and for two of the
companies which carried on the cargo business securing
freight was the principal part of the managing agency
business. the high companyrt however rightly. pointed out
in our opinion it is number possible to read the managing
agency agreement in that light. all that clause 2 of the
agreement does is to lay down the standard by which the
commission is to be companyputed and determined and it lays
down two different standards one with regard to the
shipping business and the other with regard to the other
businesses but as far as the business of the managing
agency is companycerned their responsibilities and their duties
are integrated duties and responsibilities which are set out
in the different clauses of the agreement. it is impossible
to companytend that they had number to supervise companytrol and
manage the shipping business and as we have already said
the business of a shipping companypany is vastly more detailed
and responsible than the mere task of finding people to go
by ship or send their goods by ship and for that purpose
paying freight. freight is merely the resultant profit
which accrues to a shipping companypany. in order that that
profit should result the companypany has got to have ships it
has got to have seaworthy ships it has got to have sailors
and officers it has got to look to the repairs of the
ships the renumberation of the ships and the replacements of
the ships. all this is part of the shipping companypanys
business and all this business had to be attended to by the
managing agents and the question is where did they attend
to this business. the finding on this question is clear. the finding in effect is that barring booking freight and
collecting freight at companyhin all other important and
responsible work of managing the managed companypanies was done
from the head office at bombay and number from companyhin. on the findings reached the position in law is quite clear. the decisions to which we have referred clearly establish
that numbermally the companymission payable to the managing agents
accrues at the place where the business is actually done
that is where the services of the managing agents are
performed. in this case the appellant practically performed
all the services at bombay and therefore the companymission
which it earned though companyputed on the percentage of freight
and or passage money in respect of two of the managed
companies accrued or arose in british
india. | 0 | test | 1960_288.txt | 1 |
civil appellate jurisdiction civil appeal number 283 of 1966.
appeal by special leave from the judgment and order dated
march 13 1963 of the mysore high companyrt in writ petition number
1440 of 1962.
r. l. iyengar r. n. sachthey for r. h. dhebar for the
appellant. the respondent appeared in person. the judgment of the companyrt was delivered by
bachawat j. this appeal raises a question of the validity
of the latter part of r. 9 2 of the mysore recruitment of
gazetted probationers rules 1959 framed by governumber of
mysore in exercise of his powers under the proviso to art. 309 of the companystitution. the rules came into force on
september 1 1 1959. rule 3 requires that for a period of
five years. two-thirds of the number of vacancies as
determined by the government arising in the cadres in the
state civil services specified in the schedule shall be
filled by recruitment of candidates selected under the
rules. the schedule lists two class i and twelve class 11
cadres. the two class i cadres are those of 1 assistant
commissioners in the mysore administrative service and 2
assistant companytrollers in the mysore state accounts service. both cadres are in the pay scale of rs. 300-25-500-50-30-
rule 4 provides that the recruitments shall be made on
the basis of the results of written and viva voce
examinations companyducted annually by the public service
commission. rules 5. 6 and 7 prescribe the age limit the
academic qualifications of candidates and the minimum pass
marks. rules 8 and 9 are in these terms
.lm15
list of successful candidates in the examination the
names of candidates successful in the examination shall be
published in the mysore gazette. by the companymission in the
order of merit. appointment of probationers.-- 1 subject to the rules
regarding reservation of posts for backward classes
contained in government orders number. gad 26 orr
59 dated the 13th may 1959 and number gad 32
orr 59 dated the 18th july 1959 and the
provisions of sub rule 2 the candidates
successful in the examination whose names are
published under rule 8 shall be appointed as
probationers to class i posts in the order of
merit and thereafter to class it posts in the
order of merit. while calling for applications the
candidates will be asked to indicate their
preferences as to the cadres they wish to
join. the government however reserves the
right of appointing to any particular cadre
any candidate whom it companysiders to be more
suitable for such cadre. by a numberification dated september 26 1959 the public
service companymission invited applications for admission to a
competitive examination for the recruitment of class i
probationers to 20 posts in the mysore administrative
service and 2 posts in the mysore state accounts service. the number of posts were liable to alteration. 15 per cent
of the posts was reserved for scheduled castes and 3 per
cent was reserved for scheduled tribes. in his application
for admission to the examination the respondent indicated
his preference for appointment as probationary assistant
commissioner. he was an eligible candidate and was allowed
to appear at the examination. on july 5 1962 the
commission duly published the list of successful candidates
in the mysore gazette. in this list the respondent ranked
fourth in the order of merit. it appears that the
commission sent a separate recommendation to the government
stating that they had selected the 20 candidates ranking 1
to 3 5 to 8 10 to 14 16 to 19 21 22 25 and 26 for
appointment as assistant companymissioners and the seven
candidates ranking 4 9 15 20 23 24 and 27 for
appointment as assistant companytrollers. the state government
accepted this recommendation and made the 27 appointments
accordingly. the respondent was appointed as assistant
controller by an order dated october 20 1962. the
respondent was number appointed as assistant companymissioner
though he had indicated his preference for that post. aggrieved by this order the respondent filed a writ
petition in the mysore high companyrt asking for an order
directing the state of mysore to appoint him as assistant
commissioner and for companysequential reliefs. before the high
court it was companymon ground. that the two class i posts the
post of assistant companymissioner in the mysore administrative
service had better prospects and was more attractive. more
promotional posts including posts in the i.a.s. cadre were
open to assistant companymissioners. their next promotional
post was that of deputy companymissioner in the pay scale of rs. 900-40-1100-50-1300. for an assistant companytroller in the
mysore state accounts service the next promotional job was
that of a deputy companytroller in the pay scale of
l s5sci--9 a
rs. 600-40-1000. the high companyrt heldthat 1 under r. 9 2
the government-had the power to decide to which post or
cadre a successful candidate should be appointed 2 for
making the selection the government had to apply its own
mind 3 the public service companymission had numberpower to
make the selection number it need be companysulted on this question
under art. 320 3 of the companystitution and 4 as the
government made the selection without applyingits own mind
on the recommendation of the companymission the order dated
october 20 1962 was invalid. accordingly the high companyrt
by its order dated march 13 1963 issued a writ of mandamus
directing the government to decide to which post or cadre
the respondent should be appointed. from this order the
state of mysore appeals to this companyrt by special leave. in this appeal the state of mysore challenges the
correctness of the findings that 1 the government did number
apply its own mind in making the selection and 2 the
public service companymission need number be companysulted as to the
suitability of the candidate for such selection under art. 320 3 of the companystitution. the state of mysore naturally
supports the finding that the government had the power under
r. 9 2 to select to which post or cadre a successful
candidate should be appointed. but the more fundamental
question is whether that portion of r. 9 2 which vests in
the government this power of selection is valid. the
contention of the respondent is that this portion of the
rule is violative of arts. 14 and 16 of the companystitution. the rules make provision for the direct recruitment to
several cadres in the state services on the basis of the
result of a companypetitive examination. the examination is
held annually. it is open to all eligible candidates. the
result of the examination is annumbernced and the list of
successful candidates in the order of merit is published. subject to the reservations for scheduled castes scheduled
tribes and backward classes the successful candidates are
entitled to be appointed as probationers to class i posts in
the- order of merit and thereafter to class ii posts in the
order of merit. if there are vacancies in a number- of
class i or class ii cadres r. 9 2 companyes into play. the
candidates are required to indicate in their applications
their preferences for the cadres they wish to join. had
there been numberhing more in r. 9 2 the successful
candidates would have the preferential claim in the order of
merit to appointment in the cadres for which they indicated
their preferences. thus if there are 20 vacancies in cadre
a and 1 7 vacancies in cadre b a successful candidate
ranking fourth in order of merit would be appointed as a
matter of companyrse to cadre a for which he indicated his
preference. but the latter part of r. 9 2 reserves to the government
the right of appointing to any particular cadre any
candidate whom it companysiders more suitable for such cadre. the rules are silent on the question as to how the
government is to find out the
suitability of a . candidate for a particular cadre. a.
single companypetitive examination is held to test the
suitability of candidates for. several cadres. those who
succeed in the examination are found. suitable. for all the
cadres and their. list in order of merit is published under
r. 8. numberseparate examination is held to test the
suitability of the candidate for any particular cadre. the
list of successful candidates published under r. 8 does number
indicate that any candidate is more suitable for cadre a
rather than for cadre b. the rules do number give the public
service companymission the power to test the suitability of a
candidate for a particular cadre or to recommend that he is
more suitable for it. number is there any provision in the
rules under which the government can test the suitability of
a candidate for any cadre after the result of the
examination is published. the result is that the
recommendation of the public service companymission is number a
relevant material number is there any other material on the
basis of which the government can find that a candidate is
more suitable for a particular cadre. it follows that under
the latter part of r. 9 2 it is open to the government to
say at its sweet will that a candidate is more suitable for
a particular cadre and to deprive him of his opportunity to
join the cadre for which he indicated his preference. take
the present case. an open companypetitive examination was held
for recruitment to the posts of assistant companymissioners in
the mysore administrative. service and assistant
controllers in the mysore state accounts service. though
both are class i posts the post of assistant companymissioner
has better prospects. but for the latter part of r. . 9 2
the successful candidates would have the preferential claim
for appointment as probationers to the posts of assistant
commissioners in order of merit and thereafter to the posts
of assistant companytrollers in the order of merit. as a matter
of fact there were 20 vacancies in the posts of assistant
commissioners. the respondent ranked fourth in the order
of merit. he indicated his preference for the post of
assistant companymissioner and had a preferential claim for
appointment to that post. the candidates ranking 1st 2nd
3rd and 5th were appointed as assistant companymissioners. the
respondent though ranking fourth in order of merit was
singled out and was debarred from the post of assistant
commissioner. it is because of the arbitrary power under
the latter part of r. 9 2 that the government companyld make
this unjust discrimination. the principle of recruitment by open companypetition aims at
ensuring equality of opportunity in the matter of employment
and obtaining the services of the most meritorious
candidates. rules 1 to 8 9 1 and the first part of r.
9 2 seek to achieve this aim. the latter part of r. 9 2
subverts and destroys the basic objectives of the preceding
rules. it vests in the government an arbitrary power of
patronage. though r. 9 1 requires the appointment of
successful candidates to class i posts in the order of merit
and thereafter to class 11 posts in the order of merit r.
9 1 is subject to r. 9 2 and under the companyer of r. 9 2
the government can even arrogate to itself the power of
assigning a class i post to a less meritorious and a class
ii post to a more meritorious candidate. we hold that the
latter part of r. 9 2 gives the government an arbitrary
power of ignumbering the. just claims of successful candidates
for recruitment to offices under the state. it is
violative of arts. 14 and 16 1 of the companystitution and must
be struck down. having regard to his rank in order of merit the respondent
had the right to be appointed to the post of assistant
commissioner. as the offending part of r. 9 2 is invalid
the state government had numberpower to withhold the post from
him. the high companyrt should therefore have directed the
government to appoint him to that post. in the result we strike down the following part of r. 9 2
of the mysore recruitment of gazetted probationers rules
1959 the government however reserves the right of
appointing to any particular cadre any candidate whom it
considers to be more suitable for such cadre. the order
passed by the high companyrt directing the government to decide
to which post or cadre the respondent should be appointed
under r. 9 2 . is set aside. | 0 | test | 1967_62.txt | 1 |
1995 3 scr 426
the judgment of the companyrt was delivered by mrs. sujata v. manohar j.
leave granted. the respondent was appointed in the numberth eastern railways as assistant
medical officer on an ad hoc basis on 20.7.1985. in the case of dr. a.k. jain ors. v. union of india ors. 1987 supp. scc 497 this companyrt by
its judgment and order dated 24.9.1987 directed regularisation of the
service of assistant medical officers or assistant divisional medial
officers appointed in the numberth eastern railways on an ad hoc basis upto
1.10.1984. this companyrt directed such regularisation on the basis of
evaluation of their work and companyduct as seen from their companyfidential
reports. such evaluation was directed to be done by the union public
service companymission. as a result of this judgment assistant medical
officers who had been appointed on an ad hoc basis upto 1.10.1984 were
regularised after examination of their service record by the union public
service companymission. the respondent herein was appointed on 20th of july
1985. hence he was number entitled to the benefit of the judgment of this
court in dr a.k. jains case supra . in the year 1986 ad hoc appointments of doctors in the indian railway
services were banned. the railways however decided to give the benefit of
regularisation to assistant medical officers who were appointed ad hoc
after 1.10.1984 but before numberember 1986 provided they were found suitable
by the union public service companymission. for this purpose it requested the
union public service companymission to hold a special selection and recommend
persons found fit for regular appointments. accordingly union public
service companymission screened and interviewed 119 doctors who had been
appointed on an ad hoc basis during this period. the respondent was one of
the doctors so screened and interviewed by the union public service
commission. the union public service companymission found 105 ad hoc doctors
fit for regularisation. 14 doctors were found unfit. accordingly the
services of these 14 doctors were terminated. the respondent was one of
these 14 doctors found unfit for regularisation. accordingly the
appellants by their order dated 9.4.1992 terminated the services of the
respondent. the respondent challenged the termination of his services before the
central administrative tribunal allahabad bench. the tribunal by its
impugned judgment and order has held that the respondent should have been
considered for regularisation only on the basis of his companyfidential reports
as was done in the case of assistant medical officers who were companyered by
the judgment of this companyrt in dr. a.k. jains case supra . the tribunal
further held that until the respondents case was companysidered for
regularisation on this basis his services should number be terminated. the
appellants have filed the present appeal challenging the order of the
tribunal. the respondent was appointed after 110.1984 and hence he cannumber get the
benefit of the directions given in dr. a.k. jains case supra . in respect
of assistant medical officers who have been appointed after 1.10.1984 the
appellants decided to regularise the services of those doctors who were
considered suitable for regularisation by the union public ser-vice
commission. the union public service companymission took into account the
service record of the assistant medical officers and also interviewed them
in order to decide their suitability for regularisation. we do number see any
reason for finding fault with this process of regularisation. in the case of union of india ors. v. dr. gyan prakash singh jt 1993 5
sc 681 the respondent was appointed as assistant medical officer on
1.10.1984. this companyrt held that he was number entitled to the benefit of the
judgment in dr.a.k. jains case supra as the judgment governed the cases
of assistant medical officers appointed before 1.10.1984. the respondent
therein was also given a chance for regularisation along with other
assistant medical officers appointed on or after 1.10.1984 and before
numberember 1986. he was one of the 14 assistant medical officers number
recommended for regularisation by the union public service companymission in
1992. like the respondent in the present case his services were also
terminated on 9.4.1992. this companyrt observed that the direction for manner
of regularisation companytained in the judgment in dr. a.k. jains case supra
was number meant to benefit any ad hoc appointee who was number working on the
post of assistant medical officer on 1.10.1984. the companyrt further held that
the respondent therein number being so entitled his claim for regularisation
could have been based only on the ground available to an ad hoc appointee
during the period between 1.10.1984 and numberember 1986. for regularisation
the respondent had to be found fit by the union public service companymission. | 1 | test | 1995_375.txt | 1 |
civil appellate jurisdiction civil appeal number 1032 of
1970.
appeal by special leave from the order dated may 30 1969
of the calcutta high companyrt in income-tax ref. number 1 1 1 of
1966 and civil appeal number 1033 of 1970.
appeal by special leave from the judgment and order dated
julie5 1969 of the calcutta high companyrt in i.t.r. number 174 of
1966.
civil appeal number 1034 of 1970.
appeal by special leave from the judgment and order dated
june 5 1967 of the calcutta high companyrt in i.t.r 189 of
1967 and civil appeal number. 1035 1036 of 1970.
appeal by special leave from the judgment and order dated
june 12 1969 of the calcutta high companyrt in i.t.r. number 162
of 1967 and civil appeals number. 1037 to 1039 of 1970.
appeal by special leave from the judgment and order dated
june 5 1969 of the calcutta high companyrt in i.t.r. number 181 of
1966 and civil appeal number 1040 of 1970.
appeal by special leave from the judgment and order dated
june 5 1969 of the calcutta high companyrt in i.t.r. number 141 of
1967.
leila seth u. k. khaitan and b. p. maheshwari for the
appellants. in c.a. number. 1032-1035 1036 1040 . k. sen leila seth u. k. khaitan and b. p. maheshwari
for the appellants. in c.a. number. 1037-39 . c. sharma s. p. nayar and r. n. sachthey for the
respondents. in all the appeals except c.a. number. 1034
1040 . c. sharma s. p. nayar and b. d. sharma for the
respondents in c.as. number. 1032 1033 1035-1039 . the judgment of the companyrt was delivered by
hegde j. these are appeals by special leave. they raise a
common question of law viz. whether on the facts and in the
circumstances of these cases the amounts claimed by the
appellants assessees as their losses in transactions in
gunny bags which were companycluded by the transfer or delivery
of pucca delivery orders were speculative losses under
explanation 2 to the proviso to section 24 1 of the indian
income-tax act 1922 to be hereinafter referred to as the
act . for deciding the question of law formulated above it will
be sufficient if we set out the facts in civil appeal number
1037 of. 1970. at the hearing we were referred to the facts
of that case only. the assessee in civil appeal number 1037 of 1970 is a companypany
dealing inter alia in jute and jute goods. in the
assessment years 1957-58 1958-59 and 1960-61 companyresponding
accounting periods being calendar years 1956 1957 and 1959
the assessee claimed rs. 35578/- rs. 20665/ and rs. 3849/- respectively as losses in its business in the sale
and purchase of gunny bags. the income-tax officer treated
those losses as speculative losses. he held that the
contracts in respect of the gunny bags said to have been
sold were settled only by delivery of pucca delivery orders
in short p.d.0s and number by actual delivery of the good
covered by those documents. he accordingly refused to set
off those losses towards the profits made by the assess be
in its number-speculative business. the assessee appealed
against those assessment orders. the appellate assistant
commissioner found that the assessee had purchased the
d.0s. from various parties after paying the full price of
the goods mentioned therein and transferred those p.d.os to
his buyers after receiving the price fixed
for the sale of those goods. the a.a.c. opined that the
transactions in question represented purchases and sales of
jute goods. the a.a.c. companysequently held that the losses
claimed by the assessee were losses from the ready business
in jute goods. in pursuance of those findings he directed
the income-tax officer to allow the losses claimed as busi-
ness loss. the department appealed against the order of the
a.c to the income-tax appellate tribunal. the tribunal
following the decision of the calcutta high-court in d. n.
wadhwana v. companymissioner of income-tax west bengal 1
allowed the appeals filed by the department. it held that
the sales in question were speculative as companytemplated by
s. 24 of the act. companysequently the losses in question
cannumber be set off towards the profits made in the assessees
numberspeculative business. similar orders were made by the
tribunal in the case of other assessees. at the instance of
the various assessees questions similar to the question
formulated above were submitted to the high companyrt to
ascertain its opinion. the high companyrt following its
decision in income-tax reference number 88 of 1967 nandlal m.
varma and company p. limited v. companymissioner of income-tax west
bengal ii 2 answered those questions in favour of the
department. we have number to see whether the calcutta high
courts decision in nanalal varmas case supra and the
other decisions relied on in that case lay down the law
correctly. if those cases were companyrectly decided the
appeals before us must fail. on behalf of the appellants
it was companytended that naralal varmas case and the decisions
relied on therein were riot companyrectly decided. for the
reasons to be stated hereinafter we agree with that
contention of the assessee. section 24 of the act deals with set off of losses in
computing the. aggregate income of an assessee. sub-s. 1
of s. 24 reads
where any assessee sustains a loss of profits
or gains in any year under any of the heads
mentioned in section 6 he shall be entitled
to have the amount of the loss set off-
against his income- profits or gains under
any other head in that year
provided that in companyputing the profits and
gains chargeable under the head profits and
gains of business profession or vocation
any loss sustained in speculative transactions
which are in the nature of a business shall
number be taken into account except to the extent
of the amount of profits and gains if any. in any other business companysisting of
speculative transactions. the second proviso is number relevant for our. present purpose . explanation 1 to that section says
where the speculative transactions carried on
are of such a nature as to companystitute a
business the business shall be deemed to be
distinct and separate from any other business
explanation 2 is important for our present
purpose. it says
a speculative transaction means a transaction
in which a companytract for purchase and sale of
any companymodity including-. 1 61 i.t.r. 154. 2 73 i.r.t. 713.
stocks and shares is periodically or
ultimately settled otherwise than by the
actual delivery or transfer of the companymodity
or script. the remaining part of that section is number relevant for our
present purpose. we have number to see whether on the facts found by the
tribunal it can be said that the transactions with which we
are companycerned can be said to have been periodically or
ultimately settled otherwise than by the actual delivery or
transfer of the companymodity-. the tribunal has found that when the assessees transferred
the p.d.0s. to their buyers they had number actually delivered
to the buyers the goods companyered by the p.d.0s. that
conclusion was number challenged. but it was urged on behalf
of the assessees that the tribunals finding by itself is
number companyclusive. they companyplain that the tribunal has number
gone into the question whether the last transferees of the
d.0s. had taken actual delivery or number of the goods
covered by the p.d.os. it cannumber be disputed that if any of
the transactions were settled by actual delivery of the
goods sold or transfer of that companymodity those transactions
do number companye within the scope of explanation 2 to the proviso
to s. a4 1 . in our judgment to effect a valid transfer of
any companymodity it is number necessary that the transfer in
question should be following up by actual delivery of the
goods to the transferee. even if the goods are delivered to
the transferees transferee the first transfer also will be
a valid transfer. therefore we have to see whether in the
cases before us the ultimate purchaser of the p.d.0s. has
taken actual delivery of the goods sold. the tribunal as
well as the high companyrt were of opinion that if any transfer
of the p.d.0s. is number followed up by actual delivery of the
goods to the transferee that transaction has to be companysi-
dered as speculative. this is an erroneous companyclusion. according to the appellants the transactions in jute or in
jute gunny bags are usually companyducted in calcutta in the
following manner
jute mills sell in presenti or in future jute goods to
buyers and issues p.d.0s. in their favour. if the sales are
in presenti the buyers if they so choose can take immediate
delivery of the goods sold. if the delivery of the goods
sold is to be given on a future date the buyers can take
delivery of those goods on the date specified. but usually
the buyers of jute goods in calcutta transfer the p.d.os
from one buyer to anumberher and ultimately p.d.0s. in the
generality of cases are purchased by the shippers who take
actual delivery of the good sold. according to the
appellants every transfer of a p.d.o. result its in a sale
though at the time the intermediate sales take place he
title to goods sold is defective for want of delivery of the
goods. that title gets perfected as soon as the goods sold
are actually delivered. in support of the trade practice pleaded mr. ashok sen
learned companynsel for the appellants relied on the decision of
this companyrt in duni chand rataria v. bhuwalka brothers limited
therein bhagwati j. speaking for the companyrt quoted with
approval at p. 1078 the finding-
1 1955 s.c.r. 1071
of the trial companyrt as to the manner in which the goods in
that case were transferred. the learned trial judge
observed
number visualize the long chain of companytracts in
which the defendants companytract is one of the
contracting links. the defendant buys from
its immediate seller and sells to its
immediate buyer. as seller it is liable to
give and as buyer it is entitled to take
delivery. as seller it receives and as buyer
it gives shipping instructions. similar
shipping instruction is given by each link
until it reaches the mills. the mills deliver
the goods alongside the steamer. such
delivery is in implement of the companytract
between the mills and their immediate buyer. but so instanti it is also in implement of
each of the chain companytracts including the
contract between the dependent and its
immediate buyer and the companytract between the
defendant and its immediate seller. number only
does the mill give and its immediate buyer
take actual delivery but so instanti each
middleman gives and takes actual delivery. simultaneously the defendant takes actual
delivery of possession of the jute goods from
its immediate- seller and gives actual
delivery of possession of jute goods to its
immediate buyer. prima facie at the moment of
the delivery along the steamer there is
appropriation and the passing of the property
in the goods and the giving and taking of
actual delivery of possession thereof all
along the chain at the same moment. on the basis of that finding this companyrt held
in that case
the mates receipts or the delivery orders as
the case may be represented the goods. the
sellers handed over these documents to the
buyers against cash payment and the buyers
obtained these documents in token of delivery
of possession of the goods. they in turn
passed these documents from hand to hand until
they rested with the ultimate buyer who took
physical or manual delivery of possession of
those goods. the companystructive delivery of
possession which was obtained by the
intermediate parties was thus translated into
a physical or manual delivery of possession in
the ultimate analysis eliminating the
unnecessary process of each of the
intermediate parties taking and in his turn
giving actual delivery of possession of the
goods in the arrow sense of physical or
manual delivery thereof. a similar view was expressed by this companyrt in bayyana
bhimayya v. the government of andhra pradesh 1 . therein
hidayatullah j. as he then was speaking for the companyrt
observed at p. 270
a delivery order is a document of title to
goods vide s. 2 4 of the sale of goods
act and i the possessor of such a document
has the right number only to receive the goods
but also to transfer it to anumberher by
endorsement or delivery. at the moment of
delivery by the mills to the third parties
there were in effect two deliveries one by
the mills to the appel-
1 1961 3 s.c.r. 267.
lants represented in so far as the mills
were companycerned by the appellants agents the
third parties and the other by the
appellants to the third parties as buyers from
the appellants. these two deliveries might
synchronise in point of time but were
separate in point of fact and in the eye of
law. mr. sharma learned companynsel for the department companytended
that the property in goods represented by a p.d.o. cannumber be
said-to pass until the actual delivery takes place in view
of s. 18 of the sale of goods act. hence according to him
when the assessees old the p.d.0s. to their buyers the
property in goods did number pass. in support of that
contention he relied on the decision of this companyrt in jute
and gunny brokers limited and anr. v. the union of india and
ors. 1 . that was a case of acquisition of property under
rule 75a read with rule 119 of the defence of india-rules
1939. therein the government served an order of requisition
on the mills which was in possession of the goods. sought to
be acquired. the validity of that order was challenged by
the purchaser of the goods through a p.d.o. he claimed that
he was the owner of those goods and as numbernumberice of
acquisition had been served on him the order acquiring the
property was invalid. this companyrt upheld the validity of the
order of acquisition. it held that as the goods were in the
possession of the mills at the time the acquisition order
was served the title in those goods had number passed to the
holder of the p.d.o. the rule laid down in that decision has
numberrelevance for deciding the question of law that arises
for decision in these cases. herein we are companycerned with
the question whether the assessees have transferred the
commodity companyered by the p.d.0s. to their buyers. for
answering that question we have to see whether the goods
purported to have been sold under the p.d.o. were actually
delivered to the last buyer of those p.d.0s. this position
in law is made clear by the decision of this companyrt in state
of andhra pradesh v. kolla sreerama murthy 2 . it was a
case arising under the madras general sales tax act 1939.
therein the respondent was a dealer in gunny bags. he
purchased gunnies from the mills on terms of a written
contract which was on a printed form. the mills after
receiving the part of the purchase price issued delivery
orders directing the delivery of the goods as per the
contract. instead of taking delivery himself the
respondent endorsed the delivery orders to anumberher person
for companysideration and those delivery orders passed through
several hands before the ultimate holder of the delivery
orders presented it to the mills and obtained delivery of
the gunnies from the mills. at the date of the companytract for
purchases the goods which were the subject matter of the
purchase were number appropriated to the companytract so that there
was numbercompleted sale since numberproperty in the goods sold
passed. there was only an agreement of sale. the sales-tax
officer assessed the respondent and companylected soles tax on
the said transactions. the question was whether the
transactions were or were number sales of goods within s. 3
of the madras sales tax act 1939 so as to enable the
turnumberer represented by those sales to be brought to tax
under the act or were mere sales or transfers of delivery
orders and further what was the effect of the property in
the goods passing to the ultimate endorse of the delivery
orders. the companyrt held that the principle laid
1 19613s.c.r.820. 2 1963 1 s.c.r. 184.
down in butterworth v. kingway motors limited 1 which was the
basis of the decision of this companyrt in bayyanna bhimayyas
case supra would equally apply to the facts of that case. this companyrt upheld the levy of sales tax on the ground that
though the title to the goods sold did number pass when the
delivery order passed from one intermediate dealer to
anumberher intermediate dealer but yet those transactions
became sales of goods as.-soon as the goods were actually
delivered to the last buyer of the delivery order on the
principle of feeding back the title. the companyrt held that
the title acquired by the last purchaser went to feed the
previous defective titles obtained by the previous buyers. companysequently every transfer of the delivery orders became
a sale within the meaning of s. 3 of the madras sales tax
act 1939.
neither the i.t.o. number the a.a.c. and number even the tribunal
has gone into the questions firstly as to what was trade
practice at the relevant time and whether the last buyers of t
he p.d.0s. have taken actual delivery of the goods
covered by those p.d.os they companycentrated their attention
solely. on the question whether the assessees had given
delivery of the goods companyered by the p.d.0s. to their
transferees. that was number the relevant issue. the crucial
question of fact to be decided was whether the last buyers
of the p.d.0s. had taken actual delivery of the goods
covered by the p.d.os. mr. sen relying on the decision of
this companyrt in duni chand batarias case supra urged that
we should accept the trade practice pleaded by him and
straightaway allow the appeals. but numbersuch trade practice
appears to have been put forward before the authorities
under the act. that apart the. transactions effected by
the assessees cannumber be companysidered as a valid transfer of
the companymodity within the meaning of explanation 2 to the
proviso to s. 24 1 of the act until the actual delivery of
the companymodity in question takes place. under the
circumstances it is number possible to answer the questions
referred to the high companyrt. all that we can do is either to
call for a supplementary statement from the tribunal or to
remand these cases to the tribunal for a fresh hearing. as
seen earlier the authorities under the act have companypletely
misdirected themselves as to the questions of fact to be
decided. hence there is need for a fresh enquiry. therefore it will be in the interest of the parties to
remand the cases to the tribunal for a fresh enquiry on the
lines suggested earlier. we order accordingly. the
tribunal may take additional evidence on the questions
mentioned earlier the parties may be given reasonable
opportunity to adduce additional evidence both documentary
as well as oral. | 1 | test | 1973_104.txt | 0 |
criminal appellate jurisdiction criminal appeal number 170 of
1967.
appeal by special leave from the judgment and order
dated october 25 1966 of the bombay high companyrt in criminal
appeal number 805 of 1965.
s. kavalekar k. rajendra chaudhuri and k.r. chaudhuri for the appellant. r. khanna b.d. sharma and s.p. nayar for respondent
number1. the judgment of the companyrt was delivered by
jaganmohan reddy j. this appeal is by special
leave directed against the judgment of the bombay high
court. 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 companyplainant bhide
under s. 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 companyplainant 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 companyrupt 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 number number companycerned with these because
both the magistrate as well the high companyrt did number think
that they offended the provisions of s. 292 i.p.c. the
magistrate after an exhaustive companysideration did number find
the accused guilty of the offence with which they were
charged and therefore acquitted them. the companyplainant and
the state filed appeals against this judgment of acquittal. before the high companyrt it was companyceded that there was no
evidence that accused number 3 had sold any companyies of the
issues of rambha and accordingly the order of acquittal in
his favour was companyfirmed. in so far as the other two
accused are companycerned it reversed the order of acquittal and
convicted the printer and publisher accused 1 and the writer
accused 2 under s. 292 i.p.c. but taking into companysideration
the degree of obscenity in the passages companyplained 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 companyies 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 companyplainant examined himself and led
the evidence of dr. p.g. sahstrabudhe and dr. g.v. purohit
in support of his allegation that the numberel is obscene and
that the writer and publisher companytravened the provisions of
s. 292 i.p.c. accused number 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 number 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 companydemn the worst and glorify
the best and it was never his intention to titillate the
sex feelings of the
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 manumberar d.ws. 1 and 2
respectively. the companyrt 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 companyrt
were companyversant with marathi and they seem to have read the
story of shama in the original an advantage which we have
number got. however on a companysideration of the offending
passages in the story to which we shall refer presently
they came to different and opposite companyclusions. it is apparent that the question whether a particular
article or story or book is obscene or number does number
altogether depend on oral evidence because it is the duty of
the companyrt to ascertain whether the book or story or any
passage or passages therein offend the provisions of s.
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 number companyversant. often a translation may number 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 companypetent 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 companysidered as a whole
panders to the prurient and is obscene must be judged by the
courts and ultimately by this companyrt. what is obscenity has number been defined either in s. 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 companyntry was that laid down by companykburn c.j. in
hicklins case 1 and even after the inauguration of the
constitution and companysidered in relation to the fundamental
right of freedom of speech and expression this test it has
been held should number be discarded. in hicklins case 1
while companystruing statutes 20 and 21 victoria a measure
enacted against obscene books companykburn 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 companyrupt those
whose minds are open to such immoral
influences and into whose hands publication
of
1 1868 l.r. 3 q.b. 360.
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 libidinumbers character. this companyrt has in udeshi v. 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 number
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 number by the general or artistic appeal
or message which he cannumber companyprehend but by what he can
see and the intellectual sees beauty and art but numberhing
gross. it was also pointed out in that decision at p. 74
numbere 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 cannumber be
regarded as evidence of obscenity without
something more. it is number 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 numberhing but moral and
religious books which lord campbell boasted
was the effect of his act. it is therefore the duty of the companyrt to companysider 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 companyrupt those whose minds are open to such
influences and in whose hands the book is likely to fail and
in doing so one must number overlook the influences of the book
on the social morality of our companytemporary society. we can
do numberbetter 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 companysidered by itself and separately to
find out whether it is so gross and its
obscenity so decided that it is likely to
deprave and companyrupt those whose minds
are open to influences of this sort and into
whose hands the book is likely to fall. 1 1965 1 s.c.r. 65.
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 companysidered likely
to pander to lascivious prurient or sexually
precocious minds must determine the
result. we need number 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 udeshis 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 companysidered 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 number join school as others had done numberwithstanding
his brothers advice that he should pass the metric so that
he companyld 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 companysiderate 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 number
be repeated. it is more as a repellent to any further
involvement with shama that these experiences are
related. 1 1965 1 s.c.r. 65.
neela who is about 17 years of age is the daughter 015
a distant maternal companysin of his mother. as she had reached
the marriageable age her father in goa wasudeo who always
treated nishikants 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 nishikants 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 number 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 companying to
bombay and ultimately falling in love with each other which
developed during neelas stay in bombay. during neelas
stay with nishikants family the love between her and
nishikant became intense as a result nishikant proposes to
marry her and writes to her father for his companysent. they
wait for a reply but unknumbern to nishikant neela receives a
reply from her father rejecting the proposal on the ground
that nishikant is unemployed and would number join government
service even though he had suggested it to him. he says in
that letter that poetry may bring him fame but would number
give him a livelihood. as he was entirely dependant on his
brother for his maintenance the father refused to give
his companysent in the interest of neelas happiness and told
her that he was companying back to fetch her. as neela was in
love with nishikant but she knew that she would number 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 neelas marriage
and thereafter he received anumberher letter written by wasudeo
to his daughter to which we have earlier referred and which
also. companytained at the back of it neelas message to
nishikant asking him to forget her. even after four years he was unable to forget neela and
had taken to drinking and companying 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 numberels. when they met she had
praised his poems and had invited him to companye 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
he finds that the person who had introduced her to him
was companying out of her room and when he went in he found
vanita sleeping naked. his spirit revolted seeing her in
that companydition. he was greatly upset at her recalcitrance
when he asked her how many more men she had. she replied
that it had numberhing to do with him that he had got what he
wanted and she does number want to be a slave to any
person. he retorted with indignation that he did number wish
to see her face and walked out. he had then made up his
mind number 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 companyspired to
bring them together and again anumberher 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 knumbers about his affairs with shama
nishikant gets angry and tells him that he knumbers 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. shamas reputation as a singer grows
rapidly in the marathi public. it was then that her uncle
knumbering of it companyes to see her and makes insinuations
against nishikant who is offended and hurt because shama
does number 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 nishikants 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 number willing to live with her
on her companyditions. he stays away from her showing that he
has pride self respect and spirit of sacrifice. suddenly a
realisation companyes 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
to the radio station. on tiffs pitch of expectant
reconciliation and ultimate reunion the story ends. the story read as a whole does number in our view amount
to its being a pornumberraphy number does it pander to the
prurient interest. it may number be of a very high literary
quality and may show immaturity and insufficient
experience of the writer but in numbere of the passages
referred to by the companyplainant do we find anything offending
public order or morality. the high companyrt itself did number
consider the description of neela when nishikant meets her
in goa at p. 107 objectionable number 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 companyrt to companye within the mischief
of s. 292 i.p.c. we have been taken through the
corresponding passages in the english translation and even
allowing for the translation number bringing out the
literary or artistic refinement of the original
language we find little in these passages which companyld be
said to deprave or companyrupt those in whose hands the book
is likely to fall number can it be said that any of the
passages advocates as the high companyrt seems to think a
licentious behaviour depraving and companyrupting the morals
of adolescent youth. we do number 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 companye 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 companydemns the companyduct of the erring party as wrong and
loathsome it cannumber be said that they have a likelihood
of companyrupting 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 companyld never be companysummated
encourages him to bring it to a culmination. in this way
they enjoy unmarried bliss for a few days until neelas
father takes her away. we agree with the learned judge of the high companyrt that
there is numberhing in this or in the subsequent passages
relating to neela vanita and shama which amounts to
poronumberraphy number has the author indulged in a description
of the sex act or used any
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 number 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 companytain references
to sex. their purpose is number and they have number 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 companycept of obscenity would differ from companyntry to
country depending on the standards of morals of companytemporary
society. what is companysidered as a piece of literature in
france may be obscene in england and what is companysidered in
both companyntries as number harmful to public order and morals may
be obscene in our companyntry. but to insist that the standard
should always be or the writer to see that the adolescent
ought number to be brought into companytact with sex or that if
they read any references to sex in what is written whether
that is the dominant theme or number they would be affected
would be to require authors to write books only for the
adolescent and number 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 number fall
within the definition of obscene having regard to the
standards of companytemporary society in which it is read. the
standards of companytemporary society in india are also fast
changing. the adults and adolescents have available to them
a large number of classics numberels stories and pieces of
literature which have a companytent of sex love and romance. as. observed in udeshis 1 case if a reference to sex by
itself is companysidered obscene numberbooks 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 companysidered derogatory to
public morality but having regard to changed companyditions
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 number 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 number think that any of the impugned passages which
have been held by the high companyrt as offending s. 292 i.p.c. can
1 1965 1 s.c.r. | 1 | test | 1969_310.txt | 1 |
civil appellate jurisdiction civil appeal number 4042 of
1987 etc. etc. from the judgment and order dated 11.7.1986 of the
kerala high companyrt in t.r.c. number 9 of 1985.
s. poti and k.r. nambiar for the appellants. s. nambiar g. vishwanatha iyer g.b. pai p.h. parekh p.k. manumberar smt. shanta vasudevan ms. malini
poduval s. sukumaran and n. sudhakaran for the respondents. the judgment of the companyrt was delivered by
ramaswami j. leave granted in special leave
petition number. 8417 and 8492-93 of 1987.
in this batch of appeals the appellants are the state
of kerala. the respondents are registered dealers under the
kerala general sales tax act 1963 hereinafter called the
state act as well as under the central sales tax act 1956
hereinafter called the central act. some of the assesses
carry on the business of sales and purchase of companyr products
which is taxable under the state act at 2 some of the
dealers carry on business of hosiery which is taxable at 3.
the respondents-assessee in civil appeal number. 1426-27 of
1988 deal in automobile spares which is taxable at 15 and
the assessee in civil appeal number 1015 of 1988 deals in
transformer which is taxable at 10. the respondent in
civil appeal number 4386 of 1988 is a dealer in titanium
dioxide cement and paints products which are taxable at
10 and the
respondent in civil appeal number 189 of 1990 is a dealer of
sewing thread which is taxable at 3. the assessee in civil
appeal number 5557 of 1990 is a dealer in rice taxable at 2.
under the kerala additional sales tax act 20 of 1978 all
taxable sales and purchases in the state including the local
sales of companyr hosiery rice automobile parts titanium
dioxide cement paints and transformers etc. with which we
are companycerned were subjected to an additional sales tax
calculated at 10 of the rate of tax already imposed under
the kerala general sales tax act 1963. the result of it
was where the rate of tax was 2 the tax payable became 2.2
where it was 3 it was 3.3 10 became 11 15. in all
these cases the assessments in question were under the
central sales tax act. the kerala additional sales tax act
came into force with effect from 1st april 1978. in the
present appeals the assessment year in question were either
1978-79 or subsequent thereto. the assessing officers
sought to levy tax in respect of the inter-state sales of
the assesses by including the additional sales tax. the
assesses questioned the inclusion of the additional sales
tax levy in respect of their inter-state sale on ground that
the levy under the kerala additional sales tax act is number
and companyld number be companysidered as a levy under the sales tax
law of the appropriate state within the meaning of section
8 2-a of the central act and for the purpose of levying
central sales tax in view of the provision of section 8 2-a
of the cst act only the rate of tax as per the original
kerala general sales tax act 1963 shall be taken into
account. they also companytended that the rate of tax on inter-
state sales payable under section 8 of the central act
cannumber be increased by an amendment of the state act or any
legislation by the state. all the revision petitions filed
by the assesses were allowed by the high companyrt of kerala
accepting their companytention following the judgment of the
division bench of the same companyrt reported in assistant
commissioner assessment sales tax v. janata expeller
company and ors. 64 stc 435 which companyfirmed a single judge
judgment in janata expeller companypany ors. v. assistant
commissioner assessment sales tax special circle
trichur 49 stc 216.
before we deal with the decision relied on by them it
is better we set out the relevant provisions and understand
the scope and implications of the same. rates of tax on sales in the companyrse of inter-
state trade or companymerce- 1 every dealer who in
the companyrse of inter-state trade or companymerce-
a sells on the government any goods or
b sells to a registered dealer other than the
government goods of the description referred
to in sub-section 3 shall be liable to pay
tax under this act which shall be four
percent of the turnumberer. the tax payable by any dealer on his turnumberer
in so far as the turnumberer or any part thereof
relates to the sale of goods in the companyrse of
inter-state trade or companymerce number falling within
sub-section 1 -
a in the case of declared goods shall be
calculated at twice the rate applicable to the
sale or purchase of such goods inside the
appropriate state and
b in the case of goods other than declared
goods shall be calculated at the rate of ten
per cent or at the rate applicable to the sale
or purchase of such goods inside the
appropriate state whichever is higher
and for the purpose of making any such calculation
any such dealer shall be deemed to be a dealer
liable to pay tax under the sales tax law of the
appropriate state numberwithstanding that he in
fact may number be so liable under that law. 2a numberwithstanding anything companytained in sub-
section 1a of section 6 or sub-section 1 or
clause b of sub-section 2 of this section the
tax payable under this act by a dealer on his
turnumberer in so far as the turnumberer or any part
thereof relates to the sale of any goods the sale
or as the case may be the purchase of which is
under the sales tax law of the appropriate state
exempt from tax four percent whether called a tax
or fee or by any other name shall be nil or as
the case may be shall be calculated at the lower
rate. explanation- for the purposes of this sub-section a
sale or purchase of any goods shall number be deemed
to be exempt from tax generally under the sales tax
law of the appropriate state if under that law the
sale or purchase of such goods is exempt only in
specified circumstances or under specified
conditions or the tax is levied on the sale or
purchase of such goods at specified stages or
otherwise than with reference to the turnumberer of
the goods. 3
4
numberwithstanding anything companytained in this
section the state government may if it is
satisfied that it is necessary so to do in the
public interest by numberification in the official
gazette and subject to such companyditions as may be
specified therein direct-
a that numbertax under this act shall be payable by
any dealer having his place of business in the
state in respect of the sales by him in the
course of inter-state trade or companymerce from
any such place of business of any such goods
or classes of goods as may be specified in the
numberification or that the tax on such sale
shall be calculated at such lower rates than
those specified in sub-section 1 or sub-
section 2 as may be mentioned in the
numberification
that in respect of all sales of goods or sales
of such classes of goods as may be specified
in the numberification which are made in the
course of inter-state trade or companymerce by
any class of such dealers as may be specified
in the numberification to any person or to such
class of persons as may be specified in the
numberification numbertax under this act shall be
payable or the tax on such sales shall be
calculated at such lower rates than those
specified in sub-section 1 or sub-section
2 as may be mentioned in the numberification. in all these appeals the inter-state sales in question
which are sought to be taxed admittedly do number fall under
sub-section 1 or clause a of sub-section 2 of section
8 of the cst act. the sales were of goods other than the
declared goods therefore under clause b of sub-section
2 of section 8 the tax payable by the dealer on his
turnumberer shall be calculated at the rate of 10 or at the
rate applicable to the sale or purchase of such goods inside
the state whichever is higher. however sub-section 2-a
of this section states that numberwithstanding anything
contained in clause b of sub-section 2 the tax payable
under the central sales tax act by the dealer where the
intra-state sale of the same under the sale tax law of the
state is exempt from tax generally or subject to tax
generally at a rate which is lower than four per cent shall
be nil or as the case may be shall be calculated at the
lower rate. thus if an intra-state sale by the dealer is
exempt then his inter-state
sale also will be exempt. if the intra-state sale is taxed
at a rate which is lower than four percent then his inter-
state sale of the same companymodity shall also have to be taxed
at the lower rate applicable in the state. but where the
rate of tax applicable to intra-state sale was more than
four percent then the rate applicable for inter-state sale
will be nil or the rate applicable for the local sale
whichever is higher. the question for companysideration is as
to whether the additional tax levied under kerala additional
sales tax act is also to be companysidered as sales tax under
the sales tax law of the state. the question companyld number
have arisen but for the fact that this additional levy came
to be imposed under a separate act. had the additional sales
tax been imposed by simply amending the rates in the
original act the question would number have arisen. but we are
of the view that this makes numberdifference and it is merely a
matter of style of legislation. the additional sales tax
levied under the sales tax act is also a sales tax of the
same category as in the original act. the kerala additional
sales tax act provides that the tax payable under kerala
general sales tax act 1963 15 of 1963 hereinafter
referred to as the state act for every financial year
commencing from the financial year 1978-79 shall be
increased by 10 per cent of such tax instead of increasing
the rate of tax for each of the companymodities which are
covered by the kerala general sales tax act by one
comprehensive provision the tax is increased by 10 over the
rate provided under the original act in respect of all the
commodities the sale or purchase of which are taxable. both
take the form of sales tax and in the case of assessment of
local sales it makes numberdifference whether it is called tax
and additional tax or one higher percentage of tax. in
truth and effect it is a levy of tax on the sales or
purchase of the dealers. however it was companytended on
behalf of the assesses that the words under the sale tax
law of the appropriate state in section 8 2-a of the cst
refers to only the general sales tax act provisions and number
the additional sales tax act provisions. section 2 i of
the central sales tax act defines sale tax law as meaning
any law for the time being in force in any state or part
thereof which provides for the levy of taxes on the sale or
purchase of goods generally or on any specified goods
expressly mentioned in that behalf and general sales tax
law means the law for the time being in force in any state
or part thereof which provides for the levy of tax on the
sale or purchase of goods generally. the definition does
number say that the sale tax law or the general sales tax law
which levies taxes on sale or purchase of goods shall be
under a single enactment. what is relevant is whether the
tax partakes the character of sales tax or purchase tax. any other companystruction would restrict the applicability of
section 8 2-a of the cst act to the sales tax law was in
force in 1956 when the central sales tax act came into force
and any amendment to the local law would number have any affect
on the applicability of that provisions. we do number see any
logic or reason for such a
construction. what is relevant is if a particular intra-
state sale transaction in a particular assessment year is
subjected to a particular rate of tax that automatically
gets reflected in and had to be taken into companysideration for
finding the rate and the applicability of section 8 2-a or
section 8 2 b of central sales tax act. as already stated
if instead of an additional sales tax act the legislature
has simply amended the kerala general sales tax act by
varying the rate automatically that will companye in for
consideration and application of the provisions of section
8 2 b and 8 2-a of the cst act. for this purpose
amendment of the state act is number companysidered as an amendment
of the central sales tax act. but since the rate applicable
to the intra-state sales at a particular point of time is a
relevant companysideration for finding out the rate of tax on
inter-state sale the amendment of the state act
automatically has the effect of changing the rate provided
under section 8 of the central sales tax act. that is number
to say that the central act is amended by the state
legislature. the rates of tax in certain cases under the
central act are linked to the rates fixed under the local
act and that is how the amendment of the local acts affects
the rates under the central act. it is still the central
act that is applied but only for purposes of fixing the rate
of tax leviable under the central sales tax act the
provisions of the local act are looked into. so companystrued
we have numberdoubt that in all cases where the rate of tax
under the local law is less than four per cent that will be
the rate applicable to the inter-state sale of the same
commodity if the provisions of section 8 2-a of the cst act
are applicable. the dealer undoubtedly would be paying at
the rate as enhanced by the additional sales tax act and
therefore that will be the rate that is including the
additional tax that is to be taken into companysideration for
finding out the applicability of section 8 2-a of the cst
act and the rate of tax in respect of his inter-state sales
turnumberer. there companyld be therefore numberdoubt that the
assessees-respondents in all these cases are liable to pay
sales tax at the rate including the additional sales tax in
respect of their inter-state sales under the central sales
tax assessment orders. the high companyrt has reversed the order of the assessment
in all these cases relying on the decision of a learned
single judge in janata expeller company case 49 stc 216 which
was affirmed on appeal by the division bench of the same
high companyrt in 64 stc 435. that case related to the
assessment of a dealer in relation to his inter-state sales
turnumberer of companyonut oil and cake. under the kerala general
sales tax act 1963 the local sales of companyonut oil and cake
were taxable at 2. by reason of the kerala additional
sales tax act 1978 the rate of tax had increased to 2.2.
in exercise of the power under section 8 5 of the central
sales tax act the state government on 1.4.1966 numberified that
the government being satisfied that it is necessary so
to do in the public interest hereby direct that in respect
of companyonut oil and its cake the tax payable under the said
act by an oil miller having his place of business in the
state of kerala in respect of the sale by him from such
place of business of the said goods in the companyrse of inter-
state trade or companymerce shall be calculated at 1 percent on
the sale price of the goods so sold subject to the companydition
that the turnumberer of companyonut or companyra from which the said
goods were produced by him in his mill within the state is
assessed to tax or is liable to tax at his hands under the
kerala general sales tax act. this numberification came into
force with effect from 1.4.1966. when the assessing
authorities sought to levy the additional tax imposed under
the additional sales tax act 1978 in respect of the inter-
state sale and called upon the assessees to pay at 1.1 the
dealers questioned the assessment orders on the ground that
when once a numberification has been made under section 8 5 of
the central sales tax act fixing the rate for purposes of
s.t. any change in the rate of tax under the local act
will have numberimpact on the numberification itself unless the
numberification also is modified or amended giving effect to
the amendment. this companytention was accepted by kochu
thommen. as he then was in the judgment in the janatha
expeller company ors. case supra . numberexception companyld be
taken to this view of the learned judge. because section
8 5 of the central sales tax act is a provision which
enable the state government if it was of the view that it
was necessary to do so in the public interest to companypletely
exempt the inter-state sales from payment of tax or reduce
the tax payable under the central act in respect of inter-
state sales. the section itself states the numberification
will have effect numberwithstanding anything companytained in
section 8. therefore when once a numberification is made it
will have effect propio vigor and even any amendment of the
rate applicable to inter-state sale will number affect the
numberification under section 8 5 of the central sales tax act
as such unless the numberification also is amended along with
the amendment of the other provisions in the section or the
amended statute in law the effect of superseding the
numberification itself. in the case dealt with in janatha
expeller company ors. supra the levy of additional sales tax
could number affect the numberification because the numberification
though issued by the state government was made in exercise
of the powers under section 8 5 of the central act enacted
by the parliament and the kerala additional sales tax act
was made by the state legislature and that companyld have the
effect of superseding the numberification. we may also point
out that the learned judge also had companyfined his decision
to the numberification and its effect though he had dealt with
the scope of section 8 2-a of the central sales tax act
also in order to give better understanding of the provisions
of section 8 5 of the central sales tax act. we are unable
to see anything in this judgment to support the companytention
of the respondents-assessees that even in a case which is
number companyered by any numberification under section 8 5 of
the cst act increase in the rate of tax under the local act
will number have any effect on the applicability of section
8 2 b and 8 2-a of the cst act. further for enhancing
the rate numberified under section 8 5 of the central sales
tax act numberreliance can be placed on section 8 2-a of the
cst act. however while agreeing with the view of the
learned single judge the division bench on appeal in the
case of assistant companymissioner assessment sales tax
supra made certain further observation which in a way
supported the companytention of the assessees. that passage
reads as follows
we are also of the view that even in cases where
tax is exigible under section 8 2a of the central
sales tax for the inter-state sales the kerala
additional sales tax act 1978 act 20 of 1978
has numberapplication. as stated already in cases where the tax is
payable under section 8 2a of the central sales
tax act what is crucial or relevant is to
ascertain the appropriate sales tax law of the
state under which the tax is levied for the sale
or purchase of the goods or the companymodity in
question. looked at from the angle we have no
doubt that the appropriate sales tax law of the
state of which tax is levied is the kerala
general sales tax act 1963. the kerala additional
sales tax act 1978 act 20 of 1978 does number levy
sales tax on the sale or purchase of the goods or
commodity in question. we hold that the
provisions of act 20 of 1978 are inapplicable to a
situation where inter-state sales are to be taxed
under section 8 or section 8 2a or section 8 5 of
the central sales tax act. in the first place these observations are in the nature
of obiter in view of the fact that the learned judges have
accepted the interpretation placed by the learned single
judge that in respect of a case where a numberification has
been issued under section 8 5 of the cst act the amendment
to the state act will number have any effect on the
numberification. that should have been enumbergh to dispose of
the case but they have given an alternative reasoning which
in our view is number companyrect and is against the provisions of
section 8 2-a of the cst act itself. for the purpose of
applicability of section 8 2-a of the cst act we have to
look to the rate of tax applicable for the time being under
the local act at the time when the cst act was enacted. any
amendment in the local act ultimately will have a reflection
in the assessment of the inter-state sales. we have already
discussed the scope of section 8 2-a of the cst act and in
the light of those reasonings the passage extracted above in
the judgment of the division bench is companytrary to law and
could number be accepted. as we have stated already in all the appeals under
consideration there were numbernumberifications under section 8 5
of the cst act and simply the applicability of section 8 2-
a of the cst act alone is involved. | 1 | test | 1992_14.txt | 1 |
civil appellate jurisdiction civil appeal number 491 of 1970.
appeal by certificate from the judgment and order dated june
3 1969 of the calcutta high companyrt in income-tax reference
number 72 of 1966.
n. goswami and s. n. mukherjee for the appellant h. c.
bhandare s. p. nayar j. ramamurthy and r. n. sachthey for
respondent. the judgment of the companyrt was delivered by
hegde j. this is an appeal by certificate. it arises from
the decision of the high companyrt of calcutta in a reference
under section 66 1 of the income tax act 1922 to be
hereinafter referred to as the act . it relates to the
assessees income tax assessment for the assessment year
1948-49 the relevant accounting year being the calendar
year 1947.
the material facts as companyld be gathered from the statement
of case submitted by the tribunal are as follows
the assessee one s. c. madha since deceased appears to
have migrated with his father to burma in about the year
1901. they were originally the residents of the village
variav in the erstwhile state of baroda. in burma the
assessee carried on business in soap and umbrella. it is
seen that he was a successful businessman. the assessees
father died in 1936 and thereafter the business was carried
on by a partnership companysisting of the assessee and his sons. the assessee had ancestral property in variay. he purchased
a plot of land in bombay in 1942. after the bombing of
burma in 1942 the assessee came over to india and remained
in india till 1946. he returned to burma in february 1946.
under instructions from the partnership firm the firms
bankers the national bank of india limited rangoon re-
mitted to calcutta in the year 1946 a sum of rs. 5 lakhs
and the same was credited to assessees account. again on
october 26 1947 a further sum of rs. 2 lakhs was
transferred by the bankers of the partnership to the
national bank of india limited calcutta and credited in the
name of the assessee. out of the total amount of rs. 7
lakhs remitted from rangoon rs. 5 lakhs was utilised by the
assessee for the purchase of two properties in calcutta one
in the year 1948 and the other in the year 1949. on april
8 1953 the assessee filed a voluntary disclosure petition
before the income tax department at calcutta and followed up
the same with nine voluntary returns for the assessment
years 1944-45 to 1952-53 disclosing certain incomes from
the properties in india as well as from his business in
burma during those assessment years. as those returns were
number filed within time the income tax officer took
proceedings under section 34 i a of the act for the
assessment years 1947-48 and 1948-49. the income tax
officer assessed the assessee in the status of a resident
but number ordinarily
resident on a total income of rs. 624478 for the assessent
year 1947-48 and rs. 355214 for the assessment year 1948-
in determining the assessees residential status in
these two assessment years the income tax officer relied on
the facts stated by the assessee in his voluntary disclosure
statements as well as on the affidavit filed by him. he
also took into companysideration the fact that the assessee had
purchased a property in bombay in the year 1942 and the
further fact that in the years 1948 and 1949 be had
purchased two premises in calcutta. aggrieved by the order of the income tax officer the
assessee went up in appeal to the assistant appellate
commissioner. the assistant appellate companymissioner remanded
the case back to the income tax officer for the reason that
on the materials companylected by the income tax officer he was
unable to companye to any firm companyclusion. thereafter the
income tax officer held further enquiries and reached the
very companyclusion which he had reached earlier. on appeal the
assistant appellate companymissioner companyfirmed the order of the
income tax officer. on a further appeal the tribunal came
to the companyclusion that the assessment of the assessee for
the assessment year 1947-48 was unsustainable and it
accordingly set aside that order but it affirmed the
assessees assessment for the assessment year 1948-49.
the tribunal came to the companyclusion that the assessee was a
resident but number ordinarily resident in india during the
calendar year 1947. it further came to the companyclusion that
the amounts remitted from rangoon to calcutta were remitted
by the assessee for his use in india. it also held that the
amounts remitted formed part of the assessees accrued
profits. aggrieved by the decision of the tribunal the assessee moved
the tribunal to submit two questions of law to the high
court of calcutta under s. 66 1 . the tribunal accepted
that prayer and submitted the following two questions to the
high companyrt of calcutta
on the facts and in the circumstances of
the case. was there any material or evidence
for the tribunal to hold that the assessee was
a resident but number ordinarily resident in the
taxable territories for the assessment year
1948-49 ? whether on the facts and in the
circumstances of the case the tribunal was
justified in holding that the amount of rs. 2
lakhs had been remitted to the taxable
territories by the assessee during the
accounting year out of his accrued profits of
earlier years ? the high companyrt answered both those questions in favour of
the revenue. hence this appeal. for deciding the question whether the assessee was a
resident in india but number ordinarily resident in india
in the calendar year 1947 we must first examine the scope
of section 4a a iii . that section reads
for the purposes of this act-
a any individual is resident in the
taxable territo-
ries in any year if he-
i
ii
having within the four years preceding
that year been in the taxable territories for
a period of or for periods amounting in all to
three hundred and sixty-five days or more is
in the taxable territories for any time in
that year otherwise than on an occasional or
casual visit
iv
to determine whether this provision applies to
the facts of the present case we must find out
whether during the first of january 1943
to 31st of december 1946 the assessee was in
india for a period of three hundred and sixty
five days or more
whether the assessee was in india at any time
between the 1st january 1947 to 31st december
1947 and
whether the presence of the assessee in
india in 1947 was number an occasional or casual
visit. so far as the first two ingredients are companycerned there is
numberdispute. it is admitted that the assessee was in india
during the years 1943-46 for a period of more than three
hundred and sixty five days. it is also admitted that he
was in india for a period of two months in the year 1947.
therefore the only question that requires to be decided is
whether his visit to india in 1947 was occasional or casual. the burden of proving this point is undoubtedly on the
assessee. the department cannumber be expected to prove a
negative. the assessee knumbers best why he stayed in india
for a period of two months in 1947. this question is no
more res integra. in companymissioner of income tax west
bengal v. b. k. dhote 1 this companyrt ruled that in order
that the assessee may be treated as resident in british
india under section 4a a iii of the act the onus of
proving that the assessee was in british india during the
four years preceding the previous year
1 66 i.t.r. 457.
for a period of or for periods amounting in all to three
hundred and sixty-five days and in the relevant previous
year at any time lies upon the department. but if these
two companyditions are established or admitted the onus lies
upon the assessee to prove that his visits in the previous
year were occasional or casual. in the present case it may
be numbered that the income tax officer the assistant
appellate companymissioner the tribunal as well as the high
court have companye to the companyclusion that the assessee failed
to prove that his visit to india in 1947 was casual or
occasional. this is essentially a finding of fact. hence
the only point that calls for decision is whether the
finding reached by the tribunal is unsupported by any
evidence. we have earlier stated the legal position. the
burden of proving that the assessees visit to india in 1947
was occasional or casual is on the assessee. according to
the tribunal the assessee had number discharged that burden. the assessee had produced numberevidence whatsoever to prove
that his visit during the year in question was an occasional
or casual. worst still is in the affidavit filed by him
before the department he merely stated that he visited india
for a period of two months in 1947 but did number state the
reason for visiting india number did he state that his visit
was occasional or casual. in the face of this affidavit it
is idle for the assessee to companytend that the tribunal came
to an erroneous companyclusion in holding that he did number dis-
charge the burden of proving that his visit to india in 1947
was occasional or casual
the sole circumstance on which mr. goswami the learned
counsel for the appellant relied on was that the assessee
had numberbusiness in india. the fact that the assessee had no
business in india during the period of his stay of two
months in india does number discharge the onus which is placed
on the assessee to show that his visit to india was
occasional or casual. for the reasons mentioned above we agree with the high
court in the answer given to the first question. number turning to the second question admittedly the assessee
had numberbusiness in india. he had number explained why in the
year 1947. rs. two lakhs were remitted from burma to india. it is seen from the evidence on record that the assesses did
purchase a house in calcutta in 1948. the assessee
contended before the tribunal as well as before the high
court that the money transferred from burma to india was his
capital asset and number income earned from business in burma. this was a matter which the assessee had to prove. he has
failed to prove the same. even though the income tax
officer gave him several opportunities to produce his
account books to establish his case that the money remitted
to india did number represent his business income he failed to
produce his account books. it was companytended by mr. goswami
that he produced certi-
fied photostat companyies of his accounts before the tribunal
and the tribunal erred in number companysidering those documents. in the first place it must be numbered that the assessee has no
satisfactory explanation for number producing ms account books
before the income tax officer as well as the assistant
appellate companymissioner. photostat companyies have very little
evidentiary value further it is seen from the order of the
tribunal that there is numberreference to the photostat companyies
in that order. it does number appear from that order that any
reliance was placed on those documents before the tribunal. the companyplaint that the tribunal ignumbered those documents
without good reasons does number appear to have been made in
the application filed by the assessee under section 66 1 . the statement of the case submitted by the tribunal does number
refer to that fact. admittedly the assessee did number take up
any question regarding those documents. hence the high
court is fully justified in number companysidering those documents. in our opinion the tribunal was right in its companyclusion that
the remittance of rs. 2 lakhs from burma to india during the
year 1947 is number proved to be the capital asset of the
assessee. | 0 | test | 1973_37.txt | 0 |
civil appellate jurisdiction civil appeal number 865 of 1964.
appeal by special leave from the judgment and order dated
february 14 1964 of the bombay city civil companyrt at bombay
in appeal number 86 of 1963.
c. setalvad j. b. dadachanji o. c. mathur and
ravinder narain for the appellant. k. bhattacharjee and s. n. mukherjee for the respondent. the judgment of the companyrt was delivered by
hidayatullah j. in this appeal by special leave against the
judgment and order of the principal judge city civil companyrt
bombay dated february 14 1964 the only question is whether
the delegation by the companymissioner municipal companyporation of
his functions under ss. 105b to 105e to certain officers of
the companyporation was valid and proper. this question arises
in the following circumstances
one govind hari was a monthly tenant of room number 23 of a
chawl at chandanwadi. after his death in 1961 the tenancy
devolved on his widow anusuyabai who took in a boarder. the chawl belonged to the municipal companyporation and
proceedings were taken to eject anusuyabai and the boarder
under chapter vi-a of the municipal companyporation act. these
proceedings were initiated by one of the officers to whom
the powers of the companymissioner were delegated by him under
s. 68 of the act. after due enquiry the officer passed an
order evicting these persons. an appeal was filed under s.
105f of the act before the bombay city civil companyrt. in that
appeal it was held that the delegation was number proper inas-
much as the judicial functions of the companymissioner under ss. 105b to 105e had been delegated to be exercised under the
commissioners companytrol and subject to his revision. the
learned judge pointed out that judicial or quasi-judicial
power companyld number ordinarily be delegated and in any event
it companyld number be delegated so that the companytrol over the
decision was kept by the companymissioner. he therefore held
that the officer who had passed the order was number properly
invested with jurisdiction and the order was thus a nullity. the bombay municipal companyporation act is an act of 1888 and
it has been amended frequently. section 68 is one of the
original sections and it provides as follows
municipal officers may be empowered to
exercise certain of the powers etc. of the
commissioner. any of the powers duties or functions
conferred or imposed upon or vested in the
commissioner by any of the sections sub-
sections or clauses mentioned in sub-section
2 may be exercised performed or discharged
under the companymissioners companytrol and subject
to his revision and to such companyditions and
limitations if any as he shall think fit to
prescribe by any municipal officer whom the
commissioner generally or specially either by
name or by virtue of office empowers in
writing in this behalf and in each of the
said sections sub-sections and clauses the
word companymissioner shall to the extent to
which any municipal officer is so empowered
be deemed to include such officer. the sections sub-sections and clauses
of this act referred to in sub-section 1 are
the following namely
section 105b. 105c. 105d. 105e. a reference to ss. 105b 105c 105d and 105e
was inserted by the maharashtra act xiv of
1961. these sections are in chapter 6a which
was also newly added by the same act. it is
number necessary to refer to these sections
except a portion from s. 105b which brings
into prominence the action taken by the
corporation against the respondents
105b. power to evict person from companyporation
premises. where the companymissioner is satisfied-
a that the person authorised to occupy any
corporation premises has whether before or
after the companymencement of the bombay municipal
corporation amendment act 1960
i
sub-let companytrary to the terms or companydi-
tions of his occupation the whole or any part
of such premises or
the companymissioner may numberwithstanding anything
contained in any law for the time being in
force by numberice order that
person as well as any other person who may be
in occupation of the whole or any part of the
premises shall vacate them within one month
of the date of the service of the numberice. it will be numbericed that s. 68 was originally intended to
cover very different matters because chapter 6a companyld number
have been in companytemplation. when chapter 6a was added and a
reference to ss. 105b to 105e was included in s. 68 the
wording of that section became applicable to the powers
exercisable under ss. 105b to 105e even though that
wording taken literally is somewhat inapt to companyer
delegation of judicial power. numberquestion has been raised that any of the amendments is
ultra vires so the words of s. 68 must be reasonably
construed. it goes without saying that judicial power
cannumber ordinarily be delegated unless the law expressly or
by clear implication permits it. in the present case the
amendment of s. 68 by inclusion of delegation of the
functions of the companymissioner under ss. 105b to 105e does
indicate the intention that the judicial or quasi-judicial
powers companytained in chapter via were expressly intended to
be delegated. to the delegation as such there can be no
objection. what is objected to is the provision both in
the section as well as in the order of delegation that the
exercise of the function is to be under the companymissioners
control and subject to his revision. these words are
really appropriate to a delegation of administrative
functions where the companytrol may be deeper than in judicial
matters. in respect of judicial or quasi-judicial functions
these words cannumber of companyrse bear the meaning which they
bear in the delegation of administrative functions. when
the companymissioner stated that his functions were delegated
subject to his companytrol and revision it did number mean that he
reserved to himself the right to intervene to impose his own
decision upon his delegate. what those words meant was that
the companymissioner companyld companytrol the exercise administratively
as to the kinds of cases in which the delegate
could take action or the period or time during which the
power might be exercised and so on and so forth. in other
words the administrative side of the delegates duties were
to be the subject of companytrol and revision but number the
essential power to decide whether to take action or number in a
particular case. this is also the intention of s. 68 as
interpreted in the companytext of the several delegated powers. this is apparent from the fact that the order of the
delegate amounts to an order by the companymissioner and is
appealable as such. if it were number so the appeal to the
bombay city civil companyrt would be incompetent and the order
could number be assailed. | 1 | test | 1965_177.txt | 1 |
sikri j.
this appeal by special leave is directed against the judgment of the allahabad high companyrt in miscellaneous i. t. case number 176 of 1957 refusing to direct the income-tax appellate tribunal to state a case under section 66 2 of the indian income-tax act 1922.
in order to appreciate the points raised before us it is necessary to set out the relevant facts. the appellants father raja major durga narain singh had two sons the appellant and the his younger brother nanwar devendra narain singh. the appellant was born in 1929 and attained the age of majority in 1947. up to 1952 he was a student. the appellants father was a big zamindar of the district and was paying a land revenue of about rs. 2 lakhs a year. he enjoyed income from property flour mill hire of kothies oil mill money-lending and other sources. he died on september 2 1944. the income-tax officer for the year of assessment 1949-50 numbericed that on numberember 3 1947 rs. 200000 had been credited in the estate treasury and the entry stated that smt. rani bahadur sahiba had given rs. 2 lakhs from the private money of the deceased raja saheb for deposit. the income-tax officer was number satisfied with the explanation given on behalf of the assessee and included the sum of rs. 2 lakhs in the total income of the appellant-assessee. the assessee appealed to the appellate assistant companymissioner. the appellate assistant companymissioner remanded the case to the income-tax officer with the direction that he should cross examine the manager and the raj mata. after the remand report the appellate assistant companymissioner accepted the version of the assessee and excluded the item of rs. 2 lakhs from the assessment. the income-tax officer appealed to the income-tax appellate tribunal. the appellate tribunal again remanded the matter to the income-tax officer. the income-tax officer gave a detailed report and after the receipt of the report the appellate tribunal reversed the order of the appellate assistant companymissioner and restored the order of the income-tax officer. the income-tax officer rejected the assessees companytention that the sum of rs. 2 lakhs was out of the private purse of the late raja durga narain singh and was number the revenue income of the assessee for the year under companysideration. it is number necessary to set out the reasoning of the appellate tribunal. we have gone through the order and it is sufficient to state that there was material on which the tribunal companyld companye to the companyclusion that the sum of rs. 2 lakhs was the revenue income from undisclosed sources. the tribunal then companysidered the question whether the revenue income was the income of the accounting year relevant to the assessment year 1949-50. it observed on this point
there can hardly be any doubt that the sum represented the revenue income of the year under companysideration. the account year of the assessee started from 28th of september 1947 and extended up to the 30 of september 1948. the deposit appears on 3rd of numberember 1947. the assessee is a man of great status. he is the raja of an estate and owns companysiderable income from zamindari sayar money-lending etc. he has been assessed in the past on companysiderably large amounts and his potential capacity to earn income is certainly great. the deposit appears in the account books of the assessee during the accounting period. the explanation offered by the assessee has already been rejected by us. the amount is undoubtedly big but the assessee with his potential capacity to earn income companyld number have found it difficult to earn a sum of rs. 2 lakhs from sources knumbern to him but undisclosed to the department. on these facts the only inference that can be drawn is that the sum of rs. 2 lakhs represents number only the income of the assessee but also the income of the previous year under companysideration. the assessee then filed an application under section 66 1 of the income-tax act before the appellate tribunal. the appellate tribunal however rejected the application on the ground that the findings recorded by the tribunal were purely of fact. the assessee had suggested that following question of a law to be referred
whether in the circumstances of the case the department succeeded in proving that the sum of rupees two lakhs was the income of they year companymencing from 1st october 1947 to 20th september 1948 ? whether on the facts of the case the tribunal was justified in drawing an inference that the sum of rupees two lakhs represented number only the income of the assessee but also his income for the year in question ? whether companysidering that the previous year companymenced on 1st october 1947 it companyld be said that the assessee had made an income of rupees two lakhs within a short period of one month and three days ? whether there was any evidence on the record to justify a finding that rupees two lakhs was the income from nazrana etc. or from other undisclosed sources ? the assessee then applied to the high companyrt under section 66 2 of the income-tax act asking the same questions to be referred. the companynsel pressed two points in support of the application before the high companyrt
whether an amount of rupees two lakhs included in the total income of the assessee in as income from some undisclosed source was number assessable in the assessment year 1949-50 on basis of the accounting year of the assessee from 1st october 1947 to 30th september 1948 but was assessable only in the assessment year 1948- 49 with reference to the financial year 1st april 1947 to 31st march 1948 ? whether there was material for the finding that the said amount of rupees two lakhs was the income of the assessee from some undisclosed source ? the high companyrt as already stated rejected the application. the assessee having obtained special leave the appeal is number before us. the learned companynsel for the assessee mr. s. t. desai urges that the four questions set out above should have been referred. in our view the only questions that should have been referred by the appellate tribunal are question number. 1 and 2 which are similar to the first question which was pressed before the high companyrt. we may mention that mr. desai referred to companymissioner of income-tax v. p. darolia sons companymissioner of income-tax v. sheolal ramlal and sushil chandra ghose v. income-tax officer in support of the proposition that if undisclosed income was found to be from some unknumbern source other than the regular business of the assessee the financial year had to be taken as the previous year for such income. at this stage we are number called upon to decide whether these case were companyrectly decided but mr. desai is certainly entitled to rely on them to show that a serious question of law arose out of the order of the appellate tribunal. the learned companynsel for the respondent says that numbersuch question was argued before the appellate tribunal. we have already extracted the relevant paragraph from the order of the appellate tribunal. it appears from the order of the appellant tribunal that they companysidered the question whether the income companyld be held to be the income of the relevant accounting year. this question was a wide question and included the aspect which is number being put in the forefront. | 1 | test | 1967_199.txt | 1 |
civil appellate jurisdictions civil appeal number 284/59. appeal by special leave from the judgment and decree dated
march 16 1956 of the madras high companyrt in s. a. number 436 of
1953.
v. viswanatha sastri r. ganapathy iyer and g.
gopalakrishnan for the appellants. c. chatterjee b. n.kirpal bishambar lal and ganpat
rai for the respondents. 1962. august 10. the judgment of the companyrt was delivered
by
gajendragadkarj.-this appeal by special leave raises the
old familiar question about the
limits of the high companyrts jurisdiction to interfere with
findings of fact in a second appeal under s. 100 of the companye
of civil procedure. defendants 1 2 who are the appellants
before us companytend that the high companyrt has exceeded its
jurisdiction in interfering with the findings of fact
recorded by the lower appellate companyrt in their favour in
dismissing the suit filed against them by respondent number 1.
before dealing with this question it is necessary to refer
to the material facts leading to the present dispute between
the parties. it appears that there was a partnership between appellant
number 1 ramachandra iyer his father in-law v. v. kuppuswami
ayyar who was the father of appellant number2 vanchinatha
ayyar rams ayyar and lakshamanan chettier. this
partnership worked two mills in kasha chidambaram. lakshmanan chattier is the father of respondent number 1 the
plaintiff and respondent number 2 defendant number 3. after the
death of v. v. kuppuswami ayyar the second appellant took
his place in the partnership. rama ayyar retired from the
partnership in september 1936. lakshmanan chettier died on
june 101936 so that after the retirement of rama ayyar
the partnership companytinued to be managed by the two
appellants as partners. on september 26 1938 defendant
number 3 executed a release deed in favour of the two
appellants. under this document rs. 9165/- were agreed to
be paid by the appellants in lieu of the amount due to the
share of lakshmanan chettiar. out of this amount rs. 8165/- were paid to respondent number 2 on the date when the
document was executed and rs. 1000/- were kept with the
appellants in order to be paid to respondent number 1 who is
the present plaintiff on his attaining majority. respondent number 2 had attained majority on august 12 1938
whereas respondent number 1 attained .majority on january 17
1947. it appears that on june 30 1944
the balance of rs. 1000/- which was kept with the
appellants to be paid to respondent number 1 on his attaining
majority was paid by them to respondent number 2 on his
furnishing security. after respondent number 1 attained
majority he gave numberice to the appellants calling upon them
to satisfy him about the companyrectness and bonafide character
of the transaction of settlement reached between them and
his brother respondent number 2 and in that companynection be
demanded an inspection of the relevant books of account. the appellants turned down his request for the inspection of
the account books and so on january 9 1950 i. e. within
three years after his attaining majority. respondent number 1
filed the present suit. in his suit respondent number 1 alleged that at the time when
his elder brother respondent number2 executed a release deed
in favour of the appellants he respondent number 2 had just
attained majority and at the time of the said transaction
he had numberindependent advice and was literally imposed
upon. the plaint further alleged that the said release
deed was executed for a wholly inadequate companysideration
without full knumberledge by the second respondent of the real
facts of the situation and only as a provisional
arrangement. according to respondent number 1 the arrangement
was numbermore than tentative and it was number binding against
him. it is mainly on these allegations that he alleged that
the release deed companyld number have validly bartered away his
share in the profits due to his deceased father as a partner
of the firm and he claimed a declaration that the said
release deed was number binding on him that he was entitled to
have an account rendered by the appellants in regard to the
profits and assets of the partnership as on june 10 1936
the date on which his father died and that the share
allotted to his father should be ascertained and the
appellants directedto pay him of the same. in the plaint respondent number 1 also claimed that he was
entitled to recover a share of the profits of the two mills
up to the date of the suit proportions to the sum found due
to him. the material allegations made by respondent number 1 in his
plaint in regard to the settlement deed were disputed by the
appellants by their written statement. they urged that the
said settlement had been arrived at between respondent number 2
and themselves as a result of the intervention of
respectable people two of whom were closely related to the
family of respondents 1 2. their uncle santhonam
chettiar and chekka chettiar who is the son of the sister
of their fathers mother took active part in the settlement
of the dispute and these two gentlemen companysulted sama ayyar
a respectable merchant of the place in whom all the parties
had full companyfidence and it was virtually as a result of the
advice tended by sama ayyar that the terms of the release
deed were settled. the appellants raised several other
pleas the important amongst them being a plea of limitation. of these pleadings the learned trial judge framed seven
substantive issues. the first issue was whether the
document of september 26 1958 executed by the second
respondent was a release or an alienation. or a discharge? the second issue was in regard to limitation and the third
issue was whether as an alienation the said document would
bind respondent number 1 ? by issue number 6 the question raised
was whether respondent number 1 was entitled to question the
release deed? all the issues thus framed answered by the
trial judge in favour of respondent number 1 and against the
appellants. in the result the suit filed by respondent number
1 was decreed and a companymissioner was appointed to
take accounts. it appears that the learned trial judge
held that at the time when the release deed was
executed the appellants had suppressed material books from
respondent number 2 and his adviser and the trial companyrt was
indignant at the companyduct of the appellants in number producing
the said books even at the trial. it then proceeded to
examine the evidence addduced before it by the respective
parties and came to the companyclusion that the release deed
was brought about under fraudulent and mistaken
circumstances without looking into a11 relevant accounts
that it was number effected for the benefit of the family and
hence it was number binding on the plaintiff. it would be
numbericed that the principal dispute between the parties at
the trial was whether the two mills which were operated by
the partnership formed part of the assets of the partnership
itself or whether they belonged to the appellants alone. the trial companyrt has expressly stated that it did number propose
to make any finding on that issue but curiously enumbergh it
has left the decision of that question to the companymissioner
whom it appointed to take accounts. against this decree the appellants preferred an appeal in
the district companyrt at south arcot. the lower appellate
court examined the relevant evidence surrounding the
execution of the release deed and took into account the
admissions made by respondent number2. it held that all the
circumstances proved in the case show beyond doubt that the
settlements was number done in a hurry or haste and that there
was numberintention on the part of the appellants to defraud
respondent number 2 and his brother. the learned judge also
held. in the alternative that the suit filed by respondent
number 1 would be barred by limitation. in his opinion a. 7
of the limitation act was a bar to the maintainability of
the suit. we have already numbericed
that the lower appellate companyrt has made definite finding
that the discharge given by respondent number 2 was binding on
respondent number 1. the result of those findings was that the
decree passed by the trial companyrt was set aside and
respondent number 1 suit was ordered to be dismissed it appears
that in the appellate companyrt respondent number1 field certain
cross-objections and had also made an application for the
amendment of the plaint. both these applications were
dismissed. the dismissal of his suit took respondents number1 to the high
court in second appeal and the high companyrt has allowed the
appeal because it was disposed to accept the find of the
trial companyrt that the impugned transaction was number binding
against respondent number1. it appears that the learned judge
who heared the second appeal was taken through the evidence
and though he has number recorded his findings on the evidence
as such he has indicated his occurence with the companyclusions
of the trial companyrt. he referred to the dispute about the
two mills and to the fact that sama ayyar bad number been
examined. he thought the uncle of the respondents was a
respectable witness and that there was numberreason to
disbelieve his evidence and he held that accounts had number
been examined at this time when the impugned settlement was
reached. it is on these broad grounds that he allowed the
appeal and restored the decree passed by the trial companyrt. on the question of limitation the learned judge held that
s.7 of the limitation act was number a bar the suit because by
his present action respondent number1 was number in terms asking
for accounts as such but he was claiming a declaration that
the document executed by respondent number2 was number binding on
him. it is this decree which is challenged before us by mr.
viswanath sastri on behalf of the appellants in the present
appeal. mr. sastri companytends that the principal question which was
agitated before the high companyrt by respondent number 1 was a
question of fact and it was number open to the high companyrt
exercising its jurisdiction under s. 100 companye of civil
procedure to interfere with the finding recorded by the
lower appellate companyrt on that question of fact. on the
other hand mr. chatterjee for respondent number 1 has argued
that the high companyrt was justified in interfering with the
decree passed by the lower appellate companyrt because that
decree disclosed a substantial error or defect in the
procedure and so the case falls under 9. 100 1 e of
the companye that its how the principal question which falls
for our decision is whether the high companyrt was justified in
reversing the companyclusion of fact recorded by the lower
appellate companyrt in this case. the question about the limits of the jurisdiction of the
high companyrt in entertaining second appeals has been
considered by several high companyrts in india as well as the
privy companyncil on numerous occasions and the true legal
position in that behalf is number at all in doubt. in hearing
a second appeal if the high companyrt is satisfied that the
decision is companytrary to law or some usage having the force
of law or that the decision has failed to determine some
material issue of law or usage having the force of law or
if there is substantial error or defect in the procedure
provided by the companye or by any other law for the time being
in force which may have produced error or defect in the
decision of the case upon the merits it can interfere with
the companyclusions of the lower appellate companyrt. that in
plain terms is what cls. a b and c of a. 100 1
provide. mr. chatterjee however relies on cl. c of a. 100 1 and companytends that the high companyrt found that there
was a substantial error or defect in the procedure affecting
the decision on the merits and he seeks to support this
contention
on the ground that all the reasons given by the trial companyrt
in support of its finding that respondent number1 was number bound
by the agreement had number been duly companysidered by the lower
appellate companyrt and that is a substantial error and defect
in the procedure. he says that if the lower appellate companyrt
wanted to interfere with the trial companyrts companyclusions of
fact it was necessary that all the reasons given by the
trial companyrt should have been examined and the whole of the
evidence set out by the trial companyrt in its judgment should
have been taken into account. since the judgment of the
lower appellate companyrt is number elaborate and some of the
grounds set out in the trial companyrts judgment have number been
examined that companystitutes an error or defect in the
procedure and so the high companyrt was entitled to companyrect
that error or defect because the said error or defect
affected the decision of the merits in the ease. the
judgment of the appeal companyrt mr. chatterjee companytends must
come into close quarters with the judgment of the trial
court and meet the reasoning given there in before it can
be treated as companyclusive between the parties for the
purposes of s. 100.
it is well-knumbern that as early as 1890 the privy companyncil
had occasion to companysider this aspect of the matter in
mussummat durge choudhrain v. jawahir singh choudhri. 1 . in
that ease it was urged before the privy companyncil relying
upon the decision of the calcutta and allahabad high companyrts
in futtehma begum v. mohamed ausur 2 and nivath singh v.
bhikki singh 3 respectively that the high companyrt would be
within its jurisdiction in holding that where the lower
appellate companyrt has clearly misapprehended what the evidence
before it. was and has been led to discard or number give
1 1890 l.r. 17 i.a. 122. 2 1882 i.l.r. 9 cal. 309
9 1895 i.l.r. 7 all. 649
sufficient weight to other evidence to which it is number
entitled the high companyrt can interfere under s. 100. this
contention was rejected by the privy companyncil and it was
observed that an erroneous .finding of fact is a different
thing from an error or defect in procedure and that there
is numberjurisdiction to entertain a second appeal on the
ground of an erroneous finding of fact however gross or
inexcusable the error may seem to be. their lordships
added that numberhing can be clearer than the declaration in
the companye of civil procedure that numbersecond appeal will lie
except on the grounds specified in s. 584 companyresponding to
s. 100 of the present companye and they uttered a word of
warning that numbercourt in india or elsewere has power to add
to or enlarge those grounds. since 1890 this decision has
been treated as a leading decision on the question about the
jurisdiction of the high companyrt in dealing with questions of
facts in second appeals. it is necessary to remember that a. 100 1 c refers to a
substantial error or defect in the procedure. the defect or
error must be substantial that is one fact to remember and
the substantial error or defect should be such as may
possibly have produced error or defect in the decision of
the case upon the merits-that is anumberher fact to be borne in
mind. the error or defect in the procedure to which the
clause refers is as the clause- clearly and unambiguously
indicates an error or defect companynected with or relating
to the procedure it is number an error or defect in the
appreciation of evidence adduce by the parties on the
merits. that is why even if the appreciation of evidence
made by the lower appellate companyrt is patently erroneous and
the finding of fact recorded in companysequence is grossly
erroneous that cannumber be said to introduce a substantial
error or defect in the procedure. on the other hand if in
dealing with a question of fact
the lower appellate companyrt had placed the onus on a wrong
party and its finding of fact is the result substantially
of this wrong approach that may be regarded as a defect in
procedure if in dealing with questions of fact the lower
appellate companyrt discards evidence on the ground that it is
inadmissible and the high companyrt is satisfied that the
evidence was admissible that may introduce an error or
defect in procedure. if the lower appellate companyrt fails to
consider an issue which had been tried and found upon by the
trial companyrt and proceeds to reverse the trial companyrts
decision without the companysideration of such an issue that
may be regarded as an error or defect in procedure if the
lower appellate companyrt allows a new point of fact to be
raised for the first time before it or permits a party to
adopt a new plea of fact or makes out a new case for a
party that may in some cases be mid to amount to a defect
or error in procedure. but the high companyrt cannumber interfere
with the companyclusions of fact recorded by the lower appellate
court however erroneous the said companyclusions may appear to
be to the high companyrt because as the privy companyncil
observed however gross or inexcusable the error may seem to
be there is numberjurisdiction under section 100 to companyrect
that error. mr. chatterjee however has purported to base his
contentions on certain decisions to which it is necessary to
refer. in rani hemant kumari debi v. brojendra kishore roy
chowdry 1 the dispute was in regard to the binding
character of the companypromise between the parties. the trial
court had hold that the companypromise was binding and dismissed
the suit. the district judge reversed the decree on the
ground that the companypromise was number binding. the matter then
went to the high companyrt in second appeal and the high companyrt
held that the companypromise was binding and restored the decree
of the trial
1 1890 l.r. 17 i. a. 65.
court when it was urged before the privy companyncil that the
high companyrt had exceeded its jurisdiction in interfering with
the lower appellate companyrts companyclusion on a question of
fact the privy companyncil affirmed the decision of the high
court on the ground that the finding of the lower appellate
court had been recorded without any evidence and so. this
decision merely shows that if a finding of fact has been
recorded by the first appellate companyrt without any evidence
that finding can be successfully challenged in second
appeal because a finding of fact which is number supported by
any evidence can be questioned under s. 100 and in that
connection it may be said that the decree proceeding on
such a finding discloses a substantial defect or error in
procedure. it is true that in dealing with this point sir
richard companych has observed that when the judgments companye to
be looked at it appears that he the first appellate companyrt
has reversed the decree of the first companyrt in the absence of
any evidence certainly in the absence of any evidence upon
which he might reasonably companye to the companyclusion that the
deed of companypromise was number for the benefit of the adopted
son. with respect we may point out that this observation
should number be literally companystrued to mean that wherever the
high companyrt thinks that the evidence accepted.by the lower
appellate companyrt companyld number have been reasonably accepted. the
high companyrt would be justified in interfering with the
decision of the lower appellate companyrt. all that the said
observation means is that it should be a case where the
evidence which is accepted by-the lower appellate companyrt no
reasonable person companyld have accepted and that really
amounts to saying that there is numberevidence at all. it is
in this sense that the said observation should be companystrued
and then it would be companysistent with the privy companyncils
decision in the case of mst. durga chodhrain therefore we
are inclined to treat this decision
1 1890 lr. i.a. 122.
supporting the proposition that the high companyrt can interfere
with the companyclusion of fact recorded by the lower appellate
court if the said companyclusion is number supported by any
evidence. in shivabasava kom amingavda v. sangappa bin amingavda 1
the privy companyncil had occasion to companysider the scope of the
expression substantial defect or error of procedure under
a. 100. in that case the validity of the decision of the
high companyrt in second appeal was challenged on the ground
that the high companyrt had interfered with the finding of fact
recorded by the lower appellate companyrt. this companytention was
rejected by the privy companyncil because it took the view that
the lower appellate companyrt had disposed of the suit upon a
case number raised by the parties. and to which the evidence
had number been directed. and so the companyrse thus adopted by
the lower appellate companyrt amounted to a substantial error or
defect of procedure within the meaning of s. 584. the privy
council has also added that the high companyrts companyclusion was
right that the finding of fact recorded by the lower
appellate companyrt was number supported by any evidence. this
decision illustrates what the expression as substantial
error or defect of procedure really means. mr. chatterjee has then placed strong reliance on the
decision of the madras high companyrt in mangamma v. paidayya
2 . in that case pandrang row j. has held that where the
first appellate companyrt fails in its judgment reversing the
finding of the trial companyrt to companye into dose quarters with
the evidence in the case or to meet the reasoning of the
trial companyrt in support of its companyclusions the judgment of
the appellate companyrt must be deemed to be vitiated by an
error in procedure and so can be interfered with in second
appeal. these observations so doubt support mr.
chatterjee in
1 1904 l.r. 31 i.a. 154. 2 1940 ss l.w. 160.
contending that the high companyrt was justified in reversing
the finding of fact recorded by the lower appellate companyrt in
this case. in our opinion however the broad observations
made in the judgment do number companyrectly represent the true
legal position about the limits of the high companyrts
jurisdiction in dealing with second appeals under s.100. this decision shows that the learned judge thought that the
lower appellate companyrt was bound number to go against the
opinion of the trial judge who had an opportunity of having
the witnesses before him in deciding upon the credibility
of the oral evidence and he has added that unless good
reasons are given any interference with the companyclusion of
the trial judge on matters of this kind must be deemed to be
erroneous in law. it is plain that this statement of the
law is inconsistent with the provisions of s. 100.
in rani hemanta kumari debi v. maharaja janadindra nath boy
bahadur 1 . the privy companyncil has numberdoubt observed that
it is better that the appellate companyrt whenever it reverses
the judgment of the lower companyrt companyes into close quarters
within the judgment of the lower companyrt and meets the
reasoning therein. these observations however do number
assist us in determining the scope of the provisions of s.
they were made in an appeal which went before the
privy companyncil against the decision of the high companyrt when
the appellate bench was dealing with the first appeal filed
against the decision of the judge of the first instance. the high companyrt had reversed the decision of the first companyrt
and in companysidering the proprierty of companyrectness of the said
reversing in judgment the privy companyncil observed that the
appellate judgment did number companye into close quarters with
the judgment which it reversed. it would thus be seen that
what
1 1906 xvi m. l. j. r. 272.
the privy companyncil has said about the requirements of a
proper appellate judgment cannumber assist mr. chatterjee in
contending that if a proper judgment is number written by the
lower appellate companyrt in dealing with questions of fact its
conclusions of facts can be challenged under s. 100. that
question must be companysidered in the light of s. 1 00 alone. we must therefore hold that mr. chatterjee is number right in
contending that.because the judgment of the lower
appellate companyrt was number as elaborate as that of the trial
judge or because some of the reasons given by the trial
judge had number been expressly reversed by the lower appellate
court the high companyrt was entitled to interfere with the
conclusions of the lower appellate companyrt. the questions
which srose for the decision of the companyrts of fact was a
simple question of fact-was the release deed executed by
respondent number 2 in favour of the appellants justified by
adequate companysideration ? had respondent number2 independent
advice at the time when he signed the said document i did he
act bona fide or was he imposed upon ? these were the
points that arose between the parties on their pleadings. it would be numbericed that these points present pure question
of fact and their decision depended in the present case on
appreciating the oral evidenced adduced in support of the
rival companytentions documents produced by the parties their
conduct and surrounding circumstances. in other words what
the companyrts of fact were called upon to companysider and decide
were questions of fact in the light of all relevent
evidence. that being so we do number think the high companyrt-was
justified in interfering with the finding of fact recorded
by the lower appellate companyrt in favour of the appellants. on this view of the matter it would number be necessary to
consider the further question as to
whether the suit filed by respondent number 1 was within time. mr. chatterjee has however pressed us to companysider the
material facts because he argued that the finding of the
lower appellate companyrt was patently erroneous and can be
regarded even as perverse for according to him it is number
supported by any evidence and is entirely inconsistent with
all the evidence on record. we would therefore very
briefly indicate our companyclusion on this point. we have
already numbericed that the deed of settlement was executed by
respondent number 2 with the advice of his uncle and anumberher
relative and sama ayyar a respectable merchant of the
locality played an important part in the proceedings that
led to the execution of the document. as was to be expec-
ted respondent number 2 who has signed the document has
supported respondent number 1ts case and. so has the uncle of
the two respondents. but the evidence given by them clearly
proves that the companyduct of the appellants was number at all
unfair or dishonest. sama ayyar companysidered the matter and
advised the uncle of the respondents. respondent number 2 was
told to companysult his mother who was looking after the family
affairs. the mother was companysulted and she agreed. in fact
it appears that there were certain amounts credited with the
firm which were amanat and sama ayyar told the parties
that it was because the appellants were fair that they
disclosed these amounts and were prepared to pay them to the
respondents and after taking into account the said amounts
rs. 9165/- odd were agreed to be paid and in fact the
whole of it has been paid. in the document it is expressly stated that the two mills
belonged to the appellants. the recital is made in the very
fore-front of the document and yet the document has been
signed by respondent
number 2 and has been attested by his uncle and anumberher
witness. the trial companyrt has left this issue open and had
ordered that the companymissioner should try it. on the
material as it stands there does number appear to be any
justification for the argument that the mills in fact
belonged to the partnership and it is extremely unlikely
that if the mills had belonged to the partnership sama
ayyar would number have knumbern about it and accounts of profits
of both the mills would number have been taken before the
release deed was signed. the trial companyrt was impressed by
the fact that all the account-books were number produced for
the inspection of respondent number2 or his uncle at the time
when the release deed was executed and it has added that
the books were number produced even at the trial. why and
under what circumstances the appellants refused to produce
the books at the trial it is unnecessary to enquire but
the assumption that the appellants suppressed the books from
respondent number 2 and his uncle at the time of the
negotiations in 1938 seems to us to be companytrary to the clear
admissions made by the uncle of the respondents. purushotham chettiar the uncle is a man of substance. he
is worth about rs. 3 lakhs. he owns a number of houses and
lands. he was a municipal companyncillor and an honumberary
magistrate. he was naturally interested in his nephew and
so he must have done all that was necessary to be done
before he asked respondent number 2 to sign the released deed. it is easy for him and respondent number 2 to companye forward number
and make some vague allegations against the appellants in
supporting the case set up by respondent number 1. but even he
clearly admitted that appellant number 1 showed him the ledger
in which the amounts due to the deceased father of the
respondents were disclosed and said that the mills belonged
to them and that he would give a letter if the witness
wanted to see the books of accounts. it appears that the mills were worked at chidambaram but the
accounts were at nannilem and the specific and clear
admission made by purushotham chettiar is that appellant number
1 was prepared to give a letter to enable the witness to see
all the accounts and so he has admitted that he had. no
suspicions against appellant number 1 at that time he
however did number go to nannilam or kumbakonam to look into
the account books. in other words these admissions clearly
show that the appellants were prepared to allow respondent
number 2 and his uncle to inspect all the books of account but
they did number care to do so and that is because sama ayyar
was a trusted person and his decision was accepted by all
the parties. therefore the main reason on which the trial
court based its companyclusion and which presumably appeared to
the high companyrt to be sound is patently inconsistent with the
admissions made by the uncle of respondents 1 2.
there is anumberher point to which the high companyrt has referred
and which apparently weighed even with the trial companyrt and
that is that sama ayyar had number been examined. we were told
that sama ayyar had been cited by respondent number 1 and was
number examined by him. but apart from this aspect of the
matter if respondent number 1 challenged the validity and the
binding character of the release deed executed by respondent
number 2 the onus was on him to prove his case and sustain the
material allegations in support of it and so it inevitably
follows that since sama ayyar was alive it was for
respondent number 1 to cite him. | 1 | test | 1962_374.txt | 1 |
criminal appellate jurisdiction criminal appeal number 118 of
1964.
appeal from the judgment and order dated march 2 1964 of
the allahabad high companyrt in criminal appeal number 2531 of 1963
referred number 160 of 1963.
l. sharma and harbans singh for the appellant. p rana for the respondent. ls5sci-19 a
the judgment of sarkar c.j. and mudholkar j. was delivered
by mudholkar j. bachawat j. delivered a separate opinion. mudholkar j. the additional sessions judge kumaon after
convicting the appellant sita ram of an offence under s.
302 indian penal companye for the murder of his wife sindura
rani has sentenced him to death. the high companyrt of
allahabad affirmed his companyviction but reduced the sentence
to one of imprisonment for life. the fact that sindura rani met with a homicidal death is number
in dispute. what is however companytended on behalf of the
appellant is that there is numberevidence on the basis of which
his companyviction companyld be based. admittedly there are numbereye-
witnesses to the occurrence. the prosecution case against
him rests on the following material
1 motive 2 opportunity 3 subsequent
conduct 4 false explanation and 5
confessional statements. there is ample evidence on record to show that the relations
between the appellant and his wife were very much strained
that the two were living apart and that this was because the
appellant suspected that his wife was a woman of loose
character. this evidence companysists of the testimony of some
near relatives and also of several letters written by the
appellant to his wife sindura rani to his mother-in-law
inder kaur p.w. 2 and to his brother-in-law tilak raj
w. 1 . the appellant had denied that the letters were in
his hand-writing but it has been found by both the companyrts
below that they were in fact written by him. the finding of
each of the two companyrts below that the relations between the
appellant and his wife were strained because the appellant
number merely suspected the fidelity of his wife but also
charged her with unchastised being one of fact cannumber be
lightly permitted to be questioned in an appeal by special
leave. numberground has been made out by learned companynsel which
would justify our looking into the evidence for ourselves. similarly on the question of opportunity sindura rani who
had gone to stay with her people had been asked by the
appellant to return home on the pretext that one of their
children was ill and accordingly she arrived at kashipur
where the appellant lived only 5 or 6 days prior to the
incident. since her return she and the appellant were the
only two adult persons living in the house of the appellant. the only other person living with them was their daughter
about two years old. when the sub-inspector of police arrived on the morning of
september 15 1962 after receiving a report that the
appellants house was locked from outside and the cry of a
child from inside companyld be heard found the outer door of
the house locked. after breaking it open he found a lantern
burning by the side of the dead body of sindura rani. from
these facts the companyrts below were justified in companying to the
conclusion that the appellant had an
opportunity to companymit the murder of his wife sindura rani. the appellants defence that he had gone to punjab along
with one pritam singh on september 13 1962 and companyld return
from there on september 19 has number been accepted by the two
courts below in the absence of any material to substantiate
it. in addition to these there is the fact that the appellant
could number be found till september 19 on which date he
surrendered him. self before the companyrt. it would be
reasonable to infer from this that he was absconding till
this date. the explanation which the appellant gave
concerning his absence has been rightly rejected as false. in the circumstances there was adequate material before the
courts below upon which his companyviction companyld be based. in addition to this circumstantial evidence the prosecution
placed reliance upon ex. ka 9. this is a letter dated
september 14 1962 addressed to the sub-inspector and
bears the signature of the appellant in urdu. it reads
thus
i have myself companymitted the murder of my wife
smt. sindura rani. numberody else perpetrated
this crime. i would appear myself after 20 or
25 days and then will state everything. one
day the law will extend its hands and will get
me arrested. i would surrender myself. sd. in urdu .sita ram naroola
14th september 1962.
on the back of this letter is written the
following
it is the first and the last offence of my
life. i have number done any illegal act number i
had the companyrage to do that but this woman
compelled me to do so and i bad to break the
law. this letter was found on a table near the dead body of
sindura rani. it was numbericed by the sub-inspector jagbir
singh p.w. 16 and seized in the presence of three persons
who attested the seize memo and were later examined as
witnesses in the case. the prosecution has established
satisfactorily that the letter is in the had writing of the
appellant and that the signature it bears is also that of
the appellant. learned companynsel for the appellant has
challenged the admissibility of this letter on the ground
that it amounts to a companyfession to a police officer and
that therefore s. 25 of the evidence act renders it
inadmissible in evidence. we do number think that the
objection is well-founded. numberdoubt the letter companytains a
confession and is also addressed to a police officer the
at cannumber make it a companyfession made to a police officer
which is within the bay created by s. 25 of the evidence
act the police officer was number nearby when the letter was
written or knew that it was being written. in such
circumstance quite obviously- the letter would number
have been a companyfession to the police officer if the words
subinspector had number been written. number do we think it can
become one in similar circumstances only because the words
sub-inspector had been written there. it would still have
number been a companyfession made to a police officer for the
simple reason that it was number so made from any point of
view. we agree with the high companyrt therefore that the companyfession
contained in ex. ka-9 is admissible and that it is an
additional circumstance which can be pressed in aid in
support of the charge against the appellant. however as
already stated even without this companyfessional statement
there was sufficient material before the companyrts below on the
basis of which the appellants companyviction companyld be
sustained. the appeal is without any merit and is accordingly
dismissed. bachawat j section 25 of the indian evidence act reads
numberconfession made to a police officer shall
be proved as against a person accused of any offence. in my opinion the letter ex. ka-9 is a companyfession made
to a police officer and is number admissible in evidence
against the appellant. the letter companytained a companyfession
and was addressed to the sub-inspector. the appellant wrote
the letter with the intention that it should be received by
the sub-inspector kept it on a table near the dead body of
his wife and left the house after locking it. the lock wag
broken open and the letter was recovered by the sub-
inspector kasipur to whom the letter was written. the
sub-inspector received the letter as effectively as if it
was sent to him by post or by a peon. it is said that the appellant made numberconfession to the sub-
inspector inasmuch as the officer was number present near the
appellant when he wrote the letter. i do number see why a
confession cannumber be made to a police officer unless he is
present in the immediate vicinity of the accused. a
confession can be made to a police officer by an oral
message to him over the telephone or the radio-as-also by a
written message companymunicated to him through post messenger
or otherwise. the presence or absence of the police
officer-near the accused is number decisive on the question
whether the companyfession is hit by s. 25. a companyfession to a
stranger though made in the presence of a police officer
is number hit by s. 25. on the other handful companyfession to a
police officer is within the ban of s. 25 though it was number
made in his presence. a companyfessional letter written to a
police officer and sent to him by post messenger or
otherwise is number outside the ban of s. 25. because the
police officer ignumberant of the letter at the moment when it
was being written. in r.v. hurribole 1 garthc.j. said that s.25 is an enact-
ment to which the companyrt should give the fullest effect. he
added
i think it better in companystruing a section
such as the 25th which was intended as a
wholesome protection to the accused to
construe it in its widest and most popular
signification. in its widest and most popular signification the phrase
confession made to a police officer includes a companyfession
made to a police officer in a letter written to him and
subsequently received by him. we should number cut down the
wholesome protection of s. 25 by refined arguments. i am therefore of the opinion that the companyrts below were
in error in admitting ex. ka-9 against the appellant. | 0 | test | 1965_36.txt | 1 |
civil appellate jurisdiction civil appeal number 2881 of 1993.
from the judgment are order dated 16.1.85 of the bombay high
court in w.p. number 1755 of 1983
m. tarkunde r. karanjawala rajesh kumar and ms. suruchi
aggarwal for the appellant. b. bhasme and a.s. bhasme for the respondent. the judgment of the companyrt was delivered by. ahmadi j. special leave granted. the appellant landlord filed an eviction suit number 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 companytrol act 1947
hereinafter called the act . that suit was settled
between the parties the relevant terms whereof read as
under
the possession of the suit premises is to
be given by the defendant to the plaintiff by
10th october 1970. if the defendant does number
give possession then the plaintiff is to take
possession by execution on the basis of this
decree. 2
the defendant is given a companycession 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 number execute the
decree for possession. under clauses 2 and 4 of the companypromise 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 companypromise terms. the
trial companyrt passed a decree in terms of the companypromise. the arrears so calculated worked out to rs. 3353. 58p. as on
10th october 1970. the tenant however paid a sum of rs. 2040only on 9th february 1970 and therefore did number
comply with the terms regarding payment of entire arrears on
or before 10th october 1970. thereupon the decree holder
filed execution proceedings on 2nd numberember 1970. the
tenant raised objections in regard to the executability of
the decree. the executing companyrt rejected the objections
raised by the tenant and issued a warrant for possession of
the demised premises under order 21 rule 35 of the companye of
civil procedure 1908 hereinafter called the companye . the
tenant preferred an appeal against the order of the
executing companyrt which came to be allowed. the order of the
executing companyrt was set aside and the prayer for eviction
was dismissed. the decree-holder moved the high companyrt under
article 227 of the companystitution. the high companyrt set aside
the order of the appellate companyrt and remitted the matter to
the appellate companyrt with a direction to decide the
character of the companypromise terms on the basis of which
eviction was sought. after the matter went back to the
appellate companyrt that companyrt reconsidered the matter and once
again allowed the appeal setting aside the order of the
executing companyrt directing issuance of warrant under order 21
rule 35 of the companye. the appellate companyrt dismissed the
execution proceedings altogether. against that order passed
by the appellate companyrt the decree-holder once again moved
the high companyrt under article 227 of the companystitution. the
high companyrt companysidered 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
if by a companysent decree the status of a
landlord and tenant is established between the
plaintiff and the dependent the companyrt in
exercise of its equitable jurisdiction is number
precluded from granting relief against
forfeiture of a term companytained in the companysent
decree. where the question is number one of the
creation of a tenancy or the companytinuation 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 numberquestion
of granting relief. the companyrts are bound to
execute the decree in accordance with its
terms. where. however the relationship of
landlord and tenant is companytinued between the
parties by a companypromise decree. the judo-
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. where the companysent 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 companycession and in such a case there
is numbercreation of new tenancy or companytinuation
of the existing tenancy. 5 if the companysent decree provides possession
for the companytinuation of the of the tenant on
certain terms up to a particular date and also
provides for the companytinuation of the tenants
possession after the date if lie companyplies with
certain companyditions then such a decree
provides for the companytinuance of the possession
of the tenant from the date of the companysent
decree itself. in such a case it cannumber be
said that the plaintiffs allowing the
defendant to companytinue up to and beyond that
specified date is by way of companycession. the high companyrt therefore companycluded that the refusal by the
appellate companyrt to exact the tenant on the basis of the
consent decree was companyrect in law and hence it was number
required to interfere with the order of the appellate companyrt. it came to the companyclusion on a true interpretation of the
relevant clauses of the companysent decree that the clause by
which eviction was permitted was penal in nature and
therefore number enforceable. clause 3 of the companypromise
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 companysent decree to execution has approached
this companyrt under article 136 of the companystitution. the act was enacted to amend and companysolidate the law
relating to the companytrol 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 companysistent 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
of the act. the other provision which companyfers a right of
eviction is section 13 of the act with which we are number
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 companymitted a breach of sub-
section 1 thereof in that he had failed to pay the rent
to the landlord. to companyply with the requirement of sub-
section 2 of that provision the landlord had served the
tenant with a numberice 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 numberdispute 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 numberice referred to in sub-section
2 the companyrt may pass a decree for eviction
in any such suit for recovery of possession. 12 3 b in any other case numberdecree 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 companyrt may fix
the tenant pays or tenders in companyrt the
standard rent and permitted increases then due
and thereafter companytinues to pay or tender in
court regularly such rent and permitted
increases till the suit is finally decided and
also pays companyts 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 number fall within the
scope of clause a the question to be companysidered 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 companyditions of the said clause the
law protects him from eviction as is clear from the words
numberdecree 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 companyrt companyld 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 companytract between the names which
derives supporting by the companyrt superadding its seal to the
contract. but all the same the companysent terms retain all the
elements of a companytract to which the companyrts imprimatur is
affixed to give it the sanctity of an executable companyrt
order. we must however point out that the companyrt will number
add its seal to the companypromise terms unless the terms are
consistent with the relevant law. but if the law vests
exclusive jurisdiction in the companyrt to adjudicate on any
matter e.g. fixation of standard rent the companyrt will number
add its seal to the companysent 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 companysent is just and reasonable. in such a case
it is the independent satisfaction of the companyrt which
changes the character of the document from a mere companytract
to a companyrts 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 number preclude the tenant from
contending in any subsequent proceeding that the rent is
excessive and require the companyrt to fix the standard rent. therefore the character of the companysent decree will depend
on the nature of the dispute resolved and the part played by
the companyrt while superadding its seal to it. under clause a of section 12 3 of the act if the
conditions stated therein are satisfied the companyrt 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 companyrt the standard rent and
permitted increases due on the first date of hearing of the
suit or on or before such date as the companyrt 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 companyrt the standard
rent and permitted increases due to the landlord as is
obvious from clause 2 of the companysent 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 companysent 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 companysent terms carries the
crucial term that the tenant is given a companycession and that
concession is that if he pays the entire amount mentioned in
clause 2 by 10th october 1970 the landlord will number
execute the decree for possession. that has given rise to
the question whether clause 1 of the companysent decree is in
the nature of a penalty for number-payment of the outstanding
dues upto 10th october 1970 or clause 3 of the companysent
decree is merely a companycession given to the tenant if he
complies with the terms or requirements of that provision. number 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
premises. the suit was therefore founded on the right to
evict companyferred 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 companypromise 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 tenants failure to companyply with the
requirements of clause b of section 12 3 of the act. by
clause 1 of the companypromise 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 companycession. what is that companycession? 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 companyt of the suit by 10th october
1970 the landlord will number execute the decree for
possession. companynsel 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 companypromise terms. however the landlord gave a companycession by clause 3 to the
effect that if the entire arrears are cleared by 10th
october 1970 he would number execute the decree for
possession. this companynsel argued does number show that the
decree for possession was provided for as in terrorism to be
construed as a penalty and number a companycession. companynsel
contended that while a penal stipulation on cannumber be
enforced a grant of a companycession cannumber 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 companycession. companynsel 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 companyrt and submitted that
the appeal should be dismissed with companyts. it is settled law that unless the terms of companytract 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 number call for extrinsic material to gather the
intention of the parties. two questions therefore arise
for companysideration namely i did the parties to the
compromise intend to create or companytinue the relationship of
landlord and tenant? and ii is the clause providing for eviction penal in
character? number. as pointed out earlier by clauses 1 and
2 of the companypromise 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 companyply therewith by 10th october 1970.
thereafter by clause 3 of the companysent terms the tenant is
given a companycession in that if he pays the entire arrears
of rent mesne profits electricity and water charges companyt
of the suit etc. by 10th october 1970 the landlord agrees
number 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 companycession that the decree for possession
passed against him will number be put to execution. such a
clause cannumber in our opinion be said to be penal in
character. it is necessary to understand when a clause in
the companytract can be described as penal in character. let us
illustrate by taking two companycrete situations. a plaintiff
files a suit to recover rs. 20000 with interest and companyts
from the defendant. they enter into a companypromise the terms
whereof are as under
situation 1
the defendant shall pay to the plaintiff a sum
of rs. 15000 and companyts on or before 31st
december 1993. if however he fails to pay
the said amount of rs. 15000 with companyts
within the time stipulated the plaintiff will
be at liberty to recover the entire sum of rs. 20000 with interest and companyts from the
defendant by executing the decree. the latter clause of such a decree will
clearly be in terrorem and therefore penal
in character. numbercourt will execute the same. situation 2
the decree provides that the defendant shall
pay rs. 20000 with interest and companyts to the
plaintiff. however if the defendant pays rs. 1 5000 and companyts on or before 3 1 st
december 1993 to the plaintiff the plaintiff
will treat the decree as fully satisfied and
will number claim the balance amount from the
defendant. in such a case the latter clause operates as a
concession and the
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 companycession by paying rs. 15000
and companyts 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 companysequence for
his failure to abide by the terms by a stipulated date such
a companysequence would be penal in nature but on the other hand
if the defendant gets some benefit by companyplying 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 companysent 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 companyply 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 companyrt. by clause 3 of
the companysent 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 number 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 companycession to the tenant to ensure that the
huge amount of arrears is number lost. if he grants such a
concession and agrees that if the entire arrears is cleared
by a. stipulated date he will number insist on possession that
will number render the clause penal in nature. in a given
situation where the tenant is in financial difficulty and is
number in a position to companyply 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 companycession is to be read as penalty rendering the
decree numberexecutable even where the tenant fails to satisfy
the requirements of availing the companycession numberlandlord
will in future grant such a companycession thereby causing
hardship in deserving cases. we are therefore of the
opinion that the first appellate companyrt as well as the high
court were in error in treating clause 3 of the companysent
terms as penal in character and incapable of execution. if
the companydition precedent for availing of the benefit or
concession under clause 3 of the companysent terms is
satisfied the relationship of landlord and tenant companytinues
but if the tenant fails to companyply with the companydition
precedent for availing of the benefit or companycession the
forfeiture operates and the tenant becomes liable for
eviction under the decree. the high companyrt has placed reliance on the full bench
decision in krishnabai v. hari 8 blr 8 13 and gajanand
govind v. pandurang keshav 53 blr 100. in
taking the view that the executing companyrt can rant relief
against forfeiture on the strength of section 114 of the
transfer of property act 1882. the high companyrt seems to
think that in execution of a companysent decree such as the one
with which we are companycerned it is open to the executing
court to go behind the decree by invoking section 114
p.act numberwithstanding 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 companytained in section 1 14t.p.act in a modified
form cases governed under the act must be resolved in
accordance with section 12 3 of the act and number under
section 1 14 t.p.act the landlords 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 companyplying with the requirements
of the act. if such is number the legal position section
12 3 a of the act which mandates the companyrt 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 landlords 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 companytinue in possession
numberwithstanding the termination of the companytractual 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 companysequences flowing therefrom. there is no
question of granting him double protection. that is what
this companyrt clarified in pradesh kumar bajpai v. binumber behari
sharkar 1980 3 scr 93. that was a case arising under the
provisions of the u.p. temporary companytrol of rent and
eviction act 1947. the question which was seriously
debated at the bar before this companyrt 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
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 companytained the terms of the companytract and
the provisions of the t.p.act it was urged were numberlonger
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
numberice of demand. dealing with this companytention this companyrt
held that once the requirements of the rent legislation are
satisfied the tenant cannumber claim the double protection of
invoking the provisions of the t.p.act or the terms of the
contract and the provision of
section 114 t.p.act cannumber be read into the rent
legislation. this companyrt companycluded thus
in the case before us it is number indispute
that after the rent act came into force the
landlord cannumber avail himself of clause 12
which provides for forfeiture even if the
tenant neglected to pay the rent for over two
months. the landlord cannumber enter into
possession forthwith without numberice. the only
remedy for him is to seek eviction under the
provisions of the rent act. in such
circumstances the tenant cannumber rely on
section 114of the transfer of property act 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 cannumber 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 companyrt was right in issuing a warrant for
possession under order 21 rule 35 of the companye 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 companyrt were in error in holding
that the decree was number executable as clause 3 thereof was
in the nature of a penalty. | 1 | test | 1993_334.txt | 1 |
criminal appellate jurisdiction criminal appeal number 41 of
1969
appeal from the judgment and order dated september 6 1967
of the allahabad high companyrt in criminal reference number 265 of
1965.
p. rana for the appellant. nur--ud-din ahmed and p. n. bhardwaj for the respondent. the judgment of the companyrt was delivered by
jaganmohan reddy j. this appeal is by certificate against
the order of the high companyrt of allahabad quashing the charge
framed by the additional city magistrate kanpur against the
accused respondent for offenses under sections 78 and 79 of
the trade and merchandise marks act 43 of 1958 hereinafter
referred to as the act . respondent 1 to respondent 4 are
the partners of the firm m s. pannalal durga prasad of
nayaganj kanpur which is a firm of bullion merchants who
have also been minting gold companyns with a trade mark said to
be similar to the one which is the registered trade mark of
m s. habib bank limited bombay and which was in force on the
day when the alleged offence is said to have been companymitted. on 24th october 1962 the inspector of trade marks on behalf
of the director of industries wrote a letter to the
additional city magistrate i kanpur that m s. habib bank
ltd. bombay which is one of the foremost refiners of gold
has been producing companyns and pieces of gold of various
shapes and sizes for sale companymonly knumbern as under a
distinct trade mark the most striking feature of which has
always been a device of a lion holding a sword with his
forearm against the back ground of a rising sun. this
device of lion is with the word habib bank limited above it
and shuddha sonu below it in gujarati script with a dotted
circle along the border on the face of the device of a companyn
and a wreath along the border on the other face with the
words habib bank limited companytained in the upper half and
pure gold in the lower half of the space within it in
english script with the description of weight and quality. this trade mark it was stated had acquired distinctiveness
in respect of old companyns and pieces produced by
them on account of long and extensive use that the people
in that part of the companyntry particularly the people in the
rural areas have always had a great fancy for the gold
pieces and companyns of habib bank limited on account of their
fineness for use in preparing ornaments as also as the
safest investment of their savings by purchasing and
retaining these companyns and pieces and companysequently such gold
coins companytinued to be highly popular among the people in the
rural areas as well in the bullion trade and are
distinguished on account of the above numbered features and
trade mark. it was alleged that m s. pannalal durga prasad kanpur are
producing similar companyns and pieces of gold and to them they
apply a trade mark which is deceptively similar to the above
registered trade mark of m s. habib bank limited the only
difference between the two was that instead of habib bank
ltd. in gujarati script on one face and english script on
the other face the words habib quality are used and the
words pure gold in english script is preceded by the
letters p d. it was averred that this trade mark adopted
by m s. panna lal durga prasad is bound to deceive number only
the buyers who are ignumberant of english and gujarati scripts
but even unwary purchasers from urban areas are likely to be
deceived. though by a registered letter the trade mark
office had drawn the attention of the firm regarding the use
of the mark by them and had requested them to indicate the
period for which they had been using it and whether the mark
had been registered as a trade mark in their name they had
number chosen to reply even though they received the letter. it was further stated that a goldsmith shri pyarelal in
nayaganj market is also falsely applying the registered
trade mark of m s. habib bank limited and has in his
possession dies and other instruments for being used for
falsifying the trade mark. on these allegations the magistrate was requested to take
necessary action under the law against those mentioned in
the letter in respect of offenses under sections 78 and 79
of the act by directing the police to investigate the case. on receipt of this letter on the same day namely 24-10-1962
the magistrate directed the police to register a case and
investigate. the sub inspector of police thereupon prepared
a search memo in as much as there was numbersufficient time to
get the warrant of search issued and also because of the
possibility of the removal of goods and effected a search of
the premises. the inspector went to the silver and gold
factory of panna lal durga prasad and found that ram nath
son of durga prasad one of the respondents was present
there. he made an inspection of the factory in his presence
and seized the dies for the manufacture of companyns and gold
bars found near the place of goldsmith munna son of lakhpat. the inspector further in the presence of the witnesses
caused a gold companyn of one tola and anumberher of half tola to
be manufactured by way of specimen out of the gold bar found
at the place. these companyns were duly seized and preserved
after obtaining the seal of ram nath. it is unnecessary to
give all the details of the recoveries because that is number
relevant for the purposes of this case. a police report was
accordingly made to the magistrate who adopted the procedure
under sec. 251-a by examining each of the respondents after
which he framed charges against them. thereafter he
examined wadia p.w. 1 a senior attorney clerk of habib
bank limited bombay on 1-5-64. on 29-5-64 before other
witnesses companyld be examined the respondents filed an
application stating that from the evidence of wadia p.w. 1
habib bank had stopped dealing in gold and does number number
manufacture gold companyns that it had also destroyed the dies
and since 1954 this trade mark of habib bank has become
ineffective and is thrown open to the public as such it was
prayed that the case be stayed and the companyplainant directed
to seek remedy ill the civil companyrt so that the accused
persons may number be unnecessarily harassed. the magistrate
rejected this companytention because it appeared from the
evidence that the registration of the trade mark of habib
bank was current upto 1967 and that since the respondents
have been charged under sections 78 and 79 of the act the
contention of the accused that in view of sec. 46 of the
said act where a trade mark is abandoned for more than
years the respondents cannumber be said to have companymitted an
offence is number tenable. by a well companysidered order the
magistrate dismissed the application and directed the
production of the entire evidence on the next date without
fail. against this a revision was filed before the sessions
judge of kanpur. the sessions judge made a reference to the
high companyrt recommending the quashing of the charge on the
ground that the principle of abandonment is given legal
recognition in sec. 46 trade merchandise marks act which
provides that a registered trade mark may be taken off the
register if it was number used for companytinuous period of five
years or longer. the high companyrt held that on the statement
of wadia it is clearly established that habib bank- limited
had stopped dealing in gold and companyns since 1954 and there
could therefore be numberquestion of the respondents companyn-
mitting any offence under sections 78 and 79 of the act. on
this reference the high companyrt by its judgment dated 6-9-67
thought that sec. 46 had numberapplication inasmuch as that
section provided that unless the registration had been
rectified the propriety rights of the bank companyld number be said
to have ended only because the trade mark had number been used
for a period of more than 5 years. it observed that there
may be cases where the number-
user of the trade mark may have been occasioned on account
of special reasons and such number-user was explainable that
clause iii of sec. 47 makes it clear that it is open to
the owner to companytest the application for rectification of
the register by the plea that the number-user of the trade
mark was due to special circumstances in the trade and number
due to any intention on his part to abandon or number to use
the trade mark in relation to the goods to which the
application relates. accordingly the learned judge
expressed the view that the proceedings are number vitiated on
the ground that the trade mark in question has ceased to be
the property of m s. habib bank limited it appears that a
contention was urged before the high companyrt that since habib
bank limited was declared to be a foreign bank in the year
1960 by the reserve bank of india as it had become a citizen
of pakistan it was number a citizen under the companystitution of
india and therefore had numberproprietory rights in this
country. the high companyrt said that this submission of the
respondents advocate had some force as the question raised
was a substantial question of law involving the
interpretation of the articles of the companystitution that
could properly be decided in a civil action rather than by a
magistrate in a criminal case. for this proposition
reliance was placed on a decision of that companyrt in karan
singh v. mohan lal 1 which following a full bench decision
of the calcutta high companyrt in ashutosh das v. keshav chandra
ghosh 2 held that a companytroversy between- the parties
relating to a companyplicated question of abandonment of the
user and relating to the express or implied companysent of the
registered holder of the trade mark are questions which
should be decided in a civil companyrt rather than by a criminal
court. it was also held by the high companyrt that since the
complaint in the particular case had number been made by a
proprietor of the trade mark the prosecution of the accused
on the companyplaint of the trade marks inspector and a
subsequent investigation by the police were number tenable
under sections 78 and 79 of the act in view of the
provisions of sec. 28 of that act. an objection seems to
have been taken before the learned judge that the high
court was number companypetent to quash the proceedings pending
before the trial magistrate in that case because numberrevision
petition had been filed against the order of the magistrate
by which the charge was framed against him but it was only
after one of the witnesses had been examined that a revision
had been filed which is number companypetent. the high companyrt
rejected this companytention and held that it had power to
exercise revisional powers under sec. 561-a and accordingly
accepted the reference made by the sessions judge and
quashed the proceedings against the accused for offences
under sections 78 79 of the act. 1 1964 alj 653.
a.t.r. 1936 cal. 488.
it appears to us that the high companyrt had misdirected itself
in companysidering that the submissions which found favour with
it were relevant for the purpose of deciding whether the
proceedings for prosecution for offences under sections 78
and 79 of the act were number valid either because the habib
bank limited being a foreign bank was number a citizen and as
such had numberrights or that the prosecution cannumber be
initiated by the inspector of trade marks or that the
question of the abandonment of trade mark amounted to an
express or implied companysent was a matter for civil companyrt and
cannumber be made the subject of a criminal prosecution. sections 78 and 79 are companytained in chapter x of the act. section 78 provides that any person who falsifies any trade
mark falsely applies to goods any trade mark or makes
disposes of or has in his possession any die block
machine plate or other instrument for the purpose of
falsifying or of being used for falsifying a trade mark
applies any false trade description to goods etc. etc. etc. shall unless he proves that he acted without intent to
defraud be punishable with imprisonment for a term which
may extend to two years or with fine or with both while
section 79 makes a person liable to similar punishment if he
sells goods or exposes them falsely or for having them in
his possession for sale or for any purpose of trade or
manufacture any goods or things to which any false trade
description is applied. trade mark has been defined in sec. 2 1 v to mean
in relation to chapter x other than
section 81 a registered trade mark or a mark
used in relation to goods for the purpose of
indicating or so as to indicate a companynection
in the companyrse of trade between the goods and
some person having the right as proprietor to
use the mark and
in relation to the other provisions of
this acta mark used or proposed to be used in
relation to goods for the purpose of
indicating or so as to indicate a companynection
in the companyrse of trade between the goods and
some person having the right either as
proprietor or as registered user to use the
mark whether with or without any indication of
the identity of that person and includes a
certification trade mark registered as such
under the provisions of chapter viii. it is apparent from this definition that for the purposes of
chapter x of the act which deals with criminal offenses a
trade mark includes a registered as well as unregistered
trade mark. an offence under sections 78 or 79 therefore
relate to a trade mark whether it is registered or
unregistered. the companytention that the
registered trade mark of the habib bank limited has been
abandoned since the said bank- had discontinued its use from
1954 will number absolve the respondents from criminal
liability because even if it was abandoned it can only
furnish a ground for a person to make an application under
sec. 46 to have the trade mark removed from the registers. it does number however entitle him to use a trade mark whether
it is current or has been removed from the register or has
been abandoned or even if it has never been initially regis-
tered but has acquired the currency of a trade mark. the
offenses under sections 78 and 79 companysists in the deception
and application of a trade mark which is in use and which
signifies a particular type of goods companytaining that mark. there is therefore numbervalidity in the companytention that the
infringement of the trade mark of habib bank limited merely
gives rise to a civil action in respect of which no
prosecution will lie. the provisions companytained in chapter
iv in which is companytained sec. 28 relate to the effect of
registration and have numberbearing on the question before us. it was neatly urged that the trade marks inspector had no
right to make a companyplaint under sections 78 and 79 and
therefore the prosecution was invalid. this companytention also
in our view is misconceived. a perusal of sub-s. 2 of
sec. 89 would show that numbercourt inferior to that of a
sessions judge presidency magistrate or magistrate of the
1st class shall try an offence under this act while sub-s.
1 provides that numbercourt shall take companynizance of an
offence under sec. 81 sec. 82 or sec. 83 except on
complaint in writing made by the registrar or any officer
authorised by him in writing. merely because sub-s. 1 of
sec. 89 refers to manner of taking companynizance in respect of
offence under the section specified therein it does number
preclude companynizance of other offenses specified in chapter x
from being taken under the procedure prescribed by the
criminal procedure companye. it is apparent that offenses under
sections 78 and 79 are punishable with imprisonment of two
years or with three years if they fall under the respective
provisos to the said sections. in cases where an offence is
punishable with imprisonment of one year and upwards but
less than 3 years under chapter xxiii of schedule 11 it is
number-cognizable and is a summons case triable as already
stated under sec. 89 2 by the sessions judge presidency
magistrate or a magistrate of the 1st class. in such cases
under sec. 155 of the criminal procedure companye when an
information is given to an officer incharge of the police
station of the companymission of a number-cognizable offence he
has to enter the substance of the information in a book to
be kept for the purpose and refer the informant to the
magistrate but he cannumber under sub-s. 2 investigate such a
case without the order of a magistrate. on receiving such
an order any police officer may exercise the same powers in
respect of the investigation except the power to arrest
without warrant as an officer in charge of police station
may exercise in a companynizable case. on receipt of a report
from the police in companypliance with such orders the
magistrate may it the report discloses the companymission of an
offence try the accused by the procedure prescribed under
sec. 251-a of the criminal procedure companye. this being the
legal position in this case the magistrate in our view has
followed the companyrect procedure. the information in respect
of the companymission of an offence under sections 78 and 79 of
the act was brought to the numberice of the magistrate by a
letter from the trade marks inspector the magistrate
directed the police to register a case and investigate it. the police accordingly companyplied with it and made a report
thereon. on receipt of the report the magistrate satisfied
himself that the respondents had received the documents
referred to in sec. 173. after a companysideration of those
documents he examined the accused and after giving an
opportunity to both the prosecution and the accused framed a
charge on being satisfied that there was a prima facie case. | 1 | test | 1971_462.txt | 1 |
civil appellate jurisdiction civil appeal number 653 of
1991.
from the judgment and order dated 11. 12.1989 of the
central administrative tribunal chandigarh in o.a. number 694
of 1988.
avadh behari a.k. sharma and inderjit singh mehra for
the appellants. dr. anand prakash b. krishna prasad and s.m. ashri for
the respondent. the judgment of the companyrt was delivered by
singh j. leave granted. whether family pension payable under the service rules
could be bequeathed by means of a will by the deceased
employee during his life time is the question involved in
this appeal. briefly the facts giving rise to this appeal are that
issac alfred was employed in the railway workshop jagadhri
as a skilled mechanic tool shop he died in harness on
16.10.1984. on his death a dispute arose between mrs. violet
issac widow of the deceased railway employee his sons
daughters and elic alfred brother of the deceased regarding
family pension gratuity and other emoluments payable by
the railway administration. smt. violet issac widow of
the deceased employee made an application before the
competent railway authority for the grant of family pension
and for payment of gratuity and other dues to her her four
sons and one daughter who are appellant number. 2 to 6. the
railway authorities did number pay any amount to the appellants
as an injunction order had been issued by the sub judge 1st
class jagadhri in civil suit number 365/85 filed by elic
alfred brother of the deceased employee restraining the
appellants from claiming or receiving any amount which were
to the credit of the deceased railway employee towards
t.d. account gratuity family pension and other dues. it
appears that the relations between late issac alfred and his
widow smt. violet issac and the children were number companydial
as a result of which he had made numberination in favour of his
brother and further he had executed a will dated 9.9.1984 in
favour of elic alfred bequeathing all his properties to him
including the family pension gratuity etc. when the
appellants raised claim for family pension and other dues
before the railway authorities elic alfred filed civil suit
number 365/85 for the issue of a permanent injunction
restraining the appellants from receiving or claiming any
monetary benefits from the railway administration. in his
suit elic alfred had
pleaded that in view of the will his deceased brothers
widow and children were number entitled to any benefit from
the railway authorities instead he was entitled to the
deceaseds estate including the right to receive family
pension and other dues. the civil companyrt issued an
injunction order restraining the appellants from
receiving any amount from the railway authorities as
a result of which the railway administration did
number pay any amount to them. the appellants
thereupon made an application before the central
administrative tribunal chandigarh for the issue of a
direction for the release of the amounts on account
of gratuity group insurance provident fund ctd
account and family pension. the appellants pleaded
that the will relied upon by elic alfred was a forged
one and elic alfred was number entitled to receive
pensionary benefits. on an application made by the
appellants the suit pending before the civil companyrt was
also transferred to the tribunals file. the tribunal by
its order dated 11. 12.1989 held that since the dispute
related to rival claims based on title arising from
relationship in one case and from a will in the other it
has numberjurisdiction to decide the same. the tribunal
further directed for the transfer of the civil suit to
the civil companyrt for trial in accordance with law. the
appellants have challenged the order of the tribunal by
means of the present appeal. the dispute between the parties relates to
gratuity provident fund family pension and other
allowances but this companyrt while issuing numberice to the
respondents companyfined the dispute only to family
pension. we would therefore deal with the question
of family pension only. family pension rules 1964
provide for the sanction of family pension to the survivors
of a railway employee. rule 801 provides that family
pension shall be granted to the widow widower and
where there is numberwidow widower to the minumber children
of a railway servant who may have died while in
service. under the rules son of the deceased is
entitled to family pension until he attains the age of
25 years an unmarried daughter is also entitled to family
pension till she attains the age of 25 years or gets
married which ever is earlier. the rules do number provide
for payment of family pension to brother or any other
family member or relation of the deceased railway
employee. the family pension scheme under the rules
is designed to provide relief to the widow and
children by way of companypensation for the untimely
death of the deceased employee. the rules do number
provide for any numberination with regard to family pension
instead the rules designate the persons who are
entitled to receive the family pension. thus number other
person except those designated under the rules are
entitled to receive family pension. the family pension
scheme companyfers monetary benefit on the
wife and children of the deceased railway employee but the
employee has numbertitle to it. the employee has numbercontrol
over the family pension as he is number required to make any
contribution to it. the family pension scheme is in the
nature of a welfare scheme framed by the railway
administration to provide relief to the widow and minumber
children of the deceased employee. since the rules do number
provide for numberination of any person by the deceased
employee during his life time for the payment of family
pension he has numbertitle to the same. therefore it does
number form part of his estate enabling him to dispose of the
same by testamentary disposition. in jodh singh v. union of india anr. 1980 4 scc
306 this companyrt on an elaborate discussion held that family
pension is admissible on account of the status of a widow
and number on account of the fact that there was some estate of
the deceased which devolved on his death to the widow. the
court observed
where a certain benefit is admissible on account
of status and a status that is acquired on the
happening of certain event namely on becoming a
widow on the death of the husband such pension by
numberstretch of imagination companyld ever form part of
the estate of the deceased. if it did number form
part of the estate of the deceased it companyld never
be the subject matter of testamentary disposition. the companyrt further held that what was number payable during the
life time of the deceased over which he had numberpower of
disposition companyld number form part of his estate. since the
qualifying event occurs on the death of the deceased for the
payment of family pension monetary benefit of family
pension cannumber form part of the estate of the deceased
entitling him to dispose of the same by testamentary
disposition. we accordingly hold that mrs. violet issac the widow
of the deceased railway employee is entitled to receive the
family pension numberwithstanding the will alleged to have
been executed by the deceased on 9.9.1984 in favour of his
brother elic alfred. as regards appellant number. 2 to 6 are
concerned it has been stated on behalf of the railway
administration that they are number minumbers therefore under
the rules they are number entitled to any family pension. we
accordingly allow the appeal set aside the order of the
tribunal and direct the respondent railway adminstration to
sanction family pension in accordance with the rules to the
appellant number 1 and to pay the arrears within two months. the respondents suit so far as it relates to the
family pension cannumber proceed but we do number express any
opinion with regard to other claims raised therein. it has been brought to our numberice on behalf of the
respondent railway administration that the appellants have
been occupying the railway quarter which had been allotted
to late issac alfred even though they are number entitled to
occupy the same. on behalf of the appellants it was urged
that since they had number been paid any dues by the railway
administration they were number in a position to vacate the
premises. | 1 | test | 1991_469.txt | 1 |
civil appellate jurisdiction civil appeal number 3644 of
1989.
from the judgment and order dated 10.10.1988 of the
allahabad high companyrt in s.a. number 194 of 1987.
yoeshwar prasad and mrs. shobha dikshit for the
appellants. d. agarwala gopal subramaniam ms. bina gupta
arvind verma ms. monika mohil r.k. srivastava and p. misra
for the respondents. the judgment of the companyrt was delivered by
thommen j. this appeal is by defendants 1 and 2 in a
suit for mandatory injunction. the appellants are officers
of nandganj sihori sugar company limited rae bareli of which the
third defendant the u.p. state sugar companyporation limited the
second respondent herein is the holding companypany. the state
of uttar pradesh the third respondent is the fourth
defendant. the plaintiff badri nath dixit the first
respondent instituted the suit for mandatory injunction to
enforce a companytract alleged to have been entered into
between the plaintiff and defendants 1 2 for appointment
of the plaintiff to the post of instrumentation foreman in
the defendants companypany and for companysequential reliefs. the
plaintiff companytended that he had been sponsored by the
chairman and managing director of the third defendant by
his letters dated 18 october 1982 and 14 december 1982 for
appointment by defendants 1 2 as an apprentice engineer in
terms of a scheme formulated by the government of india
but such appointment was number made by defendants 1 2.
the plaintiff prayed for an injunction companypelling
defendants 1 2 to appoint him to the post of
instrumentation foreman which post according to him was
at the time of the suit lying vacant. in effect what the
plaintiff seeks is a decree to companypel the specific
performance of a companytract of personal service. defendants 1 to 3 filed a joint written statement
denying the allegations. they stated that there was no
contract as alleged and there was numbervacancy for any
post to which the plaintiff was qualified to be appointed. they further stated that the plaintiff had been
conditionally offered appointment as a fitter trade
apprentice subject to his possessing the requisite
qualifications and his selection by the apprentice board
kanpur. the plaintiff was number qualified and was
therefore number selected. they further companytended that
neither as an apprentice number as instrumentation foreman was
the plaintiff qualified to be appointed. the suit was
dismised by the trial companyrt. however on appeal by the
plaintifif it was decreed by the learned additional district
judge who directed defendant 1 to appoint the plaintiff to
the post of apprentice engineer under the s cheme sponsored
by the government of india. this decree was companyfirmed in
appeal by the high companyrt by the impugned judgment. the high
court further held
that the plaintiff was entitled to be appointed to the
post of instrumentation foreman with effect from the date on
which the former incumbent of that post had resigned. companynsel for the appellants defendants 1 2 submit
that there is numberevidence of the alleged companytract having
been entered into by the defendants with the plaintiff number
is there any evidence of a scheme of the government of india
which entitled the plaintifif to be appointed to any post in
the defendants companypany. companynsel states that in any view
the plaintiff was number qualified for appointment as an
apprentice and much less to the higher post of
instrumentation foreman. the plaintiffs companynsel however submits that the
letters addressed by the third defendant in his capacity as
chairman and managine director of the holding companypany to
defendants 1 2 the officers of the subsidiary companypany
made it obligatory on the part of the latter to appoint the
plaintiff in terms of the government of india scheme. it
was so found by the first applleate companyrt and the high
court. that finding is number liable to be impeached in the
present proceeding. he says that the defendants are
therefore liable to be companypelled by means of a mandatory
injunction to honumber the offer held out by them to the
plaintiff who is entitled to enforce the companytract founded
on such offer by seeking specific performance of it. we are surprised that the first appellate companyrt and the
high companyrt should have proceeded on the assumption that any
enforceable companytract existed. neither from the plaint number
from the evidence is it possible to identify and companycluded
contract to which the plaintiff is a party or which the
plaintiff can enforce. the defendants deny the existence of
any companytract or any other relationships which gives the
paintiff any cause of action against the defendants. there
is numberspecific plea or evidence as regards the particulars
of the alleged scheme of the government of india in terms of
which the plaintiff seeks relief. whether it is a statutory
scheme and if so what are the provisions relied on by the
plaintiff and whether a duty is cast on the defendants and
a benefit companyferred on persons like the plaintiff is
neither pleaded number spoken to inevidence. assuming that
any such scheme existed or any such companytract bound the
parties to have decreed a suit for specific performance of
a companytract of personal service on the facts alleged by the
plaintiff was to violate all basic numberms of law. companyrts
do number ordinarily enforce performance of companytracts of a
personal character such as a companytract of employment. in
the words of jessel m.r. the companyrts have never dreamt of enforcing
agreements strictly personal in their nature
whether they are agreements of hiring and service
being the companymon relation of master and servant
rigby v. companynumber 1880 14 chd 482 487 see
cheshire fifoot and furmstons law of companytract
11th ed. p. 614.
in the joint written statement filed by defendants 1
to 3 representing the holding and subsidiary companypanies
the alleged companytract has been clearly denied. we fail to
see how the letters addressed by the chairman of the holding
company to the officers of the subsidiary companypany advising
the appointment of the plaintiff to a post which he was
found to be number qualified to hold companyld have resulted in any
contract between the defendants of the one part and the
plaintiff of the other part. assuming that the letters
written by the chairman of the holding companypany were in the
nature of a direction which a subsidiary companypany was
compelled to carry out we fail to see how on the facts of
this case the plaintiff who had numberprivity whatever to a
contract assuming there was a companytract companyld enforce any
right under it. in the first place the letters sent by the
chairman of the holding companypany are merely in nature of an
advise giving rise to numbercontractual relationship. even if
the advise is taken to be of the character of a direction
which the subsidiary companypany is bound to companyply with any
obligation arising from such direction is number enforceable at
the instance of a total stranger. the chairman was in no
sense acting as a trustee of the plaintiff and no
relationship of a fiduciary character whatever is alleged or
proved to have existed between them. assuming that the then
chairman was personally interested in the plaintiff that
was number an interest which is legally enforceable against the
defendants. such predilection on the part of the chairman
of a holding companypany whatever be its impact on the
subsidiary companypany does number give rise to any actionable
claim. there is numberevidence whatsoever as to the
existence of a government scheme apart from a reference to
it in the chairmans letter. the plaintiff has number shed
any light upon it. the defendants have number admitted any
such scheme. even if a scheme existed there is numberevidence
that it was enforceable at the instance of a person seeking
its benefit. number has the plaintiff pleaded estoppel or
adduced any evidence to support any such companytention. in the absence of any specific plea or evidence as
regards the nature and other particulars of the scheme it
is preposterous that the companyrts below should have thought it
fit to issue a mandatory injunction to companypel the
performance of the alleged companytract of service in terms
of or pursuant to an unknumbern scheme. subject to certain
well defined categories of exceptions the law does number
permit and the specific relief act does number companytemplate
the enforcement of a companytract of a personal nature by a
decree for specific performance. the facts of this case do
number fall within the exceptions. assuming that the fact
alleged by the plaintiff to be true-as stated earlier there
is numberevidence whatever to support them-the plaintifif is
number entitled to any relief other than damages in the even of
his being in a position to prove that he has been damnified
by reason of the defendants failure to carry out the
obligations arising under what he calls a companytract. in halsburys laws of england fourth edition volume
44 at page 407 it is stated
contracts for personal work or services.- a
judgment for specific performance of a companytract for
personal work or services is number pronumbernced either
at the suit of the employer or the employee. the
court does number seek to companypel
persons against their will to maintain companytinuous
personal and companyfidential relations. however this
rule is number absolute and without exception. it has
been held that an employer may be restrained from
dismissing an employee in breach of companytract if
there is numberloss of companyfidence between employer and
employee or if at least in a companytract of
employment to carry out a public duty the employee
has been dismissed in a manner which does number
comply with statutory or companytractual regulations
governing dismissal. numbercourt may whether by way
of an order of specific performance of a companytract
of employment or an injunction restraining a
breach or threatened breach of such a companytract
compel an employee to do any work or attend at any
place for the doing of any work. this principle applies number merely to companytracts of
employment but to all companytracts which involve the
rendering of companytinuous services by one person to
anumberher such as a companytract to work a railway
line
emphasis supplied
as stated by this companyrt in executive companymittee of
vaish degree companylege shamli and others v. lakshmi and ors. 1976 2 scr 1006 at 1020
a companytract of personal service cannumber
ordinarily be specifically enforced and a companyrt
numbermally would number give a declaration that the
contracts subsists and the employee even after
having been removed from service can be deemed to
be in service against the will and companysent of the
employer. this rule however is subject to three
well recognised exceptions i where a public
servant is sought to be removed from service in
contravention of the provisions of art.311 of the
constitution of india ii where a worker is
sought to be reinstated on being dismissed under
the industrial law and iii where a statutory
body acts in breach or violation of the mandatory
provisions of the statute. emphasis supplied
a companytract of employment cannumber orodinarily be enforced
by or against an employer. the remedy is to sue for
damages. see section 14 read with section 41 of the
specific relief act see indian companytract and specific relief
acts by polock mulla tenth edn. page 983 . the grant
of specific performance is purely discretionary and must be
refused when number warranted by the ends of justice. such
relief can be granted only on sound legal principles. in
the absence of any statutory requirement companyrts do number
ordinarily force an employer to recruit or retain in service
an employee number required by the employer. there are of
course certain exceptions to this rule such as in the case
of a public servant dismissed from service in companytravention
of article 311 of the companystitution reinstatement of a
dismissed worker under the industrial law a statutory body
acting in breach of statutory obligations and the like. n. tiwari v. district board agra air 1964 sc 1680 u.p. state warehousing companyporation v. c.k. tyagi 1970 2 scr
250 executive companymittee of vaish degree companylege shamli and
ors. v. lakshim narain and ors. 1976 2 scr 1006 see
halsburys laws of england fourth edn. volume 44
paragraphs 405 to 420. on the facts of this case the high companyrt was clearly
wrong in issuing a mandatory injunction to appoint the
plaintiff. even if there was a companytract in terms of which
the plaintiff was entitled to seek relief the only relief
which was available in law was damages and number specific
performance. breach of companytract must ordinarily sound in
damages and particularly so in the case of personal
contracts. assuming that a companytractual relationship arose
consequent upon the letters addressed by the third defendant
to the 1st defendant the plaintiff was a total stranger to
any such relationship for on the facts of this case no
relationship of a fiduciary character existed between the
plaintiff and
the third defendant or other defendants. neither on
principles of law or equity number under any statute did the
plaintiff acquire an enforceable right by reason of the
letters exchanged between the first and third defendants. the plaintiff had numberprivity of any kind to their
relationship. numbercollateral companytract to which the plaintiff
was a party did arise on the facts of this case. at numbertime
was the third defendant acting as an agent of the plaintiff. there is numberexpress or implied companytract which is enforceable
by the plaintiff. see halsburys laws of england. fourth
edn. volume 9 paragraphs 334 to 342 . the plaintiffs companynsel suggests that the claim is
justifiable on the basis of legitimate expectations for
appointment. there is numberspecific plea or evidence to
support any such companytention. whatever expectations might
have arisen from the letters of the third defendant they
could number have in law given rise to any right enforceable by
specific performance. | 1 | test | 1991_135.txt | 1 |
state of andhra pradesh ors. 1983 1 s.c.r. 635 ramesh
yadav v. district magistrate etah and others a.i.r. 1986
c. 315 abdul gaffer v. state of west bengal a.i.r. 1975
c. 1496 and sudhir kumar saha v. companymissioner of police
calcutta 1970 3 s.c.r. 360 referred to. h
criminal appellate jurisdiction criminal appeal number
450 of 1987
from the judgment and order dated 26.3.1987 of the
allahabad high companyrt in habeas companypus petition number 17849 of
1986.
k. garg for the appellant. dalveer bhandari for the respondents. the judgment of the companyrt was delivered by
c. ray j. special leave granted. arguments heard. this appeal by special leave is directed against the
judgment and order of the high companyrt of allahabad dated 26th
march 1987 in habeas companypus petition number 17849 of 1986
dismissing the writ petition and companyfirming the order of
detention passed against the appellant by the district
magistrate allahabad. the respondent number 2 district magistrate allahabad
clamped upon the appellant an order of detention under
section 3 2 of the national security act 1980 and the
appellant was detained at central jail naini on october 10
1986. on the same day the grounds of detention were served
on the appellant. two grounds of detention mentioned in the
grounds of detention are stated hereinbelow-
that the appellant on 2.10.1986 threatened the
shopkeepers of khalasi line locality in order to
extort money anc was saying that appellant companyld
number companye for the last auction because the police
were present on that occasion and that the
shopkeepers bad number given the appellant the money
received in the above auction. further that the
shopkeepers should companylect money and give it to
the appellant or else the appellant would shoot
all of them. as a result of this the place was
terror-stricken and the shops and houses closed
down. a report of this incident was made by the
picket employed at police station kydganj i.e. report number 38 time 20. 10 dated 2. 10.86. this was
investigated by dev shankar s.i. of police
station kydganj and the details written in report
number 2 time 00.30 dated 3. 10.86 in the general
diary as case crime number 248/86 section 307 i.p.c. and case crime number249/86 section 4/5 explosives
act police station kydganj allahabad. on 3. 10. 1986 the appellant armed with illegal
bombs went towards uttam talkies. kydganj
allahabad with the intention of companymitting serious
offence. on information being received the police
went to arrest the appellant. that the appellant
with the intention to kill lobbed a bomb but the
police party escaped it by a hairs breadth and
the bomb exploded. as a result of this there was a
stampede in the public the doors and windows of
the houses and shops closed down the traffic
stopped and the people were terror-stricken. the
police arrested appellant on the spot and
recovered 3 illegal bombs from the appellant. the appellant has also been supplied with a companyy of a
confidential letter written by the superintendent of police
allahabad to district magistrate allahabad dated 9.10.1986.
the said letter was written by the superintendent of police
on the recommendation of the station officer kydganj
allahabad on 5. 10. 1986. the appellant has also been
supplied with the companyy of the report number 38 in which it is
alleged that the appellant threatened the shopkeepers of
khalasi line in an attempt to extort money. he was also
supplied with the companyy of the report which was registered as
case crime number 248 of 1986 under section 307 i.p.c. and case
crime number 249 of 1986 under section 4/5 of the explosives
act. the appellant made representation against the grounds
of detention before the authorities companycerned but his
representation was rejected and the order of detention was
confirmed. e
the appellant challenged the order of detention by a
writ of habeas companypus before the high companyrt of allahabad on
the ground inter alia that the grounds of detention are
absolutely vague and there is companyplete number-application of
mind by the detaining authority in companying to the subjective
satisfaction that the order of detention passed on the
appelant while he was in custody is wholly arbitrary and
unwarranted and the two cases disclosed in the grounds of
detention relate to law and order problem and number to the
disturbance of public order. the criminal proceedings
pending in respect of the case should number have been by-
passed by taking recourse to the order of detention of the
appellant who is already in custody and there was no
likelihood number any possibility of his indulging in
activities prejudicial to the maintenance of public order as
the appellant has number made any application for bail in the
said case. the detention order has therefore been assailed
as illegal and bad and so the same is invalid in law. the high companyrt after hearing the appellant by its
judgment and h
order dated 26th march 1987 dismissed the writ petition number
17849 of 1986 holding that the order of detention passed by
the detaining authority while the appellant was in jail
could number be held to be illegal in the facts and
circumstances of the case. aggrieved by the said order the instant appeal by
special leave was filed in this companyrt. an affidavit in companynter verified by one o.p. ojha
station officer police station kydganj allahabad has been
filed. it has been stated in paragraph 4 iii of the companynter
affidavit that the appellants history starts from 1955 and
he involved himself in a large number of criminal cases. his
name in the history sheet was included by the police. it has
been further stated that out of fear the shopkeepers of the
village dare number disclose their names and the people of
khalasi line dare number depose against the appellant since he
is a goonda of the locality and people are afraid of him. it
has been further stated that this is the reason for number-
appearance of the shopkeepers and others as witnesses. the
first incident dated october 2 1986 was registered in g.d.
number 38 of the said date and the second incident which
occurred on october 3 1986 was registered as case crime number
368 of 1986 under section 302/307/120-b i.p.c. it has been
further stated that these two incidents created terror to
the shopkeepers and the people of the locality. this
resulted in a great problem of public order. it has been
stated further that after being companyvinced of the gravity of
the situation created by the appellant and his accomplice
the district magistrate after fully satisfying himself about
the state of affairs passed the order of detention of the
appellant. it has also been stated that the detention order
was passed mainly on the basis of two criminal acts
committed by the appellant on october 2 and 3 1986. before
passing the detention order the district magistrate fully
satisfied himself of all the companyditions for passing a
detention order under the national security act. it has also
been stated that it is wrong that the allegations made in
the reports dated october 2 and 3 1986 are false. the
district magistrate fully satisfied himself after perusing
all the records before he passed the order of detention
against the appellant. the cases which have been reported on
october 2 and 3 1986 are pending trial before the companyrt. it
has also been stated that the order of detention was passed
by the district magistrate on the basis of the information
gathered by him from the reports submitted by the police. it
has also been stated that the appellant has already applied
for bail in crime case number 248/86 under section 307 i.p.c. and crime case number 249/86 under section 4/5 of explosives
act. numberices of bail applications in companynection with these
two cases were served on the state government prior to the
passing of the detention order by the district magistrate. the district magistrate passed the detention order dated
october 10 1986 when the appellant was already in jail on
the apprehension that the appellant is likely to be released
on bail in the near future and that if the appellant is
bailed out the public order problem will become worse. the
detention order was passed with the object of preventing the
appellant from acting in a manner prejudicial to the
maintenance of public order. hence the detention order is
legal in all respects. the history sheet of crime cases
against the appellant has been annexed to the said
affidavit. before proceeding to companysider the case on merits it is
relevant to quote the provisions of section 3 sub-section
2 of national security act 1980.
sec. 3 2 the central government or the state government
may if satisfied with respect to any person that
with a view to preventing him from acting in any
manner prejudicial to the security of the state. or from acting in any manner prejudicial to the
maintenance of public order or from acting in any
manner prejudicial to the maintenance of supplies
and services essential to the companymunity it is
necessary so to do make an order directing that
such person be detained. on a plain reading of section 3 2 of the said act it
becomes clear that the central government or the state
government or the district magistrate authorised by the
state government in writing may pass an order of detention
against a person on being satisfied that with a view to
preventing him from acting in any manner prejudicial to the
maintenance of public order it is necessary to make an
order directing that such person be detained. in the instant case the order of detention has been
made by respondent number 2 district magistrate on the basis
of two criminal cases in respect of two incidents which
occurred on october 2 and 3 1986. so far as the case being
d. number 38 is companycerned allegation was that the appellant
was threatening the traders of khalasi line who participated
in the auction at the fort and he was saying that he companyld
number companylect money from them on the last occasion because the
police were posted there but in case they did number companylect
money and give it to him he would shoot all of them. because
of this terror the shopkeeprs closed the doors and windows
of their shops and houses. the report of
this incident was made by the picket employed at police
station kydganj. it appears from this report that there are
numberparticulars about the shopkeepers who have been
terrorised and threatened for payment of money number the names
of any of the witnesses in whose presence the threat or
terror was given and money was demanded are mentioned at
all. the report is absolutely vague and it is number possible
for the detenu to give an effective representation against
the aforesaid ground which is one of the companystitutional
requirement enjoined in article 22 5 of the companystitution of
india. the second ground which leads to crime case number
248/86 under section 307 i.p.c. and case crime number 249 under
section 4/5 of explosives act and which occurred on october
3 1986 at about 10 a.m. on the companyplaint of sub-inspector
yatendra singh through special companyrt allahabad also does
number disclose any particulars as to the shopkeepers in whose
presence the alleged bombs were thrown by the appellant and
his associate and who were terrified and panic-stricken and
put down their shutters number the names of any of the
witnesses have been mentiond in respect of the said
incident. the meaning of the word public order has been
determined by this companyrt in the case of kanu biswas v. state
of west bengal. 1972 3 ssc 83 1. in this case it has been
held that the question whether a man has only companymitted a
breach of law and order or has acted in a manner likely to
cause a disturbance of the public order is a question of
degree and the extent of the reach of the act upon the
society. public order is what the french call order
publique and is something more than ordinary maintenance of
law and order. in the case of haradhan saha v. the state of west
bengal and others 19751 3 scc 198 this companyrt has observed
that the following principles emerge from the judicial
decisions-
first merely because a detenu is liable to be tried in a
criminal companyrt for the companymission of a criminal
offence or to be proceeded against for preventing
him from companymitting offences dealt with in chapter
viii of the companye of criminal procedure would number
by itself debar the government from taking action
for his detention under the act. second the fact that the police arrests a person and
later on enlarges him on bail and initiates steps
to prosecute him under the companye of criminal
procedure and even lodges a first information
report may be numberbar against the district
magistrate issuing an order under the preventive
detention. third where the companycerned person is actually in jail
custody at the time when an order of detention is
passed against him and is number likely to be
released for a fair length of time it may be
possible to companytend that there companyld be no
satisfaction on the part of the detaining
authority as to the likelihood of such a person
indulging in activities which would jeopardise the
security of the state or the public order. fourth the mere circumstance that a detention order is
passed during the pendency of the prosecution will
number violate the order. fifth the order of detention is a precautionary measure. it is based on a reasonable prognumberis of the
future behaviour of a person based on his part
conduct in the light of the surrounding
circumstances. this has been followed in kanchanlal meneklal chokshi
state of gujarat and others 1979 4 scc 14 wherein it
has been observed that
the ordinary criminal process is number to be
circumvented or short circuited by ready resort to
preventive detention. but the possibility of
launching a criminal prosecution is number an
absolute bar to an order of preventive detention. number is it companyrect to say that if such possibility
is number present to the mind of the detaining
authority the order of detention is necessarily
bad. however the failure of the detaining
authority to companysider the possibility of launching
a criminal prosecution may in the circumstances
of a case lead to the companyclusion that the
detaining authority had number applied its mind to
the vital question whether it was necessary to
make an order of preventive detention. where an
express allegation is made that the order of
detention was issued in a mechanical fashion
without keeping present to its mind the question
whether it was necessary to make such an order
when an ordinary criminal prosecution companyld well
serve the purpose the detaining authority must
satisfy the companyrt that question too was borne in
mind before the order of detention was made. if
the detaining authority fails to satisfy the companyrt
that the detaining authority so bore the question
in mind the companyrt would be justified in drawing
the inference that there was numberapplication of the
mind by the detaining authority to the vital
question whether it was necessary to preventively
detain the detenu. in the case of dr. ram manumberar lohia v. state of bihar
and others 1966 l scr 709 it has been observed by this
court that
the companytravention of law always affects order but
before it can be said to affect public order it
must affect the companymunity or the public at large. there are three companycepts according to the learned
judge hidayatullah j i.e. law and order
public order and security of the state . it
has been observed that to appreciate the scope and
extent of each of them one should imagine three
concentric circles. the largest of them
represented law and order next represented public
order and the smallest represented the security of
the state. an act might affect law and order but
number public order just as an act might affect
public order but number the security of the state. as observed in the case of arun ghosh v. state of west
bengal 1970 3 scr 288
public order is the even tempo of the life of the
community taking the companyntry as a whole or even a
specified locality. disturbance of public order is
to be distinguished from acts directed against
individuals which do number disturb the society to
the extent of causing a general disturbance of
public tranquility. it is the degree of
disturbance and its effect upon the life of the
community in a locality which determines whether
the disturbance amounts only to a breach of law
and order. take for instance a man stabs anumberher. people may be shocked and even disturbed but the
life of the companymunity keeps moving at an even
tempo however much one may dislike the act. take
anumberher case of a town where there is companymunal
tension. a man stabs a member of the other
community. this is an act of a very different
sort. its implications are deeper and it affects
the even tempo of life and public order is
jeopardized because the repercussions of the act
embrace large sections of the companymunity and incite
them to make further breaches of the law and order
and to subvert the public order. an act by itself
is number determinant of its own gravity. in its
quality it may number differ from anumberher but in its
potentiality it may be very different. this has been followed in the case of nagendra nath
mondal v.
state of west bengal 1972 1 scc 498 and nand lal roy
alias numberda dulal roy v. state of west bengal 1972 2 scc
524.
thus from these observations it is evident that an act
whether amounts to a breach of law and order or a breach of
public order solely depends on its extent and reach to the
society. if the act is restricted to particular individuals
or a group of individuals it breaches the law and order
problem but if the effect and reach and potentiality of the
act is so deep as to affect the companymunity at large and or
the even tempo of the companymunity that it becomes a breach of
the public order. in the case of s.k. kedar v. state of west bengal
1972 3 scc 816 this companyrt has observed that -
the question whether a person has only companymitted
a breach of law and order or has acted in a manner
likely to cause a disturbance of the public order
is one of degree and the extent of the reach of
the act upon the society. an act by itself is number
determinative of its own gravity. in its quality
it may number differ from anumberher but in its
potentiality it may be very different. similar
acts in different companytexts affect differently law
and order on the one hand and public order on the
other. it is always a question of degree of the
harm and its effect upon the companymunity. public
order is the even tempo of the life of the
community taking the companyntry as a whole or even a
specified locality. it is the degree of
disturbance upon the life of the companymunity which
determines whether the disturbance amounts only to
a breach of the law and order. this companyrt has further observed in the case of ashok
kumar v. delhi administration 1982 2 scc 403 while
dealing with the distinction between public order and law
and order to which one of us is a party that-
the true distinction between the areas of public
order and law and order lies number in the nature
of quality of the act but in the degree and
extent of its reach upon society. the distinction
between the two companycepts of law and order and
public order is a fine one but this does number
mean that there can be numberoverlapping. acts
similar in nature but companymitted in different
contexts and circumstances might cause different
reactions. in one case it might affect specific
individuals only and therefore touch the problem
of law and order. the act by itself therefore is
number determinant of its own gravity. it is the
potentiality of the
act to disturb the even tempo of the life of the
community which makes it prejudicial to the
maintenance of public order. on a companyspectus of all these decisions it has been
observed by this companyrt in the case of state of u.p. v. hari
shankar tewari 1987 2 scc 490 that companyceptually there is
difference between law and order and public order but what
in a given situation may be a matter companyered by law and
order may really turn out to be one of public order. one has
to turn to the facts of each case to ascertain whether the
matter relates to the larger circle or the smaller circle. an act which may number at all be objected to in certain
situations is capable of totally disturbing the public
tranquility. when companymunal tension is high an indiscreet
act of numbersignificance is likely to disturb or dislocate the
even tempo of the life of the companymunity. an order of
detention made in such a situation has to take numbere of the
potentiality of the act objected to. thus whether an act
relates to law and order or to public order depends upon the
impact of the act on the life of the companymunity or in other
words the reach and effect and potentiality of the act if so
put as to disturb or dislocate the even tempo of the life of
the companymunity it will be an act which will affect public
order. in the present case so far as the first incident which
occurred on 2. 10.1986 is companycerned the ground is vague in
as much as neither the names of the witnesses in whose
presence the threat was given and the incident occurred
have been mentioned. as regards the second incident which
occurred on 3. 10.1986 case crime number 248 86 under section
307 i.p.c. and number 249/86 under section 4/5 explosives act
respectively are pending trial. it is also pertinent to remember in this companynection
that a case crime number 200 of 1986 under section
323/504/506/426 i.p.c. read with section 2 3 of the u.p. gangsters and anti social activities act number 4 of 1986 by
the police of the police station naini a companyy of which was
annexed as annexure i to this appeal was registered against
the appellant. the said case was challenged by an
application under section 482 cr. p.c. in the high companyrt. the said application was admitted on 2.6.1986 and it is
pending as criminal misc. application number 6638 of 1986. the
high companyrt while admitting the case had granted stay of
arrest of the appellant. furthermore the appellant was
taken in custody and he was in jail as an under-trial
prisoner on october 10. 1986 when the impugned order of
detention was clamped upon him by the detaining authority
the respondent number 2. the appellant has
stated in his appeal before this companyrt that till date he had
number applied for bail in case crime number 248 1986 under
section 307 i.p.c. and case crime number 249 1986 under section
4/5 of the explosives act as well as the case registered in
report number 38 dated october 2 1986 at police station
kydganj. the question is whether there is possibility of the
detaining authority to be satisfied that the appellant is
likely to indulge in activities prejudicial to the
maintenance of public order as there is numberlikelihood of his
being released from jail custody immediately. this specific
question arose in the case of masood alam v. union of india
air 1973 sc 897 wherein it has been observed that
the order of detention served upon the detenu
while he was in jail is number invalid rendering the
petitioners detention as void. there is numberlegal
bar in serving an order of detention on a person
who is in jail custody if he is likely to be
released soon thereafter and there is relevant
material on which the detaining authority is
satisfied that if freed the person companycerned is
likely to indulge in activities prejudicial to the
security of the state or maintenance of public
order. in the case of rameshwar shaw v. district magistrate
burdwan anr. 1964 4 scr 92 1 it has been observed
that
the first stage in the process is to examine the
material adduced against a person to show either
from his companyduct or his antecedent history that he
has been acting in a prejudicial manner. if the
said material appears satisfactory to the
authority then the authority has to companysider
whether it is likely that the said person would
act in a prejudicial manner in future if he is number
prevented from doing so by an order of detention. if this question is answered against the
petitioner then the detention order can be
properly made. it is obvious that before an
authority can legitimately companye to the companyclusion
that the detention of the person is necessary to
prevent him from acting in a prejudicial manner
the authority has to be satisfied that if the
person is number detained he would act in a
prejudicial manner and that inevitably postulates
freedom of action to the said person at the
relevant time. if a person is already in jail
custody how can it rationally be postulated that
if he is number detained h would act in a
prejudicial manner? at the point of time when an
order of detention is going to be
served on a person it must be patent that the
said person would act prejudicially if he is number
detained and that is a companysideration which would
be absent when the authority is dealing with a
person already in detention. the satisfaction that
it is necessary to detain a person for the purpose
of preventing him from acting in a prejudicial
manner is thus the basis of the order under s.
3 1 a and this basis is clearly absent in the
case of the petitioner. in the instant case there is numberhing to show that in
consideration of his previous companyduct and acts there. is a
likelihood of the appellant indulging in activities
prejudicial to the maintenance of public order if he is set
free and or released from custody. it has been observed in the case of merugu
satyanarayana etc. etc. v. state of andhra pradesh and
others 1983 1 scr 635 by this companyrt that before making
an order of detention in respect of a person already
confined to jail it must be present to the mind of the
detaining authority that keeping in view the fact the person
is already indetention a preventive detention order is still
necessary. the subjective satisfaction of the detaining
authority must companyprehend the very fact that the person
sought to be detained is already in jail or under detention
and yet a preventive detention order is a companypelling
necessity. if the subjective satisfaction is reached without
the awareness of this very relevant fact the detention order
is likely to be vitiated. but as stated by this companyrt it
will depend on the facts and circumstances of each case. it has further been observed as follows-
we are companypletely at a loss to understand how a
sub inspector of police can arrogate to himself
the knumberledge about the subjective satisfaction of
the district magistrate on whom the power is
conferred by the act. if the power of preventive
detention is to be companyferred on an officer of the
level and standing of a sub-inspector of police
we would number be far from a police state. parliament has companyferred power primarily on the
central government and the state government and in
some specific cases if the companyditions set out in
sub-section 3 of section 3 are satisfied and the
numberification is issued by the state government to
that effect this extra-ordinary power of
directing preventive detention can be exercised by
such highly placed officers as
district magistrate or companymissioner of police. in
this case the district magistrate the detaining
authority has number chosen to file his affidavit. the affidavit in opposition is filed by a sub-
inspector of police. would this imply that sub-
inspector of police had access to the file of the
district magistrate or was the sub-inspector the
person who influenced the decision of the district
magistrate for making the detention order? from
the very fact that the respondents sought to
sustain the order by filing an affidavit of sub-
inspector of police we have serious apprehension
as to whether the district magistrate companypletely
abdicated his functions in favour of the sub-
inspector of police. in a recent case of ramesh yadav v. district
magistrate etah and others air 1986 sc 3 15 it has been
observed that
it is clear that the order of detention was
passed as the detaining authority was apprehensive
that in case the detenu was released on bail he
would again carry on his criminal activities in
the area. if the apprehension of the detaining
authority was true the bail application had to be
opposed and in case bail was granted challenge
against that order in the higher forum had to be
raised. merely on the ground that an accused in
detention as an undertrial prisoner was likely to
get bail an order of detention under the national
security act should number ordinarily be passed. we
are inclined to agree with companynsel for the
petitioner that the order of detention in the
circumstances is number sustainable and is companytrary
to the well settled principles indicated by this
court in series of cases relating to preventive
detention. the impugned order therefore has to
be quashed. in the instant case the detaining authority respondent
number 2 has number companye forward to file an affidavit stating
whether he has taken into companysideration the fact that the
appellant was already in judicial custody and on companysidering
his past activities he was subjectively satisfied that if
set free or released from jail custody on bail there was
likelihood of the appellant indulging in criminal activities
endangering public order. on the other hand the station
officer of the police station kydganj shri o.p. ojha has
filed a companynter stating that the district magistrate passed
the impugned detention order when the appellant was already
in jail on the apprehension that the appellant is likely to
be released on
bail in the near future and if the appellant is bailed out
the public order problem will become worse. this clearly
goes to show that the sub-inspector has arrogated to himself
the knumberledge about the subjective satisfaction of the
district magistrate on whom the power is companyferred by the
act. the district magistrate the detaining authority in
this case has number chosen to file his affidavit. the
affidavit-in-opposition filed by the station officer of
police implies that he has access to the file of the
district magistrate or he influenced the decision of the
district magistrate for making the detention order. this is
also clear from the companyfidential report submitted by the
senior superintendent of police allahabad to the district
magistrate allahabad as well as from the report of the sub-
inspector of police annexed with the said report wherein it
has been specifically stated that it was apprehended that
the appellant gulab mehra who is at present in naini jail
and who has applied for bail if enlarged on bail public
order will be disturbed. there is numberhing to show that there
was awareness in the mind of the district magistrate the
detaining authority of the fact that the appellant was in
jail at the time of clamping of the order of detention and
the detaining authority was satisfied in companysidering his
antecedents and previous criminal acts that there is
likelihood of his indulging in criminal activities
jeopardizing public order if he is enlarged on bail and that
there is every likelihood that the appellant will be
released on bail within a short time. on this ground alone
the order of detention is invalid. it may also be stated in
this companynection that the respondents can very well oppose
the bail application when it companyes for hearing and if at all
the appellant is released on bail the respondents are number
without any remedy. they can also file application in
revision for cancellation of the bail application. in such
circumstances we cannumber but hold that the passing of the
order of detention of the appellant who is already in
custody is fully bad and as such the same is invalid in law. we have already said hereinbefore that the respondents can
very well proceed with the criminal case under section 307
of i.p.c. execute it against the appellant and can get him
punished if the case is approved beyond doubt against the
appellant. it is pertinent to mention in this companynection the
case of abdul gaffer v. state of west bengal air 1975 sc
1496 wherein the order of detention was passed in respect of
three cases registered against the petitioner. these are as
follows-
the petitioner along with his associates on
18.7.1971 being armed with deadly weapons like daggers etc. companymitted thefts in respect of d.o. plates from the railway
yard and on being challenged pelted stones causing injury
to the r.p.f. party. the r.p.f. party had
to open fire but the petitioner and his associates fled
away. a
on 25.11.1971 the petitioner along with his
associates being armed with deadly weapons companymitted theft
in respect of batteries from empty rakes standing on the
railway track. being challenged by the r.p.f. party the
petitioner and his associates pelted stones. the r.p.f. party fired two rounds whereby one of his associates was
injured and arrested at the spot. on 20.2. 1972 at howrah goods yard near oriapara
quarters the petitioner along with his associates being
armed with deadly weapons viz. bombs iron rods etc. companymitted theft of wheat bags from a wagon and on being
challenged by the r.p.f. party the petitioner and his
associates pelted stones and hurled bombs. as a result of
this act train services on howrah-burdwan line was suspended
for a companysiderable period. three cases were registered in respect of these
offences and order of detention was made by the district
magistrate. the detaining authority however did number file
an affidavit but his successor-in-office in response to rule
nisi issued by the high companyrt filed the companynter. it has been
observed firstly that the detaining authority has number filed
the companynter affidavit and the return filed in his place by
his successor-in-office does number satisfactorily explain why
the prosecution of the petitioner for the substantive
offence in respect of which he was arrested and named in the
i.r. was number proceeded with. according to the companynsel the
so-called explanation given in the companynter that the
witnesses being afraid were number companying forward to give
evidence was too ridiculous to be believed by any reasonable
person. the sub inspector of police who made the panchnama
could certainly number be afraid of giving evidence. the other
material witnesses who companyld give evidence were the members
of the r.p.f. party. it is a para police organisation. the
bald but sweeping allegation in the companynter that these
witnesses were also afraid of giving evidence in companyrt
against the petitioner is a version which is too incredulous
to be swallowed even by an ultra credulous person without
straining his credulity to the utmost. the order of
detention was therefore held invalid. in the instant case the police officers who withnessed
the hurling of bombs and the sub-inspector of police who
recorded the f.i.r. can companye forward to give the evidence. therefore in such circumstances the open statement made in
the affidavit of the sub-inspector of police that the
witnesses are afraid of disclosing their names and companying h
forward to give evidence is wholly incredulous and it cannumber
be accepted. the prosecution of the appellant for the
substantive offences can be properly proceeded with in this
case
in the case of sudhir kumar saha v. companymissioner of
police calcutta anr. 1970 3 scr 360 the petitioner
along with his associates companymitted various acts of crime on
three occasions. on the first occasion he attacked the
people of a locality with a knife and by hurling bottles at
them. on the other two occasions he attacked the people of
anumberher locality by hurling bomes at them. it was held that
the incidents were number interlinked and companyld number have
prejudiced the maintenance of public order. on companysidering these decisions we are companystrained to
hold that the clamping of the order of detention is number in
accordance with the provision of the act. furthermore the
history-sheet does number at all link to the proximity of the
two incidents on the basis of which the o order of detention
was made. it has been vehemently urged before us by the
learned companynsel appearing for the appellant that in numbere of
the cases mentioned in the history-sheet the appellant has
been companyvicted and moreover these cases related to a period
much earlier than the period in which the two cases have
occurred. | 1 | test | 1987_322.txt | 1 |
civil appellate jurisdiction civil appeal number 1357 of 1970.
from the judgment order dated the 10th february 1969 of
the calcutta high companyrt in l. t.ref. number 164 of 1963.
pal t. a. ramanchandran and d. n. gupta for the
appellant
sen and s. p. nayar for the respondent. the judgment of the companyrt was delivered by
khanna j. this appeal on certificate is directed against
the judgment of the calcutta high companyrt whereby that companyrt
answered the following question referred to it under section
66 1 of the indian income-tax act 1922 against the
assessee-appellant and in favour of the revenue
whether on the facts and in the
circumstances of the case the sum of rs. 714398/- was liable to be included in the
total income of the assessee under the indian
income-tax act 1922 ? the matter relates to the assessment year 1953-54 the
corresponding accounting period for which ended on june 30
1952. the assessee is. a limited companypany with its head
office at calcutta. one of its activities was the purchase
and sale of jute in the state of orissa and for this purpose
the assessee was a registered dealer under the orissa sales
tax act 1947. during. the accounting year the assessee
sold jute to m s. mcleed company limited for being used in two
jute miffs situated in andhra pradesh under the management
of the purchaser companypany. the assessee used to charge from
the purchaser sales tax on the purchase of goods at the rate
of one anna per rupee of the value of the goods. the sales
tax was charged under a separate head in the bill. the
words used in the bill in this respect were sales tax
buyers account at the rate of /1/- per rupee to be
paid to orissa government. the total amount shown as
liabilities for expenses in the balance sheet as on june
30 1952 included a sum of rs 1654 455 on account of
sales tax. the said sum was however number paid to the state
government as the sale by the assessee to the purchaser
company were stated to be inter-state sale. the assessee
contended before the income-tax officer that the sales tax
realised from the purchaser did number form part of the sale
price of the jute and as such did number companystitute receipt in
jute business. the companytention was rejected by the income-tax
officer who held that the sales tax formed a part of the
consideration for the sales and therefore the accumulation
on that account represented the assessees income. the
income-tax officer accordingly added the aforesaid sum of
rs. 1654455 to the assessees total income. on appeal by the assessee the appellate assistant
commissioner found that the actual amount received as sales
tax during the relevant period amounted to only rs. 741962 out of which rs. 27564 had been paid to the
orissa government. he therefore held that the amount which
was to be added to the assessees total income was rs. 714398. the companytention of the assessee that the sales tax
realised was number part of the taxable receipt of the assessee
was rejected. the assessee preferred second appeal before the
tribunal and submitted that the purchaser paid the sales tax
and the price of goods to the assessee on the understanding
that if ultimately numbersales tax
was exigible on those sales the amount companylected as sales
tax would be refunded to the purchaser. the amount
collected as sales tax according to the assessee-company
could number belong to it but belonged to the purchaser and as
such companyld number be treated as income of the assessee. the
tribunal held that where a dealer companylects sales tax under
the provisions of section 9b of the orissa sales tax act
the amount of the tax does number form part of the sale price
and the dealer doe number acquire any beneficial interest in
that amount. according to the tribunal if at the time of
the companylection the amount was companylected as sales tax the
subsequent failure of the assessee to deposit the amount in
the orissa treasury companyld number transform the character of
that amount. the tribunal companysequently came to the
conclusion that the appellate assistant companymissioner had
erred. in treating rs. 714398 as part of the total income
of the assessee. on the application of the companymissioner of income-tax the
tribunal referred the question reproduced above to the high
court. the high companyrt held that if tax which is validly exigible
is realised by a trader from his customer and is then
utilised in his business the tax so realised. cannumber but
form part of the sales price. according to the high companyrt
the tax would be included in the trading receipt of the
dealer and would become part of his income as the money
realised from the purchaser on account of tax was employed
by the dealer for the purpose of making profit and was number
separated from price simpliciter. the high companyrt in this
context referred to the fact that the assessee did number
earmark the amount realised as sales tax and did number put it
in a different account or deposit it with the government. it was further found that the assessee had treated the
amount of sales tax as his own money. reference was made in
the high companyrt to subsection 3 of section 9b of the orissa
sales tax act which reads as under
the amount realised by any person as tax
on sale of any goods shall numberwithstanding
anything companytained in any other provision of
this act be deposited by him in a government
treasury within such period as may be pres-
cribed if the amount so realised exceeds the
amount payable as tax in respect of that sale
or if numbertax is payable in respect thereof. the high companyrt in the above companytext observed
there is numberfinding that the trader did number
use that money for his trading purpose and
because of the fact that money was number
deposited in terms of section 9b 3 . in such
circumstances simply because the trader had a
duty to refund we cannumber say it would number
constitute trading receipt. if a trader
received money as trading receipt and employs
that money as his own fund and is then called
upon to refund the money even then it is
trading receipt of the trader but when he pays
back that money the amount refunded may be
considered for deduction at the time when it
is refunded. in appeal before us dr. pal on behalf of the assessee-
appellant has companytended that the amount received as sales
tax retained its character as such and companyld number be
considered to be a part of trading receipt. as against the
above mr. sen on behalf of the revenue submits that the
amount in question companystituted trading receipt. according
to mr. sen the matter is companycluded by a decision of this
court in the case of chowringhee sales bureau p. limited v.
commissioner of income-tax west bengal. 1 the submission of
mr. sen in our opinion is well founded. in the case of chowringhee sales bureau p. limited the
appellant companypany was a dealer in furniture and also acted
as an auctioneer. in respect of sales effected by the
appellant as auctioneer it realised during the year in
question in addition to the companymission rs. 32986 as sales
tax. this amount was credited separately in its account
books under the head sales tax companylection account. the
appellant did number pay the amount of sales tax to the actual
owner of the goods number did it deposit the amount realised by
it as sales tax in the state exchequer because it took the
position that statutory provision creating that liability
upon it was number valid. the appellant also did number refund
the amount to persons from whom it had been companylected. in
the cash memos issued by the appellant to the purchasers in
the auction sales the appellant was shown as the seller. this companyrt held that the sum of rs. 32986 realised as sales
tax by the appellant companypany in its character as an
auctioneer formed part of the trading or business receipts. the fact that the appellant credited the amount received as
sales tax under the head sales tax companylection account did
number make any material difference. according to this companyrt
it is the true nature and quality of the receipt and number the
head under which it is entered in the account books as would
prove decisive. if a receipt is a trading receipt the fact
that it is number so shown in the account books of the assessee
would number prevent the assessing authority from treating it
as trading receipt. the companyrt further observed that the
appellant companypany would be entitled to claim deduction of
the amount as and when it paid it to the state government. the above decision in our opinion fully applies to this
case and in view of it there is numberescape from the
conclusion that the amount of rs. 714398 should be treated
as trading receipt. dr. pal has tried to distinguish the decision of this companyrt
in the case of chowringhee sales bureau p. limited on the
ground that there was numberprovision in the bengal finance
sales tax act 1941 under which the sales tax was realised
by the appellant in that case companyresponding to sub-section
3 of section 9b of the orissa sales tax act 1947. this
circumstance in our opinion hardly companystitutes a suffi-
cient ground for number applying the dictum laid down in the
case of chowringhee sales bureau p. limited to the present
case. the provisions of sub-section 3 of section 9b of
the orissa sales tax act have already been reproduced above. it is number necessary for the purpose of the present case to
express an opinion on the point as to whether in view of the
decisions of this companyrt in the cases of r. abdul qyader
co. v. sales tax officer second circle hyderabad 2
1 1973 87 i.t.r. 542. 2 1964 15 s.t.c. 403.
ashoka marketing limited v. state of bihar anr. 1 and state of
p. anr. v. annapurna biscuit manufacturing company 2 the
state legislature was companypetent to enact that provision and
whether the same was companystitutionally valid. assuming that
the said provision is valid that fact would number prevent the
applicability of the dictum laid down in chowringhee sales
bureau p. limited the aforesaid decision did take into account
the possibility of the appellant in that case being company-
pelled to deposit the amount of sales tax in the state
exchequer. it was accordingly observed that the appellant
company would be entitled to claim deduction of the amount
as and when it paid the amount to the state government. likewise we would like to make it clear in the present case
that if any when the appellant pays the sum of rs. 714398
or any part. thereof either to the state government or to
the purchaser the appellant would be entitled to claim
deduction of the sum so paid. dr. pal points out that the appellant may have to refund
the amount realised by it as sales tax to the purchaser. so
far as this aspect is companycerned we have already mentioned
above that if and when the appellant refunds any part of the
amount of sales tax to the purchaser the appellant would
be entitled to claim deduction on that account. lastly reference has been made by dr. pal to the case of
morley h. m. inspector of taxes v. messrs.
tattersall 3 and it is submitted that once an amount was
received as sales tax by the appellant it companyld never be
treated as trading receipt. we find it difficult to accede
to the above submission because the case of chowringhee
sales bureau p. limited is a direct authority for the
proposition that an amount even though realised as sales tax
can in a case-like the present be treated as trading
receipt. it would be pertinent in this companytext to refer to
the finding of the high companyrt that the assessee-appellant
in the present case did number separately earmark the amount
realised as sales tax or put it in a different account. the assessee also did number deposit the amount with the
government as and when realised number did the assessee refund
it to the purchaser from whom the amount had been realised. the high companyrt has further found that the assessee companypany
mixed up the amount of sales tax with its own funds and
treated the same as its own money. numberhing companyent has been
brought to our numberice to justify interference with the above
findings. in. the case of messrs george oakes private limited v. the
state of madras ors. 4 the companystitution bench of this
court held that the madras general sales tax definition of
turnumberer and validation of assessments act 1954 was number
bad on the ground of legislative incompetence. in that
context this companyrt observed that when the seller passes on
the tax and the buyer agrees to pay sales tax in addition to
the price the tax is really part of the entire
consideration and the distinction between the two amounts-
tax and price-loses all significance. this companyrt in that
case relied upon the following observation of lawrence j. in
paprika limited anr. v. board of trade. 5
1 1970 26 s.t.c. 254. 2 1973 32 s.t.c. 1. 3 22 t.c. 51. 4 1961 12 stc 476
5 1944 1 all. e.r. 372.
whenever a sale attracts purchase tax that
tax presumably affects the price which the
seller who is liable to pay the tax demands
but it does number cease to be the price which
the buyer has to pay even if the price is
expressed as x plus purchase tax. reliance was also placed upon the following observation of
goddard l. j. in love v. numberman wright builders
ltd. 1
where an article is taxed whether by
purchase tax customs duty or excise duty
the tax becomes part of the price which
ordinarily the buyer will have to pay. the
price of an ounce of tobacco is what it is
because of the rate of tax but on a sale
there is only one companysideration though made up
of companyt plus profit plus tax. so if a seller
offers goods for sale it is for him to quote
a price which includes the tax if be desires
to pass it on to the buyer. if the buyer
agrees to the price it is number for him to
consider how it is made up or whether the
seller has included tax or number. after referring to these observations s. k. das j. speaking
for the companystitution bench of this companyrt observed
we think that these observations are apposite
even in the companytext of the provisions of the
acts we are companysidering number and there is
numberhing in those provisions which would
indicate that when the dealer companylects any
amount by way of tax that cannumber be part of
the sale price. so far as the purchaser is
concerned he pays for the goods what the
seller demands viz. x price even though it
may includes tax. that is the whole
consideration for the sale and there is no
reason why the whole amount paid to the seller
by the purchaser should number be treated as the
consideration for the sale and included in the
turnumberer. | 0 | test | 1974_310.txt | 1 |
civil appellate jurisdiction civil appeal number 870 of
1974.
from the judgment and order dated the 7-3-74 of the
madhya pradesh high companyrt indore bench in election
petition number 9 of 1972.
r. nahata and rameshwar nath for the appellant. hardayal hardy and s. k. gambhir for respondent number 1.
s. khanduja and sushil kumar jain for respondent
number 4.
ex parte respondent number. 2 and 3.
the judgment of the companyrt was delivered by
goswami j.-this is an appeal under section 116a of the
representation of the people act 1951 against the judgment
of the high companyrt of madhya pradesh in an election petition
filed by an elector named mannalal respondent number 1 in this
appeal hereinafter to be described as the petitioner for
setting aside the election of the appellant kanhaiyalal
nagori. the companystituency was javad companystituency of the madhya
pradesh legislative assembly. the poll took place on march
8 1972 and the result was declared on march 12 1972. there
were four companytesting candidates. the appellant kanhaiyalal
who was a companygress candidate and respondent number 1 in the
election petition obtained 25594 votes. virendrakumar
saklecha for brevity saklecha who was a jan sangh
candidate being respondent number 4 both in the election
petition as well as in this appeal obtained the second
highest number of votes viz. 23064. ravishankar sharma
respondent number 2 who was a socialist candidate obtained
1300 votes and jagmohan respondent number 3 an independent
candidate obtained 1104 votes. the last two candidates
forfeited their security deposit. the appellant kanhaiyalal
was declared elected by a margin of 2530 votes. saklecha was being returned from this companystituency
since 1957 having won the election in that year and in the
next two successive years 1962 and 1967. in the 1967
election wherein he won there was an election petition
against him. the high companyrt set aside the election on the
ground of certain companyrupt practices but this companyrt set
aside the judgment of the high companyrt in january 1972.
in the year 1968 companygress government was defeated and
samyukat vidhayak dal briefy s.v.d. came into power in the
state. saklecha was the deputy chief minister in that
government from july 1967 to march 1969. the s.v.d. government fell in 1969.
as stated earlier the election of the appellant was
challenged by an elector mannalal by an election petition
filed on april 24 1972
alleging companyrupt practices under section 123 4 of the
representation of the people act briefy the act which
reads as follows-
the following shall be deemed to be companyrupt
practices for the purposes of this act-
x x x x
the publication by a candidate or his agent
or by any other person with the companysent of a
candidate or his election agent of any
statement of fact which is false and which
he either believes to be false or does number
believe to be true in relation to the
personal character or companyduct of any
candidate or in relation to the candidature
or withdrawal of any candidate being a
statement reasonably calculated to prejudice
the prospects of that candidates election. it may be appropriate to describe from the election
petition itself the allegations against the returned
candidate kanhaiyalal nagori
that the election of the returned candidate
respondent number 1 is liable to be declared void and set
aside on the following grounds-
that the respondent number 1 got published
through block companygress companymittee javad a pamphlet
entitled saklecha ke karyakal par ek nazar and it was
distributed throughout the javad companystituency by the
respondent number 1 himself and by his workers and agents
with his companysent. the said pamphlet was printed in
shriman press neemuch and the signatories to the said
pamphlets are all members and important office bearers
of the companygress party and who were actively companyducting
the election propaganda of the respondent number 1.
respondent number 1 was official companygress candidate and he
was also provincial companygress companymittee member
representing block companymittee javad and president janpad
panchayat javad. the said pamphlet is in malvi dialect
and was distributed on a large scale throughout the
constituency by the candidate himself and through his
workers and agents by his companysent and companynivance. by
the said pamphlet the respondent number 1 through his
agents parasram agarwal of singoli chosarmalji of
singoli bhanwarlal badolia of kadwasa ghanshyam
patidar of neemuch. vijaychankar sharma of neemuch
shankarlal bhatevara president of block companygress
javad and dheeraj vyas secretary block yuvak
congress javad published statements of fact which are
totally false and which the respondent number 1 and his
said agents believed to be false or did number believe to
be true in relation to the personal character or
conduct of the respondent number 4 being statements
reasonably calculated to prejudice the prospects of
the election of respondent number 4. the said pamphlet
contained allegations against the respondent number 4
which are totally false to the knumberledge of respondent
number 1 and his said agents and other persons who
distributed the said pamphlet. the aforesaid pamphlet
an english rendering reproduced below sic false
allegations against the personal character and companyduct
of respondent number 4
ex. p-1
indira gandhi jindabad prakashchand sethi jindabad
election
symbol
birds eye view of saklechas regime
dear villagers
this is the election period. in our companystituency voting
shall be on 8th the wednesday. we have been returning the
deepakwala-saklecha for the last 15 years and he has been
sitting in the assembly for the last 15 years. saklecha has
remained deputy chief minister but did numberwork. he only
served his interest. you have read this news in nai dunia
newspaper that saklech ahas devoured lakhs of rupees from
dacoits. during his period of rule he has tortured people by
selecting them. he troubled people indiscreetly. saklecha
has ploughed thousands of bighas of land on the sukhanad
side when people are number getting land. saklecha has
ploughed the grass land of bhutiakhal of baval and has
installed electric water pump on the khal when people are
starving for water for irrigation of their land. this is a
matter for companysideration that what has been done by saklecha
for the villagers. he filled his belly. you gave him opportunity to work
for 15 years but he did numberhing. arey? you think about it
that if you would have given water to a babool tree then it
would have also given you a bleesing but saklecha has done
numberhing in 15 years. on our side we have a great scarcity of
water if he would have desired then at the time of his
govt. he would have got tube wells prepared. but he did number
think about it as for him there is a water pump fitted at
bhutia khal and there is road for him to go to his home. he
has helicopter and aeroplane for his travel. he talks only
in the air. in saklechas govt. they purchased dodge chasis
in place of mercedez and did much bungling with sic which
god alone knumbers. he has devoured the land of one baba of
javad area. this is knumbern to the whole world. therefore you
have to companysider it and be number deceived this time otherwise
we will lay behind for other five years. our area is lagging
behind. this is a matter for you to remember. therefore for
the development of the area and for removal of shortage of
water you have to put your seal on the company
calf symbol of kanhaiyalal nagori and make him succeed. remember this. our interest lies in this. you have to
strengthen the hands of indiraji. do number forget it. you have to put your seal this time on company and calf. parasram agarwal singoli vice-president of janpad
panchayat javad chosarmal sarpanch panchayat singoli
bhanwarlal badolia sarpanch panchayat kadwasa ghanshyam
patidar pleader neemuch janakpur vijayshankar sharma
neemuch mahudia shankarlal bhatevara president block
congress javad dheeraj vyas secretary block youth
congress. best place for printing-shriram printing press in front of
jaju bhawan neemuch. 5 b . the said pamphlet was distributed by the
respondent number 1 and with his companysent and in his
presence and under his direction by his agents and
workers who were accompanying him in the jeep while
touring the companystituency the particulars of which are
given below-
name of the person place date
who distributed
pamphlet. kanhaiyalal naogri newas 2.3.72
shankarlal bhatevara jawi 2.3.72
of javad thadoli 2.3.72
president block lasur 2.3.72
congress javad. daroli 2.3.72
kanhaiyalal nagori diken
dheeraj vyas mantri ratangarh
of ratangarh carwada 3.3.1972
block yuvak companygress alori
javad. kabriya 3.3.1972
singoli 3.3.1972
5 c . the said pamphlet was also distributed with the
consent of the respondent number 1 by the following persons the
particulars whereaf are as follows-
name of the person place date
ghanshyam patidar village 25.2.72.
jagdishchandra airen dhaneria
shivlal rawat and jawi
advocate of neemuch. tehsil
parasmal s o kanhaiyalal nagori neemuch
the said persons were active workers and agents of the
respondent number 1 and the said parasmal is his son and
agent. the said persons distributed the said pamphlet which
they were carrying on for the respondent number 1.
the statements companytained in the said pamphlet are
false and which the said persons and the respondent number
1 believed to be false and did number believe to be true. 5 d . that the respondent number 1 through the block
congress companymittee javad published an election bulletin
dated 6.3.1972 under the caption of companygress tatha
anya dalo kee sachhi hakeekat and got it distributed
free on a large scale throughout the javad
constituency. in this buletin there is a reference to
an interview with the companygress candidate respondent number
1 in the form of questions and answers. the questions
put to him and answers given by him included the
following question-answers
it is number necessary to reproduce what was published in
the haquikat particularly because the charge of
distribution of the same by kanhayalal on 6th march 1972
in various places such as morwan daroli diken ratangarh
singoli and jhantla is number being pressed by mr. hardy
although evidence was led to that effect in the trial companyrt. in the affidavit annexed to the election petition the
petitioner stated as follows-
the information regarding distribution has been
received as detailed below-
name of the person place of companyrupt practice
committed and para of
the petition
modidas bairagi village newas . . . newad 5 b
madanlal sharma village jawi . . . jawi 5 b c
onkarlal khati village thandoli. . . thandoli 5 b
ramniwas patidar village lasoor. . . lasoor 5 b
mishrilal tailor village diken . . . diken 5 b d
lakshminarayan latha vill ratangarh . ratangarh 5 b d
shankerlal cheran vill garwada aloni. garwada 5 b
aloni
bhanwar singh village kabriya . . . . kabriya 5 b
bapalal son of bhanwarlal vill singoli singoli 5 b d
keshar singh village dhaneria . . . . dhaneria 5 c
khemraj moti jat village morwan . . . morwan 5 d
balooram dhakar village jhatla . . . jhatla 5 d
the petition was companytested only by kanhaiyalal. he
denied the printing publication and distribution of the
aforesaid two pamphlets either by himself or by others with
his companysent. on the pleadings the following issues were raised in the
trial-
whether respondent number 1 kanhaiyalal through
the block companygress companymittee javad got published the
pamphlet saklecha ke karyakal par ek nazar as
reproduced in para 5 a of the petition? 2 a whether respondent number 1 kanhaiyalal and with
his companysent in his presence and under his direction
his agents and workers named in paragraph 5 b of the
petition also distributed the said phmphlet at the
places and on the dates mentioned in the said
paragraph? b i whether the said pamphlet was also
distributed with companysent of respondent number 1
kanhaiyalal by the persons at the places and on the
dates mentioned in paragraph 5 c of the petition? whether the persons named in paragraph 5 c
of the petition were active workers and agents of the
respondent number 1 ? whether the said pamphlet companytained statements
of facts which were false and or which the respondent
number 1 and his alleged agents and workers did number
believe it to be true ? 4 a whether respondent number 1 kanhaiyalal through
the block companygress companymittee javad published the
bulletin as reproduced in para 5 d of the petition and
also got it freely distributed on a large scale and on
the dates mentioned in para 5 d of the petition ? whether the statement of facts in the said
bulletin was false and or which the respondent number 1
did number believe it to be true in regard to the personal
character and companyduct of respondent number 4 ? whether the said statement was calculated to
prejudice the result of the election of respondent number
4 ? to what relief the parties are entitled to? the trial judge answered the first question in favour
of the election petitioner issue number 2 a also in favour of
the petitioner except at the places newad and kabriya issue
number 2 b i 2 b ii and issue number 3 in favour of the
petitioner issue number 4 a also in favour of the petitioner
except at the places dadoli diken and jhantia and issue
number 4 b and c also in favour of the petitioner. the trial
judge answered issue number 5 holding that the petition
deserved to be allowed. mr. nahata who appeared on behalf of the appellant
the returned candidate has addressed us with reference to
all the issues that were held against him. mr. hardy the
learned companynsel on behalf of the petitioner respondent
however did number press the charges
with regard to the distribution of haquikat ex.p-13 . he
also did number press the charges with regard to the
distribution of ex.p-1 by agents and by workers of the
returned candidate with his companysent as alleged in the
election petition some of which have even been held in his
favour by the high companyrt. he however submits that pamphlet
ex.p-1 is a false and libellous document affecting the
personal character or companyduct of the respondent saklecha
and so far as the same was distributed by kanhaiyalal
personally at jawi and thadoli on 2nd march 1972 the
charges have been fully established and this companyrt should
number interfere with the findings of the high companyrt in favour
of the appellant. mr. khanduja appearing on behalf of the
respondent saklecha adopted the submission of mr. hardy in
toto. before we proceed further we should observe that in the
trial the petitioner produced evidence to prove all the
allegations mentioned in the election petition by exaamining
as many as 42 witnesses including himself and by producing
relevant documents. the appellant also gave rebuttal
evidence with regard to all the charges levelled against him
by examining 21 witnesses including himself and by producing
various documents. in this appeal we are companycerned with only one species
of companyrupt practice companytemplated in section 123 4 of the
act. section 123 4 companysists of three types of companyrupt
practices namely 1 the publication of an offending or
incriminating statement by a candidate 2 by his agent
within the meaning of the explanation 1 to section 123 and
3 by any other person with the companysent of the candidate or
his election agent. we are number companycerned in this appeal with
the types in 2 and 3 in view of the stand taken by mr.
hardy and mr. khanduja. we may first examine whether ex.p-1 companyes within the
mischief of section 123 4 . the allegations mentioned in
ex.p-1 if false and believed to be so or number believed to
be true would companye within the mischief of section 123 4 . we have gone through the document and we are clearly of
opinion that the allegations mentioned in the document
relate to the personal character and companyduct of saklecha and
are reasonably calculated to prejudice the prospects of
saklechas election. if the distribution of the same by
kanhaiyalal is established and if it is also established
that the statements of facts therein are false and
kanhaiyalal either believed them to be false or did number
believe them to be true he will be guilty of companyrupt
practice under section 123 4 of the act. since the pamphlet on the face of it is shown as being
printed at shriram printing press neemuch evidence was led
by the petitioner by examining harishankar pw 32 the
proprietor of the press who produced the register
containing the printing orders. he stated that during the
last general elections 5000 companyies of the pamphlet like
ex.p-1 were printed in his press. he was however unable to
state who had companye to place the order as he was indisposed
and his son shivshankar took the order. the entry in the
register also was number made by him but was made by his son
shivshankar who
was number examined in the case. from the entry in the register
ex.p-14 it appears that on 24th february 1972 companygress
committee javad placed orders for printing of 5000 pamphlets
with the caption saklecha ke karyakal par ek nazar. there
is an obvious interpolation in the entry showing that
ghanshyam patidar placed the orders on behalf of the block
congress companymittee but the witness companyld number say who had
made this interpolation. he companyld number identify the
handwriting in the interpolation. the trial judge has numbered
the demeanumberr of this witness stating that it appears that
he did number intend to stick to any particular answer and
tried to change his version as and when he found it
convenient. the petitioner wanted to establish that
ghanshyam patidar who according to him was actively
working for the companygress went to the press for placing the
orders and later on even distributed some pamphlets with the
consent of kanhaiyalal. it is in that companytext that this
interpolation assumes significance. we are unable to hold
that on the evidence of pw 32 the fact of ghanshyam patidar
placing the order is established. there was numberattempt to
examine the son who had personal knumberledge about the placing
of the order. even so we are satisfied that the pamphlets
were printed in this press but it is difficult to hold as to
who placed the orders for printing. that this pamphlet was
printed in order to advance the cause of the companygress
candidate and to prejudice the interests of saklecha cannumber
be in doubt. apart from this the proprietor was prosecuted
for printing this pamphlet for companytravention of the
provisions of section 127a of the representation of the
people act and he was companyvicted on his plea and sentenced
to pay a fine of rs. 50/-. we are therefore satisfied that
the pamphlet was printed in the shriram printing press but
in the absence of the evidence of shivshankar we are unable
to agree with the high companyrt that ghanshyam patidar had
anything to do with the placing of the orders or printing of
ex.p-1. we must next companysider as to when this document came
into existence. the register of the press shows that the
order for ex. p-1 was placed on 24th february 1972 that is
to say about two weeks before the pool and the allegations
of its distribution were on 25th february and on 2nd march
1972. having companye to knumber of the distribution of this
offending pamphlet saklecha companyplained to the returning
officer by a letter dated 26th february 1972 by enclosing
a panchnama testifying to the distribution of the pamphlet
at jawi. although it is number specifically established that
this letter was posted on 26th february 1972 or that it
was received by post by the returning officer it is clear
even from the application on behalf of the respondent
kanhaiyalal for summoning the returning officer that
saklecha had personally handed over this companyplaint to the
returning officer on 5th march 1972 which was definitely
prior to the poll. there is a further fact which has been
established. under the instructions of saklecha hiralal
mehta advocate pw 1 sent out registered numberices dated
27th february 1972 to seven signatories of the pamphlet
ex.p-1 namely parasram agarwal chosarmal bhanwarlal
ghanshyam patidar vijayshankar sharma shankarlal batevara
and dheeraj vyas. some of the witnesses examined on behalf
of the
respondent kanhaiyalal rws 5 6 and 8 admitted to have
received the registered numberices of the advocate to which
they did number send any reply. the fact of denial by ghanshyam
patidar rw 1 is number of much significance. there is
therefore numberdoubt whatsoever that the pamphlet ex.p-1
was in existence during the election period prior to the
date of poll on 8th march 1972.
we are satisfied that 5000 companyies of the pamphlet were
printed in the shriram printing press. evidently these were
printed for the purpose of distribution in order to advance
the cause of the appellant and to harm the interests of
saklecha. we are number companycerned in this appeal with the
distribution of the pamphlet on 25th february 1972. since
these pamphlets were alleged to be distributed on 25th
february 1972 number by the appellant himself but by other
persons the petitioner had also to establish companysent of the
appellant in the distribution. although the high companyrt has
held that even companysent was established mr. hardy has number
pressed his case regarding the allegation of distribution of
the pamphlet on 25th february 1972.
mr. nahata submits that in view of the newspaper
reports and the assembly proceedings in particular the
statements on the floor of the assembly on a vote of no
confidence against the s.v.d. ministry where particular
reference had been inter alia made in severe terms
creating a furore about the activities of saklecha in his
capacity as the deputy chief minister in-charge of the home
department any person reading these will have reasonable
belief that the allegations in ex.p-1 are true and at least
number false. it is also emphasised by companynsel that at numbertime
saklecha ever publicly companytradicted the allegations number
took any action against the publishers. mr. hardy submits that numbere of the companyrespondents of
the newspapers number the authors of the allegations whether
made through the press or on the floor of the house or
through a regular companyplaint were examined by the appellant
to make out even a prima facie case for reasonable belief of
the truth of the wild allegations against the personal
character and companyduct of saklecha. it is submitted by mr.
hardy that the statements made on the floor of the assembly
are privileged and they are also privileged when published
in the authorised organs under the order of the house but
to publish these again without the authority of the house
will number be protected by privilege under article 194 2 of
the companystitution. section 123 4 is a punitive rule against character
assassination of candidates during the period of election. a
charge of electoral companyrupt practices being of a quasi-
criminal character the onus on an election petitioner is
heavy as if in a criminal charge. the allegations must be
established beyond reasonable doubt to the satisfaction of
the companyrt by companyent and unimpeachable evidence. that being
the position in law the petitioner will have to satisfy the
court that the returned candidate had reason to believe that
the allegations in the offending pamphlet were false or number
true. even assuming this ingredient is satisfied since the
charge may fail if it is number established that the appellant
himself distributed the offending pamphlet as
alleged we will immediately address ourselves to that
aspect of the matter. before adverting to the evidence we have to take numbere
of certain factors. ex companycessis the allegations of the
publication of the pamphlet ex.p-1 on 25th february 1972
by the workers and agents with the companysent of the appellant
have to be held as number established. so far as the
distribution of the pamphlet on 25th february 1972 at jawi
and at dhaneria two respective panchnamas were exhibited. a
complaint enclosing a companyy of the panchnama regarding the
distribution of the pamphlet on 25th february 1972 was
lodged before the returning officer and it was received by
him prior to the poll although the exact date was number
proved. so far as the distribution of the pamphlet ex.p-1 on
25th february 1972 there was therefore both oral and
documentary evidence. even so since the appellant was number
associated with the distribution it companyld number be
established that the distribution even if it took place
was with his companysent. the charges relating to the 25th
february 1972 were therefore rightly abandoned before
us. so far as however the distribution of the pamphlet on
2nd march 1972 at jawi and thadoli which alone survives
for companysideration the petitioner relies entirely upon oral
testimony and the companyrt will have to be cautious and
circumspect in accepting the same. this companyrt in rahim khan v. khurshid ahmed ors. 1
dealing with the oral testimony in election cases pithily
observed at page 656 as follows-
we must emphasize the danger of believing at its
face value oral evidence in an election case without
the backing of sure circumstances or indubitable
documents. it must be remembered that companyrupt practices
may perhaps be proved by hiring half-a-dozen witnesses
apparently respectable and disinterested to speak to
short simple episodes such as that a small village
meeting took place where the candidates accused his
rival of personal vices. there is numberx-ray whereby the
dishonesty of the story can be established and if the
court were gullible enumbergh to gulp such oral versions
and invalidate elections a new menace to our electoral
system would have been invented through the judicial
apparatus. we regard it as extremely unsafe in the
present climate of kilkenny cat election companypetitions
and partisan witnesses wearing robes of veracity to
upturn a hard won electoral victory merely because lip
service to a companyrupt practice has been rendered by some
sanctimonious witnesses. the companyrt must look for
serious assurance unlying circumstances or
unimpeachable documents to uphold grave charges of
corrupt practices which might number merely cancel the
election result but extinguish many a mans public
life. ordinarily this companyrt will be slow to interfere with
the findings of the high companyrt regarding appreciation of
evidence except for good
and sufficient reasons. have we good and sufficient reasons
to depart from the findings of the high companyrt ? our answer
is in the affirmative and we will set out the reasons
the high companyrt while dealing with the distribution
of the pamphlet ex.p-1 at jawi by ghanshyam patidar and
others felt assured from the subsequent companyduct on the part
of virendrakumar saklecha in preparing panchnama ex.p-11
instructing advocate hiralal pw 1 to serve registered
numberices ex.p-17 to the distributors of the pamphlet and in
making a companyplaint ex.p-18 to the returning officer
enclosing a panchnama. the high companyrt held that this
subsequent companyduct on the part of virendrakumar saklecha
naturally lends companyroboration to his statement and the
statements of the petitioners witnesses who have deposed
about the publication and distribution of this pamphlet on
the dates referred to by them in their statements. thus on a
consideration of the petitioners evidence i feel satisfied
that the pamphlet ex.p-1 was distributed by ghanshyam
patidar jagdishchandra airen shivlal rawat and parsamal in
jawi and dhaneria as alleged in the petition. the above approach which is companyrect particularly in
an election matter was totally lost sight of by the high
court in dealing with the allegations of distribution of the
pamphlet ex.p-1 by kanhaiyalal at jawi and thadoli on
march 2 1972. the high companyrt did number look for or adopt the
same test with regard to the aforesaid distribution of the
pamphlet ex.p-1 . the high companyrt arrived at a companypletely erroneous
finding regarding the printing of the document ex.p-1 at the
instance of ghanshyam patidar. as shown earlier there was
numberlegal evidence before the high companyrt on which it companyld
come to the companyclusion that the person who got this ex.p-i
printed in the press of pw 32 harishankar was numbere else than
rw 1 ghanshyam patidar on behalf of the javad block companygress
committee. in the absence of any direct evidence from the
press the above finding cannumber be sustained in law from the
fact that ghanshyam patidar denied receipt of and did number
reply to the registered numberice of the advocate and that he
denied his signature in a certain tour programme ex.p-29. the high companyrt companymitted a serious error in linking
up the printing of the document ex.p-1 by ghanshyam patidar
at the instance of kanhaiyalal for which there was no
evidence whatsoever with the distribution of the same by
kanhaiyalal in the companystituency for holding
if the respondent kanhaiyalal had number in any way
been associated with the printing and publication of
this pamphlet then he would number have been one of the
persons who would have distributed this pamphlet as
alleged in paragraph s b of the petition. the high companyrt companymitted an error of law in number dealing with
the two matters of printing of the pamphlet and of its
distribution separately and independently. the high companyrt did number adopt a uniform standard in
appreciating the evidence of the witnesses of the two
contending parties. for example while rw 2 was disbelieved
by the high companyrt holding admittedly he was the pollining
agent of the respondent kanhaiyalal and must have had
sympathies for him during the election period polling
agents of the respondent seklecha did number companye under the
same hostile companyment for rejecting their testimony. it is manifest that the high companyrt was largely
influenced by its finding that the pamphlet was printed by
the javad block companygress companymittee through ghanshyam patidar
at the instance of the appellant. when this finding
disappears as we have shown above the edifice of the
judgment cracks and it is numbermore a matter of mere
reappreciation by us of the evidence simpliciter but of
proper appreciation by us of the evidence simpliciter but
of proper appreciation of only oral evidence produced
regarding distribution of the pamphlet by kanhaiyalal at
jawi and thadoli on march 2 1972 which we will next
undertake. saklecha took care to prepare panchnamas for the
distribution of the offending pamphlets at jawi and dhaneria
on 25th february 1972. he instructed his lawyer to serve
registered numberices on the signatories of the pamphlets and
registered numberices bear the date 27th february 1972.
seklecha lodged a companyplaint dated 26th february 1972 with
the returning officer about the distribution of the pamphlet
enclosing a companyy of the panchnama prepared at jawi on 25th
february 1972. this was quick action indeed. all this
documentary evidence lands companyroboration to the existence of
the pamphlet prior to the poll and even to its circulation. on the other hand there is numberdocumentary evidence of any
complaint or service of lawyers numberice or preparation of a
panchnama regarding distribution of the pamphlet by
kanhaiyalal nagori on 2nd march 1972. it is absurd to
suppose that if kanhaiyalal had actually personally
distributed the pamphlet at jawi and thadoli the matter
would number have taken air and saklecha would number have moved
in the matter. this is particularly so since in the case
of distribution by workers and other persons companysent of
kanhaiyalal was necessary to establish the companyrupt practice
whereas if kanhaiyalal had personally distributed the
charge would have been established without the requirement
of proof of companysent. so far as the distribution of the pamphlet ex. p-1 at
jawi on 2nd march 1972 is companycerned we have the evidence
of pws. 2 3 4 and 5 on behalf of the petitioner and rws
15 16 17 and 21 in rebuttal on behalf of the appellant. madanlal pw 2 nanalal pw 3 mohanlal pw 4 and
ramshankar pw 5 stated about distribution of the pamphlet
ex. p-1 by kanhaiyalal and shankarlal bhatevara at jawi
bazar on march 2 1972.
there is a significant revelation in the evidence of
madanlal pw 2 which the high companyrt has absolutely failed
to companysider. according to madanlal he did number personally
knumber about the pamphlet being distributed on 25th of
february 1972 at jawi. he also did number see a panchnama
being prepared. he deposed only about the distribution
of the pamphlet by kanhaiyalal and shankarlal bhatevara at
jawi about five or six days before the date of poll. this
would show that he was deposing only with regard to the
distribution of the pamphlet by kanhaiyalal on 2nd march
1972. he stated in his evidence
i met saklecha the same day when i saw ex.p-1. i
had a talk with saklecha regarding the pamphlet ex. p-
1.
he further stated that-
this pamphlet was given to me by kanhaiyalali
handed over the same pamphlet to saklecha which was
given to me by kanhaiyalal. if the above statements are true he met saklecha on 2nd
march 1972. in the way saklecha reacted to the distribution
of the pamphlet on 25th february 1972 his utter inaction
with regard to the distribution of the pamphlet by
kanhaiyalal on 2nd march 1972 is absolutely inexplicable. the absence of any companyplaint to the returning officer
against kanhaiyalal even after receipt of the information
and the pamphlet from madanlal would go to show that the
entire allegation regarding kanhaiyalals distribution of
the pamphlet is an after-thought to reinforce the charge
against the returned candidate. in the way sakclecha was
following a certain procedure of his own regarding the
alleged illegal activities of the appellants campaigners
there was numberreason why a panchnama would number have been
prepared at jawi on 2nd march 1972 when madanlal informed
him about kanhaiyalals distribution of the pamphlet which
was even handed over to him that very evening. we find that madanlal pw 2 is companytradicted by nandlal
pw 3 . although madanlal who is the in formant about the
distribution of the pamphlet by kanhaiyalal at jawi on 2nd
march 1972 denied the fact of the panchnama being prepared
on 25th february 1972 at jawi nanalal pw 3 stated
while the panchnama was under preparation
ramshankar madanlal tiwari who has been examined to-
day and two others had also companye there. it is difficult to appreciate why madanlal had suppressed
the fact of his knumberledge of the panchnama prepared on 25th
february 1972. it will be relevant to numbere here that in the
affidavit annexed to the election petition madanlal has
been shown as the informant regarding the distribution of
the pamphlet at jawi on 25th february as well as on 2nd
march 1972. madanlal however in his evidence disowns
personal knumberledge about the distribution of the pamphlet on
25th february 1972. according to nanalal pw 3 after the
preparation of the panchnama on 25th february 1972
saklecha addressed a meeting in front of his shop by the
public address system. madanlal pw 3 also deposed that he
only saw once saklecha addressing some persons assembled in
front of nanalals shop by the public address system. he
further stated that he handed over the pamphlet to saklecha
on that date. this falsifies his evidence regarding march 2
1972.
madanlals statement about distribution of the pamphlet by
kanhaiyalal to him on 2nd march 1972 is open to grave
suspicion rather smacks of padding. madanlal is admittedly a member of the jan sangh party
although according to him he is number an active worker. since his evidence is intrinsically unaceptable it is number
necessary to refer to the various companytradictions in his
evidence. to mention one instance only he companytradicted
himself in the cross-examination when he stated that some
time before the pamphlet was given to me by kanhaiyalal i
got anumberher companyy of the same pamphlet from some boys in the
village earlier and that was given by me to saklecha. i
cannumber say if the pamphlet given to me by kanhaiyalal is or
is number still with him sic . nanalal pw 3 deposed to the distribution of the
pamphlet at jawi on 25th february as well as on 2nd march
1972. in the companyrse of cross-examination he stated that he
did number personally tell anyone that kanhaiyalal had
distributed the pamphlet in the village. he did number have any
talk with nanalal agarwal the petitioner regarding the
pamphlet. he further stated that when kanhaiyalal nagori
gave the pamphlet to him he was the only person present in
his shop. he admmitted that on the date of poll he acted as
a polling agent of saklecha. if the same standard has to be
adopted which the high companyrt has done with regard to the
appreciation of the evidence of shivlal rawat rw 2 whose
testimony was rejected because he acted as the polling agent
of kanhaiyalal nanalals evidence would have to be treated
in the same manner. even by the standard adopted by the high
court the testimony of this witness cannumber be accepted. mohanlal jain pw 4 is the second grocer examined on
behalf of the petitioner. he deposed to the distribution of
the pamphlet on both the dates on 25th february and on 2nd
march 1972. he admitted that he exhibited posters and put
up banner of the jan sangh party. he is therefore a highly
interested witness. he also admitted that he did number tell
anyone that any pamphlet had been given to him by
kanhaiyalal. his evidence also cannumber be acted upon. the last witness examined with regard to jawi
distribution is ramshankar pw 5 a real brother of
madanlal pw 2 . the evidence of madanlal about distribution
in jawi is that the offending pamphlet was distributed to
all the shopkeepers and to also those who met them. it
appears that the jawi bazar has about eight or nine shops. yet only two shopkeepers namely nanalal and mohanlal jain
were examined madanlal and his brother ramshankar are
cultivators and number shopkeepers at jawi bazar. as against
this the appellant examined two shopkeepers of jawi namely
ratanlal rw 15 and gordhanlal rw 16 who denied the
distribution of the pamphlet by kanhaiyalal. kanhaiyalal
himself also stated on oath that he did number distribute the
pamphlet number accompanied shankarlal bhatevara for the
purpose of distribution of the pamphlet. similarly
shankarlal bhatevara pw 8 also denied the distribution. it
is number even necessary to closely scrutinise the evidence of
the appellant and his witnesses when we are satisfied that
the petitioner has number been able to establish the
allegations about the distribution of the pamphlet by
kanhaiyalal at jawi on
2nd march 1972. we are of opinion that the high companyrt is
number right in its companyclusion that the charge of distribution
of pamphlet by kanhaiyalal at jawi is established against
the appellant. this takes us to the distribution of the pamphlet by
kanhaiyalal on 2nd march 1972 at thadoli. onkarlal khati
pw 9 was the informant regarding the distribution at
thadoli. according to him about five or six days before the
date of poll he was sitting with a few others by the side of
the village temple when he saw kanhaiyalal nagori and
shankarlal bhatevara companying to them. amongst others
tulsiram pw 7 and bhanwarlal pw 8 were also sitting with
him. he stated that kanhaiyalal told them that the jan sangh
candidate was being elected for the last fifteen years and
the companystituency was very much handicapped and that this
time the companygress candidate should be elected. then he
distributed the pamphlet similar to ex. p-1. the pamphlet
was distributed both by kanhaiyalal and shankarlal
bhatevara. he further stated that about six days after the
poll he met mannalal and talked to him about the incorrect
statement circulator in the form of pamphlet which affected
the result of the election. in the companyrse of cross-
examination he stated that kanhaiyalal and shankarlal
bhatevara were number accompanied by any person on that day. he
denied that he was a jan sangh worker. he did number preserve
the pamphlet which was given to him and it was destroyed
after he had read it. two other witnesses are tulsiram pw
7 and bhanwarlal pw 8 to companyroborate him about the
distribution of the pamphlet by kanhaiyalal and shankarlal
bhatevara five or six days before the date of poll. amongst these tulsiram was a polling agent for saklecha
at thadoli as has been admitted by saklecha himself. this
witness however suppressed this fact and denied that he
was a polling agent of saklecha. bhanwarlal pw 8 similarly deposed that five or six
days before the date of poll when he and others were sitting
in the temple precincts he saw kanhaiyalal and shankarlal
bhatevara companying to them and after some canvassing both of
them distributed pamphlets like ex. p-1. we are invited to rely on the above oral testimony to
hold that kanhaiyalal distributed the offending pamphlet. kanhaiyalal rw 21 and shankarlal bhatevara rw 8
have denied the allegations. the appellant also examined
mangilal of thadoli rw 18 to state that tulsiram
bhanwarlal and onkarlal are the jan sangh party workers at
thadoli. he was admittedly a person who accompanied the
distributors to the village. there is thus practically oath
against oath with regard to the distribution of the pamphlet
by kanhaiyalal at thadoli. to summarise this part of the case the high companyrt
while deciding about the truth or otherwise of the
allegations of distribution of the pamphlet by kanhaiyalal
at thadoli as also in other places seems to have a large
degree of assurance from its finding that the offending
pamphlet was got printed by kanhaiyalal through ghanshyam
patidar. that finding as shown above numberlonger survives. we are number only left with the oral testimony of pws 7 8 and
9 regarding distribution of the pamphlet at thadoli by
kanhaiyalal and shankarlal bhatevara. these three witnesses
are pitted against three others kanhaiyalal rw 21
shankarlal rw 8 and mangilal rw 18 stating to the
contrary. mangilal was admittedly in the companypany of the
distributors of the pamphlet when they entered thadoli
village. mangilal as rw 18 denies the visit of kanhaiyalal
to thadoli. again pw 7 speaks with two voices regarding the
day of kanhaiyalals visit to thadoli for the purpose of
distribution of the pamphlet. he stated at first that it was
ten or twelve days before the poll and then said about five
or six days before the poll. bhanwarlal pw 8 saw kanhaiyalal and shankarlal
bhatevara companying on foot and only heard the sound of vehicle
coming near the village. pw 7 saw them companying in a motor
vehicle. they were all sitting together and even then they
are discrepant as to how kanhaiyalal and shankarlal
bhatevara came there. pw 8 makes a curious statement in
cross examination
all those who were sitting by my side had seen
the distribution of pamphlets. besides them i did number
tell anyone about the distribution of pamphlets. it passes ones companyprehension why he had to tell them. he
also stated that-
besides shankarlal and kanhaiyalal there was no
other person who accompanied them. on the other hand according to pw 7 bhanwarlal sutar and
mangilal mahajan accompanied them when they entered the
village after parking the car outside. onkarlal pw 9 stated in examination-in-chief
about six days after the polling i met mannalal
in neemuch dhan mandi where he enquired from me about
the result of the election. i then told him as to what
was the result. i also talked to him about the
incorrect statement circulated in the form of
pamphlet. in the companyrse of cross-examination he stated
the only talk that i had with mannalal was that
the false pamphlets had its effect on the election. at
that time i had numberother talk with him. whatever be the effect of the above statements which
mr. hardy wanted to explain away it is clear that pw 9 did
number mention at all that he had told the petitioner
mannalal the names of kanhaiyalal and shankarlal bhatevara
as distributing the pamphlet at thadoli. on the other hand
he referred to the only talk which he had about the
effect of the pamphlet. he also admitted that his talk with
mannalal was only a casual talk. this is number the quality of
evidence we expect from the only informant of the
publication of the pamphlet at thadoli. we have referred to some of the above incongruities and
inconsistencies in the evidence of pws 7 8 and 9 in order
to show how unsafe it is to rely merely on oral testimony
which is number vouchsafed from any other safe source. it is true that the high companyrt has relied upon the oral
testimony of the above witnesses but we express grave doubt
if the high companyrt would have based its decision to upset an
election merely on their oral testimony if it had number companye
to companyclusion that kanhaiyalal had earlier got the offending
pamphlet printed at the press. the latter finding had
obviously its decisive effect on the mind of the learned
trial judge. we are unable to suppose that saklecha would number knumber
of such illegal activities of his opponent if true. it is
alleged that the offending pamphlets had been distributed by
kanhaiyalal in a number of places in the companystituency
commencing from march 2 and ending on march 6 1972 in one
case even in a bus stand watched by the petitioner. it is
impossible to imagine that such nefarious activities if
true would number reach the ears of saklecha with his network
of workers and companypaigners for the purpose of the election. between march 2 and march 8 numbercomplaint had been made by
saklecha or by anyone regarding distribution of the
offending pamphlet by kanhaiyalal. we are therefore unable
to hold that a serious charge of this nature is established
on the mere oral testimony of the aforesaid three witnesses. before companycluding we may only refer to the petitioner
mannalals evidence to highlight how far oral testimony can
go. both kanhaiyalal and mannalal are residents of village
daroli. it is the evidence of mannalal pw 42 that
kanhaiyalal distributed the offending pamphlet ex. p-1 on
2nd march 1972 at daroli to him and to many others. although we are number companycerned with the distribution of the
pamphlet by kanhaiyalal at daroli in this appeal it is
absurd that kanhaiyalal would choose to hand over an
offending pamphlet of this nature to mannalal who is an
active worker of jan sangh party and keen supporter of
saklecha unless he foolishly chose to create evidence
against him. it is true that the charge regarding
distribution at daroli is number pressed before us but we
cannumber close our eyes to the extent to which the petitioner
could go in levelling charges of companyrupt practice against
the appellant. oral testimony therefore will have to be judged with
the greatest care and an electoral victory cannumber be allowed
to be nullified by a mouthful of oral testimony without
contemporaneous assurance of a reliable nature from an
independent source. the matter would have been different if
there had been an immediate written companyplaint to the
returning officer against kanhaiyalal as had been made in
the case of his workers. an election dispute is number a private feud between one
individual and anumberher. the whole companystituency is intimately
involved in such a dispute. shaky and wavering oral
testimony of a handful of witnesses cannumber still the
dominant voice of the majority of an electorate. we are therefore clearly of opinion that the
distribution of the pamphlet ex. p-1 by kanhaiyalal at
jawi and thadoli has number been satisfactorily established on
the oral testimony of the witnesses. it is therefore number necessary to deal with the
submission of mr. nahata as to whether kanhaiyalal had
reason to believe that the statements of facts in ex. | 1 | test | 1976_93.txt | 1 |
civil appellate jurisdiction civil appeal number 404 of
1984.
appeal by special leave from the judgment and order
dated the 11th july 1983 of the patna high companyrt in
w.j.c. number 623 of 1983.
dr. l.m. singhvi mrs. lakshmi kant pande s.k. sinha
for the appellant. goverdhan b.b. singh for the respondents. the following judgments were delivered
fazal ali j. the most difficult and delicate task of
our founding fathers while framing the companystitution of the
largest democracy in the world was to protect preserve and
safeguard the interests of the minumberities and the backward
classes in order to retain the secular nature of our
constitution. perhaps they feared that a time may companye when
the overwhelming majority may overshadow or dominate devour
of destroy the educational cultural and social rights of
the minumberities and wreck their individuality and
personality. it was this central theme that runs through the
entire companystitution which has provided sufficient safeguards
to protect and preserve the minumberity educational
institutions which is the most important and vocal medium
through which this section of the society can speak and seek
to redress its grievances. in this appeal we are merely companycerned with the rights
and obligations of the state for the protection of minumberity
institutions and for this avowed purpose art. 30 was
enshrined in our companystitution so that they may number suffer
from a sense of inferiority companyplex and are able to through
themselves into the main stream of the econumberic and
political life of the companyntry so as to march forward with
the temper of the times and the needs of the nation although
art. 30 is number included in part ii of the indian
constitution which guarantee certain fundamental rights. yet this companyrt starting from the kerala education eills
case. which is the locus classicus on the point in issue
right up to the case of the ahmedabad st. xaviers companylege
society anr etc. v. state of gujarat anr. and ending
with all sainis high school hyderabad ors. v. government
of
andhra pradesh ors. has clearly recognised that running of
minumberity institutions is also as fundamental and important
as the rights companyferred on the other citizens of the
country. perhaps the only difference is that the rights
contained in art. 30 have an independent sphere of their
own. a close scrutiny and study of the various decisions of
this companyrt reveal that the freedoms guaranteed by art. 30
are also elevated to the status of a full-fledged
fundamental right within the field in which they operate. in
other words any state action which in any way destroys
curbs or interferes with such rights would be violative of
art. 30.
in the instant case we are mainly companycerned with the
rights privileges and status of minumberity institutions. in
dwelling on these matters four important aspects or facets
have been companysidered by this companyrt viz. 1 right of the minumberity institutions to get aid from
the government
2 right to get affiliation from the universities
3 nature and extent of the autonumbery which such
institutions enjoy in their internal discipline
and administration and
4 right to be protected from undue or repeated
interference in the independence of the
institutions in the garb of achieving excellence
in the standard of education. the first question to be determined is whether the
minumberity institutions have a fundamental right to get aid
from the government or affiliation from the universities as
a matter of companyrse. in other words the question posed is
whether the right to affiliation or to number so as to violate
art. 30. technically speaking the answer to this question is
in the negatives but it must be stressed that the refusal to
give aid or affiliation by the statutory authorities without
just and sufficient grounds amounts to violation of the
fundamental freedoms enshrined in art 30 of the
constitution. if the government withholds giving aid or a
university refuses to grant affiliation the direct
consequence would be to destroy the very existence of the
institution itself because there may be a number of minumberity
institutions which may number exist without the government aid
and a large
number of students admitted to these institutions in the
absence of affiliation will be deprived of acquiring higher
academic status which will number only be a loss to the
institution but a loss to the nation itself. it is for this
purpose that art 30 was inserted in the companystitution. in the present case we would like to companyfine our
judgment only to the question of refusal of affiliation to a
minumberity institution by the state and the university. to
begin with in kerala education bills case supra das
j speaking for the majority venkatarama aiyar j.
having given his separate judgment observed thus
the minumberities evidently desire that education should
be imparted to the children of their companymunity in an
atmosphere companygenial to the growth of their culture. our companystitution makers recognised the validity of
their claim and to allay their fears companyferred on them
the fundamental rights referred to above they also
desire that scholars of their educational institutions
should go out in the world well and sufficiently
equipped with the qualifications necessary for a useful
career in life. but the scholars of unrecognised
schools are number permitted to avail themselves of the
opportunities for higher education in the university
and are number eligible for entering the public services. without recognition therefore the educational
institutions established or to be established by the
minumberity companymunities cannumber fulfil the real objects of
their choice and the rights under art 30 1 cannumber be
effectively exercised. the right to establish
educational institutions of their choice must
therefore mean the right to establish real
institutions which will effectively serve the needs of
their companymunity and the scholars who resort to their
educational institutions. there is numberdoubt numbersuch
thing as fundamental right to recognition by the state
but to deny recognition to the educational institutions
except upon terms tantamount to the surrender of their
constitutional right of administration of the
educational institutions of their choice is in truth
and in effect to deprive them of their rights under
art. 30 1 . we repeat that the legislative power is
subject to the fundamental rights and the legislature
cannumber indirectly take away or abridge the fundamental
rights which it companyld number do directly and yet that will
be the result if the said bill companytaining any offending
clause becomes law. emphasis ours
the observations and the ratio of this case were fully
affirmed
and expounded by this companyrt in a 9-judge bench decision in
st. xaviers companylege case supra where all the judges
speaking in the same strain held that withholding of aid or
affiliation in such a manner as to destroy or efface the
autonumbery and individuality of a minumberity institution
violates art. 30. in this companynection the judges by separate
judgements made the following observations-
the companysistent view of this companyrt has been that there
is numberfundamental right of a minumberity institution to
affiliation. an explanation has been put upon that
statement of law. it is that affiliation must be a real
and meaningful exercise for minumberity institutions in
the matter of imparting secular education. any law
which provides for affiliation on terms which will
involve abridgement of the right of linguistic and
religious minumberities to administer and establish
educational institutions. of their choice will offend
article 30 1 . the educational institutions set up by
minumberities will be robbed of their utility if boys and
girls cannumber be trained in such institutions for
university degrees. minumberities will virtually lose
their right to equip their children for ordinary
careers if affiliation be on terms which would make
them surrender and lose their rights to establish and
administer educational institutions of their choice
under article 30the establishment of a minumberity
institution is number only ineffective but also unreal
unless such institution is affiliated to a university
for the purpose of companyferment of degrees on students. affiliation of minumberity institutions is intended
to ensure the growth and excellence of their children
and other students in the academic field. affiliation
mainly pertains to the academic and educational
character of the institution. ray c.j. we agree with the judgment of honble the chief
justice just pronumbernced and with his companyclusions that
ss. 40 41 33a 1 a 33a 1 b 51a and 52a of the
act violate the fundamental rights of minumberities and
cannumber therefore apply to the institutions
established and administered by them. the right under art. 30 cannumber be exercised in
vacuo. number
would it be right to refer to affiliation or
recognition as privileges granted by the state. in a
democratic system of government with emphasis on
education and enlightenment of its citizens there must
be elements which give protection to them. the
meaningful exercise of the right under art. 30 1 would
and must necessarily involve recognition of the secular
education imparted by the minumberity institutions without
which the right will be a mere husk. this companyrt has so
far companysistently struck down all attempts to make
affiliation or recognition on terms tantamount to
surrender of its rights under art. 30 1 as abridging
or taking away those rights. again as without
affiliation there can be numbermeaningful exercise of the
right under art. 30 1 the affiliation to be given
should be companysistent with that right. number can it
indirectly try to achieve what it cannumber directly do. jaganmohan reddy j. i am of the view that it is permissible for the
state to prescribe reasonable regulations like the one
to which i have referred earlier and make it a
condition precedent to the according of recognition or
affiliation to a minumberity institution. it is number
however permissible to prescribe companyditions for
recognition or affiliation which have the effect of
impairing the right of the minumberity to establish and
administer their educational institutions. affiliation
and recognition are numberdoubt number mentioned in article
30 1 position all the same remains that refusal to
recognize or affiliate minumberity institutions unless
they the minumberities surrender the right to administer
those institutions would have the effect of rendering
the right guaranteed by article 30 1 to be wholly
illusory and indeed a testing illusion. what is said above with regard to aid or
recognition applies equally to affiliation of a companylege
to the university because but for such affiliation the
student will number be able to obtain a university degree
which is recognized as a passport to several
professions and future employment in public service. if the companyversion of affiliated companyleges of the
minumberities
into companystituent companyleges companytravenes article 30 1
the fact that such companyversion is in pursuance of a
scheme which permits the grant of autonumbery to an
individual companylege would number prevent the striking down
of the impugned provision. emphasis ours
khanna j. over the year this companyrt has held that without
recognition or affiliation there can be numberreal or
meaningful exercise of the right to establish and
administer educational institutions under article
30 1 . the heart of the matter is that numbereducational
institution established by a religious or linguistic
minumberity can claim total immunity from regulations by
the legislature or the university if it wants
affiliation or recognition but the character of the
permissible regulations must depend upon their purpose. as we said such regulations will be permissible if
they are relevant to the purpose of securing or
promoting the object of recognition or affiliation. mathew j. it is true that if the object of an enactment is
to companypel a minumberity institution even indirectly to
give up the exercise of its fundamental rights the
provisions which have this effect will be void or
inumbererative against the minumberity institution the price
of affiliation cannumber be a total abandonment of the
right to establish and administer a minumberity
institution companyferred by art 30 1 of the
constitution. this aspect of the matter therefore
raises the question whether any of the provisions of
the act are intended to have that effect upon a
minumberity institution. even if that intention is number
manifest from the express terms of statutory
provisions the provisions may be vitiated if that is
their necessary companysequence or effect. beg j. however in case of an affiliating university
affiliation cannumber be denied to a minumberity institution
on the sole ground that it is managed by a minumberity
whether based on religion or language or on arbitrary
or irrational basis. such a denial would be violative
of arts. 14 and 15 1 and will be struck
down by companyrts. again art 13 2 prohibits the state
from taking away or abridging the right under art
30 1 . since the state cannumber directly take away or
abridge a right companyferred under art. 30 1 the state
cannumber also indirectly take away or abridge that right
by subjecting the grant affiliation to companyditions which
would entail the forbidden result. diwedi j. on a careful and detailed review of the cases cited
above the following position emerges
1 that while art 30 undoubtedly seeks to preserve
the religious freedom autonumbery and its
individuality there is numberfundamental right under
which an institution can claim either aid or
affiliation as a matter of right. it is
permissible for the state or the university as
the case may be to lay down reasonable companyditions
to maintain the excellence of standard of
education but in the garb of doing so refusal to
grant affiliation cannumber be made a ruse or pretext
for destroying the individuality and personality
of the said institution. if this is done then
apart from being wholly arbitrary and unreasonable
it would amount to a clear infraction of the
provisions of art 30 because what cannumber be done
directly is done indirectly. while the state or a university has got an
absolute right to insist on certain companyrses of
study to be followed by institutions before they
could be companysidered for affiliation but these
conditions should number in any way take away the
freedom of management or administration of the
institution so as to reduce it to a satellite of
the university or the state. this is wholly
impermissible because such a companyrse of action
directly violates art. 30 of the companystitution. while imposing companyditions before granting
affiliation as indicated above the state or the
university cannumber kill or annihilate the
individuality or personality of the institution in
question by insisting on following a particular
kind of syllabus or a companyrse of study which may be
directly opposed to the aims objects and ideals
sought to be achieved by the institutions. there is a very thin line of distinction between
withholding of affiliation for a particular
purpose on extraneous grounds so as to subject the
institution to rigorous orders edicts or
resolutions which may run companynter to the dominant
purpose for which the institution has been
founded and insisting on genuine and reasonable
conditions to be imposed in the larger interest of
education. thus all the authorities mentioned above clearly laid
down that while affiliation itself may number be a fundamental
right but refusal of affiliation on terms and companyditions or
situations which practically denies the progress and
autonumbery of the institution is impermissible as being
violative of art. 30 of the companystitution. it is number
necessary for us to dwell on the other aspects of the matter
because we are number companycerned with them in this particular
case. we number proceed to discuss the facts of the present case
which we are companystrained to observe reveal a most
distressing and disturbing attitude exhibited by the
university and the government of bihar as well. in fact the
reason and the motive for refusing affiliation to the milli
talimi mission bihar ranchi are so obvious and manifest
that even the standing companynsel for the state of bihar
despite his best efforts found himself unable to support
the action of the university. we are indeed amazed how the
respondents have behaved in filing their affidavits in the
highest companyrt of the land and have violated the express
orders of this companyrt with impunity. in order to buttress
what we have said it may be necessary to give a short
history of the institution in question. the institution in dispute milli talimi mission bihar
ranchi was started as a teachers training companylege under a
society which was established as for back as 1972 though
the companylege itself was established and started in july 1977.
on 22.9.1977 the institution made an application to the
government for grant of affiliation or recognition of the
same in response to which a most extraordinary order was
passed by the government directing the universities for
refusing affiliation on the strange ground that all
proposals for affiliation by the number-government teachers
training companyleges be rejected and that numberstudent be allowed
to appear as a private candidate. however in the case of
minumberity institutions the state government in sub-para 3
of paragraph 1 stated thus
the above decision as described vide decision number. 1 and 2 above shall number be applicable in cases of
colleges run by the minumberity companymunity. government
decision in this regard to their cases shall be
intimated separately. in view of the above it was incumbent on an
institution to prove that it was a minumberity institution
before it companyld be granted affiliation. thereafter on
24.2.1978 the appellants filed an application before the
ranchi university for grant of affiliation. this was
followed by issue of bihar number-government teachers training
college ordinance on june 5 1978. on june 15 1978 the
government wrote to the ranchi university for inspection of
the appellants companylege. on 13.8.1979 the government
numberified that the decision regarding affiliation would be
governed by its circular dated 1.10.1973 annexure b which
laid down certain companyditions for grant of affiliation and
that with regard to the minumberity institutions a final
decision would be taken later. thereafter a writ was filed
in the patna high companyrt where it was decided that section 2
of the ordinance referred to above would number apply to
minumberity training companyleges. on 6.2.1980 joint secretary to
the government of bihar sent letters to the ranchi
university and the deputy companymissioner ranchi for
inspection of the appellants companylege. it would appear that
although the institution applied for affiliation in 1977 and
claimed to be a minumberity institution which was never
disputed at any point of time yet it took three years for
the government to take a decision about affiliation of the
appellants companylege. on 5.3.1980 the university authorities inspected the
appellants companylege and recommended its affiliation which
was followed by a report by the district development
officer ranchi on 30.6.1980 recommending affiliation. but
despite these facts numberfinal decision was taken by the
government as a result of which the appellants had to move
the high companyrt again for directing the government to grant
affiliation and the high companyrt gave a direction to the
government to decide recognition and affiliation of the
appellants companylege within a specified time. on 3.11.80 the
government granted recognition and approval for affiliation
for three sessions only i.e. 1977-78 1978-79 and 1979-80.
on 10.11.1980 the university wrote to the government
recommending grant of affiliation to the appellants
college. on 22.11.1980 the appellants applied for grant of
permanent affiliation. but somehow or the other on
27.11.80 for undisclosed reasons
the government passed a strange order cancelling the
recognition and approval for affiliation granted to the
appellants companylege vide its letter dated 3.11.80. this
order was challenged before the high companyrt which quashed the
same on 18.5.81.
thereafter on 17.8.81 the state of bihar filed a
special leave petition before this companyrt which was dismissed
on 30.11.81. however on 7.9.81 three minumberity companyleges
alongwith the appellants companylege were granted recognition
and affiliation by the government. ultimately the high companyrt had to be moved again which
directed the state government to dispose of the application
of the appellants for permanent recognition which was filed
by them on 22.11.80. on 16.9.82 the education companymissioner
bihar again made a recommendation for grant of affiliation
to the appellants companylege which may be extracted thus
in this companynection the numberings of the joint secretary
may kindly be seen at pages 62-64. also the judgment of
the high companyrt be seen at page 137 according to which
the restrictions of the ordinance is number applicable to
minumberities institutions. in addition to this this
institution has also been got inspected in which the
local authorities were present. there is unanimous
recommendation that this training institution be
affiliated. the recommendation of the university may
kindly be seen at p. 150. accordingly this companylege be
temporarily granted recognition and affiliation for the
sessions 1980-81 to 1982-83 for the present. a perusal of the above recommendation shows that the
institution in question was inspected in the presence of the
local authorities as also the university authorities who
unanimously recommended that the institution was a minumberity
institution and should be granted affiliation and
recognition at least for the session 1980-81 to 1982-83
despite this numberhing tangible seems to have happened which
compelled the appellants to file anumberher writ petition in
the high companyrt on 3.5.1983 for examination of the students
of the appellants companylege who had passed the 1982-83
session. but the writ petition was dismissed by the high
court in limine. hence this appeal by special leave to this
court. after leave was granted we directed the respondents to
produce ex. j. education companymissioners recommendation and
the data on
the basis of which the companycerned authorities had recommended
that affiliation should be granted to the appellants companylege
but till today numberattempt has been made to produce those
documents and the learned companynsel for the state of bihar was
unable to give any explanation for this most extraordinary
action on the part of the state government. the state has filed an affidavit raising all sorts of
pleas which companyld number be supported by the companynsel for the
state. it would appear that practically numberreasons were
given by the state as to why despite the recommendations of
several authorities which were made after a full and proper
inspection the affiliation was refused. in paragraph 7 of
one of the affidavits filed by the respondents it is
mentioned that before grant of affiliation the following
conditions must be fulfilled by an institution-
a that there must be full-time qualified principal
and lecturers in proportion of 1 15
b the institution must have a recognised high school
attached to it
c it must have sufficient land of its own to provide
adequate accommodation for classrooms hostels
play-grounds residences of lecturers gymnasium
canteen etc. and the companylege must run during the
day time like the schools
d the admission registers attendance registers to
be properly maintained
e that in numbercase it will charge capitation fee or
any tuition fee from students. f that there should be residential accommodation for
at least one-fourth of the staff. g that hostel accommodation to at least one-fifth of
the students is provided
h that there should be a stable source of income to
run the companylege. it is manifest that if these companyditions were fulfilled
then affiliation companyld be granted as a matter of companyrse on
the findings and decision taken by the government itself. in
reply to the affidavit filed by the
appellants the defence of the state was that after
inspection of the institution it was found by a team of
inspectors that the institute suffered from the following
infirmities-
there were numberfull-time qualified principal or
lecturers. that there was numberrecognised school attached to
it. the companylege runs during evening hours which makes
impracticable for practice classes in schools
which run during day time. the companylege had numberbuilding of its own. the library and laboratory were number properly
maintained. it is rather strange that while a previous expert
committee after inspecting the said institute found it in
order but subsequently the government without referring to
the data submitted by the expert companymittee which was the
basis of ex. j. seems to have suddenly given a go-bye to the
same and taken the defence that in view of the defects and
number-fulfilment of the companyditions it was number possible to
grant affiliation without even mentioning in what manner and
to what extent the recommendation of education companymissioner
and the materials on which it was based was wrong and why
the five new companyditions were sought to be imposed. despite repeated orders of this companyrt to the
respondents to produce the report of the education
commissioner and the details thereof the same was number done
and a belated attempt was made to show that there were
certain defects in the institution. in view of the number-
production of the most important and decisive material we
are unable to accept the subsequent affidavit of the
respondents which is numberhing but an afterthought. the state government in its companynter-affidavit has
stated that it was prepared to grant affiliation to the
appellants companylege on fulfilling certain companyditions. we are
however satisfied that this is numberhing but a pretext or a
smoke-screen to cloud the real issue. indeed if the
government meant business it should have the companyrage to
produce the report on which ex. j. was based which has been
deliberately suppressed despite our orders to produce the
same. we are therefore companypelled to draw an adverse
inference against the state
government to the effect that if the materials on which
the report was based had been produced it would have
exploded the case of the government and disclosed the real
state of affairs viz that the appellants institute does
fulfil all the companyditions imposed by the state. thus the position is that the state has refused to
grant affiliation on purely illusory grounds which do number
exist and failed to companysider the recommendation of the
education companymissioner which was made after full inspection
for grant of affiliation. in other words the affiliation
was refused without giving any sufficient reasons and such a
refusal companytravenes the provisions of art. 30 of the
constitution. for the reasons given above we find that this is a fit
case where this companyrt should step in to strike down the
government action which is violative of art. 30 of the
constitution and which does number fall within the guidelines
indicated in the various authorities cited in our judgment. the heart of the matter is that as the government did number
like the recommendation of the education companymissioner and
was number prepared to grant affiliation for undisclosed
reasons the act of the government was a companyourable exercise
of jurisdiction which deprived the appellants institution
of its companystitutional rights. numbermally this companyrt does number grant companyts in such cases
but having regard to the manner in which the state
government has behaved and exhibited its reluctance to
perform a companystitutional duty and has also tried to disobey
our orders for production of certain documents we must
impose a heavy companyt on the state. we therefore allow this appeal with companyts quantified
at rs. 5000 rupees five thousand only to be paid to the
appellants within three months from today set aside the
order of the high companyrt dismissing the writ petition in
limine as also the order of the government refusing
affiliation and peremptorily direct the government to grant
affiliation to the appellants companylege and allow its
students of the 1980-81.1981-82 and 1982-83 sessions to sit
in the examination both written and practical as the case
may be. we would however like to add that if there are
cogent reasons and sufficient material before the state or
the university to show that the appellants institute has
number fulfilled the companyditions which may be imposed hereafter
it is open to it to withdraw the affiliation provided the
conditions imposed are reasonable and justifiable. sabyasachi mukharji j. i agree with the order proposed
by my learned brother justice fazal ali. for the purpose of
disposing of this appeal it is sufficient to state that on
the 5th march 1980 the university authorities inspected the
appellants companylege and recommended its affiliation which
was followed by a report by the government on 30 june. 1980
recommending affiliation. but despite these numberfinal
decision was taken by the government as a result of which
the appellants had to move the high companyrt for directing the
government to decide recognition and affiliation of
appellants companylege within a specified time. on 3rd
numberember 1980 the government granted recognition and
approval for affiliation for three sessions namely 1977-78
1978-79 and 1979-80. on the 10th numberember 1980 the
university wrote to the government recommending grant of
affiliation. on 22nd numberember 1980 the appellants applied
for grant of permanent affiliation. but the government on
27th numberember 1980 passed an order cancelling the
recognition and approval for affiliation granted to the
appellants companylege vide its letter dated 3rd numberember
1980. this order was challenged before the high companyrt. the
high companyrt quashed the said order dated 27th numberember 1980
on 18th may 1981. on the 17th august 1981 the state of
bihar filed a special leave petition before this companyrt which
was dismissed on 30th numberember 1981. the high companyrt was
moved again for directing the state government to dispose of
the application of the appellants for permanent recognition
which was filed by them on 22nd numberember 1980. on the 16th
september 1982 the education companymissioner bihar again made
a recommendation for grant of affiliation to the appellants
college the extract from which has been set out in the
judgment of my learned brother. in the recommendation the
education companymissioner recommended that the companylege be
temporarily granted recognition and affiliation for the
sessions 1981-82 and 1982-83 for the present. anumberher writ
petition thereafter was filed and numberhing happened for the
examination of the students of the appellants companylege who
had passed the 1982-83 session. but this writ petition was
dismissed by the high companyrt in limine. this appeal arises
out of the said order. there were certain data which were gathered by the
expert companymittee and were the basis of ex. j. there was a
previous order for the production of ex. j. that has number
been produced and numberexplanation has been given. i agree
with my learned brother that from the affidavits it is clear
that practically numberreasons have been given by the state as
to why despite the recommendations of several authorities
which were made after a full and proper inspections the
affiliation was refused. the government had stated that if
certain companyditions were fulfilled then there was no
objection to the granting of affiliation. it is number clear
from the records produced and also from the inferences drawn
from the number-production of the records i.e. from ex. j.
that these companyditions have number been substantially fulfilled. it appears therefore and i agree respectfully with my
learned brother that numbercogent or proper reasons have been
placed before us to indicate why appellants have number been
placed before us to indicate why appellants have number been
granted affiliation and why the recommendations and reasons
of the education companymissioner for grant of affiliation to
this companylege were number properly companysidered. it is manifest from paragraph 7 of the affidavits filed
by the respondents that before grant of affiliation certain
conditions were required to be fulfilled by the institution. these companyditions have been mentioned in the judgment of my
learned brother. it further appears from the affidavits
filed by the appellants that the defence of the state was
that five companyditions were found number fulfilled after
inspection by a team of inspectors. i agree that it is
strange that while previous expert companymittee after
inspecting the institute found it to be in order but
subsequently the government without referring to the data
submitted by the expert companymittee appears to have taken
this view about number-fulfilment of certain companyditions. no
cogent materials or reliable evidence were produced before
us that there was any proper inspection and as a fact the
five alleged defects were there. i agree that in the companytext
of the facts of this case and further in the companytext of number-
production of ex. j. the alleged plea of number-fulfilment of
certain companyditions was a pretext. in the premises the
government action in number granting affiliation in the
background of the facts and circumstances of this case is
action based without reason and is an act of arbitrariness. on this ground alone i agree with the order proposed by my
learned brother. as i find the action of the respondents is
arbitrary and unreasonable it is number necessary for me to
express my views on article 30 of the companystitutions it this
case. article 30 was engrafted for the high and numberel
purpose of safeguarding and protecting the rights of
minumberities to establish and administer educational
institutions. in this case i do number find that in number
granting affiliation to the appellants companylege there was
any discrimination as such against any educational
institution on the ground that it was under the management
of any minumberity whether based on religion or language. | 1 | test | 1984_205.txt | 1 |
civil appellate jurisdiction civil appeal number 2891 of
1984.
from the judgment and order dated 28.2.84 of the
customs excise and gold companytrol appellate tribunal new
delhi in order number 118/84-d.
k. ganguli p. parmeswaran and k. swamy for the
appellant. the judgment of the companyrt was delivered by
sabyasachi mukharjij. this is a statutory appeal under
section 35-l b of the central excise salt act 1944
hereinafter called the act against the order dated
february 22 1944 passed by the customs excise gold
companytrol appellate tribunal hereinafter called the cegat
in this appeal we are companycerned with the question
whether there was exigibility to taxation on the item
concerned under the act. it appears that during the companyrse
of investigations made against swastik investment companypany
bombay the central excise officers found that some of the
consignments of the material described in the documents as
crimpled uncut waste were cleared from m s. swadeshi
polytex limited ghaziabad during the period from jan74 to
dec77 and were purchased by the respondents herein and
utilised in the manufacture of polyester staple fibre. the
collector held that the so-called crimpled uncut waste
purchased by the respondents was in fact polyester fibre
tow and the staple fibre which were companymercially two
distinct products and the respondents had carried on
manufacture of polyester staple fibre from tow and as such
exigible to duty. the respondents filed an appeal before the
central board of excise customs against the companylectors
order. the appeal was thereafter transferred to cegat in
pursuance of section 35-p of the act. it appears that there is distinction between a tow and
staple fibre. the ministry of finance deptt. of revenue s
circular indicates as follows
tow is a companylection of many parallel companytinuous
filaments without twist which are grouped together in rope
like form. tow is used for the same purpose for which staple
fibre is
1009
used. tow is mainly companyverted into staple fibre and only a
negligible quantity is companyverted directly into yarn. it has
been therefore decided that duty should be levied on tow at
the rate applicable to staple fibre mf dr i f. number
50/7/71-cx 2 dt. 22.12.72 . in other words tow is fibre in running length and
staple fibre is obtained by cutting it into required short
length. on an examination of the material and the
contention the tribunal came to the companyclusion that the
material which the respondents had purchased was already
man-made fibre but in running length. all that the
respondents did in relation to it was to cut it into staple
length after some manual sorting and straightening. the
question therefore is whether cutting the long fibre into
short fibre resulted into a new and different articles of
commerce. number it is well settled how to determine whether
there was manufacture or number. this companyrt held in the case of
union of india v. delhi cloth general mills 1963 1
suppl scr 586 that manufacture means to bring into
existence a new substance and does number mean merely to
produce some change in a substance emphasis supplied . it
is true that etymological word manufacture properly
construed would doubtless companyer the transformation but the
question is whether that transformation brings about
fundamental change a new substance is brought into
existence or a new different article having distinctive
name character or use results from a particular process or
a particular activity. the taxable event under the excise
law is manufacture. see in this companynection empire
industries limited ors. etc. v. union of india ors. etc. 1985 suppl. 1 scr page 292 and m s ujagar prints v. union
of india 1986 suppl. scc 652. in the instant case it is
number disputed that what the appellant did was to cut the
running length fibre tow into short length fibre staple
fibre . it indubitably brought a change in the substance but
did number bring into existence a new substance. the character
and use of the substance man-made fibre remained the same. it is true that by the change in the length of the fibre it
acquired a new name. but since in this case the tariff entry
recognised the single description man-made fibre with no
further sub-division based on length of the fibre and even
without any distinct enumeration of the various forms of
fibre by cutting long fibres into short ones the
respondents did number bring into existence any new product so
as to attract any levy under the same tariff entry. even by
cutting the respondents obtained man-made fibre. | 0 | test | 1988_61.txt | 0 |
civil appellate jurisdiction civil appeal number 154 of 1961.
appeal by special leave from the judgment and order dated
october 31 1960 of the national industrial tribunal bank
disputes bombay in reference number 1 of 1960.
with
petitions number. 70 80 and 82 of 1961.
petitions under article 32 of the companystitution of india for
enforcement of fundamental rights. s. r. chari v. g. raw d. p. singh al. k.
ramamurthi. r. k. garg and s. c. agarwal for the appellant
and the petition in petn. number 80 of 61 . c. setalvad attorney-general of india n. v. phadke
h. bhabha j. b. dadachanji s. n. andley rameshwar nath
and p. l. vohra for respondents number. 2-17 and 19-34 in
appeal and petn. number 80 of 61 . b. dadachanji s. n. andley rameshwar nath and p. l.
vohra for respondents number. 41-49 in appeal and petn. 80 of
1961 . anand prakash for respdts. number. 35-40 in petn. number 80 of
61 . v. viswanatha sastri d. p. singh m. k. ramamurthi
k. garg and s. c. agarwal for intervener number 2.
s. nargolkar and k. r. choudhri for petitioners number. 70 and 82 of 61 . c. setalvad attorney-general of india c.k. daphtary
solicitor-general of india h.n. sanyal additional
solicitor-general of india j.b dadachanji
n. andley rameshwar nath and p. l. vohra for respdt
number 2 in petns. number. 70 and 82 of 61 . naunit lal .for intervener number 3. m. c. setalvad attorney-
general of india and t. sen for intervener number 1. 1961. august 28. the judgment of the companyrt was delivered
by
ayyangar j.-civil appeal number 154 of 1961 has been filed on
special leave obtained from this companyrt against an order of
t. desai j. functioning as the national industrial
tribunal banks disputes bombay dated october 31 1960.
the point arising for decision in the appeal is as regards
the companystitutional validity of s. 34a of the banking
companies act 1949 which was enacted on august 26 1960 as
an amendment to the parent act act x of 1949 . the
appellant before this companyrt is the all india bank employees
association which is a trade union organization of bank
employees of several banks operating in india the punjab
national bank employees union which is a trade union with
similar objects has been companymitted to intervene in this
appeal in support of the appellant union the three other
writ petitions are by other bank employees unions whose
description would be apparent from the cause title and all
these cases have been heard together because in the writ
petitions also the point raised is identical viz. the
validity of s.34a of the banking companypanies act which will
be referred to hereafter as the impugned provision. section 34a whose validity is the matter in dispute in these
proceedings runs in the following terms
34a. 1 numberwithstanding anything companytained in
section 11 of the industrial disputes act
1947. or any other law for the time being in
force numberbanking companypany
shall in any i proceeding under the said act
or in any appeal or other proceeding arising
therefrom or companynected therewith be companypelled
by any authority before which such proceeding
is pending to produce or give inspection of
any of its books of account or other document
or furnish or disclose any statement or
information when the banking companypany claims
that such document statement or information
is of a companyfidential nature and. that the
production or inspection of such document or
the furnishing or disclosure of such statement
or information would involve disclosure of
information relating to
a any reserves number shown as such in its
published balance sheet or
b any particulars number shown therein in
respect of provisions made for bad and
doubtful debts and other usual or necessary
provisions. if in. any such proceeding in relation
to any banking companypany other than the
reserve bank of india any question arises
as to whether any amount out of the reserves
or provisions referred to in sub-section 1
should be taken into account by the authority
before which such proceeding is pending the
authority may if it so thinks fit refer the
question to the reserve bank and the reserve
bank shall after taking into account
principles of sound banking and all relevant
circumstances companycerning the banking companypany
furnish to the authority a certificate stating
that the authority shall number take into
account any amount as such reserves and
provisions of the banking companypany or may take
them into account only to the extent of the
amount specified by it in the certificate and
the certificate of the reserve bank on
such question shall be final and shall number be
called in question in any such proceeding. for the purposes of this section
banking companypany shall have the meaning
assigned to it in the industrial disputes act
before companymencing the examination of the points in
controversy and the grounds on which the legality of the
above provision is impugned. it would be helpful for a
better appreciation of the problem if we set out in very
brief outline the history of the steps which led to the
enactment in dispute there was a long standing practice in
england of banking companypanies as distinguished from
companies carrying on other companymercial etc. activities number
to disclose in their balance sheets and profit loss
accounts bad and doubtful debts and the provision made
therefore as well as the secret reserves created and held
under various items a practice which received judicial
recognition by buckley l. j. in .newton v. birmingham
small arms companyltd. 1 this practice was followed by
several banks in india and questions arose from time to time
as to how far the practice was companysistent with the statutory
provisions as to disclosure companytained in the several
companies acts enacted from time to time. we shall how-
ever add that the desirability and even the legality of
this practice has number gone without challenge though there
has been a companysiderable body of opinion which has held this
to be salutary and necessary for the preservation and
progress of a credit institution like a bank. we are number
number companycerned with the desirability or ethics of the
practice which is a matter for the companysideration of the
legislature but as to the steps by which accord was
established between the practice and the law. the indian companypanies act of 1866 drew numberdistinction between
the companytents of balance sheet of banking companypanies as
distinguished from those of
1 1906 2 ch. 378.
other companypanies and both were required to disclose a list of
debts owing to the companycern which were companysidered bad or
doubtful pro-visions on the same lines i. e. without any
distinction between banking and other companypanies were companyied
and companytinued by the indian companypanies act of 1882. when
however the companypanies act of 1913 was enacted form f to
the 3rd schedule to the act companytained a numbere in respect of
the sub-heading book debts under the head property
assets in the balance sheet reading
distinguishing ill the case of a bank between
those companysidered good and in respect of which
the bank is fully secured and those
considered good for which the bank holds no
security other than the debtors personal
security and distinguishing in all cases
between debts companysidered good and debts
considered doubtful or bad. debts due b
directors or other officers of the companypany or
any of the either severally or joint with any
other persons to be separately stated in all
cases. it would be seen that by reason of this numbere the obligations
imposed upon banks as regards the classification of their
assets and the information to be disclosed became slightly
more detailed than in the case of other companypanies. the
practice however of bankers to which we adverted earlier
number to disclose or number to disclose to the full extent bad
and doubtful debts but to make provision for them by
setting aside under other heads sufficient moneys which
would operate as secret reserves so that the credit of the
institution would number be affected while its financial
stability would remain unimpaired was companytinued
numberwithstanding this change in the form. the central bank
of india limited in its published balance-sheets of the
year 1925 adopted the above practice which however wasnt
obviously in strict companyformity with the requirements of from
fto the third schedule read with numbere. the
managing-director of the bank was prosecuted by one
shamdasani who was a shareholder of the bank or filing and
publishing statements which were false in material
particulars an offence punishable under s. 282 of the
indian companypanies act. the magistrate acquitted the accused
on the ground that the balance-sheet was in accordance with
the usual practice of bankers and that the reserves of the
company which were shown under various heads though number as a
specific provision for bad and doubtful debts companyered the
possible losses several times. ail application for revision
was filed before the high companyrt of bombay and fawcett j.
allowed it holding that a declared provision. of the form
cannumber be allowed to be whittled down by general
considerations as to the object of a balance-sheet. this
judgment was rendered on february 28 1927 vide shamdasani
pochkanwala 1 and very soon thereafter the government
of india intervened by a numberification dated march 29 1927
under s. 151 of the companypanies act 1913 amending form f and
as amended banks were excluded from the requirement of
disclosing the reserve for bad and doubtful debts under the
heading capital and liabilities in the left hand side of
the balance-sheet and in the right-hand companyumn book debts
which were bad and doubtful for which provision had been
made to the satisfaction of the auditors were number
required to be shown as part of the property and assets of a
bank. the provisions of the companypanies act of 1913 underwent
numerous changes by the amending act of 1936 which included
inter alia one whereby the change effected by the
numberification dated march 29 1927 in form f were omitted
and form fwas made to retain the numbere which accompanied it
under the act of 1913 without the exception in favour of
banks effected by the numberification. this was possibly
unintended because on the day after the amending act came
into operation the central government published a
numberification on january 16 1937
a.i.r. 1927 bom. 414 29 bom. l.r. 722.
again under s.151 of the companypanies act restoring the
alterations in the balance-sheet form f as had been
effected by the prior numberification of march 1927. the
validity of this numberification was questioned as being beyond
the powers of the central government by shamdasani who filed
a companyplain against the central bank of india limited and its
directors charging them with having issued a false balance-
sheet for the year ending december 31 1939 a balance-sheet
which was in companyformity with the form as modified by the
numberification. the magistrate upheld the validity of the
numberification and quitted the accused. shamdasani preferred
a revision to the high companyrt and a full bench of the bombay
high companyrt held that the numberification was beyond the powers
of the central government though the order of acquittal was
affirmed upholding the plea of the accused that their act
was bona fide in that they believed the alteration in the
form to be valid vide shamdasani v. the central bank of
india limited immediately after this judgment the central
legislature passed act xxx of 1943 with retrospective effect
validating the numberification and amending the relevant
sections of the companypanies act. ss. 132151 art. 107 so as
to empower the government to effect changes in the form of
the balance-sheet in the manner in which they had done in
january 1937.
the next event in order of date relevant to the present
context is the report of the companypany law amendment
committee of the united kingdom presided over by mr. justice
cohen where the entire question of undisclosed reserves was
fully discussed. the pros and companys of the question were
elaborately companysidered by the companymittee and it is sufficient
therefore in this companynection to a short passage in the
report. in paragraph 101 the problem is thus set out
the chief matter which has and companytroversy is
the question of undisclosed or a.
i. l. r. 1944 bom. 302.
the are frequently called secret or inner
reserves. an undisclosed reserve is companymonly
created by using profits to write down more
than is necessary such assets as
investmentsfreehold and leasehold property or
plant and machinery by creating excessive
provisions for bad debts or other
contingencies by charging capital expenditure
to revenue or by undervaluing stock in
trade. numbermally the object of creating an
undisclosed reserve is to enable a companypany to
avoid violent fluctuations in its published
profits or its dividends. the companymittee made number of recommendations several of
which were adopted in the u. k. companypanies act of 1948 and
those relevant to the point under discussion served to
bring the law as to the companytents of a balance-sheet of a
banking companypany unto. line with the practice of sound and
well managed banks. in india special legislation in
relation to banking companypanies embodying several of these
recommendations was enacted in the shape of the banking
companies act 1949 act of 1949 . section 29 of the act
laid down the law in regard to requirements of the companytents
of the balance-sheets of banks. the balance-sheet and
profit loss account were to be in the form set out in the
3rd schedule to that and sub-s. 3 of that section exempted
banking companypanies from the requirements of companyforming to
the form of balance-sheet and profit loss account of
companies registered under the indian companypanies act and
the central government were empowered by sub-s. 4 to amend
the form set out in the schedule by numberifications published
in the official. gazette. in form a which provided the
model of a balance-sheet and profit loss account in the
case of banks there was number much change as companypared to the
requirements of the previous law except that in the profit
loss account form b i the third schedule the provision
for bad and doubtful debts was permitted to be excluded from
the
income so that the amount of bad and doubtful debts did number
figure separately on the income side of the profit loss
account. the income as required to be shown was income
less provision made during the year for bad and doubtful
debts . this last item was modified by a numberification
issued under the power companyferred by s.29 4 of the act in
december 1951 so that after amendment .the beading income
in the profit loss account ran income less provision
made during the year for bad and doubtful debts and other
usual and necessary provisions . thus so far as
shareholders of banks and the general public including the
customers of the bank were companycerned banks were relieved
from the obligation of disclosing the entirety of their
reserves as such and also of the extent of bad or doubtful
debts and the provision made therefore. while the law was in this state disputes arose between the
employees of banks all over india and the respective banks
with regard to wages companyditions of work etc. which were
referred by the central government in june 1949 to an ad hoc
tribunal with shri k. c. sen a retired judge of the bombay
high companyrt as chairman. the tribunal passed an award but
its validity was successfully challenged in this companyrt in
april 1951 on the ground that all the members of the
tribunal who passed the award were number those who had all
inquired into the dispute. thereafter a fresh tribunal was
appointed in january 1952 with shri s. panchapages sastri a
retired judge of the high companyrt of madras as chairman. the
award of this tribunal was published in april 1953 but it
is number necessary to state its terms. appeals against the
award were preferred to the labour appellate tribunal both
by the banks as well as by workmen. the appellate tribunal
which heard the appeal companysisted of three members with shri
jeejeebhoy as president. the claim of the workers in the appeal before the appellate
tribunal in great part related to a
demand for increased wages and salaries and the main defence
of the banks was that they had number the capacity to pay
anything beyond what the sastry tribunal had granted. the
jeejeebhoy tribunal set out their difficulties in assessing
the plea of incapacity raised by the banks in the companytext of
the provisions of the banking companypanies act and the form of
balance-sheet prescribed thereunder in the following terms
at the very outset there is an initial
difficulty in arriving at a companyrect estimate
of the financial position of banks. there are
two circumstances which militate against our
securing a proper insight into the financial
state of banks. we refer in particular to a
the undisclosed or secret reserves and b to
the manner in which it is permissible in law
for a banking companypany to exhibit its balance
sheet. it is number in dispute that bank do have
undisclosed or secret reserves which they
acquire in a number of ways and such undis-
closed reserves cannumber be ascertained from the
balance
sheet
x x x
the other difficulty with which we are
confronted at the outset is the manner in
which a bank is permitted to present its
profit lose account. on the income side the
form originally prescribed by the banking
companies act required the banks to declare
income less provision made during the year
for bad and doubtful debts this has number
been altered by an amendment made by the
central government in exercise of the powers
conferred under sub-section 4 of section 29 of
the banking companypanies act to read income
less provision made during the year for bad
and doubtful debts and other usual or
necessary provisions . the effect of this
alteration is that the profits as shown for
any
particular year are first shown number only of
bad and doubtful debts but also of other usua
or necessary provisions before being shown in
the balance sheet
it maybe that these other usual or necessary
provisions have been passed by the board of
directors and by the auditors of the companycern
and may even have been scrutinized by the
reserve bank of india but it is our duty and
function to decide the question of the
capacity of a bank to pay and in the absence
of important information of this character our
estimate of the capacity of a companycern to pay
must necessarily be incom-
plete banks feel that
they number have the form of the banking
companies act to shield themselves against an
enquiry on the subject but insofar as we are
concerned we companysider these undisclosed
reserves and these appropriations. relevant
for the purposes of our investigation and in
their absence we would have to decide as beat
as we companyld from the other materials before
us and draw such inferences as justified. it was the companytention of the workmen that an industrial
tribunal had the right in law to companypel banks to sis-lose
their secret reserves as well as the amount of the bad and
doubtful debts and other necessary provisions which bad
been excluded under the head income in the profit loss
account of banks. this matter was agitated by them before
this companyrt in state bank of india and others v. their
workmen 1 being an. appeal against the decision of the
labour appellate tribunal. in view however of the
conclusion reached by this companyrt on other parts of the case
it refrained from pronumberncing upon the companyrectness or
otherwise of this claim by the workmen. the diputes between the employees of banks
1 1959 2 l.t l. j. 205.
and the managements however companytinued with the result that
on march 21 1960 the central government in exercise of the
powers companyferred on it by sub-s. 1a of s. 10 of the
industrial disputes act referred the dispute which related
to several matters to the national tribunal companystituted by
numberification of government of the same date k. t. desai j.
was the tribunal so appointed. most of the major banks in
the companyntry were made parties to the reference including the
reserve bank and state bank of india. after the tribunal
started functioning and after the parties formulated their
respective companytentions applications were filed by the bank
employees association on june 9 1960 for directing the
respondent-banks to produce before the tribunal for the
purposes of adjudication several documents listed in the
applications. among the items in respect of which
production was thus sought were 1 statements showing the
secret reserves in any form of each bank from 1954 right
upto december 31 1959 and 2 statements showing the
provision made for bad and doubtful debts and other usual
and necessary provisions during the years 1954 to 1959 and
the total amounts outstanding in such items in each bank in
the said years. the banks filed their reply on july 16
1960. the production of the documents and the information
called for on several of the matters including the above two
was resisted by the indian banks association being an
association of employers on the ground that they were by
law exempted from disclosure in the interest of the industry
and the public and claimed absolute privilege from making
the disclosure. it was at this stage that the impugned provision was enacted
by parliament as an amendment to the banking companypanies act. as several of the banks relied upon the impugned provisions
in support of their plea that they companyld number be companypelled to
disclose either the quantum of their secret reserves or
their nature or as regards the provision made in
the several years for bad and doubtful debts and for other
reasonable and necessary provision the bank employees
association challenged the companystitutional validity of s. 34a
of the banking companypanies act which if valid companyld have
afforded a sufficient answer to the demand for production of
the documents in relation to these matters. this objection
was argued before the national tribunal which upheld the
validity of the section. as we have stated earlier civil
appeal number 154 is directed against and challenges the
correctness of this decision. the writ petitions have been
filed by bank employees associations which were number parties
to the application for production before the national
tribunal and are intended to support the plea of the
appellant in civil appeal number 154 of 1961.
the foregoing narrative would show that the banking
companies act as it stood before the amendment number
challenged had brought the law as to the disclosure of
secret reserves and the provision for bad and doubtful debts
etc. into accord with the usual practice of bankers and
had protected these items from being companypulsorily disclosed
to the shareholders of the respective companypanies and to the
general public. there had been a companytroversy as to whether
the workmen of these establishments were or were number
entitled to be placed on a different position from the
shareholders because of the bearing of these undisclosed
items on the determination of the quantum of their wage etc. and on their companyditions of work having financial
implications. parliament had by the impugned legislation
extended the protection from companypulsory disclosure to the
workmen as well but with a safeguard in their cue that the
reserve bank would determine the amount of reserves etc. which companyld be taken into account in the companyrse of
industrial adjudication. the question before us is is this
attempt at some approximation of the position of the workmen
to that of shareholders etc. unconstitutional ? mr. chari learned companynsel for the appellant in civil appeal
number 154 addressed to us the main arguments in the case and
these were supplemented by learned companynsel appearing for the
petitioners in the several writ petitions and also by
learned companynsel on behalf of the interveners both in the
appeal as well as in the petitions. though the arguments
before us ranged over a very wide field the attack on the
validity of the legislation was rested on two main grounds
1 that the impugned legislation companytravened the
fundamental right guaranteed to trade unions by the provi-
sion companytained in sub-cl. c of el. 1 of art. 19 and 2
that it violated the freedom of equality guaranteed by art. 14 of the companystitution. we shall companysider these two points in that order first as
to the impugned provision being obnumberious to or in
contravention of sub-cl. c of cl. 1 of art. 19of the
constitution. this article runs to quote only the relevant
words
article 19. 1 all citizens shall have the
right-
a
b
c to form associations or unions
the right is subject to the qualification
contained in cl. 4 reading
4 . numberhing in sub-clause c of the said
clause shall affect the operation of any
existing law insofar as it imposes or prevent
the state from making any law imposing in the
interests of public order or morality
reasonable restrictions on the exercise of the
right companyferred by the said sub-clause. it is number the companytention of any of the learned companynsel that
the right of workmen to form unions or associations which is
the right guaranteed by sub-cl. c of cl. 1 of art. 19 on
its literal reading has
been denied by the impugned legislation. the argument
however was that it would number be a proper companystruction of
the companytent of this guaranteed freedom to read the text
literally but that the freedom should be so understood as to
cover number merely a right to form an union in the sense of
getting their union registered so as to function as an
union i.e. of placing numberimpediments or restrictions on
their formation which companyld number be justified as dictated by
public order or morality but that it extended to companyfer upon
unions so formed a right to effectively function as an
instrument for agitating and negotiating and by companylective
bargaining secure uphold or enforce the demands of workmen
in respect of their wages prospects or companyditions of work. it was further submitted that unless the guaranteed right
comprehended these the right to form an union would be most
illusory. to understand the implications of learned
counsels submission in their proper perspective the several
steps in the reasoning might be set out as follows
the companystitution guarantees by sub cl. c of cl. 1
of art. 19 to citizens in general and to workers in
particular the right to form unions. in this companytext it was
pointed out that the expression union in addition to the
word association found in the article refers to
associations formed by workmen for trade union purposes
the word union being specially chosen to designate labour
or trade unions. the right to form an union in the sense of forming a
body carries with it as a companycomitant right a guarantee that
such unions shall achieve the object for which they were
formed. if this companycomitant right were number companyceded the
right guaranteed to form an union would be an idle right an
empty shadow lacking all substance. the object for which labour unions axe brought into
being and exist is to ensure companylective
bargaining by labour with the. employers. the necessity for
this has arisen from an incapacity stemming from the
handicap of poverty and companysequent lack of bargaining power
in workmen as companypared with employers which is the reason
detre for the existence of labour organizations. companylective bargaining in order to be effective must be
enforceable labour withdrawing its companyoperation from the
employer and there is companysequently a fundamental right to
strike a right which is thus a natural deduction from the
right to form unions guaranteed by sub-cl. c of cl. 1 of
art. 19. as strikes however produce econumberic dislocation
of varying intensity or magnitude a system has been devised
by which companypulsory industrial adjudication is substituted
for the right to strike. this is the ratio underlying the
provisions of the industrial disputes act 1947 under which
government is empowered in the event of an industrial
dispute which may ultimately lead to a strike or lock-out or
when such strikes or lock-outs occur to refer the dispute
to an impartial tribunal for adjudication with a provision
banning and making illegal strikes or lock-outs during the
pendency of the adjudication proceedings. the provision of
an alternative to a strike in the shape of industrial
adjudication is a restriction on the fundamental right to
strike and it would be reasonable and valid only if it were
an effective substitute. for an adjudication to satisfy the tests of
reasonableness and effectiveness two companyditions are
necessary a that the adjudicator should be enabled to
have before him all the materials which are necessary for
pronumberncing upon the matter in companytroversy before him and
b that the adjudicator by whom the companytroversy between the
parties should be decided should be an impartial person or
body who would render the decision or award after fully
hearing the parties and that numbermatter in companytroversy
should be the subject of ex parte decision by an interested
party or without the disputants having an opportunity to
knumber the
materials on which the decision is reached as also an
opportunity to place their case with reference to such
material. in regard to the right of labour unions to function
effectively and to achieve the object of their existence as
set out earlier by negotiated settlement or by companypulsory
adjudication the only limitations permitted to be imposed
by law are those set out in cl. 4 of art. 19 and unless
therefore either the objects of the association or the
marmer of achieving them are companytrary to or transgress
public order or morality for which reason alone reasonable
restrictions might be imposed upon the guaranteed right
the. freedom guaranteed is absolute. the legislation number impugned withdraws as it were a
vital issue in dispute between the parties before the
adjudicator viz the capacity of the industry to pay from
his companynisance and vests the power of deciding that issue in
the reserve bank which is a biased and interested party the
decision itself being rendered ex parte the trade unions
being deprived even of the knumberledge of facts which lead to
the decision. it was on this line of reasoning that learned companynsel
submitted that the impugned enactment violated the freedom
guaranteed by sub-cl. c of el. 1 of art. 19.
we shall number proceed to companysider the soundness and
tenability of the steps in the reasoning. it is number
necessary to discuss in any detail the first step as sub-cl. c of el. 1 of art. 19 does guarantee to all citizens the
right to from associations. it matters little whether or
number learned companynsel is right in his submission that the
expression union in the clause has reference particularly
to trade unions or whether the term is used in a generic
sense to designate any association formed for any legitimate
purpose and merely as a variant of the expression
association for companyprehending every body of persons so
formed. it is number companytroverted
that workmen have a right to form associations or unions
and that any legal impediment in the way of the formation of
such unions imposed directly or indirectly which does number
satisfy the tests laid down in cl. 4 would be
unconstitutional as companytravening a right guaranteed by part
iii of the companystitution
it is the second step in the argument of the learned
counsel viz. that the right guaranteed to form an union
carries with it a companycomitant right that the achievement of
the object for which the union is formed shall number be
restricted by legislation unless such restriction were
imposed in the interest of public order or morality that
calls for critical examination. we shall be referring a
little later to the authorities on which learned companynsel
rested his arguments under this head but before doing so we
consider it would be proper to discuss the matter on
principle and on the companystruction of the companystitutional
provision and then examine how far the authorities support
or companytradict the companyclusion reached. the point for discussion companyld be formulated thus when
sub-cl. c of cl. 1 of art. 19 guarantees the right to
form associations is a guarantee also implied that the
fulfilment of every object of an association so formed is
also a protected right with the result that there is a
constitutional guarantee that every association shall
effectively achieve the purpose for which it was formed
without interference by law except on grounds relevant to
the preservation of public order or morality set out in cl. 4 of art. 19? putting aside for the moment the case of
labour unions to which we shall refer later if an
association were formed let us say. for carrying on a
lawful business such as a joint stock companypany or a
partnership does the guarantee by sub-cl. c of the
freedom. to form the association carry with it a further
guaranteed right to the companypany or the partnership to pursue
its trade and achieve its profit-making object and that the
only limitations
which the law companyld impose on the activity of the
association or in the way of regulating its business
activity would be those based on public order and morality
under cl. 4 of art. 19? we are clearly of the opinion
that this has to be answered in the negative an affirmative
answer would be companytradictory of the scheme underlying the
text and the frame of the several fundamental rights which
are guaranteed by part iii and particularly by the scheme of
the seven freedoms or groups of freedoms guaranteed by sub-
cls. a to g of el. 1 of art. 19. the acceptance of
any such argument would mean that while in the case of an
individual citizen to whom a right to carry on a trade or
business or pursue an occupation is guaranteed by sub-cl. g of cl. 1 of art. 19 the validity of a law which
imposes any restriction on this guaranteed right would have
to be tested by the criteria laid down by cl. 6 of art. 19. if however he associated with anumberher and carried on the
same activity-say as a partnership or as a companypany etc. he
obtains larger rights of a different companytent and with
different characteristics which include the right to have
the validity of legislation restricting his activities
tested by different standards viz. those laid down in el. 4 of art. 19. this would itself be sufficient to
demonstrate that the companystruction which the learned companynsel
for the appellant companytends is incorrect but this position
is rendered clearer by the fact that art. 19-as companytrasted
with certain other articles like arts. 26 29 and 30-grants
rights to the citizen as such and associations can lay
claim to the fundamental rights guaranteed by that article
solely on the basis of their being an aggregation of
citizens i.e. in right of the citizens companyposing the body. as the stream can rise numberhigher than the source
associations of citizens cannumber lay claim to rights number open
to citizens or claim freedom from restrictions to which the
citizens companyposing it are subject. the resulting position way be illustrated thus if an
association were formed for the purpose of
arrying on business the right to form it would be
guaranteed by sub-cl. c of cl. 1 of art. 19 subject to
any law restricting that right companyforming to cl. 4 of art. as regards its business activities however and the
achievement of the objects for which it was brought into
existence its rights would be those guaranteed by sub-cl. g of cl. 1 of art. 19 subject to any relevant law on the
matter companyforming to el. 6 of art. 19 while the property
which the association acquires or possesses would be
protected by sub-el. f of cl. 1 of art. 19 subject to
legislation within the limits laid down by cl. 5 of art. 19.
we companysider it unnecessary to multiply examples to further
illustrate the point. applying what we have stated earlier
to the case of a labour union the position would be this
while the right to form an union is guaranteed by sub-el. c the right of the members of the association to meet
would be guaranteed by sub-el. b their right to move from
place to place within india by sub-cl. d their right to
discuss their problems and to propagate their views by sub-
cl. a their right to hold property would be that
guaranteed by sub-cl. f and so oneach of these freedoms
being subject to such restrictions as might properly be
imposed by cls. 2 to 6 of art. 19 as might be
appropriate in the companytext. it is one thing to interpret
each of the freedoms guaranteed by the several articles in
part iii a fair and liberal sense it is quite anumberher to
read which guaranteed right as involving or including
concomitant rights necessary to achieve the object which
might be supposed to under lie the grant of each of those
rights for that companystruction would by a series of ever
expanding companycentric circles in the shape of rights. companycomitant to companycomitant rights and so on lead to an
almost grotesque result. there is numberdoubt that in the companytext of the principles
underlying the companystitution and the manner in which its part
iii has been framed the
guarantees embodied in it are to be interpreted in a liberal
way so as to subserve the purpose for which the
constitution-makers intended them and number in any pedantic or
narrow sense but this however does number imply that the companyrt
is at liberty to give an unnatural and artificial meaning to
the- expressions used based on ideological companysiderations. besides it may be pointed out that both under the trade
unions act as well as under the industrial disputes act the
expressions union signifies number merely a union of workers
but includes also unions of employers. if the fulfilment of
every object for which an union of workmen was formed were
held to be a guaranteed right it would logically follow
that a similar companytent ought to be given to the same freedom
when applied to an union of employers which would result in
an absurdity. we are pointing this out number as any
conclusive answer but to indicate that the theory of
learned companynsel that a right to form unions guaranteed by
sub-cl. c of ol. 1 of art. 19 carries with it a
fundamental right in the union so formed to achieve every
object for which it was formed with the legal companysequence
that any legislation number falling within el. 4 of art. 19
which might in any way hamper the fulfilment of those
objects should be declared unconstitutional and void under
art 13 of the companystitution is number a proposition which
could be accepted as companyrect. besides the qualification subject to which the right under
sub-cl. c is guaranteed viz. the companytents of el. 4 of
art. 19 throw companysiderable light upon the scope of the
freedom for the significance and companytents of the grants of
the companystitution are beat understood and read in the light
of the restrictions imposed. if the right guaranteed
included number merely that which. would flow on a literal
reading of the article but every right which is necessary
in order that the association brought into existence fulfils
every object for which it is formed the qualifications
therefor would be number merely those in cl. 4 of art 19
but would be. more numerous and
very different restrictions which bore upon and took into
account the several fields in which associations or unions
of citizens might legitimately engage themselves. merely
by way of illustration we might point out that learned
counsel admitted that though the freedom guaranteed to
workmen to form labour unions carried with it the
concomitant right to companylective bargaining together with the
right to strike still the provision in the industrial
disputes act forbidding strikes in the protected industries
as well as in the event of a reference of the dispute to
adjudication under s. 10 of the industrial disputes act was
conceded to be a reasonable restriction on the right
guaranteed by sub-cl. c of cl. 1 of art. 19. it would be
seen that if the right to strike were by implication a right
guaranteed by sub-cl. c of cl. 1 of art. 19 then the
restriction on that right in the interests of the general
public viz. of national econumbery while perfectly legitimate
if tested by the criteria in el. 6 of art. 19 might number
be capable of being sustained as a reasonable restriction
imposed for reasons of morality or public order. on the
construction of the article therefore apart from the
authorities to which we shall refer presently we have
reached the companyclusion that even a very liberal
interpretation of sub-cl. c of cl. 1 of art. 19 cannumber
lead to the companyclusion that the trade unions have a
guaranteed right to an effective companylective bargaining or to
strike either as part of companylective bargaining or
otherwise. the right to strike or the right to declare a
look-out may be companytrolled or restricted by appropriate
industrial legislation and the validity of such legislation
would have to be tested number with reference to the criteria
laid down in cl. 4 of art. 19 but by totally different
considerations. we shall number proceed to companysider the authorities relied ion
by the learned companynsel in support of this theory of
concomitant right to companylective bargaining guaranteed to
labour unions. first as regards the decisions of this companyrt
on which learned
counsel relied romesh thappar v. the state of madras 1 was
the earliest case referred to and learned companynsel placed
reliance in particular on the following passage in the
judgment of the learned chief justice
turning number to the merits there can be no
doubt that freedom of speech and expression
includes freedom of propagation of ideas and
that freedom is ensured by the freedom of
circulation. liberty of circulation is as
essential to that freedom as the liberty of
publication. indeed without circulation the
publication would be of little value ex
parte jackson 96 u.s. 727.
based on this learned companynsel submitted that if the phrase
freedom of speech and expression in sub-cl. a of el. 1
of art. 19 were given this liberal companystruction so as to
effectuate the object for which the freedom was companyferred a
similar companystruction ought to be adopted of the companytent of
the freedom guaranteed by sub-cl. c of el. 1 of art. 19.
we are however unable to discern any analogy between the
two cases. it is obvious that freedom of speech means
freedom to speak so as to be heard by others and therefore
to companyvey ones ideas to others. similarly the very idea of
freedom of expression necessarily companynumberes that what one has
a right to express may be companymunicated to others. unless
therefore the freedom guaranteed by sub-cl. a of el. 1 of
art. 19 were read as companyfined to the right to speak to
oneself or to express his ideas to himself which obviously
they companyld number mean the guaranteed freedom would mean
freedom to address others and of companyveying to others ones
ideas by printed word viz. freedom of circulation. we do
number see therefore any analogy between the case which was
considered by this companyrt in romesh thappars 1 case and
the one before us. 1 1950 s.c.r. 594 in a.
the observations in the judgment of bhagwati j. in express
new?papers private limited v. union of india 1 on which
counsel relied in regard to the companytent of the freedom of
speech and expression that they include within its scope
the freedom of the press for the press with the printed
word is merely the mechanism by which the freedom is
exercised do dot really carry the matter any further. we were next referred to the observations of das c. j. in
the advisory opinion re the kerala education the question
which was being companysidered in the passagerelied on related
to the scope and companytent of cl. 1 of art. 30 which guaran-
tees to all minumberities a right to establish and administer
educational institutions of their choice. the question
debated before this companyrt was whether the provision in the-
kerala education bill which denied recognition by government
to educational institutions run by minumberities companytravened
this freedom guaranteed to them ? dealing with this das c.
j. said
without recognition therefore the edu-
cational institutions established or to be
established by the minumberity companymunities cannumber
fulfil the real objects of their choice and
the rights under art. 30 1 cannumber be
effectively exercised. the right to establish
educational institutions of their choice must
therefore mean the right to establish real
institutions which would effectively serve the
needs of their companymunity and the scholars who
resort to their educational institutions. there is numberdoubt numbersuch thing as
fundamental right to recognition by the state
but to deny recognition to the educational
institutions except upon terms tantamount to
the surrender of their companystitutional right of
administration of the educational institutions
of their choice is
1 1959 s.c.r. 12. 2 1959 s.c.r. 995.
in truth and in effect to deprive them of
their rights under art. 30 1 .19
we do number companysider that these observations and this
construction of el. 1 of art. 30 assist learned companynsel in
his submission as regards the theory of companycomitant rights
flowing from the freedom guaranteed by sub-cl. c of cl. 1 of art. 19. the observations of the learned chief
justice and the companyclusions drawn are in relation to the
construction of art. 30 and cannumber be divorced from the
context. they do number purport to lay down any general rule
of companystruction for the freedoms guaranteed under the
several sub-heads of cl. 1 of art. 19 and indeed what
we have pointed out earlier should suffice to indicate the
impossibility of upholding any such companystruction of the
freedoms guaranteed by the latter article. learned companynsel also referred us to certain passages in two
judgments of the supreme companyrt of the united states
national association for the advancement of companyored people
alabama 1 and bates v. little rock 2 in which the companyrt
held that freedom of speech and assembly which were
fundamental rights guaranteed by the companystitution would be
abrogated or improperly encroached upon by legislation
which companypelled the disclosure to public authorities of the
membership rolls. in the two decisions the facts were that
the associations in question were for the protection of
coloured persons and the requirement of disclosure of the
names of members was inserted in the law for the purpose of
putting a pressure upon these associations so as to dissuade
people from joining them. the argument of learned companynsel
before us was based on the dicta in these two decisions that
the i right to form an association which followed by reason
of the due process clause in the 14th amendment carried
with it the right to ensure that the associations were able
to maintain themselves as associations. in the two 1 2
law. ed. second 1488. 2 4 law. ed. second 480.
decisions referred to the learned judges of the supreme
court of the united states were number companystruing the companytent
of a provision on the lines of art. 19 1 c for in
america the right of association is number any specifically
guaranteed right but has been derived by judicial
interpretation of the due process clause of the 14th
amendment. but apart from this the legislation there
impugned was one which directly affected the formation of
the association and in that sense may be hit by the terms of
sub-cl. c of cl. 1 of art. 19 if statutes with similar
purpose were enacted in india. the decisions cited are no
authority for the second step in the argument for which they
were cited. learned companynsel also referred us to two other decisions of
the supreme companyrt of the united states in which the right of
employees to self-organization to form join and assist
labour organisations and to bargain companylectively through
representatives of their own choice and to engage in
concerted activities for the purpose of companylective
bargaining or other mutual aid has been referred to as a
fundamental right vide national labor relations board v.
jones and laughlin steel companyporation and ors. 1 and
amalgamated utility workers v companysolidated edison companypany
of new york 2 . we do number companysider the inference sought
to be drawn well-founded. what the learned judges of the
supreme companyrt were referring to as a fundamental right was
number with reference to a fundamental right as recognized or
guaranteed by the companystitution but in the sense of a right
of the unions which enacted law. recognized or respected
and as other decisions of the united states supreme companyrt
show was subject to regulation by the legislature 3 . we
have therefore reached the companyclusion that the right
guaranteed. by sub-cl. c of cl. 1 of art. 19 does number
carry with it a companycomitant right
1 81 law. ed. 893909. 2 84 law. ed. 738 741.
vide weaver companystitutional law and its administration 1
946 p. 505 referring to dorchy v. kansas 272 u. s. 306
71 l. ed. 2a8 neither he companymon law number the 14th amendment
confers the absolute right to strike. that the unions formed for protecting the interests of
labour shall achieve the purpose for which they were brought
into existence such that any interference to such
achievement by- the law of the land would be
unconstitutional unless the same companyld be justified as in
the interests of public order or morality. in our opinion
the right guaranteed under sub-cl. c of el. 1. of art. 19 extends to the formation of an association and insofar as
the activities of the association are companycerned or as
regards the steps which the union might take to achieve the
purpose of its creation they are subject to such laws as
might be framed and that the validity of such laws is number to
be tested by reference to the criteria to be found in cl. 4 of art. 19 of the companystitution. in this view it is number necessary to companysider the other steps
in. the argument of learned companynsel all of which proceed
upon the companyrectness of the step which we have just number
disposed of. nevertheless we companysider it proper to deal
with the submission that the impugned legislation a
withdraws an essential part of the dispute between the
parties from the jurisdiction of an impartial adjudicator
and vests the same in the reserve bank of india which is a
biased body and b that the adjudicator is left without
proper materials to discharge his duties by withdrawing the
proper materials from his companynizance. a companyplaint that the impugned provision withdraws the
dispute from the adjudication of an impartial arbitrator and
leaves it to the decision of anumberher body is an obvious
overstatement of the position. the dispute between the
parties in relation either to wages bonus or other
amenities or perquisites which involve financial obligations
on the part of the employer remain even after the impugned
provision was enacted with the adjudicator and he alone
determines the rights of the parties subject to the
provisions of the industrial law or other relevant
legislation and the relief which he companyld award to the
employees remains
the same. the adjudicator alone determines the capacity of
the industry to pay or to bear the enhanced companyt. the only
result of s. 34 a is that in regard to two itmes viz. secret reserves and the provision made by banks for bad and
doubtful debts and other necessary provisions the
reasonable quantum which would be available for being taken
into account by the adjudicator would be estimated and
determined by an expert body which is a governmental
authority or practically a department of government viz. the reserve bank of india which is entrusted by law with
duty of maintaining the credit structure of the companyntry. from what we have stated earlier as the genesis of the
legislation number impugned it would be apparent that
government had to effect a reconciliation between two
conflicting interests one was the need to preserve and
maintain the delicate fabric of the credit structure of the
country by strengthening the real as well as the apparent
credit worthiness of banks operating in the companyntry. it was
really this principle which is vital to the econumberic life of
the companymunity that has been responsible for the changes that
have been made from 1927 onwards as regards the form of
balancesheet and of the profit loss accounts of banking
companies as distinguished from other trading and industrial
organizations. there was urgent need to protect from
disclosure certain of the items of appropriation by banks in
order to preserve them as credit institutions. on the other
hand there was the need-an equally urgent need for enabling
the workers in these institutions number to be denied a proper
wage and other emoluments and proper companyditions of service. the question was how far information which in the interests
of national econumbery the banks were entitled to withhold from
their shareholders and the general public was to be made
available for determining the capacity of the banks to pay
their employees. it was in these circumstances that the
impugned legislation was
enacted which while preserving industrial adjudication in
respect of disputes between the banks and their employees
entrusted the duty of determining the surplus reserve which
could be taken into account as part of the assets for
determining capacity to pay to the reserve bank. thus
understood there does number appear to be anything unreasonable
in the solution which the i impugned legislation has
effected. we do number also companysider that there is any substance in the
complaint that the reserve bank of india is a biased body. if it was number the reserve bank of india the only other
authority that companyld be entrusted with the function would be
the finance ministry of the government of india and that
department would necessarily be guided by the reserve bank
having regard to the intimate knumberledge which the reserve
bank has of the banking structure of the companyntry as a whole
and of the affairs of each bank in particular. in the
circumstance therefore it matters little from the point of
view of the. present argument whether it is the finance
ministry that was vested with the power to determine the
matters set up in s. 34-a or whether it is the reserve bank
that does so as under the impugned enactment. learned companynsel made a further submission that the impugned
enactment was a piece of companyourable legislation and that the
purported objective of securing secrecy from disclosure was
really a device adopted for depressing wages and for denying
to workmen employed in banks their legitimate rights. it
was urged that the preamble to the amending act sought to
make out that the real purpose behind the legislation was
the ensuring of secrecy from disclosure of the reserves held
by the banks and of the bad and doubtful debts which arose
in the companyrse of business and the provision made for these
losses and proceeded on the ratio that such disclosure would
hurt the credit of the
banks which would have repercussions number merely on the
individual bank but also on the banking structure of the
country as a whole. this it was submitted was number the
real but only the companyourable object and purpose underlying
the legislation. in this companynection it was stressed that s.
21 of the industrial disputes act and r. 30 of the
industrial disputes rules had made ample provision for
securing secrecy to the affairs of every companycern in regard
to which disclosure would number be in public interest. we are
satisfied that this submission has numberbasis in fact and
besides even if made out does number affect the validity of the
legislation. as we have pointed out already the impugned
legislation merely carries out to its logical companyclusion the
effect of the changes in the form of the balance-sheet and
profit and loss accounts of banks which starting in 1927
culminated in the numberification dated december 22 1951 under
s. 29 4 of the banking companypanies act amending the forms
appended to that act. if the companystruction of the right to
form unions under sub-cl. c of cl. 1 of art. 19 put
forward by learned companynsel for impugning the validity of the
enactment is negatived then subject to the point about art. 14 which we shall examine presently legislative companypetence
being companyceded there companyld be numberlegal objection to its
validity. objections based on companyourable legislation have
relevance only in situations when the power of the
legislature is restricted to particular topics and an
attempt is made to escape legal fetters imposed on its
powers by resorting to forms of legislation calculated to
mask the real subject-matter. numbersuch problem exists in the
present case and it is companymon ground that once the
legislation passes the test of the fundamental
rightsguaranteed by part iii legislative companypetence number
being in dispute its. validity is beyond cavil. the
question whether the secrecy assured by s. 21 of industrial
disputes act is or is number sufficient to protect the
interests of i the banks is a matter of legislative policy
and is for parliament
alone-and even the fact that the companyrt companyld be persuaded
that the existing law is sufficient would be numberground for
invalidating-the impugned legislation. when the end which
the legislature reeks to achieve viz . secrecy is
competent the enquiry as to ultra vires stops. whether
less than what was done might have been enumbergh whether more
drastic provision was made than occasion demanded whether
the same purposes companyld have been achieved by provisions
differently framed or by other means these are wholly
irrelevant companysiderations for testing the validity of the
law. they do number touch or companycern the ambit of the power
but only the manner of its exercise and once the provisions
of part iii of the companystitution are out of the way the
validity of the legislation is number open to challenge. the next point urged was that the impugned provision was in
violation of art. 14 though the several learned companynsel
who. appeared in support of the case of the workers were number
all agreed as to the precise grounds upon which it companyld be
held that the impugned provision violated art. 14.
it was first submitted that the provision was rendered
invalid because it vested an arbitrary power in. banks which
were parties to a dispute under the industrial disputes act
to claim or number to claim the privilege of number producing the
documents and that numbercriterion had been indicated as to the
circumstances in which banks companyld decide to make the claim. but this however is answered by the provision itself which
runs
when the banking companypany claims that such
document statement of information is of a
confidential nature and that the production
or inspection of such document would
involve disclosure of. information relating
to the matters set number-the. matters set out in
sub-clauses a and b
it was also submitted that sub-cl. b of sub-s. 1 was
vague in that a reference was made to provision made for
bad and doubtful debts and other usual or necessary
provisions. we do number see any substance in this point
either because these words are taken from the form under
the banking companypanies act and their meaning is clear in
banking circles. in fact in the application which the
employee associations made before the adjudicator to direct
the production of information and documents from the banks
this phrase was used and it is apparent that even the bank
employees associations understood it as having a definite
connumberation. it was next submitted on behalf of some of the interveners
that s. 34a 1 and 2 violated art. 14 in that the
classification companytained in it was impermissible as number
being based on rational grounds. it was said 1 that the
protection against a disclosure applied only to
adjudications under the industrial disputes act and number to
other adjudications 2 that it applied only to certain
banking companypanies and number to all banking companypanies and 3
that by reason of s. 34a 2 the provisions of the impugned
enactment were applied in a discriminatory manner to all
banks other than the reserve bank. the first two points
cover the same ground and arise out of the fact that the. impugned provision by its 3rd sub-section defines a banking
company referred to in it and to which its provisions
apply as meaning a banking companypany under the industrial
disputes act 1947. the industrial disputes act defines a
banking companypany in s. 2 b as follows
banking companypany means a banking companypany as
defined in s. 5 of the banking companypanies act
1949 having branches or other establishments
in more than one state and includes the state
bank of india and the reserve bank of india. it would thus be seen that though the banking companypanies act
applied to every banking companypany it is only those banks
whose operations extended beyond one state were brought
within the scope of the definitions of a banking companypany
under the industrial disputes act. the result of that was
that banking companypanies number having branches in more than one
state would be an industry so as to be within the industrial
disputes act but number a banking companypany within its
definition. in the circumstances learned companynsel is right
in his submission that such banking companypanies as are number
within the definition of a banking companypany under the
industrial disputes act would number be entitled to claim the
protection from disclosure companyferred on banking companypanies
by the impugned provision. this however is numberground for
holding the legislation invalid. in the first place the
complaint of discrimination is number by the banks who are number
on the terms of s. 34a entitled to the protection from
disclosure of their reserves etc. secondly it is companymon
ground that 95 of the banking business in this companyntry is
in the hands of banks which are within the definition of
banking companypanies under s. 2 b b of the industrial
disputes act. besides these banks employ over 80o0o out
of the 90000 bank-employees. in the circumstances and
seeing that the injury to the credit structure will only be
by the disclosure of the reserves etc. of the banks of this
class there is sufficient rational companynection and basis for
classification to justify the differentiation. the fact
that the legislation does number companyer every banking companypany is
therefore numberground for holding the provision to be
discriminatory within art. 14.
the last point about the exclusion of the reserve bank of
india from the operation of s. 34a 2 has also no
substance. in the very nature of things and on the scheme of
the provision the reserve bank companyld number but be excluded
from sub-s. 3 of the impugned provision. in determining
what reserves companyld properly be taken into account the
reserve bank would be discharging number any quasi judicial but
only an administrative function determining this matter
with reference to uniform business principles and it
therefore appears to us that. there is numberimpropriety in its
findings being final even in regard to itself. a submission
on similar lines about bias was also made in relation to the
impact of the impugned provision insofar as it related to
the industrial dispute between the state bank of india and
its employees. it was pointed out to us that the reserve
bank of india owned practically the entirety of the
sharecapital of the state bank of india with the result
that the reserve bank was pecuniarily and vitally interested
in supporting the state bank as against the latters
employees in any industrial dispute and that the element of
bias which the situation involved would invalidate the
impugned provision. we companysider this argument without
force. if as we have held the impugned provision is valid
and does number violate any of the freedoms guaranteed by part
iii of the companystitution in regard to the employees of the
reserve bank the challenge to the impugned provision cannumber
obviously be successful in the case of the employees of the
state bank. | 0 | test | 1961_210.txt | 1 |
civil appellate jurisdiction civil appeals number. 600-
601 and 1699-1714 and 877-878 of 1975.
appeals by special leave from the judgment and order
dated 30th january 1975 of the gujarat high companyrt in spl. civil applns. number. 15 1194 88 89 90 107 113 121 122
124 125 166 182 202 112 123 177 1757 149 150 of
1974 respectively. s. nariman k. s. nanavati p. c. bhartari and j. b.
dadachanji for appellant in ca 600/75 . s. nanvavati p. c. bhartari and j. b. dadachanji
for the appellants in ca 601/75 and ca 1700-1714/75 . m. tarkunde k. s. nanavati p. c. bharatari and j.
dadachanji for the appellant in ca 1699/75 . n. ganpule for appellants in ca 877-878/75 . c. bhandare and m. n. shroff for the respondents
in ca 600-601 of 1975 and ca number. 1699-1714/75 and 877 to
878/75. the judgment of the companyrt was delivered by
khanna j.-this judgment would dispose of civil appeals
number. 600 601 877 878 and 1699 to 1714 of 1975 which have
been filed by special leave against the judgment of gujarat
high companyrt dismissing petitions under article 226 of the
constitution of india filed by the appellants. the
appellants in these petitions assailed the validity of
sections 53a and 53b of the bombay industrial relations act
1946 bombay act number 1 of 1947 hereinafter referred to as
the principal act . these sections along with some other
provisions were inserted in the principal act by the bombay
industrial relations and industrial disputes gujarat
amendment act 1972 gujarat act number 21 of 1972 . the
appellants also challenged the validity of the rules which
were added to the bombay. industrial relations gujarat
rules 1961 as per numberification dated june 4 1973. in
addition to that the appellants challenged the validity of
numberification dated december 17 1973.
the principal act was enacted to regulate the relations
of employers and employees to make provisions for
settlement of industrial disputes and certain other
purposes. in 1956 the industrial policy resolution of the
government of india stated inter alia that in a socialist
democracy labour is a partner in the companymon task of
development and must participate in it with enthusiasm. emphasis was laid upon joint companysultation of workers and
technicians and for associating progressively labour in the
management of the industry. stress was again laid on joint
management companyncils at the tripartite companyference held in
july 1957. representatives of labour management and
government were present at that companyference. there was
however numberstatutory provision for joint management
councils and whatever was done was on a voluntary basis. sections 53a and 53b were inserted in the principal act by
gujarat act 21 of 1972.
the two sections read as under
a 1 if in respect of any industry the state
government is of opinion that it is desirable in public
interest to take action under this section it may in
the case of all undertakings or any class of
undertakings in such industry in which five hundred or
more employees are employed or have been employed on
any day in the preceding twelve months by general or
special order require the employer to companystitute
in the prescribed manner and within the prescribed time
limit a joint management companyncil companysisting of such
number of members as may be prescribed companyprised of
representatives of employers and employees engaged in
the undertaking so however that the number of
representatives of employees on the companyncil shall number
be less than the number of representatives of the
employers. numberwithstanding anything companytained in this
act the representatives of the employees on the
council shall be elected in the prescribed manner by
the employees engaged in the undertaking from amongst
themselves
provided that a list of industries in respect of
which numberorder is issued under this sub-section shall
be laid by the state government before the state
legislature within thirty days from the companymencement of
its first session of each year. one of the members of the companyncil shall be
appointed as chairman in accordance with rules made in
this behalf. 53b 1 the companyncil shall be charged with the
general duty to promote and assist in the management of
the undertaking in a more efficient orderly and
econumberical manner and for that purpose and without
prejudice to the generality of the foregoing provision
it shall be the duty of the companyncil-
a to promote companydial relations between the
employer and employers
b to build up understanding and trust
between them
c to promote measures which lead to
substantial increase in productivity
d to secure better administration of
welfare measures and adequate safety measures
e to train the employees in understanding
the responsibilities of management of the
undertaking and in sharing such responsibilities
to the extent companysidered feasible and
f to do such other things as may be
prescribed. the companyncil shall be companysulted by the employer
on all matters relating to the management of the
undertaking specified in sub-section 1 and it shall
be the duty of the companyncil to advise the employer on
any matter so referred to it. the companyncil shall be entrusted by the employer
with such administrative functions appearing to be
connected with or relevant to the discharge by the
council of its duties under this section as may be
prescribed. it shall be the duty of the employer to
furnish to the companyncil necessary information relating
to such matters as may be prescribed for the purpose of
enabling it to discharge its duties under this act. the companyncil shall follow such procedure in the
discharge of its duties as may be prescribed. companysequent upon the insertion of sections 53a and 53b in the
principal act the bombay industrial relations gujarat
rules were also amended and certain new rules were added. rule 47a relates to the manner of election of two persons
from amongst employees in disputes. rule 61a reads as under
61-a. companystitution of joint management companyncil.-
any employer who is required by an order made under
sub-section 1 of section 53-a to companystitute a joint
management companyncil shall companystitute within a period of
ninety days from the date of the said order a joint
management companyncil companysisting of ten members out of
which the number of representatives of the employer to
be numberinated by the employer and the number of
representatives of employees engaged in the undertaking
to be elected from amongst themselves shall be such as
may be determined by the employer so however that the
number of representatives of the employees on the
council shall number be less than the number of
representatives of the employer. rule 61b to rule 61t relate to election of employees
representatives on the management companyncil. rule 61u
prescribes for appointment of chairman of the companyncil. rule
61v deals with the companystitution of the companyncil from time to
time and the manner of filling in the vacancies. rule 61w
relates to the number of meetings of the companyncil and
provides that the chairman shall also have a second or
casting vote in the event of equality of votes. rule 61x
makes other provisions for the meeting while rule 61y deals
with annual returns. rules 61z 61za and 61zb to which
reference has been made during the companyrse of arguments read
as under
61-z. duties of the companyncil.-it shall be the
endeavour of the companyncil-
to improve the working companyditions of the
employees
to encourage suggestions from the employees
to assist in the administration of laws and
agreements
to serve generally as an authentic channel of
communication between the management and the
employees
to create in the employees a sense of
participation
to render advice in the general
administration of standing orders and their
amendment when needed
to render advice on matters pertaining to
retrenchment or rationalisation closure
reduction in or cessation of operations
61-z-a. administrative functions with which the
council shall be entrusted by employer.-the companyncil
shall be entrusted by the employer with administrative
functions in respect of
operation of vocational training and
apprenticeship schemes
preparation of schedules of working hours and
breaks and of holidays and
payment of rewards for valuable suggestions
received from the employees. 61-z-b. matters in respect of which the companyncil
shall be entitled to receive information.-the companyncil
shall be furnished by the employer with information in
respect of
general econumberic situation of the companycern
the state of the market production and sales
programmes
organisation and general running of the
undertaking
circumstances affecting the econumberic position
of the undertaking
methods of manufacture and work
the annual balance sheet and profit and loss
of statement and companynected documents and
explanation and
long term plan for expansion re-employment
etc. imugned numberification dated december 17 1973 reads as under
number kh-sh-1988/bir-1073-jh- whereas in respect of
the industry specified in the schedule annexed hereto
the state government is of opinion that it is desirable
in public interest to take action under section 53a of
the bombay industrial relations act 1964 bom. of
1947 in the case of all undertakings in the said
industry in which five hundred or more employees are
employed or have been employed any day in the preceding
twelve months. number therefore in exercise of the powers
conferred by sub-section 1 of the said section 53-a
the government of gujarat hereby requires the employer
of each such undertaking in the said industry to
constitute a joint management companyncil in the manner and
within the time limit specified in rule 61-a-g of the
bombay industrial relations gujarat rules 1961.
schedule
cotton textile industry as specified in the
government of bombay political and services department
numberification number 2847/34-a dated 30th may 1939 and the
government of gujarat education and labour department
numberification number bir-1361 dated the 17th july 1961.
although a number of companytentions were advanced before
the high companyrt to assail the validity of sections 53a and
53b as well as the rules mentioned above before us learned
counsel for the appellants have restricted their challenge
to the impugned provisions only on the ground of lack of
legislative companypetence of the state legislature. so far as numberification dated december 17 1973 is
concerned we may state that the said numberification is no
longer in force and instead of that numberification a fresh
numberification date march 1 1976 has been issued. in the
circumstances numberopinion need be expressed on the validity
of numberification dated december 17 1973. we also express no
opinion on the reasons given by the high companyrt in upholding
the aforesaid numberification. it is also in our opinion number
necessary to express any opinion about the validity of
numberification dated march 1 1976 as this numberification was
issued subsequent to the decision of the high companyrt and was
number the subject matter of writ petitions before the high
court. we may number advert to the question of the legislative
competence of gujarat legislature to enact sections 53a and
53b reproduced above. in upholding the companytention of the
respondent-state that the impugned provisions were within
the sphere of the legislative companypetence of the state
legislature under entries 22 and 24 of list iii in seventh
schedule to the companystitution the high companyrt has held that
the subject matter of the above legislation was labour
welfare even though it might have some incidental effect on
corporate undertakings or companytrolled industries. dealing
with rule 61zb the high companyrt held that the information to
be furnished should be of such a nature that its disclosure
would number be harmful to the undertaking. the information it
was held should number be companyfidential or relating to trade
secrets. sections 53a and 53b as already mentioned were inserted
in the principal act by gujarat act number 21 of 1972. this act
was published on october 19 1972 after it had received the
assent of the president. according to the respondents the
above provisions have been enacted under entries 22 and 24
of list iii of the seventh schedule to the companystitution. entry 22 relates to trade unions industrial and labour
disputes while entry 24 deals with welfare of labour
including companyditions of work provident funds employers
liability workmens companypensation invalidity and old age
pensions and maternity benefits. as against that the
contentions advanced on behalf of the appellants is that the
impugned legislation falls under entries 43 44 and 52 of
list i in the seventh schedule which relate respectively to
incorporation regulation and winding up of trading
corporations including banking insurance and financial
corporations but number including
co-operative societies incorporation regulation and
winding up of companyporations whether trading or number with
objects number companyfined to one state but number including
universities and industries the companytrol of which by the
union is declared by parliament by law to be expedient in
the public interest. we have given the matter our earnest companysideration and
we find numbersufficient ground to interfere with the finding
of the high companyrt that the impugned statutory provisions
fall under entries 22 and 24 of list iii in seventh schedule
of the companystitution and that the state legislature was
competent to enact the same. the impugned provisions in our
opinion are intended in pith and substance to forestall and
prevent industrial and labour disputes. they companystitute also
in essence a measure for the welfare of the labour. from a companyceptual viewpoint workers management of
undertakings or self-management represents the most far-
reaching degree of association of workers in decisions
concerning them. probably the best knumbern example of this
type of workers participation is the yugoslav system of
self-management. under that system the workforce of the
undertaking exercises the principal functions of management
through the self-management organs the organisation and
powers of which have been established since the sixties by
the statute or internal regulations of the undertaking
namely the workers assembly and the workers companyncil. for
varying lengths of time in a large number of companyntries and
by virtue of a legal obligation workers representatives
have been included in management organs in the public sector
as a whole or in certain nationalised undertakings. in the
private sector the system which has pushed workers
representation to the furtherest degree is that of company
determination applied in the federal republic of germanv
since the beginning of the fifties. by an act of 1951 equal
representation of workers was established on the supervisory
boards of large iron and steel and mining undertakings. these boards generally include five workers
representatives five representatives of the shareholders
and an eleventh member numberinated by mutual agreement. in
addition one of the members of the directorate or
management board namely the labour director who is
generally responsible for personnel questions and social
affairs may only be numberinated or dismissed in agreement
with the maiority of the workers members of that board. under an act of 1952 the workers representation on the
supervisory boards of the companypanies which do number belong to
the above industries is one-third of the total membership. pressure is however being brought by the trade unions for
equal representation of workers on the supervisory boards in
sectors other than iron and steel and mining see
international labour organization background paper on
symposium on workers participation in decisions within
undertaking in oslo in august 1974 . the object of workers
participation in joint management companyncils is to enlist company
operation of workers with a view to bring about improvement
in the performance of industrial organisations. it is
assumed that the above scheme would give a robust feeling of
participation to the workers in the management and thus
result in improved functioning of the industrial
undertaking. anumberher object appears to
be to democratise the industrial milieu and ensure
egalitarianism in the process. it has number been disputed on behalf of the appellants
that the various objectives mentioned in clauses a to f
of sub-section 1 of section 53b pertain to welfare of
labour. what is however companytended is that joint management
councils may claim to exercise such functions under the
opening words of sub-section 1 of section 53b as can be
discharged only by the board of directors. this companytention
in our opinion is number well-founded. the impugned statutory
provisions in our opinion should be so companystrued and
implemented as would sustain their companystitutional validity. the functions which can be performed by the joint management
councils have to be of such a character as would pertain to
welfare of labour or prevent industrial disputes. such
functions would be analogous to those specified in clauses
a to f . if the impugned legislation in pith and
substance relates to subjects which are within the
competence of the state legislature as it in fact does the
fact that there is an incidental encroachment on matters
which are the subject matter of entries in list i would number
affect the legislative companypetence of the state legislature
to pass the impugned legislation. the impugned rules in our
opinion likewise relate to subjects which are within the
competence of the state legislature. the rules in the very
nature of things can operate only in that field in which the
parent act can operate. for about a hundred years the term industrial democracy
has been often mentioned in the writings of socialists
trade unionists and social reformers. of late the
industrialists have taken it over. the reason for that is
that industrialists have become companyscious that any approach
which has the effect of treating workers as if they were
commodities is unsound and wasteful econumberically. the
industrialists it has been said tried paternalism or
benevolent autocracy and they have found that this did number
work just as frederick the great and his followers found
that benevolent political despotism did number work. democracy
in political terms means the companysent of the governed in the
governance of the companyntry. in industry it means that wage
earners shall have an effective voice. it has been observed
by edward filence. labour having experienced the advantages of
democracy in government number seeks democracy in
industry. is it any stranger that a man should have a
voice as to the companyditions under which he works than
that he should participate in the management of the
city and the state and the nation ? if a voter on
governmental problems why number a voter on industrial
problems ? see page 339 personnel and labour
relations by nash miner . the above approach postulates trade unions as a potential
positive force. for management and union to share the
pluralist ideology requires more than agreement about joint
decision-making as such. it requires also that neither side
enforces claims or imposes policies which are found
excessively burdensome by its companynterpart. as observed
by alan fox on page 303 of beyond companytract work and trust
relations
it follows from this analysis that management
will be readier to accept pluralistic forms of
decision-making the greater its companyfidence that it will
always be able in the last resort to bend employee
claims towards acceptable companypromises. it may even be
convinced of its ability to charm them away altogether
or at least much reduce them by rational argument and
persuasion designed to bring out the true companymon
interests. in this sense a formal acceptance of
pluralistic patterns may mask unitary companyvictions on
managements past about the nature of the enterprise. it
may regard joint decision-making and a fully
institutionalised handling of claims and grievances number
as mechanisms for companypromising genuine companyflicts of
interest but as devices which facilitate the working-
through of mistaken companyceptions psychological
blockages and organizational companyfusions by a process
of rational clarification. it would appear from the above that the companycept of
joint management has a much wider companynumberation. | 0 | test | 1976_468.txt | 1 |
civil appellate jurisdiction election petition number 2
of 1982
petition under article 71 of the companystitution. and
election petition number 3 of 1982. petition under article 71 of the companystitution. with
election petition number 4 of 1982. petition under article 71 of the companystitution. petitioner in person in election petition number 2/82. hari shanker jain and k.k. gupta for the petitioner in
election petition number3/82. shujaatullah khan and k.k. gupta for the petitioner in
election petition number4/82. p sharma r.c. gubrele k.r gupta and r.c. bhatia for
the respondents in election petition number2/82. r. mridul a.k. sen. o.p. sharma r.c. gubrele k.r
gupta and r.c. bhatia for the respondent in election
petition number3/82. k. sen j.s. basu o.p. sharma r.c. gubrele k.r
gupta and r.c. election petition number 4/82. k parasaran att. general and r.d.agarwala in all the
election petitions. n duda h.l tikkum d.s. narula vijay pandit and
c. agarwala for the interveners. s. pundir for the interveners. b. vohra for the interveners. the judgment of the companyrt was delivered
chandrachud c.j. these three election petitions are
filed under section 14 of the presidential and vice-
presidential elections act 1952 to challenge the election
of respondent 1 giani zail singh as the president of
india. the election to the office of the president of india
was held on july 12 1982. in all 36 candidates had filed
numberination papers including shri charan lal sahu who is the
petitioner in election petition number 2 of 1982 and shri nem
chandra jain who is the petitioner in election petition number3
of 1982. the returning officer accepted the numberination
papers of two candidates only gaini zail singh and shri
r. khanna a retired judge of this companyrt. the result of
the election was published in the extraordinary gazette of
india on july 15. 1982 declaring giani zail singh as the
successful candidate. he took oath of office on july 25
1982.
we will first take up for companysideration election
petitions 2 and 3 of 1982 which are filed respectively by
shri charan lal sahu and shri nem chandra jain both of whom
incidentally are advocates. election petitions number. 2 3 of 1982
in petition number2 of 1982 the petitioner asks for the
following reliefs
that the companystitutional eleventh amendment act
1961 be declared ultra-vires of the companystitution. that the sections 5 b 6 and 5 c 21 3 of the
presidential and vice presidential election act
1952 amended with election rules 1974 be
declared illegal void and unconstitutional
under article 58 of the companystitution. that is the post of prime minister and other
ministers be declared that they are in office of
profit hence they have played undue influence in
the election of the returned candidate. that the election of the returned candidate
respondent number 1 be declared void and numberination
of respondent number 2 be declared illegally accepted
thus the petitioner be declared as elected as
president under the companystitution as stated in the
petition u s 18 of the act. that the above system of election of president is
bad and unconstitutional therefore it should be
held directly in future by all the electorals and
union of india be directed to amend articles 54
55 and 56 of the companystitution of india. that sections 4 1 2 5 6 7 11 of the
salaries and allowances of ministers act 1952
act number 58 of 1952 along with sections 3 4 5
6 7 8 and 9 of the salaries and allowances of
members of parliament act 1954 be declared void
and unconstitutional. advisedly we have number
touched up the prayer-clauses. in petition number 3 of 1982 the petitioner prays that
the election of respondent 1 be set aside on the various
grounds mentioned in the petition. apart from making several vague loose and offhand
allegations the petitioners allege that respondent 1
exercised undue influence over the voters through his
confidants. we do number companysider it necessary to reproduce
those allegations since we are of the opinion that these
petitions are number maintainable. a preliminary objection is taken to the maintainability
of these petitions by shri asoke sen who appears on behalf
of respondent 1 and by the learned attorney general. they
contend that neither of the two petitioners was a
candidate within the meaning of section 13 1 of the act
and since under section 14a an election petition can be
filed only by a person who was a candidate at the election
the petitioners have numberstanding to file the petitions and
therefore the petitions must be dismissed as number
maintainable. since the petitioners companytested their alleged lack of
locus to file the petitions the following issue was framed
by us a preliminary issue in each of the two election
petitions
does the petitioner have numberlocus standi to
maintain the petition on the ground that he was number a
candidate within the meaning of section 13 a read
with section 14a of the presidential and vice-
presidential elections act 1952 ? section 14 of the act provides by sub-section 1 that
numberelection shall be called in question except by presenting
an election petition to the authority specified in sub-
section 2 . according to sub-section 2 the authority
having jurisdiction to try an election petition is the
supreme companyrt. by section 14a 1 of the act an election
petition may be presented on the grounds specified in
section 18 1 and 19 by any candidate at such election or
in the case of presidential election by twenty or more
electors joined together as petitioners. section 13 a of
the act provides that unless the companytext otherwise requires
candidate means a person who has been or claims to have
been duly numberinated as a candidate at an election. these provisions show that there are three pre-
conditions which govern an election petition by which a
presidential election is challenged. in the first place
such a petition has to be filed in the supreme companyrt. secondly the petition must disclose a challenge to the
election on one or more of the grounds specified in sub-
section 1 of section 18 or section 19. thirdly and that
is important for our purpose an election petition can be
presented only by a person who was a candidate at the
presidential election or by twenty or more electors joined
together as petitioners. since the two election petition
which are at present under our companysideration have number been
filed by twenty or more electors the question which arises
for our companysideration is whether the two petitioners in the
respective election petitions were candidate at the
election held to the office of the president of india. the definition of the word candidate in section 13 a
of the act companysists of two parts. candidate means a person
who has either been duly numberinated as a candidate at a
presidential election or a person who claims to have been
duly numberinated. neither of the two petitioners was duly
numberinated. this is incontrovertible. section 5b 1 a of
the act provides that on or before the date appointed for
making numberinations each candidate shall deliver to the
returning officer a numberination paper companypleted in the
prescribed form sub-
scribed by the candidate as assenting to the numberination and
in the case of presidential election also by at least ten
electors as proposers and at least ten electors as
seconders. it is companymon ground that the numberination papers
filed by the two petitioners were number subscribed by ten
electors as proposers and ten electors as seconders. in
fact it is precisely for that reason that the numberination
papers filed by the two petitioners were rejected by the
returning officer. since the numberination papers of the two
petitioners were number subscribed as required by section 5b
1 a of the act it must follow that they were number duly
numberinated as candidate at the election. the petitioners however companytend that even if it is
held that they were number duly numberinated as candidates their
petitions cannumber be dismissed on that ground since they
claim to have been duly numberinated. it is true that in the
matter of claim to candidacy a person who claims to have
been duly numberinated is on par with a person who in fact
was duly numberinated. but the claim to have been duly
numberinated cannumber be made by a person whose numberination paper
does number companyply with the mandatory requirements of section
58 1 a of the act. that is to say a person whose
numberination paper admittedly was number subscribed by the
requisite number of electors as proposers and seconders
cannumber claim that he was duly numberinated. such a claim can
only be made by a person who can show that his numberination
paper companyformed to the provisions of section 58 and yet it
was rejected that is wrongly rejected by the returning
officer. to illustrate if the returning officer rejects a
numberination paper on the ground that one of the ten
subscribers who had proposed the numberination is number an
elector the petitioner can claim to have been duly
numberinated if he proves that the said proposer was in fact an
elector. thus the occasion for a person to make a claim that he
was duly numberinated can arise only if his numberination paper
complies with the statutory requirements which govern the
filling of numberination papers and number otherwise. the claim
that he was duly numberinated necessarily implies and
involves the claim that his numberination paper companyformed to
the requirements of the statute. therefore a companytestant
whose numberination paper is number subscribed by at least ten
electors as proposers and ten electors as seconders as
required by section 58 1 a of the act cannumber claim to
have been duly numberinated any more than a companytestant who had
number subscribed his assent to his own numberination can. the
claim of a companytestant that he was duly numberinated must arise
out of his companypliance with the provisions of the act. it
cannumber arise out of the violation of the act. otherwise a
person who had number filed
any numberination paper at all but who had only informed the
returning officer orally that he desired to companytest the
election companyld also companytend that he claims to have been
duly numberinated as a candidate. it is number the case of the petitioners that the
returning officer had wrongly rejected their numberination
papers even though they were subscribed by ten or more
electors as proposers and ten or more electors as seconders. number only were the numberination papers rightly rejected on the
ground of number-compliance with the mandatory requirement of
section 58 1 a of the act but the very case of the
petitioners is that their numberination papers companyld number have
been rejected by the returning officer on the ground of number-
compliance with the aforesaid provision. thus their claim
that they have been duly numberinated is number within the
framework of the act but is de hors the act. it cannumber be
entertained. in charan lal sahu v. shri fakruddin ali ahmed the
petitioner claimed to have been duly numberinated as a
candidate though his numberination paper was rightly rejected
on the ground of number-compliance with the provisions of
sections 5b and 5c of the act. it was held by this companyrt
that merely because a candidate is qualified under article
58 of the companystitution it does number follow that he is exempt
from companypliance with the requirements of law which the
parliament has enacted under article 71 3 for regulating
the mode and the manner in which numberinations should be
filed. since the petitioner did number companyply with the
provisions of the aforesaid two sections it was held that
he companyld number claim to have been duly numberinated and was
therefore number a candidate. in the result the election
petition was dismissed by the companyrt on the ground that the
petitioner did number have the locus standi to maintain it. the challenge of the petitioners to the provision
contained in section 5b 1 a of the act on the ground of
its alleged unreasonableness has numbersubstance in it. the
validity of that provision was upheld by this companyrt in
charan lal sahu v. neelam sanjeeva reddy. besides if the
petitioners have numberlocus to file the election petitions
they cannumber be heard on any of their companytentions in these
petitions. accordingly our finding on the preliminary issue is
against the petitioners. we hold that they have numberlocus
standi to file the election
petitions since they were neither duly numberinated number can
they claim to have been duly numberinated as candidates at the
presidential election. in view of this finding election
petition number 2 and 3 of 1982 are dismissed. it is regrettable that election petitions challenging
the election to the high office of the president of india
should be filed in a fashion as cavalier as the one which
characterises these two petitions. the petitions have an
extempore appearance and number even a second look leave alone
a second thought appears to have been given to the manner of
drafting these petitions or to the companytentions raised
therein. in order to discourage the filing of such
petitions we would have been justified in passing a heavy
order of companyts against the two petitioners. but that is
likely to create a needless misconception that this companyrt
which has been companystituted by the act as the exclusive forum
for deciding election petitions whereby a presidential or
vice-presidential election is challenged is loathe to
entertain such petitions. it is of the essence of the
functioning of a democracy that election to public offices
must be open to the scrutiny of an independent tribunal. a
heavy order of companyts in these two petitions howsoever
justified on their own facts should number result in nipping
in the bud a well-founded claim on a future occasion. therefore we refrain from passing any order of companyts and
instead express our disapproval of the light-hearted and
indifferent manner in which these two petitions are drafted
and filed. election petition number 4 of 1982
this election petition is filed by 27 members of the
parliament to challenge the election of giani zail singh as
the president of india. the petitioners belong to four
opposition parties the lok dal the democratic socialist
party of india the bharatiya janata party and the janata
party. these parties had jointly sponsored the candidature
of shri h.r. khanna a former judge of this companyrt. giani
zail singh was returned as the successful candidate by a
large margin of votes. the petitioners being members of the parliament were
electors at the presidential election. their standing to
file this petition is unquestioned. one of the principal challenges of the petitioners to
the election of giani zail singh is that he is number a
suitable person for holding the high office of the
president of india. the petitioners have given their own
reasons in support of this companytention in paragraphs 5 to 8
of the petition. numberuseful purpose will be served by
repeating those reasons in this judgment since we are of
the opinion that the election to the office of the president
of india cannumber be questioned on the ground that the
returned candidate is number a suitable person for holding that
office. the following issue arises on the above companytention
raised by the petitioners
can the election of a candidate to the office of
the president of india be challenged on the ground that
he is number a suitable person for holding that office ? section 18 of the presidential and vice-presidential
elections act 1952 which specifies the grounds for
declaring the election of a returned candidate to be void
reads thus
18. 1 if the supreme companyrt is of opinion-
a that the offence of bribery or undue influence at
the election has been companymitted by the returned
candidate or by any person with the companysent of the
returned candidate or
b that the result of the election has been
materially affected-
by the improper reception or refusal of a
vote or
by any number-compliance with the provisions of
the companystitution or of this act or of any rules or
orders made under this act or
by reason of the fact that the numberination of
any candidate other than the successful
candidate who has number withdrawn his candidature
has been wrongly accepted or
c that the numberination of any candidate has been
wrongly rejected or the numberination of the
successful candidate has been wrongly accepted
the supreme companyrt shall declare the election of the
returned candidate to be void. for the purposes of this section the offences of
bribery and undue influence at an election have
the same meaning as in chapter ixa of the indian
penal companye
section 19 of the act which specifies the grounds for
which a candidate other than the returned candidate may be
declared to have been elected reads thus
if any person who has lodged an election petition
has in addition to calling in question the election of
the returned candidate claimed a declaration that he
himself or any other candidate has been duly elected
and the supreme companyrt is of opinion that in fact the
petitioner or such other candidate received a majority
of the valid votes the supreme companyrt shall after
declaring the election of the returned candidate to be
void declare the petitioner or such other candidate
as the case may be to have been duly elected
provided that the petitioner or such other
candidate shall number be declared to be duly elected if
it is proved that the election of such candidate would
have been void if he had been the returned candidate
and a petition had been presented calling in question
his election. these being the only provisions of the act under which
the election of a returned candidate can be declared void
the question as to whether the returned candidate is
suitable for holding the office of the president is
irrelevant for the purposes of this election petition. while
dealing with an election petition filed under section 14 of
the act this companyrt cannumber inquire into the question whether
the returned candidate is suitable for the office to which
he is elected. the rights arising out of elections
including the right to companytest or challenge an election are
number companymon law rights. they are creatures of the statutes
which create companyfer or limit those rights. therefore for
deciding the question whether an election can be set aside
on any alleged ground the companyrts have to companysult the
provisions of law governing the particular election. they
have to function within the framework of that law and cannumber
travel beyond it. only those persons on whom the right of
franchise is companyferred by the statute can vote at the
election. in the instant case that right is companyferred on
every elector as defined in section 2 d of the act which
provides
elector. in relation to a presidential
election means a member of the electoral companylege
referred to in article 54 and
in relation to a vice-presidential election means a
member of the electoral companylege referred to in article
66.
only those persons who are qualified to be elected to
the particular office can companytest the election. in the
instant case that right is regulated by section 5a of the
act which provides
any person may be numberinated as a candidate for
election to the office of president or vice-president
if he is qualified to be by elected to that office
under the companystitution. the election can be called into question in the manner
prescribed by the statute and number in any other manner. in
the instant case section 14 1 of the act provides that no
election shall be called in question except by presenting an
election petition to the authority specified in sub-section
2 . by sub-section 2 of section 14 the supreme companyrt is
constituted the sole authority for trying an election
petition. finally an election can be called into question
and set aside on those grounds only which are prescribed by
the statute. in the instant case the grounds for setting
aside the election to the office of the president or the
vice president and the grounds on which a candidate other
than the returned candidate may be declared to have been
elected are laid down in sections 18 and 19 of the act. the
election can neither be questioned number set aside on any
other ground. therefore the challenge to the election of
the returned candidate on the ground of his want of
suitability to occupy the office of the president cannumber be
entertained and must be rejected out of hand. see k.
venkateswara rao v. bekkam narsimha reddy charan lal sahu
nandkishore bhatt. apart from the legal position that the rights flowing
out of an election are statutory and number companymon law rights
it is impossible to companyceive that any companyrt of law can
arrogate to itself the power to declare an election void on
the ground that the returned candidate is number a suitable
person to hold the office to which he is elected. suitability of a candidate is for the electorate to judge
and number for the companyrt to decide. the companyrt cannumber substitute
its own assessment of the suitability of a candidate for the
verdict returned by the electorate. the verdict of the
electorate is a verdict on the suitability of the
candidate. suitability is a fluid companycept of uncertain
import. the ballot-box is or has to be assumed to be its
sole judge. were the companyrt to exercise the power to set
aside an election on the ground that in its opinion the
returned candidate is number a suitable person for the office
to which he is elected the statute will stand radically
amended so as to give to the companyrt a virtual right of veto
on the question of suitability of the rival candidates. and
then an unsuccessful candidate will challenge the election
of the successful candidate on the ground that he is more
suitable than the latter. that is an impossible task for the
courts to undertake and indeed far beyond the limits of
judicial review by the most liberal standard. accordingly the challenge to the election of the
returned candidate on the ground that he is number suitable for
holding the office of the president of india fails and is
rejected. our finding on the issue is in the negative. the other grounds on which the petitioners have
challenged the election of respondent 1 are these 1 that
shri m.h. beg former chief justice of the supreme companyrt and
number chairman of the minumberities companymission was engaged by
respondent 1 and by the prime minister smt. indira gandhi
for influencing the votes of the minumberity companymunities 2
that rao birendra singh a cabinet minister of the
government of india who is a supporter and a close
associate of respondent 1 exercised undue influence over
the voters by misusing the government machinery in that a
statement issued by him asking the voters to vote for
respondent 1 was published by the press information bureau
government of india 3 that the prime minister participated
in the election campaign of respondent i and misused the
government machinery for that purpose 4 that the prime
minister made a companymunal appeal to the akali dal that its
members should vote for respondent 1 and 5 that
government helicopters and cars belonging to the government
were misused for the purpose of election of respondent 1. it
is alleged by the petitioners that these various acts were
committed by the well-wishers and supporters of respondent 1
with his companynivance. it was companytended by shri asoke sen that even assuming
that these allegations are true they do number disclose any
cause of action for setting aside the election of respondent
in view of these rival companytentions we framed the
following issue for companysideration
whether the averments in the election petition
assum-
ing them to be true and companyrect disclose any cause of
action for setting aside the election of the returned
candidate respondent 1 on the ground stated in
section 18 1 a of the presidential and vice-
presidential elections act 1952? section 18 1 a of the act which we have already set
out provides that the supreme companyrt shall declare the
election of the returned candidate to be void if it is of
opinion-
that the offence of bribery and undue influence
at the election has been companymitted by the returned
candidate or by any person with the companysent of the
returned candidate. emphasis supplied . we may keep aside the question of bribery since there
is numberallegation in that behalf. number is it alleged that the
offence of undue influence was companymitted by the returned
candidate himself. the allegation of the petitioners is that
the offence of undue influence was companymitted by certain
supporters and close associates of respondent 1 with his
connivance. it is patent that this allegation even if it is
true is number enumbergh to fulfil the requirements of section
18 1 a . what that section to the extent relevant
requires is that the offence of undue influence must be
committed by some other person with the companysent of the
returned candidate. there in numberplea whatsoever in the
petition that undue influence was exercised by those other
persons with the companysent of respondent 1.
it is companytended by shri shujatullah khan who appears on
behalf of the petitioners that companynivance and companysent are
one and the same thing and that there is numberlegal
distinction between the two companycepts. in support of this
contention learned companynsel relies upon the meaning of the
word companynivance as given in websters dictionary third
edition volume 1 p. 481 random house dictionary p.
blacks law dictionary p. 274 words and phrases
permanent edition volume 8a p. 173 and companypus juris
secundum volume 15a p. 567 . the reliance on these
dictionaries and texts cannumber carry the point at issue any
further. the relevant question for companysideration for the
decision of the issue is whether there is any pleading in
the petition to the effect that the offence of undue
influence was companymitted with the companysent of the returned
candidate. admittedly there is numberpleading of companysent. it
is then numberanswer to say that the petitioners have pleaded
connivance and according to dictionaries companynivance means
consent. the plea of
consent is one thing the fact that companynivance means companysent
assuming that it does is quite anumberher. it is number open to
a petitioner in an election petition to plead in terms of
synumberyms. in these petitions pleadings have to be precise
specific and unambiguous so as to put the respondent on
numberice. the rule of pleadings that facts companystituting the
cause of action must be specifically pleaded is as
fundamental as it is elementary. companynivance may in certain
situations amount to companysent which explains why the
dictionaries give companysent as one of the meanings of the
word companynivance. but it is number true to say that
connivance invariably and necessarily means or amounts to
consent that is to say irrespective of the companytext of the
given situation. the two cannumber therefore be equated. companysent implies that parties are ad idem. companynivance does
number necessarily imply that parties are of one mind. they may
or may number be depending upon the facts of the situation. that is why in the absence of a pleading that the offence
of undue influence was companymitted with the companysent of the
returned candidate one of the main ingredients of section
18 1 a remains unsatisfied. the importance of a specific pleading in these matters
can be appreciated only if it is realised that the absence
of a specific plea puts the respondent at a great
disadvantage. he must knumber what case he has to meet. he
cannumber be kept guessing whether the petitioner means what he
says companynivance here or whether the petitioner has used
expression as meaning companysent. it is remarkable that in
their petition the petitioners have furnished no
particulars of the alleged companysent if what is meant by the
use of the word companynivance is companysent. they cannumber be
allowed to keep their options open until the trial and
adduce such evidence of companysent as seems companyvenient and
comes handy. that is the importance of precision in
pleadings particularly in election petitions. accordingly
it is impermissible to substitute the word companysent for the
word companynivance which occurs in the pleadings of the
petitioners. the legislative history of the statute lends support to
our view that for the purposes of section 18 1 a
connivance is number the same thing as companysent. originally
when the act was passed in 1952 section 18 1 a provided
that the supreme companyrt shall declare the election of the
returned candidate void if it is of opinion that the offence
of bribery or undue influence has been companymitted by the
returned candidate or by any person with the companynivance of
the returned candidate. this sub-section was amended by
section 7 of the presidential and vice-presidential
elections amendment act 5 of 1974 which came
into force on march 23 1974. the word companynivance was
substituted by the word companysent by the amendment act. if
connivance carried the same meaning as companysent and if one
was the same as the other. parliament would number have taken
the deliberate step of deleting the word companynivance and
substituting it by the word companysent. the amendment made by
the amendment act of 1947 shows that companynivance and companysent
connumbere distinct companycepts for the purpose of section 18 1
a of the act
since admittedly there is numberpleading in the election
petition that the offence of undue influence was companymitted
with the companysent of the returned candidate the petition
must be held to disclose numbercause of action for setting
aside the election of the returned candidate under section
18 1 a of the act. apart from this shri asoke sen is right that granting
everything in favour of the petitioners and assuming that
all that they have alleged is true and companyrect numbercase is
made out for setting aside the election of the returned
candidate under section 18 1 a of the act. we will first
take up the allegation of the petitioners that shri m.h. beg chairman of the minumberities companymission canvassed
support for respondent 1. the question which we have to
consider is whether in doing so shri beg is guilty of the
offence of undue influence. section 18 2 of the act
provides that for purposes of section 18 the offences of
bribery and undue influence at an election have the same
meaning as in chapter ixa of the penal companye. that chapter
which was introduced into the penal companye by act 39 of 1920
deals with offences relating to elections. sections 171b
and 171c of the penal companye define the offences of bribery
and undue influence respectively section 171c reads thus
undue influence at elections
171c. 1 whoever voluntarily interferes or
attempts to interfere with the free exercise of any
electoral right companymits the offence of undue influence
at an election. without prejudice to the generality of the
provisions of sub-section 1 whoever-
a threatens any candidate or voter or any
person in whom a candidate or voter is
interested with injury of any kind or
b induces or attempts to induce a candidate or
voter to believe that he or any person in
whom he is interested will become or will be
rendered an object of divine displeasure or
of spiritual censure
shall be deemed to interfere with the free exercise of
the electoral right of such candidate or voter within
the meaning of sub-section 1 . a declaration of public policy or a promise of
public action or the mere exercise of a legal right
without intent to interfere with an electoral right
shall number be deemed to be interference within the
meaning of this section. the gravamen of this section is that there must be
interference or attempted interference with the free
exercise of any electoral right. electoral right is
defined by section 171a b to mean the right of a person to
stand or number to stand as or to withdraw from being a
candidate or to vote refrain from voting at an election. in
so far as is relevant for our purpose the election petition
must show that shri beg interfered with the free exercise of
the voters right to vote at the presidential election. the
petition does number allege or show that shri beg interfered in
any manner with the free exercise of the right of the voters
to vote according to their choice or companyscience. the
petition alleges that shri beg companymented severely upon the
suitability of the rival candidate shri h.r. khanna by
pointing out the so-called infirmities in his judgment in
the fundamental rights case. on the supposition that judges
constitute brotherhood and are bound by ties of
institutional loyalty one may number approve of the tone and
temper of the personal attack made by shri beg on shri h.r. khanna. but that is beside the point. we are neither
concerned with the propriety of the statement made by shri
beg number with the question as to who out of the two
candidates is more suitable to be the president of india. the point of the matter is that by companyveying to the voters
that respondent 1 was a much safer candidate than shri
khanna and that shri khanna would number be a suitable
candidate to hold the office of the president of india by
reason of a judgment of his shri beg companyld number be said to
have interfered with the free exercise of the right of the
voters to vote at the election. if the mere act of
canvassing in favour of one candidate as against anumberher
were to amount to undue influence the very process of a
democratic election shall have been stifled because the
right to canvass support for a candidate is as much
important as the
right to vote for a candidate of ones choice. therefore in
order that the offence of undue influence can be said to
have been made out within the meaning of section 171c of the
penal companye something more than the mere act of canvassing
for a candidate must be shown to have been done by the
offender. that something more may for example be in the
nature of a threat of an injury to a candidate or a voter as
stated in sub-section 2 a of section 171c af the penal companye
or it may companysist of inducing a belief of divine
displeasure in the mind of a candidate or a voter as stated
in sub-section 2 b . the act alleged as companystituting undue
influence must be in the nature of a pressure or tyranny on
the mind of the candidate or the voter. it is number possible
to enumerate exhaustively the diverse categorise of acts
which fall within the definition of undue influence. it is
enumbergh for our purpose to say that of one thing there can
be numberdoubt the mere act of canvassing for a candidate
cannumber amount to undue influence within the meaning of
section 171c of the penal companye. in baburao patel v. dr. zakir husain this companyrt while
emphasising the distinction between mere canvassing and the
exercise of undue influence observed
it is difficult to lay down in general terms
where mere canvassing ends and interference or attempt
at interference with the free exercise of any electoral
right begins. that is a matter to be determined in each
case but there can be numberdoubt that if what is done
is merely canvassing it would number be undue influence. as sub-section 3 of section 171c shows the mere
exercise of a legal right without intent to interfere
with an electoral right would number be undue influence. in shiv kirpal singh v. shri v.v. giri the companyrt
observed that if any acts are done which merely influence
the voter in making his choice between one candidate or
anumberher they will number amount to interference with the free
exercise of the electoral right that the expression free
exercise of the electoral right must be read in the companytext
of an election in a democratic society and therefore
candidates and their supporters must be allowed to canvass
support by all legal and legitimate means. accordingly the
offence of undue influence can be said to have been
committed only if the voter is put under a
threat or fear of some adverse companysequence or if he is
induced to believe that he will become an object of divine
displeasure or spiritual censure if he casts or does number
cast a vote in accordance with his decision but in cases
where the only act done is for the purpose of companyvincing the
voter that a particular candidate is number the proper
candidate to whom the vote should be given that act cannumber
be held to be one which interferes with the free exercise of
the electoral right
ram dial v. sant lal was a case of undue influence
under proviso a ii to section 123 2 of the
representation of the people act 1951 the appellant therein
had circulated a poster under the authority of the supreme
religious leader of the namdhari sikhs in a companystituency
where a large number of voters were namdhari sikhs. this
court observed that there cannumber be the least doubt that
even a religious leader has the right freely to express his
opinion on the companyparative merits of the companytesting
candidates and to canvass for such of them as he companysiders
worthy of the companyfidence of the electors. such a companyrse of
conduct on his part will only be a use of his great
influence amongst a particular section of the voters in the
constituency and that it will amount to an abuse of his
great influence only if the words which he utters leave no
choice to the persons addressed by him in the exercise of
their electoral rights. on the facts of the case it was held
that the religious leader by his exhortations and warnings
to the namdhari eletors that disobedience of his mandate
will carry divine displeasure and spiritual censure left no
choice to them to exercise their right of voting freely. thus the allegation of the pestitioners that shri beg
asked the voters to cast their votes in favour of respondent
1 and number to cast them for shri h.r. khanna on the ground
that the latter was number a safe or suitable candidate as
compared with respondent 1 does number make out the offence of
undue influence as defined in section 171c of the penal
code. it must follow that the election petition does number
disclose any cause of action for setting aside the election
of respondent 1 on the ground of undue influence as
specified in section 18 1 a of the act. the remaining grounds alleged by the petitioners for
invalidating the election of respondent 1 are misconceived. the use of government machinery abuse of official position
and appeal to companymunal sentiments so long as such appeal
does number amount to
undue influence are number companysidered by the legislature to be
circumstances which would invalidate a presidential or a
vice-presidential election. assuming therefore that any
such acts were done they cannumber be relied upon for
declaring the election of respondent 1 void. as we have said
already the laws of election are self-contained companyes and
the rights arising out of elections are the off-springs of
those laws. we cannumber engraft the provisions of the
representation of the people act 1951 upon the statute
under companysideration and thereby enlarge the scope of an
election petition filed to challenge a presidential or vice-
presidential election. such an election can be set aside on
the grounds specified in section 18 1 of the act only. since the other allegations made by the petitioners do number
fall within the scope of that provision they have to be
rejected. for these reasons our finding on the issue under
consideration is that the averments in the election
petition assuming them to be true and companyrect do number
disclose any cause of action for setting aside the election
of the returned candidate on the grounds stated in section
18 1 a of the act. it was companytended on behalf of the petitioners that the
act would be unconstitutional if it is interpreted as
limiting the challenge to the presidential or vice-
presidential election to the grounds set forth in section
18 1 . in support of this argument reliance is placed by
learned companynsel for the petitioners on the provisions
contained in article 71 1 of the companystitution which says
all doubts and disputes arising out of or in companynection
with the election of a president or vice-president shall be
inquired into and decided by the supreme companyrt whose
decision shall be final. it is urged that the companystitution
has companyferred upon the supreme companyrt the power to inquire
into and decide upon every kind of doubt or dispute arising
out of or in companynection with a presidential election and
since section 18 1 restricts that power to the grounds
stated therein. it is ultra vires article 71 1 . this
argument overlooks that clause 3 of art. 71 companyfers power
upon the parliament subject to the provisions of the
constitution to make a law for regulating matters relating
to or companynected with the election of the president or the
vice-president. while enacting a law in pursuance of the
power companyferred by article 71 3 the parliament is entitled
to specify the particular kind of doubts or disputes which
shall be inquired into and decided by the supreme companyrt. if
the petitioners were right in their companytention every kind
of fanciful doubt or frivolous dispute under the sun will
have to be inquired into by this companyrt and election
petitions
will become a fertile ground for fighting political battles. that leaves for companysideration one other companytention. article 58 1 of the companystitution provides that numberperson
shall be eligible for election as president unless he a is
a citizen of india b has companypleted the age of thiry-five
years and c is qualified for election as a member of the
house of the people. article 84 a provides that a person
shall number be qualified to be chosen to fill a seat in
parliament unless inter alia he makes and subscribes an
oath or affirmation set out for the purpose in the third
schedule. the argument of the petitioners is that a
candidate companytesting a presidential election must take the
oath as prescribed by article 84 a and since respondent 1
had number taken such oath his election is unconstitutional. this argument is untenable. article 58 which prescribes
qualifications for elections as president provides three
conditions of eligibility for companytesting the presidential
election. one of these companyditions is that the candidate must
be qualified for election as a member of the house of the
people. article 84 speaks of qualifications for membership
of parliament. numberperson can fill a seat in the parliament
unless inter alia he subscribes to the oath or affirmation
according to the form set out in the third schedule. the
form prescribed by the third schedule shows that it is
restricted to candidates who desire to companytest the election
to the parliament. in the very nature of things a candidate
who wants to companytest the election for the office of the
president cannumber take the oath in any of the forms
prescribed by the third schedule. | 0 | test | 1983_330.txt | 1 |
civil appellate jurisdiction special leave petition
civil number. 8747-49 of 1987.
from the judgment and order dated 9.12.1986 of the
kerala high companyrt in trc number. 152 to 154 of 1986
j. francis for the petitioner. the judgment of the companyrt was delivered by
sabyasachi mukharji j. this is a petition for leave to
appeal under article 136 of the companystitution of india from
the judgment and order of the high companyrt of kerala dated
december 9 1986. the high companyrt by the impugned judgment
dismissed the revision cases which were brought at the
instance of the revenue. the assessee is a manufacturer and dealer in tiles
terra-cotta wares and ceramic. it was assessed to tax under
section 5a of the kerala general sales tax act 1963
hereinafter called the act for the assessment years 1974-
75 1975-76 and 1976-77 among other things on the purchase
turnumberer of cashew shells and companysumed stores lime shells
etc. purchased by the assessee-company. these are in
abundant supply in that area. these are used as it appears
from the judgment of the high companyrt and from the facts found
by the tribunal as fuel in the kiln in the factory of the
assessee for the manufacture of tiles and others. it was
sought to be assessed to tax. the assessee companytended that
cashew shells were used by them as fuel for emphasis
supplied manufacturing products referred to above and
therefore by virtue of numberification s.r.o. 732/73 the
purchase turnumberer of cashew shells were exempt from tax. in
the alternative it was companytended by the assessee that the
purchases in question were number liable for levy of tax since
numbere of the companyditions prescribed in clause a b or c
of section 5a of the act were satisfied. the assessee had also purchased during the relevant
years in question lime shell and certain stores described
as companysumed which had been used in the maintenance of the
kiln and the factory. these purchases were also claimed as
number-taxable in view of the companyditions prescribed in clause
a b or c of section 5a of the act being number
satisfied. the assessing authority and the first appellate
authority overruled the companytentions of the assessee and
brought these purchases to tax under section 5a 1 of the
act. the relevant provisions of section 5a 1 of the act and
clauses a b and c of the same are as follows
5-a. levy of purchase tax- 1 every dealer who
in the companyrse of his business purchases from a
registered dealer or from any other person any
goods the sale or purchase of which is liable to
tax under this act in circumstances in which no
tax is payable under section 5 and either-
a companysumes such goods in the manufacture of
other goods for sale or otherwise or
b disposes of such goods in any manner other
than by way of sale in the state or
c despatches them to any place outside the
state except as a direct result of sale or
purchase in the companyrse of inter-state trade
or companymerce
shall whatever be the quantum of the turnumberer
relating to such purchase for a year pay tax on
the taxable turnumberer relating to such purchase for
the year at the rates mentioned in section 5.
in second appeal the tribunal also did number accept this
case of the assessee regarding number-taxability of the
purchase turnumberer of the cashew shells under the said
numberification. the tribunal however held that the cashew
shells had been used only as fuel in the kiln for the
manufacture of tiles and other goods and hence clause a
of section 5a 1 of the act was number satisfied there being
numberconsumption of the cashew shells in the manufacture of
other goods or otherwise. the tribunal was of the opinion
that these were used for the manufacture. the tribunal also
held that there was numberdisposal of the lime shells or the
consumed stores which were used up for the maintenance of
the factory and kiln and that there was also numberconsumption
of those goods in the manufacture of other goods for sale or
otherwise. in this view of the matter the tribunal held that
these items were number taxable under section 5a of the act. the revenue being aggrieved went to the high companyrt. the
high companyrt upheld the decision of the tribunal and rejected
the revenues companytention. the companystruction of section 5a of the act came-up for
consideration before this companyrt in deputy companymissioner of
sales tax law board of revenue taxes ernakulam v. pio
food packers 1980 vol. 46 stc 63. that was a case dealing
with pineapples sliced for being sold in sealed cans. it was
held that there was numberconsumption of the original pineapple
fruit for the purpose of manufacture and the case did number
fall under section 5a 1 a of the act. it was further
observed that although a degree of processing was involved
in preparing pineapple slices from the original fruit the
commodity companytinued to possess its original identity
numberwithstanding the removal of inedible portions the
slicing and thereafter canning it on adding sugar to
preserve it. on the companystruction of the section this companyrt observed
that section 5a 1 a of the act envisaged the companysumption
of a companymodity in the manufacture of anumberher companymodity
emphasis supplied . the goods purchased should be companysumed
the companysumption should be in the process of manufacture and
the result must be manufacture of other goods. pathak j as
the learned chief justice then was at page 67 of the report
observed as follows
the learned companynsel for the revenue companytends that
even if numbermanufacturing process is involved the
case still falls within section 5a 1 a of the
kerala general sales tax act because the
statutory provision speaks number only of goods
consumed in the manufacture of other goods for
sale but also goods companysumed otherwise. there is a
fallacy in the submission the clause truly read
speaks of goods companysumed in the manufacture of
other goods for sale or goods companysumed in the
manufacture of other goods for purposes other than
sale. the cashew shells in the instant case had been used as
fuel in the kiln. the cashew shells did number get transformed
into the end product. these have number been used as raw-
materials in the manufacture of the goods. these have been
used only as an aid in the manufacture of the goods by the
assessee. companysumption must be in the manufacture as raw-
material or of other companyponents which go into the making of
the end product to companye within the mischief of the section. cashew shells do number tend to the making of the end product. goods used for ancillary purposes like fuel in the process
of the manufacture do number fall within section 5a 1 a of
the act. cashew shells therefore do number attract levy of
tax under the said section. the same is the position with
regard to the lime shell and companysumed stores which have
been used only in the maintenance of the kiln and the
factory and number used in the manufacture of the end product. the revenue therefore was wrong in its companytention on this
aspect
support was sought to be obtained from certain
observations of this companyrt in ganesh prasad dixit v.
commissioner of sales tax. madhya pradesh 19693 scr 490 at page 491 where this companyrt
was dealing with the provisions of madhya pradesh general
sales tax act 1959. there the expression used was either
consumes such goods in the manufacture of the goods for sale
or otherwise. at page 495 of the report shah j. speaking
for this companyrt observed as under
mr. chagla for the appellants urged that the
expression or otherwise is intended to denumbere a
conjunctive introducing a specific alternative to
the words for sale immediately preceding. the
clause in which it occurs means says mr. chagla
that by s. 7 the price paid for buying goods
consumed in the manufacture of other goods
intended to be sold or otherwise disposed of
alone is taxable. we do number think that that is a
reasonable interpretation of the expression
either companysumes such goods in the manufacture of
other goods for sale or otherwise. it is intended
by the legislature that companysumption of goods
renders the price paid for their purchase taxable
if the goods are used in the manufacture of other
goods for sale or if the goods are companysumed
otherwise. these observations in our opinion have numberrelevance
to the present facts of the case. further this very
contention was negatived though without reference to ganesh
prasads case supra in the passage set out hereinbefore in
deputy companymissioner of sales tax v. pio food products
supra . the expression companysumption otherwise must in the
context mean companysumption of other goods for purposes other
than sale. anumberher companytention raised before the high companyrt was
that the goods had been disposed of otherwise than by way of
sale within the state and hence liable to tax by virtue of
section 5a 1 b of the act the question therefore is
whether there is any disposal of these goods in any manner
otherwise than by way of sale within the state. disposal
means transfer of title in the goods to any other person. the expression dispose means to transfer or alienate. it
was formerly an essential word in any companyveyance of land. see jowitt the dictionary of english law and also webster
comprehensive dictionary international edn. -vol. 1 page
clause b of the section requires that the goods in
question should be transferred to some person otherwise than
by way of sale. in this case there was numberevidence of any
transfer at all therefore there was numberdisposal of the
goods as
knumbern to law. the high companyrt records that admittedly there
was numbertransfer of the cashew shells the lime shells or the
consumed stores in this case. these were used by the
assessee himself as fuel in the case of cashew shells for
the maintenance of kiln. | 0 | test | 1988_96.txt | 0 |
civil appellate jurisdiction civil appeal number1021
of 1976 etc. from the judgment and order dated 10.8.1976 of the
allahabad high companyrt in special appeal number 248 of 1973.
p. goyal r.k. garg yogeshwar prasad s.n. kacker
p. rana k.k venugopal rajesh v.k. verma suman
kapoor r.k. jain r.p. singh r.a. sharma s.k. jain mrs.
rani chhabra s.r. srivastave r.b. mehrotra mrs. c.
markandeya raju ramachandran p.k. pillai raj narain
munshi sudhansu atreya gopal subramaniam mrs. shobha
dikshit s.k. bisaria b.d. sharma s.c. birla and b.y. maheshwari for the appearing parties. the judgment of the companyrt was delivered by c
chinnappa reddy j. these appeals have been placed
before us primarily to resolve a companyflict between ram sanehi
singh v. bihar state road transport companyporation 1971 3
c.c. 797 mysore state road transport companyporation v.
mysore revenue appellate tribunal and others 1975 1 s.c.r. 493 and mysore state road transport companyporation v. mysore
revenue appellate tribunal and others 1975 1 s.c.r. 615.
the question for our companysideration is where a route is
nationalised under chapter iv-a of the motor vehicles act
whether a private operator with a permit to ply a stage
carriage over anumberher route but which has a companymon
overlapping sector with the nationalised route can ply his
vehicle over that part of the overlapping companymon sector if
he does number pick up or drop passengers on the overlapping
part of the route? the answer to the question really turns
on the terms of the scheme rather than on the provisions of
the statute as we shall presently show. we will mention here the facts of a few cases which are
illustrative of the question raised. in civil appeal number 684
of 1981 the appellants hold a stae carriage permit over
the route meerut to ambala via bamanheri deoband gagalheri
and saharanpur. one part of the route namely meerut to
bamanheri is also part of a nationalised route meerut-
bamanheri-hardwar while yet anumberher part of the route
namely gagalheri to saharanpur is part of anumberher
nationalised route hardwar-dehradun-gagalheri saharanpur. the question has arisen whether the petitioners may be
allowed to ply their stage carriage over the whole of the
route meerut-bamanheri-deoband-gagalheri-saharanpur-ambala
provided that they observe companyridor restrictions that is
provided they do number pick up or set down any passengers
between meerut and bamanheri and between gagalheri and
saharanpur in civil appeal number. 1909 and 1910 of 1981 the
appellants were applicants for
the grant of stage carriage permits over the route etah-
dhumari sidhupur-patiyali. the route etah-dhumari-daryaganj-
qaimganh had already been numberified under chapter iv-a of
the motor vehicles act. as part of the route over which the
appellate applied for permits to ply stage carriages had
already been numberified under chapter iva of the motor
vehicles act their applications for the grant of permits
were rejected. they claimed that they should have been
granted permits by imposing companyridor restrictions over
that part of the route which had been numberified. in civil
appeal number 1021 of 1976 the appellant held a permit for
plying a stage carriage over the inter-state route
allahabad to rewa. the permit is said to have been granted
in favour of anumberher individual originally under an inter-
state agreement between the state of uttar pradesh and
madhya pradesh. on the failure of the original permit-holder
to obtain a renewal of the permit he lost the permit and it
was thereafter granted to the appellant. part of the route
between allahabad and chakghat via panari was nationalised
by the uttar pradesh government the whole of the route rewa
to allahabad was nationalised by the madhya pradesh
government with the companycurrence of the central government
but with exemptions in favour of the existing operator
plying under inter-state agreements though the matter has
number been made very clear to us. me appellant claims that
numberwithstanding the nationalisation of the route from
allahabad to chakghat he is entitled to ply that stage
carriage over that part of the route also by observing
corridor restrictions. in civil appeal number 2921 of 1981
the state of rajasthan has nationalised part of an inter-
state route and the companyplaint is that the appellant should
have been permitted to ply his stage carriage over the
entire route with companyridor restrictions over the
nationalised part of the route. in civil appeal number. 164-166
of 1982 the companyplaint is that a very insignificant portion
of the route on which the appellants hold stage carriage-
permits is included in a nationalised route and therefore
the scheme should have exempted the operation of private
stage carriages over the companymon sector. the right of the members of the public to pass and re-
pass over a highway including the right to use motor
vehicles on the public road existed prior to the enactment
of the motor vehicles act and was number its creation. the
state companyld companytrol and regulate the right for the purpose
of ensuring the safety peace and good health of the
public. as an incident of his right of passage over a
highway a member of the public was entitled to ply motor
vehicles for pleasure or pastime or for the purpose of
trade and business subject of companyrse to permissible
control and regulation by the state saghir ahmed v. state
of u.p. 1955 1 s.c.r. 707. under article 19 6 ii of
the companystitution the state can make a law relating to the
carrying on by the state or by a companyporation owned or
controlled by the state of any particular business industry
or service whether to the exclusion companyplete or partial of
citizens or otherwise. the law companyld provide for carrying on
a service to the total exclusion of all the citizens lt may
exclude some of the citizens only it may do business in the
entire state or a portion of the state in a specified route
or part thereof. the word service has been companystrued to be
wide enumbergh to take in number only the general motor service
but also the species of motor service. there are no
limitations on the states power to make laws companyferring
monumberoly on it in respect of an area and person or persons
to be excluded kondala rao v. a.p state road transport
corporation a.i.r. 1961 s.c. 82. all this is number well
established by the various decisions of this companyrt. chapter iva of the motor vehicles act provides for the
nationalisation of road transport services in the manner
prescribed therein. numberquestion of the vires of any
provision of chapter iva on any ground has been raised
before us. chapter iva of the motor vehicles act was bodily
introduced into it by amending act number 100 of 1956. it
further underwent substantial amendments by act 56 of 69 of
1970 which came into effect on march 2 1970. we may mention
here 6.2 28a defining route was also introduced by act 56
of 69. route was defined as meaning a line of travel
which specifies the highway which may be traversed by a
motor vehicle between one terminus and anumberher. the
introduction of 8. 2 28a defining the expression route
appears to have been necessitated to dispel the companyfusion
consequent upon the seeming acceptance by high companyrt in
nilkantha prasad and others v. state of bihar 1962 supp. 1 s.c.r. 728 of the suggested difference between route and
highway by the privy companyncil in kalani valley motor
transit company limited v. companyombo ratnapura omnibus company limited
1946 a.c. 338 where it was said a highway is the physical
track along which an omnibus runs whilst a route appears
to their lordships to be an abstract companyception of line of
travel between one terminus and anumberher and to be something
distinct from the highway traversed there may be
alternative roads leading from one terminus to anumberher but
that does number make the route any highway the same. the
present definition of route makes it a physical reality
instead of an abstract companyception and numberlonger make it
something
distinct from the highway traversed. getting back to the
highway and chapter iva we first numberice s.68-a a which
defines road transport service to mean a service of tor
vehicles carrying passengers or goods or both by road for
hire or reward. next and this is important 8. 68-b gives
over-riding effect to the provisions of chapter iva and the
rules and orders made thereunder over the provisions of
chapter iv and any other law for the time being in force. section 68-c provides for the preparation and publication
of scheme of road transport service of a state transport
undertaking. since the answer to the question raised turns
primarily on the interpretation of sec. 68-c it is
desirable to extract the same. it is as follows
68-c. where any state transport undertaking is of
opinion that for the purpose of providing an
efficient adequate econumberical and properly
coordinated road transport service it is
necessary in the public interest that road
transport services in general or any particular
class of such service in relation to any area or
route or portion thereof should be run and
operated by the state transport undertaking
whether to the exclusion companyplete or partial of
other persons or otherwise the state transport
undertaking may prepare a scheme giving
particulars of the nature of the services proposed
to be rendered the area or route proposed to be
covered and such other particulars respecting
thereto as may be prescribed and shall cause
every such scheme to be published in the official
gazette and also in h other manner as the state
government may direct. the policy of the legislature is clear from s.68-c that the
state transport undertaking may initiate a scheme for the
purpose of providing an efficient adequate econumberical and
properly companyrdinated road transport service to be run and
operated by the state transport undertaking in relation to
any area or route o. portion thereof. it may do 80 if it is
necessary in the public interest. me scheme may be to the
exclusion companyplete or partial of other persons or
otherwise. m e scheme should give particulars of the nature
of the service proposed to be rendered the area or route
proposed to be companyered and such other particulars as may be
prescribed. me scheme has to be published in the official
gazette as well as in any other manner that the state
government may direct. the object of publishing this scheme
is to invite objections to the scheme. section 68-d enables
i
any person already providing transport facilities by any
means along or near the area or route proposed to be companyered
by the scheme ii any association representing persons
interested in the provision of road transport facilities
recognized in this behalf by the state government and iii
any local authority or police authority within whose
jurisdiction any part of the area or route proposed to be
covered by the scheme lies to file objections to the scheme
before the state government within 30 days from the date of
its publication in the official gazette. clause 2 of sec. 68-d empowers the state government to companysider the
objections give an opportunity to the objector or his
representatives and the representatives of the state
transport undertaking to be heard in the matter if they so
desire and approve or modify the scheme. clause 3 of sec. 68-d requires the scheme as approved or modified to be
published in the official gazette whereupon the scheme
becomes final and shall thereafter be called an approved
scheme. there 18 a proviso to clause 3 which provides that
numberscheme which relates to any inter-state route shall be
deemed to be an approved scheme unless lt has been published
with the previous approval of the central government. section 68-e enables the state transport-undertaking to
cancel or modify any scheme published under 88. 68-d 3
after following the procedure laid down in sec. 68-c and
sec. 68-d in respect of certain matters such as the
increase in the number of vehicles or the number of trips
change in the type of vehicles without reducing the sitting
capacity extension of the route or area without reducing
the frequency of the service alteration of the time-table
without reducing the frequency of the service. m e state
transport undertaking need number follow the procedure laid
down in sec. 68-c and sec. 68-d if the previous approval of
the state government is obtained and if the scheme 18 one
relating to any route or area in respect of which the road
transport services are to be run and operated by the state
transport undertaking to the companyplete exclusion of other
persons. section 68-e sub-sec. 2 enables the state
government at any time if it companysiders necessary in the
public interest so to do to modify a scheme published under
sec. 68-d 3 after giving an opportunity of being heard to
the state transport undertaking and any other person who in
the opinion of the state government is likely to be affected
by the proposed modification. section 68-f 1 obliges the
regional transport authority or the state transport
authority as the case may be to grant to the state
transport undertaking the necessary permits on its applying
for the same in pursuance of an approved scheme. the permits
have to be issued numberwithstanding anything to the companytrary
in chapter iv. section 68-f l-a oblige
the state transport authority or the regional transport as
the case may be to issue temporary permits to the state
transport undertaking for the period intervening between
the date of publication of the scheme and the date of
publication of the approved or modified scheme. the state
transport authority or the regional transport authority
must however be satisfied that it is necessary in the
public interest to increase the number of vehicles operating
in such area or route or portion thereof previously. section 68-f 1-c enables the state transport authority or
the regional transport authority as the case may be to
grant to private operators temporary permits if no
application for a temporary permit is made under sub-sec. 1-
a in respect of the area or route or portion thereof
specified in the scheme. section 68-f 1-d prohibits the
grant or renewal of a permit save as otherwise provided in
sub-sec. 1-a and sub-sec. 1-c during the period
intervening between the date of publication of any scheme
and the date or publication of the approved or modified
scheme. sub-sec. 2 of sec. 68-f enables the state transport
authority the regional transport authority as the case may
be for the purpose of giving effect to the approved scheme
in respect of a numberified area or numberified route to refuse
to entertain any application for the grant or renewal of any
permit or reject any such application as may be pending to
cancel any existing permit and to modify the terms of any
existing permit so as to render the permit ineffective
beyond a specified date to reduce the number of vehicles
authorised to be used under the permit and to curtail the
area or route companyered by the permit in 80 far as such permit
relates to the numberified area or numberified route. section 68-
ff prohibits the grant of any permit except in accordance
with a provision of the scheme once a scheme has been
published under sec.68-d 3 in respect of any numberified area
or numberified route. this is an important provision and we may
extract it here. it is as follows
68-ff
where a scheme has been published under sub-
section 3 of sec.68-d in respect of any numberified
area or numberified route the state transport
authority or the regional transport authority as
the case may be shall number grant any permit except
in accordance with the provisions of the scheme. there is however a proviso which enables the grant of a
temporary permit to any person in respect of such numberified
area
or numberified route if numberapplication for a permit has been
made by a the state transport undertaking. section 68-g and
68-h prescribe the principles and method of determining
compensation and its payment to the holders of existing
permits which cancelled or modified. section 68-i empowers
the state government to make rules for the purpose of
carrying into effect the provisions of the chapter and in
particular in accordance with the various matters specified
in sub-sec. 2
it is thus seen that while the provisions of chapter
iv-a are devised to override the provisions of chapter iv
and it is expressly so enacted the provisions of chapter
iva are clear and companyplete regarding the manner and effect
of the take over of the operation or road transport
service by the state transport undertaking in relation to
any area or route or portion thereof. while on the one hand
the paramount companysideration is the public interest the
interest of the existing operators are sufficiently well-
taken care of and such slight inconveniences to the
travelling public as may be inevitable are sought to be
reduced to a minimum. to begin with the state transport
undertaking must think it necessary in the public interest
to provide efficient adequate econumberical and properly
coordinated state transport services in relation to any area
or route or portion thereof to the exclusion companyplete or
partial of other persons or otherwise. this is the initial
requirement for the initiation of a scheme. even at that
stage the state transport undertaking is required to apply
its mind to the question of companyplete or partial exclusion of
other persons or otherwise from operating transport services
in relation to any area or route or portion thereof. there
is ample and sufficient guidance to the state transport
undertaking for the application of mind. thereafter
objections to the scheme are to be heard. all existing
operators providing transport facilities along or near the
area or the route proposed to be companyered by the scheme are
to be heard. therefore it will be open to any operator who
is likely to be affected by total or partial exclusion to
object to the scheme and suggest such modification as may
protect him. a hearing is required to be given and the
hearing is numberempty formality as decisions of this companyrt
have shown. even that is number an end of the matter. even
thereafter the state transport undertaking as well as the
state government are empowered to cancel or modify the
scheme under sec. 68-e. in other words if in the actual
working of the approved scheme any difficulty or hardship is
experienced by the public or for that matter by other
operators such difficulty may be removed and hardship
relieved by appropriate action under
section 68-e. both sec.68f and the proviso to sec.68-ff
provide for the issue of temporary permits to private
operators if the state transport undertaking has number applied
for a permit temporary or otherwise in respect of scheme
published or approved. we thus find chat at every stage
abundant provision is made to protect the public interest as
also the interest of private operators by providing for
consideration and reconsideration of any problems that may
arise out of a proposed published or approved scheme. it is
in that companytext we must companystrue sec.68-c and sec.68hh both
of which provisions have been extracted by us earlier. a careful and diligent perusal of sec.68-c sec.68-d 3
and sec.68ff in the light of the definition of the
expression route in sec.2 28-a appears to make it
manifestly clear that once a scheme is published under
sec.68-d in relation to any area or route or portion
thereof whether to the exclusion companyplete or partial of
other persons or otherwise numberperson other than the state
transport undertaking may operate on the numberified area or
numberified route except as provided in the scheme itself. a
necessary companysequence of these provisions is that numberprivate
operator can operate his vehicle on any part or por-ion of a
numberified area or numberified route unless authorised so to do
by the terms of the scheme itself. he may number operate on any
part or portion of the numberified route or area on the mere
ground that the permit as originally granted to him companyered
the numberified route or area. we are number impressed by the
various submissions made on behalf of the appellants by
their several companynsel. the foremost argument was that based
on the great inconvenience which may be caused to the
travelling public if a passenger is number allowed to travel
say straight from a to on a stage carriage to ply which on
the route a to a person x has a permit merely because a
part of the route from to somewhere between the points a and
is part of a numberified route. the answer to the question is
that this is a factor which will necessarily be taken into
consideration by the state transport undertaking before
publishing the scheme under sec.68-c by the government
under sec.68-d when companysidering the objections to the scheme
and thereafter either by the state transport undertaking or
by the government when the inconveniences experienced by the
travelling public are brought to their numberice. me question
is one of weighing in the balance the advantages companyferred
on the public by the nationalisation of the route c-d
against the inconveniences suffered by the public wanting to
travel straight from a to b. on the other hand it is quite
well knumbern that under the guise of
the so called companyridor restrictions permits over longer
routes which companyer shorter numberified routes or overlapping
parts of numberified routes are more often than number
misutilised since it is next nigh impossible to keep a
proper check at every point of the route. it is also well
knumbern that often times permits for plying stage carriages
from a point a short distance beyond one terminus to a point
a short distance beyond anumberher terminus of a numberified route
have been applied for and granted subject to the so-called
corridor restrictions which are but more ruses or traps to
obtain permits and to frustrate the scheme. if indeed there
is any need for protecting the travelling public from
inconvenience as suggested by the learned companynsel we have no
doubt that the state transport undertaking and the
government will make a sufficient provision in the scheme
itself to avoid inconvenience being caused to the travelling
public. one of the submissions urged was that a route
according to definition meant a line drawn between two
terminii and therefore route ab cannumber be the same route as
cd even if c d happened to be two points on the highway
from a to b. it was argued that if route ab was different
from route cd the nationalisation of route cd had numbereffect
whatsoever on the permits to ply stage carriages on the
route ab. this argument is specious and is only to be stated
to be rejected. in fact whatever argument was open to the
learned companynsel on the basis of the decision of the privy
council in kelani valley motor transit company limitedv. companyombo-
ratnapura omnibus company limited supra is numberlonger open to them
in view of the definition of route inserted as sec. 2 28-a
of the motor vehicles act by the amending act of 1969. we do
number have the slightest doubt that route ab companyers and
includes every part of the particular highway from a to
traversed by the motor vehicle along the route. it is
impossible to accept the argument that only the terminii
have to be looked at and the rest of the highway ignumbered in
order to discover a route for the purposes of the motor
vehicles act. equally without substance is the plea that if
an operator does number pick up or set down any passenger
between the two points of the companymon sector he cannumber be
said to be plying a state carriage between these two points. the argument is entirely devoid of substance for the simple
reason that the operator does charge the passenger for the
distance travelled along the highway between these two
points also. anumberher argument which was advanced and which
is also lacking in substance is that a companyplete exclusion of
private operators from the companymon sector would be violative
of art. 14 and that it would be ultra vires sec. 68-d. we
are unable to see how either art.14 or sec.68-d of the
motor vehicles act hit a scheme
which provides for companyplete exclusion of private operators
from the whole or any part of the numberified area. almost all
these submissions have been companysidered and met by the
majority judgment in mysore state road transport companyporation
mysore revenue appellate tribunal 1975 1 s.c.r. 615
to which we shall presently refer. in c.p.c. motor service mysore v. the state of mysore
anr. 1962 supp. 1 s.c.r. 717 the impugned scheme
provided for taking over certain stage carriage services to
the companyplete exclusion of private operators. it provided
the state transport undertaking will operate
services to the companyplete exclusion of other
persons 1 on all the numberified inter-district
routes except in regard to the portions of inter-
district routes lying outside the limits of mysore
district and also ii over the entire length of
each of the inter-district route lying within the
limits of mysore district
certain persons who possessed stage carriage permits to ply
vehicles on inter-district and inter-state routes which
overlapped the mysore district challenged the scheme and
contended that their permits should number be affected merely
because parts of the routes were within the mysore district. their companytention was that since the terminii of the routes
on which they were operating vehicles were outside mysore
district it companyld number properly be said that any portion of
their route had been taken over merely because it lay within
the mysore district. it was held by this companyrt that a route
meant number only the numberional line but also the actual road
over which the motor vehicles ran and in view of the fact
that the scheme reserved all the routes within the mysore
district to the state transport undertaking numberprivate
operator companyld be allowed to ply his vehicle on the companymon
sector which was within the mysore district. his route
automatically steel pro tanto cut down to only that portion
which lay outside the mysore district. even before the introduction of the definition of route
in sec. 2 28-a by the 1969 amendment in nilakanth prasad
and others v. state of bihar supra the companyrt understood
the word route on practically the same lines with
reference to sec. 68-c and sec. 68-f. the companyrt said
this means that even in those cases where the
numberified route and the route applied for run over
a companymon sector the curtailment by virtue of the
numberified scheme would be by excluding that portion
of the route or in other words the road companymon
to both. the distinction between route as the
physical track disappears in the working of
chapter iva because you cannumber curtail the route
without curtailing a portion of the road and the
ruling of the companyrt to which we have referred
would also show that even if the route was
different the area at least would be the same. the ruling of the judicial companymittee cannumber be
made applicable to the motor vehicles act
particularly chapter iv-a where the intention is
to exclude private operators companypletely from
running over certain sectors or routes vested in
state transport undertakings. in our opinion
there fore the appellants were rightly held to be
disentitled to run over those portions of their
routes which were numberified as part of the scheme. those portions cannumber be said to be different
routes but must be regarded as portions of the
routes of the private operators from which the
private operators stood excluded under s. 68-
f 2 c iii of the act. in ram sanehi singh v. bihar state road transport
corporation ors. supra there was a slight numbere of
discordance. the appellant there possessed a permit to ply a
stage carriage on a rout-e which had a companymon sector of five
miles of a numberified route. on the examination of the scheme
the companyrt found that there was numberhing in the numberified
scheme which companypletely excluded the other holders of
permits from plying their stage carriages in pursuance of
permits issued to them from terminii number on points on the
numberified route. it was held that merely because the
appellant had to run his vehicle on a part of the numberified
route without the right to pick up passengers or to drop
them his permit to the extent of the overlapping portion
could be said to be ineffective. we are afraid that this
decision must be companyfined to its own facts. the learned
judges did number numberice the earlier decision of the companyrt in
cpc motor services mysore v. the state of mysore and anr. supra and neelkanth prasad and ors. v. the state of bihar
supra . they also failed to numberice that while sec. 68-c
provides for preparation and publication of scheme giving
particulars of the services proposed to be run and operated
by the state transport undertaking in relation to any area
or route to the exclusion companyplete or
partial of other persons or otherwise. section 68-ff also
debars the state transport authority and the regional
transport authority from granting any permit except in
accordance with the provisions of the scheme. in s. abdul khader saheb v. the mysore revenue
appellate tribunal bangalore ors. 1973 1 s.c.c. 357
the companyrt approved the view of the high companyrt of karnataka
that
when once on a route or a portion of the route
there has been total exclusion of operation of
stage carriage services by operators other than
the state transport undertaking by virtue of a
clause in an approved scheme the authorities
granting permit under chapter iv of the motor
vehicles act should refrain from granting a
permit companytrary to the scheme. in mysore state road transport companyporation v. the mysore
revenue appellate tribunal 1975 1 s.c.r. 493 beg and
chandrachud jj departing from the views generally taken
till then took the view that a scheme which totally
excluded inter-state private operators from using any part
of a numberified route must make the intention clear. there was
a difference between area and route. route denumbered the
abstract companyception of line of travel. a difference in the
two terminii of two routes would make the two routes
different even if there was overlapping. unless the scheme
clearly indicated that the user of any portion of the
highway companyered by the numberified route was prohibited inter-
state operators companyld number be debarred from plying their
vehicles over the overlapping part of the inter-state route
merely because of the physical fact of the overlapping of
the two routes. the learned judges did number numberice the
earlier decisions of the companyrt in c.p.c. motor service
mysore v. the state of mysore anr. supra and abdul
khader v. the mysore revenue appellate tribunal supra . nilkanth prasads supra case was numbericed but by-passed
with the observation whatever may be said about the
correctness of the decision etc. in mysore state road transport companyporation v. mysore
state transport appellate tribunal 1975 1 s.c.r. 615 all
the earlier cases were numbericed and lt was held
it is therefore apparent that where a private
transport owner makes an application to operate on
a route which overlaps even a portion of the
numberified
route i.e. where the part of the highway to be
used by a the private transport owner traverses on
a line on the same highway on the numberified route
then that application has to be companysidered only in
the light of the scheme as numberified. if any
conditions are placed then those companyditions have
to be fulfilled and if there is a total
prohibition then the application must be rejected. this companyrt has companysistently taken the view that if
there is prohibition to operate on a numberified
route or routes numberlicences can be granted to any
private operator whose route traversed or
overlapped any part or whole of that numberified
route. the intersection of the numberified route may
number in our view amount to traversing or
overlapping the route because the prohibition
imposed applied to a whole or part of the route on
the highway on the same line of the route. an
intersection cannumber be said to be traversing the
same line as it cuts across it. the learned judges expressly dissented from the decision of
beg and chandrachud jj. in mysore state transport
corporation v. mysore revenue appellate tribunal 1975 1
c.r. 493 and approved the decisions of the companyrt in
nilkanth prasads case supra and abdul khaders case
supra . we agree with the view taken by this companyrt in
mysore state road transport companyporation v. mysore revenue
appellate tribunal 1975 1 s.c.r. 615 and dissent from the
view taken in mysore state road transport companyporation v.
the mysore revenue appellate tribunal 1975 s.c.r. 493. we
however wish to introduce a numbere of caution. when preparing
and publishing the scheme under s. 68-c and approving or
modifying the scheme under s.68-d care must be taken to
protect as far as possible the interest of the travelling
public who companyld in the past travel from one point to
anumberher without having to change from one service to anumberher
enroute. this can always be done by appropriate clauses
exempting operators already having permits over companymon
sector from the scheme and by incorporating appropriate
conditional clauses in the scheme to enable them to ply
their vehicles over companymon sectors without picking up or
setting down passengers on the companymon sectors. if such a
course is number feasible the state legislature may intervene
and provide some other alternative as was done by the uttar
pradesh legislature by the enactment of the
uttar pradesh act number 27 of 76 by sec. 5 of which the
competent authority companyld authorise the holder of a permit
of a stage carriage to ply his stage carriage on a portion
of a numberified route subject to terms and companyditions
including payment of licence fee. there may be other methods
of number inconveniencing through passengers but that is
entirely a matter for the state legislature the state
government and the state transport undertaking. but we do
wish to emphasise that good and sufficient care must be
taken to see that the travelling public is number to be
needlessly inconvenienced. shri r.k. garg urged that the provisions of chapter iv
and chapter iv-a must be reconciled in such a manner as to
allow permit holders to ply their stage carriages
numberwithstanding that parts of their route are also parts of
numberified routes. we fail to understand the argument having
regard to the express legislative pronumberncement in s. 68-b
that the provisions of chapter iv-a and the rules and orders
made thereunder shall have effect numberwithstanding anything
inconsistent therewith companytained in chapter iv of the act. in one of the cases it was argued before us that though
the scheme framed by the uttar pradesh transport undertaking
prohibited the plying of private stage carriages on the
numberified part of an inter-state route within the state of
uttar pradesh a later madhya pradesh scheme published by
the madhya pradesh state transport undertaking pursuant to
an inter-state agreement allowed the plying of stage
carriages by private operators on that part of the route
which was in uttar pradesh also. the argument was that the
later scheme superseded the earlier scheme and therefore the
operators companyld ply their vehicles on the uttar pradesh part
of the route also. we are unable to see how the scheme
framed by the uttar pradesh state transport undertaking can
be superseded by the scheme framed by the madhya pradesh
state transport undertaking. we are therefore unable to see any merit in any of the
civil appeals since numbere of the schemes placed before us
contain any saving clause in favour of operators plying or
wanting to ply stage carriages on companymon sectors. on the
other hand we found that invariably there is a clause to the
following effect numberperson other than the state
government undertaking will be permitted to provide road
transport services on the routes specified in paragraph 2 or
any part thereof. in the face of a provision of this nature
in the scheme totally prohibiting
private operators from plying stage carriages on a whole or
part a of the numberified routes it is futile to companytend that
any of the appellants can claim to ply their vehicles on the
numberified routes or part of the numberified routes. | 0 | test | 1985_260.txt | 1 |
criminal appellate jurisdiction criminal appeal number
341 of 1990.
from the judgment and order dated 4/5.6.90 of the
additional judge designated companyrt rohtak at sonepat in
sessions case number 42/88 sessions trial number 18/90 f.i.r. number 96 dated 7.4.88 police station rai. l. rathee raghu raman and s. balakrishnan for the
appellant. ms. indu malhotra for the respondent. the judgment of the companyrt was delivered by
bharucha j. this is an appeal against the judgment and
order of the additional judge rohtak being the designated
court under the terrorist and disruptive activities
prevention act 1987 for short t.a.d.a act 1987 whereby
the appellant was companyvicted of an offence punishable under
section 5 thereof and sentenced to undergo rigorous
imprisonment for five years and to pay a fine of rs. 200 or
in default to undergo rigorous imprisonment for a further
period of three months. the appellant was apprehended by sub-inspector rohtas
singh and head companystable ram krishan near the hilton factory
on g.t. road in the state of haryana on 7th april 1988 on
suspicion. in the envelope of wax paper that the appellant
was carrying was found a.12 bore companyntry-made pistol for
which he had numberlicence or permit. after the necessary
formalities sanction was issued on 26th april 1988 by the
district magistrate sonepat for prosecuting the appellant
for an offence under section 25 of the arms act 1959. on
7th december. 1989 the judicial magistrate first class
sonepat before whom the appellant was being prosecuted for
the said offence passed the following order
present a.p.p for the state. accused on bail. at this stage it has companye to my
numberice that this case should have
been tried by the learned
designated companyrt under section 5 of
the terrorist and disruptive
activities prevention act 1987.
consequently this case is sent to
learned designated companyrt shri b.r. gupta learned addl. sessions
judge sonepat. accused is
directed to appear in that companyrt at
12.00 numbern to day itself. file
completed in all respects be sent
immediately. sd -j.m.i.c. sonepat
annumbernced
7.12.89.
the appellant was then tried by the said additional
judge under sections 5 of the t.a.d.a. act 1987. the
judgment under appeal numbered that the appellant was charged
on 18th december 1989 by the said additional judge for the
offence punishable under section 5 of the t.a.d.a. act
1987 to which the appellant pleaded number guilty. upon the
evidence led the said additional judge found that the
prosecution had brought home the offence to the appellant
beyond reasonable doubt. accordingly the appellant was
convicted and sentenced as aforesaid. the appellant has in his grounds of appeal taken inter
alia the plea that the prosecution itself had number
considered the case against him to be a fit case to frame a
charge and proceed under the t.a.d.a. act 1987 and that it
was therefore number proper that he should have been tried
and companyvicted thereunder. in the companynter filed by khajan
singh sub-inspector police station rai it is submitted in
reply that the prosecution had companysidered this to be a fit
case to frame a charge and proceed against the appellant
under section 5 of the t.a.d.a. act 1987 and had requested
the learned magistrate to transfer the case to the
designated companyrt for trial. it is number in dispute that the provisions of the
a.d.a. act 1987 had been extended to companyer the whole of
the state of haryana by a numberification dated 18th numberember
1987.
this companyrt in the judgment in jaloba v. state of
haryana 1989 scc supple. ii 197 companysidered the submission
that the designated companyrt had numberjurisdiction to try the
appellant jaloba because he had number been charged with having
committed any offence under the t.a.d.a. act 1985. he had
been charged under section 25 of the arms act. this companyrt
rejected the submission numbering sections 6 and 9 of the
a.d.a. act 1985 equivalent to sections 5 and 11 of the
a.d.a. act 1987 . section 6 lain down that if any area
numberified by the state government under the t.a.d.a act
1987 a person companytravened any provision or rule made inter
alia under the arms acts then he was liable to the
enhanced punishment provided for in the section. section 9
of the t.a.d.a. act 1985 laid down that number withstanding
anything companytained in the criminal procedure companye every
offence punishable under that act or a rule made thereunder
was triable only by the designated companyrt within whose local
jurisdiction it was companymitted. it therefore followed that
though the offence companymitted by the appellant was in
contravention of section 25 of the arms act it became
exclusively triable by the designated companyrt because of the
numberification made by the state government and the operation
of section 6 of the t.a.d.a. act 1985. it was therefore
futile for the appellant to companytend that the designated
court did number have jurisdiction to try him for the offence
for which he stood charged. upon the authority of the judgment in jalobas case it
must be held that the appellant before us was rightly tried
by the designated companyrt under the provisions of the t.a.d.a
act 1987.
it was submitted on behalf of the appellant that in
any event the provisions of section 5 of the t.a.d.a. act
did number apply to the appellant. these provisions applied
where any person is in possession of any arms and
ammunition specified in category iii a of schedule i to
the arms rules 1962 unauthorisedly in a numberified area. category iii a of schedule i to the arms rules reads thus
------------------------------------------------------------
iii firearms other than ammunition for firearms other
those in categories i ii than those in categories i ii
and iv namely and iv namely
------------------------------------------------------------
revolvers and pistols ammunition for fire arms of
category iii a . ------------------------------------------------------------
it was pointed out that the appellant was found to be
carrying a companyntry-made pistol and submitted that a companyntry-
made pistol fell outside the ambit of the said category
iii a . that category speaks in broad terms of revolvers
and pistols and there is numberreason to exclude a companyntry-
made revolver or pistol therefrom. it was then argued and we think with substance that
section 5 of the t.a.d.a. act 1987 applied only when a
person was in possession of arms and ammunition and that
the appellant while he had been found in possession of a
country-made pistol had number been found in possession of any
ammunition. we think that the words arms and ammunition in
section 5 should be read companyjuctively. this is number merely a
matter of companyrect grammar but also subserves the object of
the t.a.d.a. act 1987. a person in possession of both a
firearm and the ammunition therefor is capable of terrorist
and disruptive activities but number one who has a firearm but
number the ammunition for it or vice versa. it is therefore
our view that the provisions of sections 5 of the t.a.d.a
act 1987 companyld number have been applied to the appellant. this is number to say that the appellant should
necessarily have been acquitted. section 12 of t.a.d.a. act
1987 empowers the designated companyrt to companyvict a person of
any offence under any other any other law it he is found
to have been guilty of the same during the companyrse of a trial
under that act and punish appropriately. it was submitted that the evidence against the
appellant did number establish that he was guilty of an offence
under section 25 1b a of the arms act namely of having
in his possession an unlicenced firearm. we have examined
the evidence and found numberreason to question the companyclusion
of the designated companyrt that the appellant was so guilty. that the evidence relied upon was of two police officials
does number ipso facto give rise to doubt about its
credibility. there is numberhing on record to show that these
police officials were hostile to the appellant and their
evidence was number shaken in cross-examination. that the
private party who was called as a witness by the prosecution
did number support it does number in the circumstances lead to
the companyclusion that the appellant was innumberent. the appellant being guilty of an offence under section
25 1b a of the arms acts is punishable with imprisonment
for a term which shall number be less than one year but which
may extent to three years and he is also liable to fine. in
the circumstances of the case we think that the appellant
must undergo rigorous imprisonment for a term of one year
and pay a fine of rs. 200.
the appeal is accordingly allowed in the aforesaid
terms. | 1 | test | 1992_459.txt | 1 |
civil appellate jurisdiction civil appeal number 112 of 1958.
appeal from the judgment and decree dated may 25 1954 of
the punjab high companyrt in l.p.a. number 82 of 1948.
naunit lal and t. m. sen for the appellant. t. desai chatter behari and a. g. ratnaparkhi for the
respondent. 1961. september 5. the judgment of the companyrt was delivered
by
shah j.-a dispute arising under a companytract relating to the
supply of solidified fuel between
messrs. mohindra supply companypany-hereinafter referred to
as the respondents-and the governumber-general of india in
council was referred to arbitration of two arbitrators. on
march 19 1946 the arbitrators made and published an award
directing the governumber-general to pay to the respondents rs. 47250/- with interest at 3 from july 171944 till
payment. this award was filed in the companyrt of the
subordinate judge first class delhi. the governumber-general
applied for an order setting aside the award on certain
grounds which for the purposes of this appeal are number
material. the subordinate judge refused to set aside the
award on the grounds set up and rejected the application. against the order refusing to set aside the award the
governumber-general preferred to the lahore high companyrt an
appeal which after the setting up of the dominions of india
and pakistan was transferred to the circuit bench of the
east punjab high companyrt at delhi. falshaw j. who heard the
appeal set aside the order because in his view the dispute
could number be referred to arbitration under the companytract
which gave rise to the dispute and that was sufficient to
invalidate the award. against that order an appeal was
preferred under cl.10 of the letters patent of the high
court of lahore which by the high companyrt punjab order
1947 applied to the east punjab high companyrt. before the
appellate bench the governumber-general companytended that the
appeal under the letters patent was prohibited by s. 39 2
of the indian arbitration act. the question whether the
appeal was maintainable was referred to a full bench of the
high companyrt. the full bench opined that an appeal from the
judgment of a single judge exercising appellate powers did
lie under cl. 10 of the letters patent numberwithstanding the
bar companytained in s. 39 2 of the arbitration act. after
the opinion of the full bench was delivered a division
bench companysidered the appeal on its merits and set aside
the order of falshaw j. the union of india appeals against
the decision of the high companyrt. in this appeal we are only companycerned with the question
whether the appeal under el. 10 of the letters patent of the
high companyrt against the order of falshaw j. was
maintainable. the proceedings relating to arbitration are
since the enactment of the indian arbitration act x of 1940
governed by the provisions of that act. the act is a
consolidating and amending statute. it repealed the
arbitration act of 1899 schedule 2 of the companye of civil
procedure and also cls. a to f of s. 104 1 of the companye
of civil procedure which provided for appeals from orders in
arbitration proceedings. the act set up machinery for all
contractual arbitrations and its provisions subject to
certain exceptions apply also to every arbitration under
any other enactment for the time being in force as if the
arbitration were pursuant to an arbitration agreement and as
if that other enactment were an arbitration agreement
except in so far as the arbitration act is inconsistent with
that other enactment or with any rules made thereunder. section 39 of the act which deals with appeals provides
an appeal shall lie from the following
orders passed under this act and from no
others to the companyrt authorised by law to hear
appeals from original decrees of the companyrt
passing the order
an order-
superseding an arbitration
on an award stated in the form of a
special ease
modifying or companyrecting a award
iv filing or refusing to file an
arbitration agreement
y staying or refusing to stay legal
proceedings where there is an arbitration
agreement
setting aside or refusing to set aside
an award
provided that the provisions of this section shall number apply
to any order passed by a small cause companyrt. numbersecond appeal shall lie from an order passed in
appeal under this section but numberhing in this section shall
affect or take away any right to appeal to the supreme
court. the two sub-sections of s. 39 are manifestly part of a
single legislative pattern. by sub-s. 1 the right to
appeal is companyferred against the specified orders and against
numberother orders and from an appellate order passed under
sub-s. 1 numbersecond appeal except an appeal to this companyrt
lies. on the question whether the interdict in sub-s. 2
operates against an appeal under the letters patent there
has been a divergence of opinion amongst the high companyrts in
india. the bombay high companyrt in madhavdas v. vithaldas 1
held that there is numberfurther right of appeal under the
letters patent when a single judge of the high companyrt
disposed of an appeal under s. 39 1 of the arbitration
act. the same view was expressed by the madras high companyrt
in radha krishna murthy v. ethirajulu 2 . in hanuman
chamber of companymerce limited delhi v. jassa ram hira nand 3
and banwari lal ram dev v. the board of trustees hindu
college 4 it was held that a right to appeal under the
letters patent against an order passed in appeal under s.
39 1 is number restricted by s. 39 2 . in the view of the
lahore and the east punjab high companyrts appeals prohibited by
sub-s. 2 were second appeals i.e. appeals under s. 100
of the civil procedure companye and intra-court appeals such
as appeals under the
i.l.r. 1952 bom. 570.
i.l.r. 1945 mad. 564.
a.i.r. 1948 lah. 64.
i.l.r. 1948 e.p. 159.
letters patent from an order of a single judge to a bench of
the same companyrt were number prohibited. the madras high companyrt
in a recent judgment-mulchand kewal chand daga v. kissan das
gridhardass 1 has overruled its earlier decision in radha
krishna murthys case and has held that s. 39 deals only
with appeals from orders passed by a companyrt to a superior
court and number with appeals intra-court and therefore s.
39 2 does number operate to prohibit an appeal under the
letters patent against the order of a single judge
exercising appellate jurisdiction in an arbitration matter. section 39 2 expressly prohibits a second appeal from an
order passed in appeal under s. 39 1 except an appeal to
this companyrt. there is clear indication inherent in sub-s.
2 that the expression second appeal does number mean an
appeal under s. 100 of the companye of civil procedure. to the
interdict of a second appeal there is an exception in
favour of an appeal to this companyrt but an appeal to this
court is number a second appeal. if the legislature intended
by enacting s. 39 2 nearly to prohibit appeals under s. 100
of the companye of civil procedure it was plainly unnecessary
to enact an express provision saving appeals to this companyrt. again an appeal under s. 39 1 lies against an order
superseding an award. or modifying or companyrecting an award
or filing or refusing to file an arbitration agreement or
staying or refusing to stay legal proceedings where there is
an arbitration agreement or setting aside or refusing to set
aside an award or on an award stated in the form of a
special case. these orders are number decrees within the
meaning of the companye of civil procedure and have number the
effect of decrees under the arbitration act. section 100 of
the companye of civil procedure deals with appeals from appel-
late decrees-and number with appeals from appellate
1 1961 74 l.w. 408 f.b. orders. if by enacting s. 39 2 appeals from appellate
decrees were intended to be prohibited the provision was
plainly otiose and unless the companytext or the circumstances
compel the companyrt will number be justified in ascribing to the
legislature an intention to enact a sterile clause. in that
premise the companyclusion is inevitable that the expression
second appeal used in s. 39 2 of the arbitration act
means a further appeal from an order passed in appeal under
s. 39 1 and number an appeal under s. 100 of the civil
procedure companye. this view was expressed by savdekar j. in
madhavdass v. vithaldas 1 and by rajamannar c. j. in
mulchand kewal chand daga v. kissan das gridhardass 2 and
we agree with the learned judges that the adjective imports
a further appeal that is numerically second appeal. the problem to which attention must then be directed is
whether the right to appeal under the letters patent is at
all restricted by s. 39 sub-ss. 1 and 2 . clause 10 of
the letters patent of the high companyrt in so far- as it is
material provides
and we do further ordain that an ap. peal
shall lie to the said high companyrt from
the judgment number being a judgment passed in
exercise of appellate jurisdiction in respect
of a decree or order made in the exercise of
appellate jurisdiction by a companyrt subject to
the superintendence of the said high companyrt and
number being an order made in the exercise of
revisional jurisdiction of one judge of the
high companyrt
by this clause a right to appeal except in the cases
specified from one judge of the high companyrt to a division
bench is expressly granted. but the letters patent are
declared by el. 37 subject to the legislative power of the
covernumber-general in companyncil and also of the governumber-in-
council under
i.l.r. 1952 bom. 570. 2 1961 74 l.w. 408 f.b. the companyernment of india act 1915 and may in all respects be
amended or altered in exercise of legislative authority. under s. 39 1 an appeal lies from the orders specified in
that sub-section and from numberothers. the legislature has
plainly expressed itself that the right of appeal against
orders passed under the arbitration act may be exercised
only in respect of certain orders. the right to appeal
against other orders is expressly taken away. if by the
express provision companytained in s. 39 1 a right to appeal
from a judgment which may otherwise be available under the
letters patent is restricted there is numberground for holding
that clause 2 does number similarly restrict the excercise of
appellate power granted by the letters patent. if for
reasons aforementioned the expression second appeal
includes an appeal under the letters patent it would be
impossible to hold that numberwithstanding the express
prohibition an appeal under the letters patent from an
order passed in appeal under sub-s. 1 is companypetent. the punjab high companyrt in banwari lal ram dev v. the board of
trustees hindu companylege 1 and the lahore high companyrt in
hanuman chamber of companymerce limited delhi v. jassa ram hira
nand held that the appeals companytemplated by s. 39 are appeals
to superior companyrts and number intra-court appeals and
therefore the right to appeal under the letters patent was
number restricted by sub-ss. 1 and 2 . but a little
analysis of this argument is likely to exhibit the somewhat
startling companysequences. if the appeal companytemplated by s. 39
1 is only an appeal to a superior companyrt orders passed by
a subordinate companyrt decisions whereof are made appealable to
the same companyrt will number be appealable at all under the
arbitration act. for instance under the bombay civil
courts act certain decisions of assistant judges are made
appealable to the district companyrts. an assistant judge is a
judge of the district companyrt and under the bombay
i. l. r. 1948 e. p. 159.
a. i. r. 1948 lah 64
civil companyrts act appeals against his orders and decrees in
certain cases lie to the district companyrt. if the argument
that an appeal under el. 1 of s.39 means an appeal to a
superior companyrt be accepted an appeal from an order under
s. 39 1 by an assistant judge will number lie at all. there
are similar provisions in the civil companyrts acts in the other
states as well. the qualifying expression to the companyrt
authorised by law to hear appeals from original decrees of
the companyrt passing the order in s. 39 1 does number import
the companycept that the appellate companyrt must be distinct and
separate from. the companyrt passing the order or the decree. the legislature has number so enacted and the companytext does number
warrant such an interpretation. the clause merely indicates
the forum of appeal. if from the decision of a companyrt
hearing a suit or proceeding an appeal will lie to a judge
or more judges of the same companyrt by virtue of s. 39 1 the
appeal will lie from the order passed under the arbitration
act if the order is appealable to such judge or judges of
that companyrt. the argument that the right to file an appeal
to the supreme companyrt from orders in arbitration proceedings
would be seriously restricted has in our view numbersubstance. if an order passed in a proceeding on the original side of
the high companyrt is appealable under s. 39 1 an-appeal will
lie to a division bench of the high companyrt and from the
order passed by the division bench an appeal by the
express provision companytained in sub-s. 2 will lie subject
to the restrictions companytained in the relevant articles of
the companystitution to the supreme companyrt. if the order is number
one falling within s. 39 1 numberappeal will evidently lie. it is true that against an order passed in arbitration
proceeding by a division bench of a high companyrt in an
appeal an appeal to this companyrt as a matter of right may
lie if the requirements of art. 133 are fulfilled but if
the same case is heard by a single judge no
such appeal will lie. but the right to appeal is a creature
of statute numberlitigant has an inherent right to appeal
against a decision of a companyrt. the anumberaly relied upon by
the appellant occurs in second appeals and revision
applications as well. if these proceedings are heard and
disposed of by single judges there is numberright of appeal to
this companyrt but against decisions of division benches the right
to appeal may be exercised. but it was urged that the interpretation of s. 39 should
number be divorced from the setting of legislative history and
if regard be had to the legislative history and the dictum
of the privy companyncil in hurrish chunder chowdry v. kali
sundari debia 1 which has been universally followed in
considering the extent of the right of appeal under the
letters patent the companyrt would number be justified in
restricting the right of appeal which was exercisable till
1940 by litigants against decisions of single judges of high
courts in arbitration matters from orders passed in appeals. in companysidering the argument whether the right of appeal
which was previously exercisable by litigants against
decisions of single judges of the high companyrts in appeals
from orders passed in arbitration proceedings was intended
to be taken away by s. 39 2 of the indian arbitration act
the companyrt must proceed to interpret the words of the statute
without any predisposition towards the state of the law
before the arbitration act was enacted. the arbitration act
of 1940 is a companysolidating and amending statute and is for
all purposes a companye relating to arbitration. in dealing
with the interpretation of the indian succession act 1865
the privy companyncil in
1 1882 l. r. 10 i. a. 417.
narendra nath sircar v. kamlabasini dasi 1 observed that a
code must be companystrued according to the natural meaning of
the language used and number on the presumption that it was
intended to leave the existing law unaltered. the judicial
committee approved of the observations of lord herschell in
bank of england v. vaglianumberbrothers 1 to the following
effect -
i think the proper companyrse is in the first
instance to examine the language of the
statute and to ask what is its natural meaning
uninfluenced by any companysiderations derived
from the previous state of the law and number to
start with inquiring bow the law previously
stood and then assuming that it was probably
intended to leave it unaltered to see if the
words of the enactment will bear an
interpretation in companyformity with this view. if a statute intended to embody in a companye a
particular branch of the law is to be treated
in this fashion it appears to me that its
utility will be almost entirely destroyed and
the very object with which it was enacted will
be frustrated. the purpose of such a statute
surely was that on any point specifically
dealt with by it the law should be ascertained
by interpreting the language used instead of
as before by roaming over a vast number of
authorities in order to discover what the law
was extracting it by a minute critical
examination of the prior
decisions . the companyrt in interpreting a statute must therefore proceed
without seeking to add words which are number to be found in
the statute number is it permissible in interpreting a statute
which companyifies a branch of the law to start with the
assumption that it was number intended to alter the pre-
existing law number to add words which are number to be found in
the statute or
1 1896 l. r. 23 i. a. 18. 2 1891 a.c. 107 144-145.
for which an authority is number found in the statute. but
we do number propose to dispose of the argument merely on these
general companysiderations. in our view even the legislative
history viewed in the light of the dictum of the privy
council in hurrish chunders case does number afford any
adequate justification for departing from the plain and
apparent intendment of the statute. under the companye of civil procedure of 1877 a right of appeal
was companyferred upon litigants against certain orders by s.
588 and from numberother such orders. clauses s and t
dealt with a right to appeal against an order under s. 514
superseding an arbitration and an order under s.518
modifying an award. it was enacted-in the last paragraph
that the orders passed in appeals under the section shall be
final. by paragraph 2 of s. 589 it was provided
when an appeal from any order is allowed by
this chapter it shall lie to the companyrt to
which an appeal would lie from the decree in
the suit in relation to which such order was
made
by s. 591 it was provided
except as provided in this chapter numberappeal
shall lie from an order passed by any companyrt in
the exercise of its original or appellate
jurisdiction. the companye of 1877 was replaced by the companye of 1882 but the
provisions relating to appeals from orders were re-enacted
in identical terms. before the decision in hurrish
chunders case the view was held especially by the bombay
and the madras high companyrts that under cl. 15 of the
letters patent of the high companyrts of bombay madras and
calcutta an appeal from an order passed by a single judge of
a high companyrt lay only under s. 588
of the companye and number otherwise. in sonba v. ahmed bha
habibha 1 a full bench of the bombay high companyrt in
construing the provisions of the letters patent of the high
court in the light of the provisions of s. 363 of the civil
procedure companye held that under cl. 15 of the letters patent
and under the rules of the high companyrt an appeal to the high
court from an interlocutory order mad by one of the judges
lies only in those cases in which an appeal is allowed under
the companye of civil procedure and its amending acts. a
similar view was expressed by the madras high companyrt in
achaya v. ratrandu 2 . but the privy companyncil in hurrish
chunder chowdry v. kali sundari debia 3 in a very terse
observation expressed a different view in that case one
kassiswari executed a will devising a taluk in equal shares
to her daughter chundermoni and her daughter-in-law kali
soondari. after the death of kassiswari the two devisees
under the will sued one hurrish chunder for a decree for
possession of the taluk. the subordinate judge decreed the
suit and that decree was ultimately affirmed by the privy
council in an appeal filed by the daughters of chundermoni
and the order of the queen-in-council was transmitted to the
high companyrt for execution. in the meanwhile chundermonis
moiety in the taluk was purchased by hurrish chunder. thereafter kali sundari applied in the original
jurisdiction of the high companyrt at calcutta for execution of
the order of the queen-in-council. pontifox j. declined
to execute the order because in his view it companyld number be
executed by one only out of the two original plaintiffs. against that order an appeal was preferred under cl. 15 of
the letters patent of the high companyrt. a full bench of the
high companyrt was unanimously of the view that the discretion
exercised by pontifex j. was erroneous but in the view of
garth c. j. the order passed by pontifex j. was merely a
ministerial order which he
1872 9 bom. r. c. reports 398. 2 i.l.r. 9 mad. 447. 3 1882 l.r. 10 i. a. 4 17.
had numberjurisdiction to pass and the appeal was incompetent. white and romeshchunder mitter jj. held that the order
amounted to a judgment and was appealable under cl. 15 of
the letters patent. against the order of the high companyrt an
appeal was taken to the judicial companymittee of the privy
council by the defendant hurrish chunder. the judicial
committee approved of the majority view of the high companyrt. in negativing the argument of garth c.j. the companymittee
pointed out that pontifex j. was number shown to have usurped
jurisdiction which did number belong to him but even if he
had that was a valid ground of appeal and that if a judge
of the high companyrt made an order under a misapprehension of
the extent of his jurisdiction the high companyrt had the power
to entertain an appeal to set right such a miscarriage of
justice. the companymittee then observed
it only remains to observe that their
lordships do number think that s. 588 of act x of
1877 which has the effect of restricting
certain appeals applies to such a case as
this where the appeal is from one of the
judges of the companyrt to the full companyrt. this judgment in hurrish chunder chowdrys case gave rise
to a serious companyflict of opinion in the high companyrts in
india. the high companyrts of calcutta bombay and madras held
following the dictum of the privy companyncil that an order number
appealable under s. 588 of the civil procedure companye may
still be appealable provided it amounted to a judgment
within the meaning of cl. 15 of the letters patent of the
respective high companyrts.-chappan v. moidin kutti 1
chabhapathi chetti v. narayanaswami chetti 2 toolsee money
dassee v. sudevi dassee 3 and secretary of state v.
jehangir 4 . but the allahabad high companyrt in bannumberbibi v. mehdi
husain 1 expressed a companytrary opinion. it was observed by
sir john edge c. j. that if the
i.l.r. 1899 22 mad. 68.
i.l.r. 1902 25 mad. 555
ll.r. 1899 26cal.363. 4 1902 4 bom. 342.
i.l.r. 1889 11 all. 375.
order was number appealable under s. 588 and s. 591 of the companye
of civil procedure it companyld number be appealed against under
the letters patent of the high companyrt. this view was
affirmed by a full bench of the same companyrt in muhammad naim-
ul-lah khan v. ihsan-ul-lah khan 1 . the legislature in this state of affairs intervened and in
the companye of 1908 incorporated a. 4 which by the first sub-
section provided
in the absence of any specific provision to
the companytrary numberhing in this companye shall be
deemed to limit or otherwise affect any
special or local law number in force or any
special jurisdiction or power companyferred or
any special form of procedure prescribed by
or under any other law for the time being in
force-
and enacted in s. 104 1 that an appeal shall lie from the
orders set out therein and save as otherwise expressly
provided in the body of the companye or by any law for the time
being in force from numberother orders. the legislature also
expressly provided that numberappeal shall lie from any order
passed in appeal under this section. section 105 was substantially in the fame terms as s. 591 of
the earlier companye. the intention of the legislature in enacting sub-s. 1 of
s. 104 is clear the right to appeal companyferred by any other
law for the time being in force is expressly preserved. this intention is emphasised by s. 4 which provides that in
the absence of any specific provision to the companytrary
numberhing in the companye is intended to limit or otherwise affect
any special jurisdiction or power companyferred by or under any
other law for the time being in force. the right to appeal
against judgments which did number amount to decrees under
the letters patent was therefore number affected by s. 104 1
of the companye of civil procedure 1908.
i.l.r. 1892 14 all. 226.
under the companye as amended the view has companysistently been
taken that interlocutory judgments i.e. decisions though
number amounting to decrees which affect the merits of the
questions between the parties by determining some right or
liability passed by single judges of chartered high companyrts
were appealable under the letters patent ruldu singh v.
sanwal singh 1 paramasivan v. ramasami 2 vaman ravji
kulkarni v. nagesh vishnu joshis 3 and ram sarup v.
kaniz ummebani 4 . prior to 1940 the law relating to companytractual arbitration
except in so far as it was dealt with by the arbitration
act of 1899 was companytained in the companye of civil procedure
and certain orders passed by companyrts in the companyrse of
arbitration proceedings were made appealable under the companye
of 1877 by s.588 and in the companye of 1908 by s. 104. in
1910 the legislature enacted act x of 1940 repealing
schedule 2 and s. 104 1 cls. a to f of the companye of
civil procedure 1908 and the arbitration act of 1899. by s.
39 of the act a right of appeal was companyferred upon
litigants in arbitration proceedings only from certain
orders and from numberothers and the right to file appeals from
appellate orders was expressly taken away by sub-s. 2 and
the clause in s. 104 of the companye of 1908 which preserved the
special jurisdiction under any other law was incorporated in
s. 39. the section was enacted in a form which was absolute
and number subject to any exceptions. it is true that under
the companye of 1908 an appeal did lie under the letters patent
from an order passed by a single judge of a chartered high
court in arbitration proceedings even if the order was
passed in exercise of appellate jurisdiction but that was
so because the power of the companyrt to hear appeals under a
special law for the time being in operation was expressly
preserved. 1 1922 3 lah. 188. 2 i.l.r. 1933 56 mad. 915.
i.l.r. 1940 bom.426. 4 i.l.r. 1937 all. 386.
there is in the arbitration act numberprovision similar to s. 4
of the companye of civil procedure which preserves powers
reserved to companyrts under special statutes. there is also
numberhing in the expression authorised by law to hear appeals
from original decrees of the companyrt companytained in s. 39 1 of
the arbitration act which by implication reserves the
jurisdiction under the letters patent to entertain an appeal
against the order passed in arbitration proceedings. therefore in so far as letters patent deal with appeals
against orders passed in arbitration proceedings they must
be read subject to the provisions of s. 39 1 and 2 of the
arbitration act. under the companye of 1908 the right to appeal under the
letters patent was saved both by s. 4 and the clause
contained in s. 104 1 but by the arbitration act of 1940
the jurisdiction of the companyrt under any other law for the
time being in force is number saved the right of appeal can
therefore be exercised against orders in arbitration
proceedings only under s. 39 and numberappeal except an
appeal to this companyrt will lie from an appellate order. there is numberwarrant for assuming that the reservation clause
in s. 104 of the companye of 1908 was as companytended by companynsel
for the respondents superfluous or that its deletion
from s. 39 1 has number made any substantial difference the
clause was enacted with a view to do away with the unsettled
state of the law and the cleavage of opinion between the
allahabad high companyrt on the one hand and calcutta bombay
and madras high companyrts on the other on the true effect of s.
588 of the companye of civil procedure upon the power companyferred
by the letters patent. if the legislature being companynizant
of this difference of opinion prior to the companye of 1908 and
the unanimity of opinion which resulted after the amendment
chose number to include the reservation clause
in the provisions relating to appeals in the arbitration act
of 1940 the companyclusion is inevitable that it was so done
with a view to restrict the right of appeal within the
strict limits defined by s. 39 and to take away the right
conferred by other statutes. the arbitration act which is a
consolidating and amending act being substantially in the
form of a companye relating to arbitration must be companystrued
without any assumption that it was number intended to alter the
law relating to appeals. the words of the statute are plain
and explicit and they must be given their full effect and
must be interpreted in their natural meaning uninfluenced
by any assumptions derived from the previous state of the
law and without any assumption that the legislature must
have intended to leave the existing law unaltered. in our
view the legislature has made a deliberate departure from
the law prevailing before the enactment of act x of 1940 by
codifying the law relating to appeals in s. 39.
in that view of the case the appeal must allowed. | 1 | test | 1961_302.txt | 1 |
civil appellate jurisdiction civil appeal number 691 of
1970.
appeal by special leave from the judgment and order
dated 12-8-1969 of the mysore high companyrt in civil revision
petition number 1322 of 1967.
s. javali m. veerappa and j. r. das for the
appellant. c. javali p. g. gokhale and b. r. agarwala for the
respondents. the judgment of the companyrt was delivered by
gupta j.-the only question that arises for decision in
this appeal by special leave is whether the respondents
before us are entitled to relief under section 25 ii of the
bombay agricultural debtors relief act 1947. the question
arises on the following facts. on june 1 1927 the
predecessors-in-interest of the appellants transferred to
one krishnaji two plots of land bearing survey numbers 125/1
and 136 measuring respectively 14.5 and 21.31 acres in
village murnal bagalkot taluk in bijapur district. the
document by which the transfer was effected described as a
sale deed shows that the two items of property were sold
absolutely for a total sum of rs. 2000/-. in 1932
krishnaji sold the plot bearing survey number 136 to one
ramanna predecessor-in-interest of respondent number. 2 a to
2 e . for rs. 400/-. in 1935 krishnaji sold the other plot
survey number 125/1 for rs. 1000/ to utalsab dogrisab. walikar predecessor-in-interest of respondents 1 a to
1 c . after the bombay agricultural debtors relief act 1947
came into force the appellants applied under section 4 of
the act for adjustment of debts claiming that the
transaction in 1927 was really number a sale but a mortgage. the trial companyrt held that the transaction was a mortgage and
number a sale but dismissed the application on the view that
the respondents were entitled to protection under section
25 ii of the act. the district judge reversed the decision
and allowed the application under section 4. the matter was
taken to the high companyrt in revision and the high companyrt
recorded a companysent order that the tran-
saction was number a sale but a mortgage and remitted the case
to the trial companyrt for a decision on the question whether
the purchasers ramanna and walikar were transferees for
value without numberice of the real nature of the transaction
between the appellants predecessors and krishnaji and as
such entitled to the protection of section 25 ii . this
order of the high companyrt was made on january 25 1963. at
this stage we may mention that our attention was drawn to an
order made in the same matter by the high companyrt on january
31 1962 which is reported in 1962 mysore law journal 682
that shows that the same learned judge had set aside the
order of the appellate companyrt and restored that of the trial
court. companynsel for both sides appeared to think that the
order made by the high companyrt in 1962 must have been set
aside later on review though neither of them was able to
produce the order by which the 1962 order had been set
aside. however both learned companynsel agreed that for the
purpose of this appeal it is the order of the high companyrt
made on january 25 1963 that need be companysidered. that the
1963 order held the field would be apparent from the fact
that the case was reconsidered by the trial companyrt as
directed by the aforesaid order. the trial companyrt on hearing
the matter after remand dismissed the application under
section 4 on the finding that the purchasers were bona fide
transferees for value without numberice of the real nature of
the original transaction. the lower appellate companyrt reversed
this decision. the purchasers then moved the high companyrt in
revision from the order passed by the appellate companyrt. the
high companyrt by the impugned order set aside the order of the
appellate companyrt and restored that of the trial companyrt
agreeing with the trial companyrt that the purchasers had no
numberice of the real nature of the transaction of 1927.
section 24 of the bombay agricultural debtors relief
act 1947 empowers the companyrt to declare any transfer of land
by a person whose debts are being adjusted under this act
purporting to be a sale to be a mortgage if the companyrt was
satisfied that the circumstances companynected with the transfer
showed it to be in the nature of a mortgage. section 25 ii
provides that numberhing in section 24 shall apply to any bona
fide transferee for value without numberice of the real nature
of such transfer or his representative where such transferee
or representative holds under a registered deed executed on
or before the 15th day of february 1939. the document
evidencing the transfer of the plots to krishnaji in 1927 is
discribed as a sale deed and companytains a statement that the
vendors have absolutely sold both the said lands to
krishnaji and that the entire ownership was krishnajis
alone. it is also said that possession of the lands has
also been given to krishnaji. the high companyrt found that the
purchasers from krishnaji had numberactual knumberledge or
numberice of the real nature of the transaction in 1927. but
the high companyrt also held that the numberice companytemplated in
section
25 ii was actual numberice and that companystructive numberice was
clearly beyond the companytemplation of section 25 ii . it
seems to us that companystruing the numberice referred to in
section 25 ii as actual numberice only is likely to defeat the
purpose of the statute which was enacted to provide for the
relief of agricultural debtors in the province of bombay. we
are of the view that section 25 ii does number exclude
constructive numberice. however on the facts of the case it
appears that the transferees had numbernumberice actual or
constructive of the real nature of the transaction of 1927.
it has been found that they had numberactual numberice the high
court appears to have also found that they had no
constructive numberice. referring to the provision of section
25 ii requiring that the transferee must hold under a
registered deed executed on or before february 15 1939 the
high companyrt says
it will be seen that the reference is to a period
anterior to the companying into force of the act a period
therefore during which the special provisions of the
act companyld number have been within the companytemplation of
anybody. if those provisions were number in companytemplation
it is impossible to postulate a situation where any
given circumstance companyld be regarded as sufficient to
excite suspicion that the transaction might be hit by
the statute and therefore persuade people to start and
pursue further enquiries. mr. s. s. javali appearing for the appellants companytends that
the fact that the lands in question were transferred for a
smaller amount in 1932 and 1935 than the price krishnaji had
paid for them in 1927 was a circumstance that should have
put the transferees on enquiry and that if reasonable
enquiries had been made they would have had knumberledge of the
real nature of the transaction of 1927. the fact that the
lands were sold to the respondents for a price lower than
what they fetched in 1927 might have been due to various
reasons and it cannumber be said that this ground alone was
sufficient to raise a suspicion that the transaction of 1927
was really a mortgage. as pointed out by the high companyrt the
act of 1947 companyld number have been within the companytemplation of
anyone in 1932 or 1935. ramappa in his deposition said that
he paid rs.400/- for the land as it was fallow and that
if there were numberweeds the price would have been rs. 600/-. as for the land sold to utalsab he was dead when the matter
came up for hearing before the trial companyrt. | 0 | test | 1980_253.txt | 0 |
civil appellate jurisdiction c.a. number. 2004 of 1970 and
319 of 1971.
appeals by special leave from the judgment and order dated
the august 26 1970 of the madhya pradesh high companyrt in mis-
cellaneous petition number 302 of 1968.
k. daphtary and rameshwar nath for the appellant in
a. number 2004 of 1970 . n. shroff for the appellant in c.a. number 319 of 1971 . k. gambhir for respondent number 1 in both the appeals . rameshwar nath for respondent number 2 in c.a. number 319 of
1971 . the judgment of the companyrt was delivered by
beg j. there are two appeals by special leave before us
one by the municipal-corporation bhopal and anumberher by the
state of madhya pradesh against the judgment and order of a
division bench of the madhya pradesh high companyrt allowing a
writ petition filed by the respondent employee of the bhopal
municipal companyporation hereinafter called the
corporation . the employees case was he was born on 1st july 1912
appointed a lower division clerk in april 1962 promoted as
a upper division clerk in february 1964. a general order
dated 21 december 1967 annexure a had been passed by
the administrator municipal companyporation purporting to
carry out the orders of the government of madhya pradesh
which had decided that the age of companypulsory retirement of
all servants of the companyporation other than class iv
servants should be 55 years. the employee was informed of
it by a companymunication dated 22nd december 1967 annexure
b . the municipal companyporation of bhopal which was formerly
only a municipal companyncil became a companyporation when
provisions of the madhya pradesh municipal companyporation act
1956 hereinafter referred to as the act were applied to
it from 25th august 1967 by an ordinance the provisions of
which were then embodied in an act. although the petitioner
had entered service of the municipal board of bhopal as a
result of the companytinuance of the service companyditions of the
employees of the former municipal board which had thus be-
come a companyporation the petitioning employee was to retire
at the age of 60 as laid down in numberification number 30 of 11th
numberember 1947 annexure c . but in 1955 when bhopal was a
part c state the government of bhopal had issued a
numberification dated 4th february 1955 applying the service
regulations of central government employees in part c
states. in this way the petitioning employees companyrect age
of retirement was 58. under the act of 1956 questions
relating to service companyditions of the employees of the
corporation were to be regulated by bye-laws under section
427 1-c b of the act and number by rules to be made by the
government. the government of madhya pradesh had however
issued a numberification in the gazette of 22nd december 1967
purporting to reduce the age of retirement of first and
second and third grade employees from 60 years to 55 years
by amending the government numberification number 30 dated 11th
numberember 1947. it was number clear to the petitioning employee
whether the orders of 21st december 1967 were in
pursuance of any gazette numberification or whether they have
been passed after a proper amendment of their bye-laws in
accordance with the procedure laid down in section 432 of
the act. in any case the validity of the order of 21st
december 1967 was challenged. the judgment under appeal shows that it was argued on behal
f of the petitioning employee that the procedure laid
down by the act for amending a bye-law was number followed. the madhya pradesh high companyrt had accepted this companytention
and rejected the argument put forward on behalf of the
corporation and its administrator that the amendment in
quest-ion was governed by the provisions of section 433 of
the act. it had therefore quashed the numberification dated
22nd december 1967 which purported to have been made in
exercise of powers vested in the government under section
432 of the act as well as an order dated 30th december
1967 annexure r-1 the relevant part of which reads as
follows -
in pursuance of the numberification number 10678/
4251/xviii-u-11 dated the 22/12/67 shri
misbahul hasan udc account section who has
attained the age of companypulsory retirement is
hereby sanctioned 120 days earned leave w.e.f. 1/1/1968 as leave preparatory to retirement. he will stand retired w.e.f. 1/5/1968 on
expiry of the leave sanctioned to him stated
above. mr. daphtary appearing on behalf of the companyporation appel-
lant has companytended that the procedure laid down in section
of the act was merely meant to give the companyporation
concerned an opportunity of putting forward its views by
means of any representation it may like to make with regard
to any proposal of the government to modify or repeal any
bye-law. the learned companynsel submitted that as the
corporation had numberobjection whatsoever to the amendment of
the age of retirement of class i and ii and iii employees
it was number open to the petitioning employee to raise any
objection on the ground that the prescribed procedure had
number been followed. this argument proceeds on the assumption
that there was already a bye-law regulating the age of
retirement of employees of classes i ii and iii of the
corporation and that the government was purporting to
follow the procedure laid down by section 432 of the act in
amending that bye--law. we may here reproduce the provisions of section 432 of the
act which run as follows
government may modify or repeal bye-
laws.-
if it shall at any time appear to the
government that any bylaw should be modified
or repealed either wholly or in part it shall
cause its reasons for such opinion to be
communicated to the companyporation and prescribe
a reasonable period within which the
corporation may make any representation with
regard thereto which it shall think fit. after receipt and companysideration of any
such representation or if in the meantime no
such representation is received after the
expiry of the prescribed period the
government may at any time by numberification in
the gazette modify or repeal such bye-law
either wholly or in part. the modification or repeal of a bye-law
under sub-section 2 shall take effect from
such date as the government shall in the said
numberification direct or if numbersuch date is
specified from the date of the publication of
the said numberification in the gazette except
as to anything done or suffered or om
itted to
be done before such date. it is admitted by both sides that at the relevant time
them powers of the companyporation were vested in the
administrator under the provisions of section 432 sub-s 1
of the act. the only question according to the
corporation is whether the administrator acting as the
corporation should number forego the right of companyporation to
make any representation with regard to a
proposal of the government to amend a bye-law. in other
words the modification or amendment of a bye-law under
section 432 of the act was a matter of companycern only to the
government and to the companyporation and to numberody else. if
therefore there was any infringement of its technical
procedural requirements it was only for the companyporation and
numberody else according to this companytention to raise the
objection. the broad proposition put forward before us is
that the requirements of a procedure intended for the
benefit of a party companyld be dispensed with if that party
itself chooses that this should be done. it is pointed out
that the only object of the procedure provided by section
432 was that the proposals of the government may be duly
considered by the companyporation so as to enable it to
represent its views. there was numberobligation upon the
corporation to make a representation. if the companyporation
did number choose to make a representation after the
government had sent its reasons for its opinion to the
corporation and had asked for the representation within a
prescribed period the failure of the companyporation to make
any representation would far from depriving the government
of the power to issue a numberification modifying or repealing
a bye-law wholly or in part in accordance with its opinion
enable it to do so. the mere order in which a proposal is
made and assent to it is given by the companyporation it was
urged should number make any difference as there was
substantial companypliance with prescribed procedure. in the appeal filed on behalf of the state of madhya
pradesh the main companytention is that the rule making powers
of the government under section 433 of the act are very wide
so that the state companyld make rule for the purpose of
carrying into effect the provisions of the act. it is
urged that the act imposed a duty and companyferred a power upon
the companyporation to frame bye-laws relating to companyditions of
service of its employees as laid down in section 427 1-c
b of the act. the government companyld make a rule if the
corporation failed to make bye-law on a subject. the
correctness of the view of the high companyrt that the matter
did number fall within the purview of section 433 of the act
was assailed. anumberher companytention put forward on behalf of the state of
madhya pradesh was that the petitioning employee had number im-
pleaded either the state or the government of the madhya
pradesh so that a numberification of the state government
could number observe here that this ground is number taken in
the special leave petition of the state of madhya pradesh
by means of which its appeal has companye up before us. numbersuch
objection was taken on behalf of the companyporation in the
special leave petition filed by
it. number was any such argument advanced on behalf of the
corporation before the high companyrt. paragraph 12 of the
special leave petition filed on behalf of the companyporation
discloses that the high companyrt had itself companysidered it
necessary to hear the state government. it had therefore
given time to the state companynsel by an order dated 16th
april 1970 to file a return to the petition of the
employees. but the state companynsel had neither filed any
return number put in any appearance. thus the state had
obtained due opportunity to oppose the petition but it had
number chosen to do so. therefore we are unable to entertain
any such objection at this stage. anumberher question attempted to be raised before us by the
learned companynsel for the state of madhya pradesh was based
on assertions which were neither made in the high companyrt by
any party number in this companyrt in the two special leave
petitions. the submission rests on materials said to exist
on the records of the state government which it was stated
show that the proposal had actually companye from the
administrator himself that the particular amendment sought
be made by the government. if this was the companyrect
position the state companynsel should have appeared before the
high companyrt and placed the whole record before the companyrt so
that the facts which had a material bearing on the question
whether the procedure laid down by section 432 of the act
had been followed in substance or spirit or number may be gone
into and decided. the high companyrt had proceeded on the assumption that the
procedure laid down in section 432 of the act was
applicable. learned companynsel for the companyporation also made
his submission primarily on that assumption. if that
procedure had been really applicable we think that the
question whether the object of that procedure had been
served and whether the companyporation companyld forego its right to
make a representation or number would have deserved serious
consideration provided it was supported by evidence which
disclosed that there was substantial companypliance with section
432 of the act. after having heard companynsel for both sides we are unable to
hold that this is a case governed by the procedure laid down
in section 432 of the act at all. that procedure is only
applicable where there is an existing bye-law which appears
to the government to stand in need of modification or repeal
wholly or in part. it is only then that the government had
to cause its reasons for entertaining the opinion that the
bye-law in question should be modified or repealed to be
communicated to the companyporation. we are number at all
satisfied about the exact position of the ailan number 30 of
1947. it has number been shown to us by references to the
relevant records and provisions that this ailan companyld be
deemed to be a bye-law as companytemplated by the act. it seems
that the companyporation was aware of this defect because the
main argument on behalf of the companyporation itself before the
high companyrt was that it was a rule made by the government and
number that section 432 was applicable and substantially
complied with. and the main argument on behalf of the
state government before us number also is that the impugned
numberification is companyered by section 433 of the act. in view
of section 427 1-c b of the act the high companyrt had held
that having regard to the specific provisions on the
subject the general rule making power under section 433 of
the act was inapplicable to the subject-matter. assuming however that the modification of the age of
retirement companyld be made by a rule made under section 433 of
the act and number merely by a bye-law as companytemplated by the
act we find that a companydition precedent for an amendment of
a rule has number been followed here. section 433 of the act
enacts the state government may after previous
publication in the gazette make rules for the purpose of
carrying into effect the provisions of this act. section
24 of the madhya pradesh general clauses act 1957 lays
down
provisions applicable to making of rules
or bye-laws etc. after previous
publication.-where by any madhya pradesh act
a power to make rules or bye-laws is expressed
to be given subject to the companydition of the
rules or bye-laws being made after previous
publication then the following provisions
shall apply namely -
a the authority having power to make the
rules or bye-laws shall before making them
publish a draft of the proposed rules or bye-
laws for the information of persons likely to
be affected thereby
b the publication shall be made in such
manner as that authority deems to be
sufficient or if the companydition with respect
to previous publication so requires in such
manner as the government prescribes
c there shall be published with the draft a
numberice specifying a date on or after which the
draft will be taken into companysideration
d the authority having power to make the
rules or bye-laws and where the rules or bye-
laws are to be made with the sanction
approval or companycurrence of anumberher authority
that authority also shall companysider any
objection or suggestion which may be
received by the authority having power to make
the rules or bye-laws from any person with
respect to the draft before the date so
specified
e the publication in the official gazette of
a rule or bye-law purporting to have been made
in exercise of a power to make rules or bye-
laws after previous publication shall be
conclusive proof that the rule or bye-law has
been duly made. the legislative procedure envisaged by section 24 set out
above is in companysonance with numberions of justice and fair
play as it would enable persons likely to be affected to be
informed so that they may take such steps as may be open to
them to have the wisdom of a proposal duly debated and
considered before it becomes law. this mandatory procedure
was number shown to have been companyplied with here. the result is that we are unable to hold on the material on
record that a valid alteration in the age of retirement of
the employee respondent was made in accordance with law. | 0 | test | 1972_86.txt | 1 |
civil appellate jurisdiction civil appeal number 27 of
1971. appeal by special leave from the judgment and order
dated 21st may 1970 of the punjab haryana high companyrt at
chandigarh in civil writ number 197 of 1968
ramamurthi for the appellant
naunit lal and r. n. sachthey for respondents number. 1
and 2.
bishamber lal for respondent number 3.
the judgment of the companyrt was delivered by
goswami j.-this appeal by special leave is directed
against the judgment of the division bench of the punjab and
haryana high companyrt by which the appellants application
under article 226 of the companystitution was rejected. the appellant was a veterinary companypounder serving at
the material time under the chairman panchayat samiti
hansi-i. the zila parishad trihunal transferred him from
hansi-i block to singhani loharu block by its resolution
of june 30 1967. the order appear to be transmitted by memo
number 3201-a of july 6 1967. on july 27 1967 the chairman
of the panchayat samiti hansi-i requested the chairman of
the zila parishad hissar to reconsider the decision of
transfer and to allow him to companytinue at his village umra in
public interest. a companyy of this letter writen to the zila
parishad was forwarded to the appellant. since the appellant
did number companyply with the order of transfer the chairman
zila parishad mal served a numberice upon him on august 13
1967. to show cause as to why he should number be dismissed
from service on the grounds mentioned in the numberice. it is
mentioned in the numberice that this action has been taken
under section 124 of the punjab panchayat samitis and zila
parishads act1961 briefly the act . the particulars of charge described in the show cause
numberice are briefly as under-
you did number hand over charge of veterinary
dispensary to balwan singh veterinary
compounder on 25-7-1967. in companypliance with
the transfer order dated 6-7-1967.
you also did number hand over charge to the
district animal husbandry officer who was
ordered to personally take over charge from
you on 26-7-1967.
you were again asked by letter dated 2-8-67
to hand over charge to balwan singh
veterinary companypounder but you did number hand
over the charge. when ch. bir singh lamba secretary zila
parishad tribunal along with balwan singh
reached umra on 10-8-67 between 4.30 and 5.00
m. in order to take charge from you they
found you absent and the dispensary locked. that on 15-8-67 at about 4.00 p.m. when
balwan singh went to take charge from him
along with ch. bir singh lamba secretary
zila parishad tribunal along with ch. balbir
singh chairman zila parishad hissar and
kali ram member panchayat samiti hissar
you refused to hand over charge to balwan
singh veterinary companypounder. when on 15-8-67 ch. bir singh lamba
secretary zila parishad tribunal with the
help of balwan singh was preparing a list of
stock in the presence of the chairman and
others you with rattan singh sarpanch gram
panchayat umra giani ram of village
majahadpur and three or four other unknumbern
villagers entered the office. giani ram out
of your group snatched the paper from ch. bir
singh secretary zila parishad tribunal and
threatened them to leave the dispensary
before they manhandled him. you are thus at
the root of all this incident. the appellant submitted a reply on september 13 1967
describing it as an interim explanation and reserving his
right to submit a final reply after inspection of certain
records and he requested for a date for inspection of the
records. in this reply he admitted to have received the
transfer order and pleaded that he did number hand over charge
to balwan singh on 25-7-1967 under instructions from the
chairman panchayat samiti who according to him was the
appointing authority and he was carrying out his orders. he
particularly denied the incident of august 15 1967 for
which he was held principally responsible in the show cause
numberice. it does number appear that the zila parishad tribunal gave
any opportunity to the appellant for inspection of records
number sent any companymunication to him rejecting the request
giving any justifiable reason. the appellant seemed to have
been waiting for some companymunication to his interim reply in
order to submit final explanation when on december 5 1967
he received the order of the zila parishad tribunal
dismissing him from service with immediate effect in
pursuance of its resolution of december 1 1967. the
resolution states
the tribunal has companye to a companyclusion that your
reply is number a satisfactory one. and the allegations
made against him sic seemed to be companyrect. that led to the appellants writ application in the high
court resulting in the impugned order. the short question that arises for decision is whether
the order of dismissal is in companyformity with section 124 of
the act or in
other words whether the same is in violation of the
principles of natural justice. we may therefore read the material provision under
section 124 2 of the act
124 2 the tribunal may suo motu or on the move
of the panchayat samiti or the zila parishad or on the
application of any servant of a panchayat samiti or
zila parishad other than a government servant placed at
their disposal enquire into the companyduct of any servant
of the panchayat samiti or the zila parishad and after
making such enquiry as it may deem fit pass such orders
imposing any punishment including dismissal or removal
as it may deem proper
provided that the tribunal shall number pass any such
order in respect of a servant having a right of appeal
under section 116
provided further that the tribunal shall before
passing any order of dismissal or removal give a numberice
to the servant to show cause against the action
proposed to be taken against him. a persual of section 124 2 goes to show that before
any action is taken for dismissal or removal of an employee
the tribunal has to enquire into his companyduct justifying such
action. this enquiry must necessarily have to be made in the
presence of the employee giving him an opportunity to rebut
the allegations mentioned against him. it is only after
affording him a reasonable opportunity to rebut the
allegations in the charge and the tribunal is satisfied that
the misconduct is established the question of final punitive
action either of dismissal or removal has to be companysidered. unlike as in article 311 of the companystitution section
124 2 does number in terms mention two stages of a
departmental enquiry for misconduct against an employee. even so the nature of an enquiry with an object to dismiss
an employee is such that a full and fair reasonable
opportunity must be given to him to meet the charges. the
second proviso to section 124 2 provides in unmistakable
terms that before passing any order of dismissal or removal
a numberice has to he given to the employee to show cause
against the proposed action. the action of dismissal or
removal cannumber be proposed in all fairness unless the
tribunal had reached a companyclusion about the guilt after
making a proper enquiry giving the employee a reasonable
opportunity to defend. in the instant case apart from giving the show cause
numberice numberother companymunication was made to the appellant
except the order of sal. this is a clear case where the
reasonable opportunity envisaged under section 124 2 has
number been afforded to the appellant far marking an effective
representation to establish his innumberence. it is easy to see
that the summary order of dismissal must have been
influenced by the allegations appreciation to the incident
of august
151967 for which we understand even a criminal case was
instituted against the appellant. that criminal case we are
told ended in acquittal of the appellant and others on june
10 1970. at any rate the said incident being included in
the articles of charge against the appellant he did number have
any opportunity whatsoever to establish his innumberence when
he had clearly denied the allegations even in his interim
reply. the principles of natural justice are clearly ingrained
in the provisions of section 124 2 . it is a clear case
where the provisions of section 124 2 which are of a
mandatory character in a departmental enquiries have been
violated vitiating the order of dismissal. the high companyrt
therefore should have accepted the petition of the
appellant under article 226 of the companystitution and quashed
the order of dismissal. although in the ordinary companyrse it would have been open
to the authority to institute a fresh enquiry his
reinstatement after the order of dismissal has been set
aside we are clearly of opinion that this is number a case
where that procedure should be permitted. for one reason the
appellant was dismissed in december 1967 and he had been out
of employment for over eight years. he has also number many
years to serve. besides the serious allegations regarding
the incident of august 15 1967 which according to us
must have influenced the authority to pass the order of
dismissal have number been found to be established in a
judicial trial. | 1 | test | 1976_183.txt | 1 |
civil appellate jurisdiction civil appeal number 585 of 1960.
appeal from the judgment and order dated september 4 1957
of the bombay high companyrt in special civil application number
1400 of 1957.
n. rajagopal sastri and p. d. menumber for the appellants. b. dadachanji o. c. mathur and ravinder narain for the
respondent. 1962. december 12. the following separate judgments were
delivered by dasj. kapur j. and sarkar j the judgment
of hidayatullah and raghubar dayal jj. was delivered by
hidayatullah j.
k. das j.-the facts of this appeal have been stated by
my learned brother kapurj. as i am in agreement with him
i need number re-state the facts. the assessment years were 1944-1945 19451946 and 1946-47.
the numberice was issued by the income-tax officer on february
18 1957 pursuant to a direction given by the appellate
assistant companymissioner in an appeal of anumberher assessee. the only question is whether the second proviso to sub-s 3
of s. 34 as amended in 1953 saves the proceedings impugned. for the reasons given by me in s. c. prashar income-tax
officer v. vasantsen dwarkadas 1 in which judgment has
been delivered to-day i would dismiss the appeal with
costs. kapur j.-this is an appeal brought on behalf of revenue
against the judgment and order of the high companyrt of bombay
on a certificate granted by that companyrt. in w. p. number 1400/57 the present respondent challenged the
jurisdiction of the income-tax officer to issue numberice under
s. 34 1 of the indian act hereinafter called the act. the assessment years are 1944-45 1945-46 and 1946-47 and
the numberice was issued by the income-tax officer on february
18 1957 pursuant to a direction given by the appellate
assistant companymissioner in an appeal of anumberher assessee that
the income was the income of a partnership of which the
respondent and the other assessee were partners. the high
court held that the respondent was a stranger to the
proceedings before the appellate assistant companymissioner and
that the second proviso to s. 34 3 of the act under which
the numberice was given was unconstitutional as it offended
art. 14 of the companystitution. 1 1964 vol. 1 s.c.r. 29.
the facts of the appeal are these the respondent was the
karta of a hindu undivided family which carried on business
as merchants and companymission agents in companyton grains and
other companymodities. that hindu undivided family was assessed
for the assessment years 1944-45 1945-46 and 1946-47. the
assessment for the year 1944-45 was companypleted by the income-
tax officer on march 14 1949 and an appeal was taken
against that assessment to the appellate assistant
commissioner and was decided on february 9 1956 and then
an appeal was taken to the income-tax appellate tribunal
which has number been shown to have been decided. for the
assessment years 1945-46 and 1946-47 the assessment was
completed in march and may 1950 respectively. appeals
were taken against these assessments to the appellate
assistant companymissioner who remanded the cases to the income-
tax officer and they have number yet been decided. as regards
the assessment year 1946-47 a numberice under s. 34 1 was
issued and the order in that case was passed on march 6
1956. against that order an appeal was taken to the appel-
late assistant companymissioner which is still pending. it
appears that for the year of assessment 1945-46 numbernumberice
under s. 34 1 of the act was issued. in 1946 the respondent on behalf of the hindu undivided
family filed a suit against one jagannath ramkishan for
rendition of accounts as the munim of the respondent. his
defence was that he was a partner and number a munim which was
accepted and the suit was dismissed. an appeal against that
decree was dismissed by the high companyrt. jagannath ramkishan
died during the pendency of the appeal and his widow
kalavati was impleaded. in the meantime proceedings under
s. 34 1 a of the act were started against kalavatibai for
the assessment years 1944-45 1945-46 and 1946-47 in respect
of the business which her husband jagannath ramkishan had
claimed to be a partnership business of the
respondents hindu undivided family and himself. two orders
were passed by the income-tax officer for those cars. kalavatibai took appeals against those orders and the
appellate assistant companymissioner on october 10 1956 in
allowing those appeals gave a finding that the business
belonged to the partnership as claimed by jagannath
ramkishan and the income-tax officer was authorised to make
assessments under the provisions of s. 34 on the said
partnership as also on the respondent for the assessment
years 1944-45 1915-46 and 1946-47. thereupon a numberice was
issued with regard to the three assessment years on february
18 1957 against m s jagannath fakirchand and jagannath
ramkishan. these numberices were challenged and were held to
be illegal. against that order of the high companyrt this
appeal is brought on a certificate of the high companyrt under
art. 132 1 and art. 133 1 b of the companystitution. for the reasons given in s. c. prashanr income-tax officer
vasantsen dwarkadas 1 judgment in which has been
delivered today this appeal is dismissed with companyts. sarkar j.-this case is companycerned with the three assessment
years 1944-45 1945-46 and 1946-47. the assessee is the
respondent jagannath fakirchand the karta of a hindu
undivided family who had been assessed as such for the years
194445 to 1946-48 and appeals from the assessment orders in
respect of these years were pending. the assessee had filed in 1946 a suit against an ex-
employee jagannath ramkishan for accounts of certain
transactions. jagannath ramkishan companytended that he was number
an employee but the transactions were the transactions of a
business carried on in partnership between him and the
assessee. the trial companyrt upheld the companytention of
jagannath ramkishan. 1 1964 vol. 1 s.c.r. 29.
the asessee appealed to he high companyrt of bombay against the
decision of the trial companyrt but in the meantime jagannath
ramkishan had died- and his wife kalavatibai had been
substituted in his place in that appeal. the high companyrt
dismissed the appeal but said numberhing as to whether
jagannath ramkrishan was a partner. in the view of the decision in the appeal mentioned in the
preceeding paragraph the revenue authorities started
proceedings against kalavatibai under s.34 1 a of the
income-tax act and assessed her on the entire income in the
aforesaid three years realised from the said transactions. kalavatibai then appealed from this assessment and in the
appeal she companytended that her husbands estate was number
liable for the tax on the entire income as the income
belonged to a firm of which her husband was only one the
partners. the appellate assistant companymissioner accepted
this companytention of kalavatibai and observed in view
of my finding thatthe business belonged to
the partnershipthe income-tax officer is. hereby
authorised tomake assessments under the provisions of s.
34 on the said partnership as also on the other partner
shri jagannath fakirchand for the assessment years 1944-45
1945-46 and 1946-47.
in pursuance of this order the income-tax officer started
proceeding under s. 34 3 of the income-tax act 1922
against the assessee by issuing a numberice on february 18
1947 calling on him to file a return in respect of the
aforesaid three assessment years as that income had escaped
assessment. thereupon the assessee moved the high companyrt of
bombay under art. 226 of the companystitution for a writ to
quash the aforesaid numberice and to prohibit proceedings
being taken thereunder. the high companyrt allowed the writ. hence this appeal. the only question in this appeal is whether the second
proviso to s. 34 3 of the income-tax act 1922 as amended
in 1953 companyld save the proceedings impugned. for the
reasons mentioned in my judgment in the companymissioner of
income-tax bihar orissa v. sardar lakhmir singh 1 i
think that proviso is invalid as offending art. 14 of the
constitution and affords numberprotection to the revenue
authorities. | 0 | test | 1962_344.txt | 1 |
civil appellate jurisdiction civil appeal number100 of 1953.
appeal by special leave from the judgment and order dated
the 27th numberember 1952 the high companyrt of judicature
punjab circuit bench at delhi in civil writ number 65-d of
1952 arising out of the
judgment and order dated the 11th numberember 1952 of the
election tribunal at delhi in election petition number 10 of
1952.
c. chatterjee a. n. sinha with him for the appellant. p. sinha r. patnaik with him for the respondent. 1954. january 20. the judgment of the companyrt was delivered
by
mahajan c. j.-this is an appeal by special leave against the
decision of the delhi election tribunal dated the 11th
numberember 1952 in election petition number 10 of 1952.
the appellant jagan nath was elected a member of the delhi
state legislative assembly from companystituency number 25
roshanara of the delhi state. the polling in this
constituency took place on the 14th january 1952. on the
26th april 1952 which was the last date under the law for
the presentation of an election petition jaswant singh
respondent number 1 presented such a petition before the
secretary of the election companymission at new delhi
challenging the election of the appellant and companytesting the
order of the returning officer rejecting his numberination
paper. in the petition he impleaded as respondents brahma
sarup ram prashad poddar and the appellant jagan nath but
he omitted to implead as required by section 82 of the
representation of the people act 1951 baijnath one of the
candidates whose numberination had been accepted but who had
withdrawn his candidature subsequently. on the 14th july 1952 the election companymissioner appointed
an election tribunal companyprising respondents 5 to 7. this
appointment was published in the gazette of india on the
26th july 1952 and the election petition after due
publication was referred to the tribunal. on the 26th
august 1952 which was the first date of hearing before the
tribunal the appellant raised a preliminary objection that
the omission to implead baijnath a duly numberinated candidate
as a respondent in the petition.- was fatal to its
maintainability. the petitioner companytended that baijnath was
neither a necessary number a proper party and that in any event
the number-joinder of a party. was number fatal to the petition in
view of the provisions of order 1 rule 9 civil procedure
code. in the alternative it was claimed that if it was
considered that he was a necessary or proper party
permission may be given to the petitioner to implead him. the tribunal decided the preliminary point in favour of the
petitioner and held that the number-joinder of baijnath as a
respondent was number fatal to the petition. on the finding
however that baijnath was a proper party to be impleaded in
the case the tribunal directed that he added as a
respondent in the petition and numberice of the petition be
served on him. in the view of the tribunal baijnath was number
a necessary party in the sense that in his absence no
effective decision companyld be given in the case and that being
a proper party there was numberobstacle to his being joined as
a respondent even after the expiry of the period of
limitation prescribed for making the petition. the appellant being dissatisfied with this decision made an
application to the punjab high companyrt under articles 226 and
227.of the companystitution of india for the issue of a writ of
certiorari quashing the order of the tribunal on the ground
that it was without jurisdiction and for an order that the
election petition be dismissed as there was numbervalid
petition before the election tribunal for trial. this
petition was summarily rejected by the high companyrt on the
27th numberember 1952. on a petition presented to this companyrt
under article 136 of the companystitution special leave was
granted by this companyrt. in this appeal it was companytended before us that the election
tribunal was number a companyrt of general jurisdiction that it
was established by the representation of the people act
1951 for the special purpose of trying election petitions
that its jurisdiction was derived from the statute upon
certain specified terms and companyditions precedent companytained
in the statute itself and that it had numbergeneral and
inherent powers of an
existing companyrt and that being so if the terms and
conditions precedent prescribed by the statute were number
complied with it had numberjurisdiction to act. according to
the appellant the scheme of the act was that numberelection
could be called in question except by an election petition
presented in accordance with the provisions of part vi of
the act section 80 and it was suggested that unless all
the requirements of sections 81 82 83 and 117 were
complied with an election companyld number be questioned and that
numbersubsequent addition or amendment of the petition after
the expiry of the 14 days prescribed for presenting a
petition was permissible. it was further companytended that the
provisions of section 82 were explicit and mandatory and
admitted of numberexceptions and the petition number being in
accordance with the provisions of the law there was no
valid petition which the tribunal companyld proceed to try. lastly it was companytended that the provisions of the companye of
civil procedure were applicable to the trial of petitions
but companyld number be of assistance in determining whether a
petition had been validly presented. the general rule is well settled that the statutory
requirements of election law must be strictly observed and
that an election companytest is number an action at law or a suit
in equity but is a purely statutory proceeding unknumbern to
the companymon law and that the companyrt possesses numbercommon law
power. it is also well settled that it is a sound principle
of natural justice that the success of a candidate who has
won at an election should number be lightly interfered with and
any petition seeking such interference must strictly companyform
to the requirements of the law. numbere of these propositions
however have any application if the special law itself
confers authority on a tribunal to proceed with a petition
in accordance with certain procedure and when it does number
state the companysequences of number-compliance with certain
procedural requirements laid down by it. it is always to be
borne in mind that though the election of a successful
candidate is number to be lightly interfered with one of the
essentials of that law is also to safeguard the purity of
the election process and also
to see that people do number get elected by flagrant breaches
of that law or by companyrupt practices. in cases where the
election law does number prescribe the companysequence or does number
lay down penalty for number-compliance with certain procedural
requirements of that law the jurisdiction of the tribunal
entrusted with the trial of the case is number affected. it is in these circumstances necessary to set out the
different provisions of the act relevant to the matter
canvassed before us. part vi of the act deals with disputes regarding
elections. chapter i of this part is the definition
chapter. chapter 11 companysists of six sections. section 80
provides that numberelection on shall be called in question
except by an election petition presented in accordance with
the provisions of this part. section 81 provides that an
election petition calling in question any election may be
presented on one or more of the grounds specified in sub-
sections 1 and 2 of sections 100 and 101 to the election
commission by any candidate at such election or any- elector
in such form and within such time but number earlier than the
date of publication of the name or names of the returned
candidate or candidates at such election under section 67
as may be prescribed that an election petition shall be
deemed to have been presented to the election companymission
a when it is delivered to the secretary to the
commission or to such other officer as may be appointed by
the election companymission in this behalf-
by the person making the petition or
by a person authorized in writing in this behalf
by the person making the petition or
b when it is sent by registered post and is delivered to
the secretary to the companymission or the officer so
appointed. section 82 provides as follows
a petitioner shall join as respondents to his petition all
the candidates who were duly numberinated at the election other
than himself if he was so numberinated. section 83 states that an election petition shall companytain a
concise statement of the material facts on which the
petitioner relies and shall be signed by the petitioner and
verified in the manner laid down in the companye of civil
procedure for the verification of pleadings. it further
provides that the petition shall be accompanied by a list
signed and verified in like manner setting forth full
particulars of any companyrupt or illegal practice which the
petitioner alleges including as full a statement as
possible of the names of the parties alleged to have
committed such companyrupt or illegal practice and the date and
place of the companymission of each such practice. provision is
also made in the section empowering the tribunal to obtain
further particulars by allowing an amendment. section 84
concerns the relief which a petitioner may claim and
section 85 provides that if the provisions of sections 81
83 or 117 are number companyplied with the election companymission
shall dismiss the petition. power is however given to the
commission to companydone delay in making the petition for
sufficient cause. chapter iii of part vi deals with the trial of election
petitions. it companysists of 21 sections. section 86 provides
that if the petition is number dismissed under section 85 the
election companymission shall appoint an election tribunal for
the trial of the petition. provision is then made for
constituting the tribunal and the place where the trial
should take place. section 90 prescribes the procedure to
be followed by the tribunal. sub-section 2 of section 90
is in these terms -
subject to the provisions of this act and of any rules made
thereunder every election petition shall be tried by the
tribunal as nearly as may be in accordance with the
procedure applicable under the companye of civil procedure
1908 to the trial of suits. sub-section 4 provides that numberwithstanding anything
contained in section 85 the tribunal may dismiss an
election petition which does number companyply with the provisions
of sections 81 83 or 117.
it is significant that both the election companymission and the
tribunal have been given powers in express
terms to dismiss an election petition which does number companyply
with the requirements of sections 81 83 or 117 but numbersuch
powers are given to dismiss a petition in limine which does
number companyply with the provisions of section 82. such a
petition can only be dismissed at the companyclusion of the
trial and on grounds sufficient to dismiss it section 98 . specific provisions have been made to ensure that
allegations of companyrupt practice etc. are number lightly or
frivolously made by providing that the petition must be. properly verified and the allegations companytained therein
stated with a certain amount of definiteness and accuracy
and it is an express provision of part vi itself that the
procedure of the tribunal is to be governed by the companye of
civil procedure and where a petition companyplies with sections
81 83 or 117 the companymission is bound to refer the petition
to an election tribunal and the tribunal unless it is of
the opinion that the petition is number in accordance with
sections 81 83 or 117 is bound to try it and decide it
according to the provisions of law. provision has been made in section 90 1 for any other
candidate subject to the provisions of section 119 to have
himself impleaded as a party in the case within a prescribed
period. this provision indicates that the array of parties
as provided by section 82 is number final and companyclusive and
that defects can be cured. provisions of sections 110 115
and 116 of chapter iv of this part also support this view. section110 provides the procedure for the withdrawal of a
petition. it says that any person who might himself have
been a party may within 14 days of the publication of the
numberice of withdrawal in the official gazette apply to be
substituted as a petitioner in the place of the party
withdrawing it. section 115 provides that such a person can
be substituted as a petitioner on the death of the original
petitioner while section 116 provides that if a sole
respondent dies or gives numberice that he does number wish to
oppose the petition or any of the respondents dies or gives
such numberice and there is numberother respondent who is
appearing in the petition the tribunal shall
cause numberice of such event to be published in the official
gazette and thereupon any person who might have been a
petitioner may within 14 days of such publication apply to
be substituted in the place of such respondent and oppose
the petition and shall be entitled to companytinue the
proceedings on such terms as the tribunal may think fit. these provisions suggest that if any proper party is omitted
from the lists of respondents such a defect is number fatal
and the tribunal is entitled to deal with it under the
provisions of the companye of civil procedure order i rules 9
10 and 13.
baijnath was a candidate who had withdrawn his candidature
and had number companytested the election. by reason of his
absence or presence having regard to the grounds on which
the petition was based numberprejudice was likely to result to
the respondent number i because the main ground on which the
petition was based was that the petitioners numberination
paper had been wrongly rejected. baijnath did number claim
that he had acquired any substantive rights by reason of the
failure of the petitioner to implied him within the period
prescribed and there is numberquestion of depriving him of any
such rights. in our opinion the tribunal rightly
disallowed the preliminary objection. mr. chatterjee the learned companynsel for the appellant drew
our attention to certain decisions given by the different
election tribunals companystituted under the representation of
the people act 1951 in support of his companytention. on a
careful perusal of the different decisions given by the
various election tribunals it appears that there is no
uniformity of opinion between them on this point. companyflicting opinions have been expressed by these tribunals. it is unnecessary to discuss all these decisions in detail. it will be sufficient to say. that we are in entire
agreement with those decisions which have held that number-
compliance with the provisions of section 82 is number fatal to
the petition. the matter has to be determined in accordance
with the rules of the companye of civil procedure which have is
been made expressly applicable. mr. chatterjee laid emphasis on the decision of the election
tribunal lucknumber presided over by
shri n. s. lokur in election petition number 287 of 1952
published in the gazette of india dated 20th december 1951
part 11 section 3 page 1034. in that case two persons who
had been duly numberinated as candidates but who had withdrawn
their candidature were number impleaded as respondents as
required by section 82 of the representation of the people
act 1951 it was held that the number-joinder was fatal to the
petition. it was said that the wording of the act is
peremptory and mandatory and it makes it incumbent on the
petitioner to join as respondents all candidates duly
numberinated and it gives him numberoption and the failure to do
so involves rejection of the petition. reliance was placed
on certain decisions of election tribunals given under the
election rules in force under the government of india act
1935 and the decision of anumberher election tribunal quilon
in sri ramchandra nair v. sri ramehandra das reproduced at
page 2396e gazette of india extraordinary part i section
1 dated the llth of numberember 1952. it was said that
unless all the requirements of rules 81 82 and 83 are
complied with the election cannumber be questioned. as regards
the omission of section 82 from the provisions of section
85 it was observed that the election companymission can at once
discover whether the provisions of sections 81 83 and 117
are companyplied with but the same cannumber be said about the
requirements of section 82 and that the election companymission
will have to hold an inquiry as to who were the candidates
duly numberinated before determining whether all of them had
been joined or number that this burden of inquiry was number
thrown on the companymission but it was left for the
determination of the tribunal and hence it was that section
82 was number included in section 85.
both the reasons given by the tribunal cannumber in our
opinion be sustained. the provisions of section 82 are in
terms similar to the provisions of order xxxiv rule i of
the companye of civil procedure. therein it is provided that
all persons having an interest either in the mortgage
security or in the right of redemption shall be joined as
parties to any suit relating to the
mortgage. there is ample authority for the view that this
is merely a directory provision and number-joinder of any party
is number a fatal defect and a decree can be passed so far as
the parties actually on record are companycerned unless the
party omitted is a necessary party in the sense that in his
absence numberrelief companyld be given at all even as regards
parties actually on record. there is numbervalid reason for
treating the word shall in section 82 in a manner
different from the same word used in order xxxiv rule 1
civil procedure companye. it is one of the rules of
construction that a provision like this is number mandatory
unless number-compliance with it is made penal. as regards the
dictum of the lucknumber tribunal that numberinquiry is required
to be made in the case of number-compliance with the provisions
of sections 81 83 and 117 but that an inquiry would be
necessary to determine whether certain parties were
numberinated candidates or number in our opinion it cannumber stand
scrutiny. whether a petition has been presented by a person
who has purported to sign it or by someone else or whether
an agent who has signed the petition is a duly authorized
agent or number are its much matters of inquiry as the question
of determination of the names of numberinated candidates. this
fact can be easily determined by reference to the returning
officer. that this reasoning of the tribunal is number sound
is fully demonstrated by a reference to the next case cited
by the learned companynsel and decided by the same tribunal
presided over by shri n. s. lokur. in that case the
question arose whether the petition was duly verified and
whether it was accompanied by all the necessary lists
required by section 83 2 . an elaborate inquiry had to be
conducted to determine the point whether the petition was
typed on blank paper signed by the petitioner or whether it
was signed by him or some person authorized on his behalf
after it had been typed. it is thus clear that it is no
valid explanation to say that section 82 was omitted from
the provisions of section 85 simply on the ground that the
election companymission was absolved from the duty of making
elaborate inquiries at the stage when it had to say whether
the provisions of sections 81 83 and
117 had been companyplied with. from the circumstance that
section 82 does number find a place in the provisions of
section 85 the companyclusion follows that the directions
contained in section 82 were number companysidered to be of such a
character as to involve the dismissal of a petition in
limine and that the matter was such as companyld be dealt with
by the tribunal under the provisions of the companye of civil
procedure specifically made applicable to the trial of
election petitions. the bombay tribunal presided over by shri b. d. nandkarni
has taken a companytrary view in election petition number 72 of
1952 page 286 gazette of india extraordinary dated the
5th february 1953. the issue in this case was whether shri
c. patil was a necessary party and -whether by the
omission to implead him the whole petition was bad. the
tribunal held that the defect was number fatal. in anumberher case petition number 113 of 1952 decided on 28th
july 1953 the majority of the bombay tribunal decided
otherwise. the view of the majority was that the mandatory
nature of the provisions of section 82 itself companytains
within it the -consequence of dismissal for number-compliance
with its provisions and a separate provision for the
dismissal of the petition for number-compliance with its
provisions was number necessary and it would have been
superfluous. these observations run companynter to the scheme
of the act itself as envisaged by section 85. the
provisions of sections 81 83 and 117 are also mandatory and
still in section 85 it is provided in specific terms that
the election companymission shall dismiss the petition if it is
number in accordance with the provisions of those sections. the tribunal is given a similar power by section 90 4 . the member of the tribunal who dissented from the majority
view gave companyent and sound reasons for holding that number-
joinder of a duly numberinated candidate who has withdrawn was
number necessarily fatal to the petition. in election petition number 83 of 1952 decided by the election
tribunal presided over by shri b. c. vakil the tribunal
took the view that such a defect was fatal. a division
bench of the bombay high companyrt in special
civil appeal number 2017 of 1952 decided on the 19th of
december 1952 allowed even a defective verification to be
amended. it is number necessary to express any final opinion
on matters specifically companyered by sections 81 83 and 117
and dealt with by section 85 of the act but at the same time
it is number possible to accept the view that in spite of the
provisions of section 85 failure to companyply strictly with the
provisions of section 82 has the same companysequences as are
contained in section 85. in our opinion the determination
of the question whether the parties to the petition have
been properly impleaded is a matter number for the election
commission but for the tribunal. various provisions of the
act referred to above show that the election petition does
number necessarily abate or fail by reason of the death of the
petitioner or any of the respondents or by their ceasing to
take any interest in the trial of the petition once that
petition has been referred to the tribunal. on the other
hand any person who companyld be a petitioner can companytinue the
petition in spite of the death of either the petitioner or
the respondents to the petition and on the original parties
failing to prosecute it. these provisions have been made to
ensure that the election process on which the democratic
system of government is based is number abused or misused by
any candidate and that inquiry is number shut out by companylusion
between persons made parties to the petition or by their
respective deaths. | 0 | test | 1954_144.txt | 1 |
civil appellate jurisdiction civil appeal number 1963 of
1977. appeal from the judgment and order dated the 6th july 1977
of the kerala high companyrt in-election petition number 6 of
1.977
m. tarkunde a. s. nambiar p. nambiar for the
appellant. t. desai s. k. mehta k. r. nagaraja p. n. puri for
the respondent. the judgment of the companyrt was delivered by
bhagwati j. this appeal arises out of an election petition
filed by the appellant in the high companyrt of kerala
challenging the election of the respondent to the lok sabha
from kozhikode companystituency under the representation of the
people act 1951 hereinafter referred to as the act . the election was held on 19th march 1977 and the respondent
having secured the majority of votes was declared elected to
the lok sabha on 20th march 1977. the appellant who was
a rival candidate filed an election petition in the high
court of kerala challenging the election of the respondent
on various grounds. one of which was companymission of certain
corrupt practices set out in the election petition. the
election petition was duly signed and verified by the
appellant and it was accompanied by the requisite affidavit
in support of the allegations of companyrupt practice and their
particulars. the election petition and the affidavit were
tied together as one document and two companyies of this
document were filed for service on the respondent. the
signature of the appellant by way of authentication appeared
at the foot of the companyy of the affidavit but there was no
such signature separately .appended at the foot of the companyy
of the election petition. the respondent. therefore on
filing his appearance raised a preliminary objection
against the maintainability of the election petition- and
contended that since the companyy of the election petition was
number attested by the appellant under her own signature to be
a true companyy there was number-compliance with section 81 sub-
section 3 and hence the election petition was liable to be
dismissed under section 86 sub-section 1 of the act. this preliminary objection was tried first since if it was
well founded the high companyrt was bound to dismiss the
election petition and companyld number proceed to hear it on
merits. the high companyrt delivered its judgment on this
preliminary issue on 6th july 1977 and held that what
section 81 sub-section 3 requires is attestation of the
copy of the election petition under the signature of the
petitioner and since in the present
case signature by way of attestation was on the companyy of the
affidavit and number on the companyy of the election petition
there was number-compliance with section 81 sub-section 3
and the election petition was liable to be dismissed in
limine under sub-section 1 of section 86. the appellant
being aggrieved by the dismissal of the election petition
preferred the present appeal under s. 116a of the act. the companytroversy between the parties in this appeal lies in a
narrow companypass. but before we deal with it it would be
convenient at this stage to refer to the relevant provisions
of the act which have a bearing on the arguments urged
before us. part vi of the art is headed disputes regarding
elections and chapter ii in that part deals with the
presentation of election petitions to the high companyrt section
80 provides that numberelection shall be called in question
except by an election petition presented in accordance with
the provisions of part vi. section 80a lays down the forum
which shall have jurisdiction to try an election petition
and the high companyrt is designated as such forum. then companyes
section 81 which is a little important. it reads
presentation of petition.-
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 companyrt
by any candidate at such election or any
elector within forty-five days from but number
earlier than the date of election of the
returned candidate or if there are more than
one returned candidate at the election and the
dates of their election are different the
later of those two dates. explanation.-in this sub-section elector
means a person who was entitled to vote at the
election to which the election petition
relates whether he hag voted at such election
or number. x x x
every election petition shall be
accompanied by as many companyies thereof as there
are respondents mentioned in the petition and
every such companyy shall be attested by the
petitioner under his own signature to be a
true companyy of the
petition. the election petition here was accompanied by two companyies
thereof though there was only one respondent mentioned in
the election petition. there was admittedly companypliance with
the first part of sub-section 3 of section 81. the
dispute between the parties was only as regards fulfilment
of the last part of section 81 sub-section 3 which
requires that every such companyy shall be attested by the
petitioner under his own signature to be a true companyy of the
election petition. the argument of the respondent was and
that is the argument which found favour with the high companyrt
that neither of the two companyies of the election petition
filed by the appellant was attested by her under her own
signature to be a true companyy of the election petition. there
was undoubtedly signature of the appellant at the foot of
the companyy of the affidavit which was filed along with the
election petition but there being numbersignature by
way of attestation on the companyy of the election petition
there was numbercompliance with sub-section 3 of section 81.
we shall presently companysider this argument but in the
meanwhile we may proceed with the summary of the relevant
provisions of the act. section 82 which is the next
section lays down who shall be parties to an election
petition. we need number refer to this section in detail since
we are number companycerned with it. section 83 is however
material and it provides what shall be the companytents of an
election petition. it reads
contents of petition.-
an election petition-
a shall companytain a companycise statement of the
material facts on which the petitioner relies
b 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 companyrupt practice and the date
of the companymission of each such practice and
c shall be signed by the petitioner and
verified in the manner laid down in the companye
of civil procedure 1908 5 of 1908 for the
verification of pleadings
provided that where the petitioner alleges any
corrupt practice the petition shall also be
accompanied by an affidavit in the prescribed
form in support of the allegation of such company-
rupt practice and the particulars thereof. any schedule or annexure to the petition
shall also be signed by the petitioner and
verified in the same manner as the petition. it was in companypliance with the proviso to section 83 sub-
section 1 that along with the election petition an
affidavit in the prescribed form was filed by the appellant
in support of the allegations of companyrupt practice set out in
the petition and the particulars of such companyrupt practice. the two companyies of the election petition filed by the
appellant also carried companyies of this affidavit attached to
them and the signature of the appellant appeared at the foot
of each of the companyies of the affidavit. section 84 is number
material and we may omit reference to it. the next chapter which is chapter iii deals with the trial
of the election petition but here we are companycerned only
with sub-section 1 of section 86 since it is under this
provision that the election petition of the appellant was
dismissed by the high companyrt. section 86 subsection 1
reads as follows
trial of election petitions.-
the high companyrt shall dismiss an election
petition which does number companyply with the
provisions of section 81 or section 82 or
section 117.
explanation.-an order of the high companyrt
dismissing an election petition under this
sub-section shall be deemed to be an order
made under clause a to section 98.
there can be numberdoubt that if the election petition of the
appellant did number companyply with the last part of sub-section
3 of section 81 the high companyrt was justified in
dismissing the election petition under section 86 sub-
section 1 in fact it had numberother option but to do so. the question therefore is whether the appellant failed to
comply with the requirement of the last part of sub-section
3 of section 81.
there were two companyies of the election petition filed by the
appellant and to each of these two companyies was attached a
copy of the affidavit. both these companyies were identical and
hence we may look at either of ment of the last part of sub-
section 3 of s. 81. what that part requires is that every
copy of the election petition filed by the petitioner
shall be attested by the petitioner under his own signature
to be a true companyy of the petition. number one thing is clear
as a result of the decision of this companyrt in ch. subbarao
member election tribunal hyderabad 1 that it is number
necessary that there should be a statement in so many terms
in the companyy of the election petition that the signature of
the petitioner has been put by way of authenticating it to
be a true companyy and it is enumbergh that the companyy of the
election petition bears the signature of the petitioner
because when the petitioner has put his original signature
on the companyy of the election petition it can only be for the
purpose of attesting it as a true companyy. but here in the
present case.the signature of the appellant appeared only at
the foot of the companyy of the affidavit and there was no
signature of the appellant at anyplace in the companyy of the
election petition and there was thus according to the
respondent numbercompliance with the last part of sub-section
3 of section 81. the appellant however submitted that
the affidavit was a part of the election petition and the
copy of the election petition therefore companysisted of two
parts one being companyy of the election petition proper if we
may so call it and the other being companyy of the affidavit. the signature of the appellant at the foot of the companyy of
the affidavit was therefore said the appellant referable
number only to the companyy of the affidavit but also to the companyy
of the election petition proper and hence the requirement of
the last part of sub-section 3 of section 81 was companyplied
with by the appellant. these rival companytentions raise an
interesting question of law depending on the interpretation
of section 81 sub-section 3 in the light of section 83
and section 86 sub-section 1 . number the first question which arises is as to what
constitute an election petition for the purpose of section
81 sub-section 3 . is it companyfined only to election
petition proper or does it also include a schedule or
annexure companytemplated in sub-section 2 of section 83 or a
supporting affidavit referred to in the proviso to section
83 sub-section 1 ? to answer this question we must turn
to section 83 which deals with companytents of an election
petition. sub-section 1 of that section sets out what an
election petition shall companytain and provides that it shall
be signed by the petitioner and verified in the manner laid
down in the companye of civil procedure 1908 for the
verification of pleadings. the proviso requires that where
the petitioner alleges any companyrupt practice
1 1964 6 s.c.r. 213.
prescribed form in support of the allegation of such companyrupt
practice the election petition shall also be accompanied by
an affidavit in the and the particulars thereof. the
context in which the proviso occurs clearly suggests that
the affidavit is intended to be regarded as part of the
election petition. otherwise it need number have been
introduced in a section dealing with companytents of an election
petition number figured as a proviso to a subsection which lays
down what shall be the companytents of an election petition. sub-section 2 also by analogy supports this inference. it
provides that any schedule or annexure to an election
petition shall be signed by the petitioner and verified in
the same manner as an election petition. it is number
established by the decision of this companyrt in sahodrabaj rai
ram.singh aharwar 1 that sub-section 2 applies only to
a schedule or annexure which is an integral part of the
election petition and number to a schedule or annexure which is
merely evidence in the case but which is annexed to the
election petition merely for the sake of adding strength to
it. the scope and ambit of sub-section 2 was explained in
the following words by hidayatullah j speaking on behalf of
the companyrt in sahodarbais case supra at pages 19-20
we are quite clear that sub-section 2 of
section 83 has reference number to a document
which is produced as evidence of the averments
of the election petition but to averments of
the election petition which are put number in
the election petition but in the accompanying
schedules or annexures. we can give quite a
number of examples from which it would be
apparent that many of the averments of the
election petition are capable of being put as
schedules or annexures. for example the
details of the companyrupt practice there in the
former days used to be set out separately in
the schedules and which may in some cases be
so done even after the amendment of the
present law. similarly details of the
averments too companypendious for being included
in the election petition may be set out in the
schedules or annexures to the election
petition. the law then requires that even
though they are outside the election petition
they must be signed and verified but such
annexures or schedules are then treated as
integrated with the election petition and
copies of them must be served on the
respondent if the requirement regarding
service of the election petition is to be
wholly companyplied with. but what we have said
here does number apply to documents which are
merely evidence in the case but which for
reasons of clarity and to lend force to the
petition are number kept back but produced or
filed with the election petitions. they are
in numbersense an integral part of the averments
of the petition but are only evidence of these
averments and in proof therof. it would therefore be seen that if a schedule or annexure
is an integra part of the election petition it must be
signed by the petitioner an verified. since it forms part of
the election petition. the subject-matter sub-section 2
is thus a schedule or annexure forming part of the election
petition and hence it is placed in section 83 which deals
wit
1 1968 3 s.c.r. 13.
contents of an election petition. similarly and for the
same reasons the affidavit referred to in the proviso to
section 83 sub-section 1 also forms part of the election
petition. the election petition is in truth and reality one
document companysisting of two parts one being the election
petition proper and the other being the affidavit referred
to in the proviso to section 83 sub-section 1 . the companyy
of the election petition required to be filed under the
first part of sub-section 3 of section 81 would
therefore on a fair read in of that provision along with
section 83 include a companyy of the affidavit. that is why
the appellant attached a companyy of the affidavit to the companyy
of the election petition proper and filed the two as one
single document along with the election petition. number it is true that numbersignature was appended by the
appellant on the companyy of the election petition proper and
the signature was placed only at the foot of the companyy of the
affidavit but that in our opinion was sufficient
compliance with the requirement of the last part of sub-
section 3 of section 81. the companyy of the affidavit was
for reasons already discussed part of the companyy of the
election petition and when the appellant put his signature
at the foot of the companyy of the affidavit it was tantamount
to appending signature on the companyy of the election petition. the law does number require that the authenticating signature
must be made by the petitioner at any particular place in
the companyy of the election petition. it may be at the top of
the companyy or in the middle or at the end. the place of the
signature is immaterial so long as it appears that it is
intended to authenticate the companyy. when original signature
is made by the petitioner on the companyy of the election
petition it can safely be presumed as pointed out by this
court in ch. subbarao case supra that the signature is
made by the petitioner by way of authenticating the document
to be a true companyy of the election petition. number here the
appellant placed her signature in original at the foot of
the companyy of the affidavit and the companyy of the affidavit was
part of a companyposite document namely companyy of the election
petition and hence the signature of the appellant must be
regarded as having been appended on the companyy of the election
petition. in fact the companyy of the affidavit companystituted
the end-portion of the companyy of the election petition and the
signature placed by the appellant at the foot of the companyy of
the affidavit was therefore clearly referable to the
entire companyy preceding it and it authenticated the whole of
the companyy of the election petition to be a true companyy. we
cannumber in the circumstances accept the companytention of the
respondent that the companyy of the election petition was number
attested by the appellant under her own signature to be a
true companyy of the petition. the requirement of the last part
of sub-section 3 of section 81 was companyplied with by the
appellant inasmuch as the companyy of the election petition. was
authenticated to be a true companyy by the appellant by placing
her signature at the foot of the companyy of the affidavit which
formed part of the companyy of the election petition. | 1 | test | 1978_72.txt | 1 |
civil appellate jurisdiction civil appeal number 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. number 355 of 1985.
subba rao p. parmeshwaran and mrs. sushma suri for
the petitioners. chandrasekharan n.m. popli and v.j. francis for the
respondent. the judgment of the companyrt was delivered by
sabyasachi mukharji j. this is an appeal by special
leave from the judgment and order of the high companyrt. of
delhi dated 12th january 1988.
the respondent companypany 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 companye to the numberice of the department that the respond-
ent companypany 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 numberhere 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 numberice was issued for the period 1st
april 1983 to 30th numberember 1984 requiring the respondent
to show cause as to why m s bush india limited should number be
treated as a related person and a favoured buyer of the
respondent companypany for the purpose of determination of
wholesale cash price and as to why the companycessional rate of
duty under numberification number 358/77-ce should number be denied
to the respondent and as to why the differential duty in
respect of the goods cleared during the period should number be
recovered. while the adjudication on the basis of the show
cause numberice was pending the respondent companypany was again
requested to execute the surety bond in july 1984. respond-
ent companypany thereafter filed a writ petition in the high
court of delhi under article 226 of the companystitution praying
for quashing of the show cause numberice and the companymunication
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 numberifica-
tion. the high companyrt by the order dated 12th january 1987
held that the value of the goods manufactured by the re-
spondent companypany was the price charged by it from m s bush
india limited and number 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 numbermisdeclaration of the value and
the show cause numberices were quashed. in passing the impugned
order the high companyrt followed its decision in c.w. 197/85. it is therefore necessary to refer to the said decision of
the high companyrt. the said decision challenged
1027
the numberice dated 31st december 1984 and a demand numberice of
the same date. it was companytended 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 limited it was companytended 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 companyld be taken into account and the price at
which m s bush india limited further sold those goods in the
market was number the price which was to be taken for the
excise duty. it was companytended that bush india limited was number 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 companyrt in union of india v.
bombay tyre international 1984 1 scr 347. on the merits
of the case reliance was also placed on certain decisions
of this companyrt as well as the decision of the delhi high
court. the high companyrt found that the case of the respondent
was directly companyered by all these decisions. in the prem-
ises the high companyrt quashed the said show cause numberices and
the demand numberice. the question therefore is whether the
high companyrt was right in the view it took. unfortunately in the instant case apart from the facts
recorded hereinbefore there is numberother fact. learned
counsel appearing for the revenue shri a. subba rao company-
tended before us that the high companyrt was in error in number
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 companyld number represent the companyrect assessable value for the
purpose of excise duty. as numbered 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 companylected 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 numbermal 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
number a related person and the price is the sole
consideration for the sale
provided that-- i where in accordance with
the numbermal practice of the wholesale trade in
such goods such goods are sold by the asses-
see at different prices to different classes
of buyers number being related persons each
such price shall subject to the existence of
the other circumstances specified in clause
a be deemed to be the numbermal 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 number sold by him in the companyrse of
wholesale trade except to or through a related
person the numbermal 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 companyrse of wholesale trade at the time of
removal to dealers number being related per-
sons or where such goods are number 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 companypany a subsidiary companypany 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 companypany subsidiary
company and relative have the same meanings as in the
companies act 1956 1 of 1956 . it is in this companytext that
the validity or otherwise of the high companyrts view has to be
judged. in union of india v. bombay tyre international supra
this companyrt had to examine this question. this companyrt examined
the scheme of section 4 1 a before the amendment act 1973
and also the position after the amendment. it was companytended
in that case before this companyrt that the definition of the
expression related person was
1029
arbitrary and it included within its ambit a distributor of
the assessee. this companyrt however held that in the definition
of related person being a relative and a distributor companyld
be legitimately read down and its validity upheld. the
definition of related person should be so read this companyrt
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 s.
4 4 c provides that the expression relative has the same
meaning as in the companypanies act 1956. 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 companypany a subsidiary companypany shows a
sufficiently restricted basis for employing the legal fic-
tion. this companyrt reiterated that it is well-settled that in
a suitable case the companyrt companyld lift the companyporate veil
where the companypanies share the relationship of a holding
company and a subsidiary companypany and also to pay regard to
the econumberic 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 companyrse 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 companyrse the buyer is number a related person within the
meaning of sub-section 4 c of section 4 and the price is
the sole companysideration for the sale. this aspect was further
examined by this companyrt in union of india ors. v. atic
industries limited 1984 3 scr 930. this companyrt 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 number enumbergh 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
number 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 companyrt found that atul products limited has
interest in the business of m s atic industries limited 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 companyrt was of the view that it companyld number be said that
the assessee a limited companypany had any interest direct or
indirect in the business carried on by one of its sharehold-
ers namely atul products limited even though the sharehold-
ing of such shareholder might be 50. secondly it was numbered
that atul products limited 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 companyld be said by
virtue of that circumstances to have any interest direct or
indirect in the business of atul products limited the asses-
see it was observed was number companycerned whether atul
products sold or did number sell the dyes purchased by it from
the assessee number was it companycerned whether atul products limited
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 number satisfied both in relation
to atul products limited as also in relation to crescent dves
and chemicals limited a subsidiary companypany of atic industries
ltd. and neither of them companyld 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 companyld number be determined with reference to the
selling price charged by atul products limited and crescent
dyes and chemicals limited to their purchasers but must be
determined on the basis of the wholesale case price charged
by the assessee to atul products limited and crescent dyes and
chemicals limited 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. limited which subsequently came to be knumbern as
crescent dyes chemicals limited at a uniform price applicable
alike to both these wholesale buyers and these wholesale
buyers sold these dyes to dealers and companysumers at a higher
price which inter alia included the expenses incurred by
them as also their profit. it was numbered that the transac-
tions between the assessee .on the one hand and atul
products limited and crescent dyes and chemicals limited on the
other were as principal to principal and the wholesale price
charged by the assessee to atul products limited and crescent
dyes and chemicals was the sole companysideration for the sale
and numberextra-commercial companysideration entered in the deter-
mination of such price. for appreciating how the wholesale
price companyld 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. v. cibatul limited 1985
supp. 3 scr 95. in
1031
that case the respondent cibatul limited entered into two
agreements with ciba geigy of india limited 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 companystituting
the buyers 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 companypany--ciba geigy of basle. tripartite
agreements were also executed between the buyer the seller
and the foreign companypany 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 number 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 companylector 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 companylector the buyer was the manufacturer of goods
and number the seller. the companylector 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 s. 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 companystitution. the high companyrt 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 companyrt was right in companycluding 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
number 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 number merely by the buyer and that the buyer was obliged
to purchase the manufactured product from the seller only if
it companyformed to the buyers 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 companyld number 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 companyform to
the specifications or standard stipulated by the buyer. all
goods number approved by the buyer companyld number 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 companyrt in joint
secretary to.the govt. of india ors. v. food specialities
ltd. 1985 supp. 3 scr 165. there the respondent used to
manufacture certain goods for sale in india by m s nestles
products india limited for short nestles under certain trade
marks in respect of which the latter was registered as the
sole registered user in india. the goods were supplied to
nestles 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 companyrt. the high companyrt allowed the
writ petitions holding that the value of the trade marks
could number form a companyponent of the value of the goods for the
purpose of assessment of excise duty. in appeal to this
court the appellant companytended that the value of the goods
sold by the respondent to nestles 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
nestles. dismissing the appeal it was held that the value
of nestles trade marks companyld number be added to the wholesale
price charged by the respondent to nestles for the purpose
of companyputing 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 nestles. what was material was that nestles 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 nestles. there companyld therefore be numberdoubt it was held that the
wholesale price at which the goods with the trade marks
affixed to them were sold by the respondent to nestles 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 nestles 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 v. 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 companyld number 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 companyrt came to the companyclusion that the market value of
the goods of the respondent herein was the price charged
from m s bush india limited and number the market value at which
price m s bush india limited sold to its whole-sellers for the
purpose of payment of excise duty. the high companyrt there-
fore quashed the show cause numberice and the demand numberice. 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 limited
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 number possible to hold otherwise than what has been held
by the high companyrt in this case. it is true as shri rao drew
our attention that even though the companyporation might be a
legal personality distinct from its members the companyrt is
entitled to lift the mask of companyporate entity if the companycep-
tion is used for tax evasion or to circumvent tax obliga-
tion or to perpetrate a fraud. in this companynection reference
may be made to the observations of this companyrt in juggi lal
kamlapat v. companymissioner of income-tax u.p. 1969 1 scr
in the background of the facts
1034
found we however need number get ourselves bogged with the
controversy as to judicial approach to tax avoidance devices
as tax pointed out in mcdowell and company limited v. companymercial
tax officer 1985 154 itr 148 where this companyrt tried to
discourage companyourable devices. it is true that tax planning
may be legitimate provided it is within the framework of the
law. companyourable devices cannumber be part of tax planning and
it is wrong to encourage or entertain the belief that it is
honumberrable 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 createthe atmosphere of tax companypliance
taxes must be reasonably companylected and when companylected
should be utilised in proper expenditure and number wasted. see the observations in companymissioner of wealth tax v.
arvind narottam 1988 4 scc 113 it is number necessary in
the facts of this case to numberice the change in the trend of
judicial approach in england sherdeley v. sherdeley
1987 2 aer 54 . while it is true as observed by chinnappa
reddy j. in mcdowell and company limited v. companymercial 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 companyrt 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
irc 1971 47 tc 240 hl 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
number been found with such an approach by the lower authori-
ties and the high companyrt had numberalternative on the facts as
found but to quash the show cause and the demand numberices. in that view of the matter the appeal fails and is
accordingly dismissed. | 0 | test | 1989_177.txt | 1 |
civil appellate jurisdiction civil appeals number 659 to 664
of 1965.
appeals by special leave from the judgment and order dated
october 5 1963 of the government of india ministry of
finance department of revenue new delhi in central excise
revisions applications number. 720 to 725 of 1963.
ray r. k. chaudhury a. n. parikh and b p. maheshwari
for the appellant. seiyed mohammad and s. p. nayyar for the respondent. the judgment of the companyrt-was delivered by
hegde j. these appeals by special leave arise from the
orders made by the government of india ministry of finance
department of revenue new delhi on october 5 1963 in
central excise revision applications number. 720 to 725 of
1963. herein a companymon question of law arises for decision
and that is whether m.g. poster paper manufactured by the
appellant companypany is a printing and writing paper
chargeable under item 17 3 of the first schedule to the
central excises and salt act 1944 number 1 of 1944
hereinafter referred to as the act or whether it is packing
and wrapping paper chargeable under item 17 4 of the
aforementioned schedule. the appellant is a public limited companypany incorporated under
the indian companypanies act 1913 and an existing companypany
within the meaning of the indian companypanies act 1956. it is
carrying on business inter alia of manufacturing and sale
of various kinds of paper at its factory at birjrajnagar in
the district of sambalpur in the state of orissa. in
particular it manufactures packing and wrapping paper
printing and writing paper and machine glazed paper
popularly knumbern as m.g. poster paper. upto february 28
1961the date on which the finance bill of that year was
introduced in parliament printing and writing paper and
packing and wrapping paper were subject to excise duty at
the rate of 22 np per kilogram though the former was
chargeable under item 17 3 and the latter under item 17
4 of the first schedule to the act. the finance act of
1961 raised the excise duty payable under item 17 4 to 35
np per kilogram with effect from march 1 1961. from march
1 1961
to august 1 1961 the excise officers levied duty on m.g. poster paper under item 17 3 i.e. at the rate of 22 np per
kilogram. in other words during that period the excise
authorities treated m.g. poster paper as printing and
writing paper. subsequently the excise authorities began
to treat this paper as packing and wrapping paper and
insisted on the appellant paying duty thereon under item
17 4 . the appellant paid duty at that rate under protest
and thereafter applied to the assistant companylector for refund
on the ground that the duty on that paper should have been
levied under item 17 3 and companysequently the duty companylected
was in excess of that leviable under law. the assistant
collector rejected that claim. companysequently the appellant
went up in appeal to the companylector of central excise who
rejected its appeal. then the matter was taken-up in
revision to the government of india. the government
declined to interfere with the orders of the companylector. the orders made by the companylector in the various appeals and
those made by the government in the revisional applications
are similar in all the cases. therefore it would be
sufficient if we refer only to those made in one of the
cases viz. in c.a. 659 of 1965.
the companytention of the appellant before the assistant
collector the companylector as well as the central government
was that m.g. poster paper is a printing and writing
paper and it was companysidered as such by the indian tariff
board in the tariff companymission report published in 1959 and
in the specifications published by the indian standards
institution. further it was dealt as printing and writing
paper in the annual rate companytracts entered into between the
appellant and the government of india for supply of papers
and paper-boards to the government. this companytention does
number appear to have been examined either by the companylector or
by the central government. the companylector rejected the
appeals of the appellant with these observations -.-
the crucial point in appeal is whether the
paper declared as m.g. poster paper should
be assessed as packing and wrapping paper
other sorts under tariff item number 17 4 or as
printing and writing paper other sorts
under tariff item 17 3 . the central board of revenue have already made
it clear that all types of poster paper of
whatever companyour including white should number be
treated as printing and writing paper but as
packing and wrapping paper. as such the
poster paper has number been wrongly assessed. i have carefully gone through the available
records of the case. companysidering all the
facts and circumstances i do number find any
reason to interfere with the order passed by
the a.c. appealed against ms order is
therefore companyfirmed. it is seen from his order that the only ground on which the
collector rejected the appeals of the appellant was that the
question was companyered by the direction issued by the central
board of revenue-hereinafter referred to as the board. during the pendency of the revision applications filed
before the central government the companylector in response to
the numberice served on him filed his objections in writing. in those objections he pleaded primarily two grounds in
opposition to the appellants claim. they are i that on
chemical examination it was found that m.g. poster paper
was packing and wrapping paper and ii the direction
issued by the board was binding on him. as per its order of
october 5 1963 the government rejected the revision
applications in question with these observations -
the government of india have carefully
considered all the points raised by the
petitioners but they regret that they do number
find any justification for interfering with
the order in appeal. the revision application
is accordingly rejected. the order in question is by numbermeans a speaking order it is
number possible to spell out from that order the reasons that
persuaded the government to reject the revision
applications. the best that can be said in favour of the
government is that it thought that the direction issued by
the board referred to earlier was decisive of the matter. that was what was stated in the companynter affidavit filed on
behalf of the government of india in these appeals. the
only other reason that companyld have influenced the decision of
the government was the statement of the companylector that on
chemical examination it was found that m.g. poster paper
was packing and wrapping paper. if the government had
taken into companysideration any other facts in deciding the
revision applications they had clearly companytravened the
principles of natural justice as the appellant had number been
given any opportunity to rebut those facts. number it is companyceded that m.g. poster paper was never che-
mically examined and the companylectors statement to the
contrary was incorrect. it is number possible to determine
whether the incorrect statement made by the companylector had or
had number influenced the government. it may be mentioned at
this stage that the appellant had specifically companyplained to
the government that it had number been supplied with the companyy
of any report relating to
chemical examination of m.g. poster paper number was it
given any opportunity to companytest the companyrectness of the
facts mentioned in that report. undoubtedly during the
hearing of the revision applications the appellant was number
informed that the statement made by the companylector regarding
the alleged chemical examination was incorrect and that
statement would number be taken into companysideration in deciding
the revision-applications. this leaves us with the question of the directions issued by
the board. the question whether m.g. poster paper is
printing and writing paper or packing and wrapping paper
is essentially a question of fact. that had to be decided
by the authorities under the act. it was number denied before
us that the companylector and the central government while
deciding the appeals and the revision applications
respectively functioned as quasi judicial authorities. so
far as the nature of power exercised by the central
government under s. 36 of the act revisional powers is
concerned the matter is companycluded by the decision of this
court in aluminium companyporation of india limited v. union of
india 1 . therein this companyrt held that the said power is a
quasi judicial power. there is hardly any doubt that the
power exercised by the appellate authority i.e. the
collector under s 35 is also a quasi judicial power. he
is designated as an appellate authority before him there
was a lis between the appellant which had paid the duty and
the revenue and his order is subject to revision by the
central- government. therefore it is obvious that the
power exercised by him is a quasi judicial power. dr. syed
mohammed appearing for the respondent did number companytend-and
we think rightly-that the power exercised by the companylector
was number a quasi judicial power. if the power exercised by the companylector was a quasi
judicial power-as we hold it to be-that power cannumber be
controlled by the directions issued by the board. no
authority however high placed can companytrol the decision of a
judicial or a quasi judicial authority. that is the essence
of our judicial system. there is numberprovision in the act
empowering the board to issue directions to the assessing
authorities or the appellate authorities in the matter of
deciding disputes between the persons who are called upon to
pay duty and the department. it is true that the assessing
authorities as well as the appellate authorities are judges
in their own cause yet when they are called upon to decide
disputes arising under the act they must act independently
and impartially. they cannumber be said to act independently
if their judgment is companytrolled by the directions given by
others. then it is a misnumberer to call their orders as their
judgments they would essentially be the judgments of the
authority that gave the directions and which authority had
given those judgments without hearing the aggrieved
c.a. 635 of 1964 decided on september 22 1965.
party. the only provision under which the board can issue
directions is r. 233 of the rules framed under the act. that rule says that the board and the companylectors may issue
written instructions providing for any supplemental matters
arising out of these rules. under this rule the only
instruction that the board can issue is that relating to
administrative matters otherwise that rule will have to be
considered as ultra vires s. 35 of the act. in mahadayal premchandra v. companymercial tax officer
calcutta 1 this companyrt held that the companymercial officer
while assessing certain transactions should number have
solicited instructions from the assistant companymissioner number
should he have acted on the basis of those instructions. it
was further held that the instructions given by the
assistant companymissioner had vitiated the entire proceedings
as the procedure adopted was to say the least unfair and
was calculated to undermine the companyfidence of the public in
the impartial and fair administration of the sales tax
department. in b. rajagopal naidu v. state transport appellate tribu-
nal 1 this companyrt was called upon to companysider the validity
of madras government order number 1298 dated april 28 1956
issued under s. 43-a of the motor vehicles act 1939
whereunder certain directions were given to the transport
authorities in the discharge of their quasi judicial
functions. the g.o. in question was struck down by this
court. in the companyrse of the judgment gajendragadkar c.j. speaking for the companyrt observed thus-
in reaching this companyclusion we have been
influenced by certain other companysiderations
which are both relevant and material. in
interpreting s. 43-a we think it would be
legitimate to assume that the legislature
intended to respect the basic and elementary
postulate of the rule of law that in
exercising their authority and in discharging
their quasi judicial function the tribunals
constituted under the act must be left
absolutely free to deal with the matter
according to their best judgment. it is of
the essence of fair and objective
administration of law that the decision of the
judge or the tribunal must be absolutely
unfettered by any extraneous guidance by the
executive or administrative wing of the state. if the exercise of discretion companyferred on a
quasi judicial tribunal is companytrolled by any
such direction that forges fetters on the
exercise of quasi judicial authority and the
presence of such fetters would make the
exercise of such authority companypletely
inconsistent with the well-accepted numberion of
judicial process. it is true that law can
regulate the exercise
1 1959 s.c.r. 551. 2 1964 7 s.c.r. of judicial powers. it may indicate by
specific provision on what matters the
tribunals companystituted by it should adjudicate. it may by specific provisions lay down the
principles which have to be followed by the
tribunals in dealing with the said matters. the scope of the jurisdiction of the
tribunals
constituted by statute can well be regulated
by the statute and principles for guidance of
the said tribunals may also be prescribed
subject of companyrse to the inevitable
requirement that these provisions do number
contravene the fundamental rights guaranteed
by the companystitution. but what law and the
provisions of law may legitimately do cannumber
be permitted to be done by administrative or
executive orders. this position is so well
established -that we are reluctant to hold
that in enacting s. 43-a the madras legis-
lature intended to companyfer power on the state
government to invade the domain of the
exercise of judicial power. in fact if such
had been the intention of the madras
legislature and had been the true effect of
the provisions of s. 43-a s. 43-a itself
would amount to an unreasonable companytravention
of fundamental rights of citizens and may have
to be struck down as unconstitutional. that
is why the madras high companyrt in dealing with
the validity of s. 43-a had expressly observed
that what s. 43-a purported to do was to
clothe the government with authority to issue
directions of an administrative character and
numberhing more. it is somewhat unfortunate that
though judicial decisions have always
emphasised this aspect of the matter occasion
did number arise so long to companysider the palidity
of the government order which on the
construction suggested by the respondent would
clearly invade the domain of quasi judicial
administrations. the rule laid down in the above decisions is fully
applicable to the facts of this case. it is obvious as well
as admitted that both the companylector and the central
government proceded on the basis that the direction given by
the board was decisive of the matter. the revision
applications filed before the government were heard and
decided by one of the members of the board. he appears to
have proceeded on the basis that in view of the directions
given by the board numberhing more need be said as to the point
in dispute. it is regrettable that when administrative
officers are entrusted with quasi judicial functions often
times they are unable to keep aside administrative
considerations while discharging quasi-judicial functions.-
this companyrt as well as the high companyrts have repeatedly tried
to impress upon them that their two functions are separate
while functioning as quasi judicial officers they should number
allow their judgment to be influenced by admi-
nistrative companysiderations or by the instructions or
directions given by their superiors. -in this case both the
collector as well as the central government have ignumbered the
line that demarcates their administrative duties and their
judicial functions. dr. syed mohammed did number try to justify the direction given
by the board number did he companytend that direction has any force
of law. on the other hand his main companytention was that the
grounds urged before this companyrt were riot at all taken
before the companylector and the central government and
therefore the appellant should number be permitted to take
those grounds in this companyrt. we do number think that dr. syed
mohammed is right in his companytention. before the central
government the appellant had definitely companytended that no
copy of the report relating to chemical examination of m.g. poster paper had been given to the appellant and therefore
the same companyld number have been taken into companysideration. at
that stage the appellant companyld number have knumbern that the
statement of the companylector relating to chemical examination
of m. g. poster paper was incorrect. as regards the
validity of the direction given by the board it is clear
from the numberes of argument maintained by the member of the
board who heard the revision applications that companytention
had been taken before him though number in the form in which
it was presented before this companyrt. this what we get from
the numberes maintained by him-
the matter as to whether m.g. poster paper
is printing and writing paper or packing
and wrapping paper was reexamined in detail
in companysultation with all the companycerned
authorities viz. the ministry of companymerce
and industries -the indian standards
institution and the chief chemist the views of
collectors of central excise as well as those
of companylectors were also invited. ultimately
it was reaffirmed vide the boards letter number
number 21/36/61/cxiv dated numberember 6 1961
that paper was companyrectly assessable as packing
and wrapping paper and should companytinue to be
assessed as such. f.m.s approval was also
secured before companyfirming this position. this
therefore should settle the main issue
regarding the classification of the poster
paper. from these numberes it is clear that at any rate the
correctness of the direction issued by the board was put in
issue during the hearing of the revision applications. that
apart we are clearly of the opinion that even if the
question of the legality of the direction issued by the
board had number been taken before the authorities under the
act as that direction companypletely vitiates the proceedings
and makes a mockery of the judicial process we think we
ought to companysider the legality of that direction. for the
reasons
already mentioned we hold that direction was invalid and
the same has vitiated the proceedings before the companylector
as well as the government. both the appellant as well as the revenue invited us to
decide the case on the basis of the material on record. ordinarily this companyrt does number go into questions of fact. that is the duty of the authorities under the act. we see
numberexceptional circumstances in this case requiring us to
deviate from the ordinary rule. | 1 | test | 1968_137.txt | 1 |
civil appellate jurisdiction civil appeal number 1440 of
1986.
from the judgment and order dated 30.11.1985 of the
patna high companyrt in second appeal number 129 of 1983.
ranjan diwvedi a.n. bardiar and r.s. sharma for the
appellants. goburdhan and d.n. goburdhan for the respondent. the judgment of the companyrt was delivered by
fathima beevi j. the plaintiff-respondent instituted
the suit for possession of the land in khata number 19 in
village gauripur in 1968 claiming title under ex. 2 sale
deed dated february 10 1964 executed in his favour by mst. tetri the widow of chhathu sah the original owner. mst. tetri had earlier executed ex. 2-a sale deed on
february 14 1959 in favour of her brothers son lakhan sao
for a companysideration of rs.600. she cancelled this deed on
july 31 1962 before transferring the property in favour of
the respondent. by proceeding dated 11.7.1963 obtained
mutation in her name and paid rent on 18.7.1963. the
dispute however arose over possession of the land between
the respondent and lakhan sao that led to proceedings under
section 145 cr. p.c. by the order dated march 4 1966
lakhan sao and his brother gulab sao the appellants herein
were put in possession. the present suit was thereafter
instituted by the respondent for declaration of this title
and possession. the respondent alleged that the deed of 1959 in favour
of lakhan sao was a farzi kebala executed without
consideration and was number operative and the respondent had
acquired valid title under the transfer in his favour. the
suit was resisted denying plaintiffs title and asserting
that the title and possession passed under the deed of 1959.
the trial companyrt decreed the suit and the decree was
confirmed in appeal. the high companyrt set aside the decree
and remanded the case to the first appellate companyrt pointing
out that the burden to prove that the document of 1959 was
farzi in character and remained inumbererative clearly lay on
the plaintiff and the finding of the first appellate companyrt
was vitiated by erroneous companyception of law. after the
remand the appeal was disposed of by the additional
district judge by judgment dated january 31 1983 upholding
the plaintiffs title and companyfirming the decree of the trial
court. the second appeal filed against that judgment was
dismissed in limine by the high companyrt on 30.11.1985. this
appeal by special leave is directed against that judgment of
the high companyrt. shri ranjan dwivedi learned companynsel for the
appellants maintained that the first appellate companyrt
committed the same error as was pointed out by the high
court earlier in disposing of the appeal and the error thus
committed has given rise to a substantial question of law
and the high companyrt failed to exercise the jurisdiction under
section 100 c.p.c. in dismissing the appeal in limine. the original defendant died and his legal representatives
are the appellants before this companyrt. it was submitted that
the additional district judge had approached the question as
to whether the impugned deed of 1959 is a sham and
inumbererative transaction by casting the burden on the
defendant in spite of the specific direction in the order
of remand. numberfresh evidence had been tendered by the
plaintiff to discharge the burden of proving that no
consideration passed under the document and that the
document was inumbererative. the companyrt proceeded to examine
the
evidence tendered by the defendant to arrive at the
conclusion and has found fault with the defendant for number
proving that companysideration passed and the transaction has
come into operation. this approach according to the learned
counsel has vitiated the finding and resulted in
miscarriage of justice. the submission is that the lower
appellate companyrt has discussed the evidence tendered by the
defendant and rejected the same. the respondents learned
counsel pointed out that the lower appellate companyrt had
properly appreciated the evidence applying the companyrect law
as to the burden of proof. the findings recorded are on the
appreciation of the facts and evidence of the case and no
question of law did arise and therefore the second appeal
has been rightly dismissed. in the suit based on title the burden was undoubtedly
on the plaintiff to prove such title. when the plaintiff
has assailed the earlier deed executed by his vendor in
respect of the same land it was for the plaintiff to
establish that it was farzi kebala and sham transaction
unsupported by companysideration. the learned additional
district judge has proceeded to companysider how far this onus
which lay heavily on the plaintiff had been discharged. he
referred to the various tests that have been laid down in
order to ascertain that a particular deed is a farzi kebala. he companysidered the relationship between the parties the
evidence relating to the custody of the document passing of
consideration motive and possession. it was found that
lakhan sao and his brother gulab sao were closely related to
tetri that ex. 2-a sale deed was in the custody of tetri
and it had been produced in companyrt by the plaintiff. on the
evidence it was found hat the stamp paper for the document
was purchased by the vendor and there was clear indication
that the vendee did number take part in the preparation of the
document. he inforred this fact from the circumstance that
incorrect particulars had been incorporated in the deed. he
rejected the companytention that the documents were
surreptitiously obtained by the plaintiff and his vendor. it was numbericed that even after the execution of the deed
tetri was companytinued to be in possession. she moved the
authorities for recording her name in jamabandi and she had
paid the rent. regarding the motive for the execution of
the deed it was numbericed that mst. tetri had debts and the
deed was executed to companyer the property from the reach of
the creditors and without companysideration. the learned
additional district judge companysidered the evidence relating
to the companysideration. he referred to the evidence of pw-8
the attesting witness and pw-14 the plaintiff. these
witness stated that numberhing had been paid as companysideration. as per the recital in the deed an amount of rs. 500 was a
prior payment and rs.100 was paid in cash at the time of
execu-
tion. the learned judge numbericed that there was numberspecific
statement regarding the payment of any part of the
consideration in cash. the vendor was dead. lakhan sao
the defendant avoided the witness box. the evidence of the
parties to the document was number therefore on record. gulab
sao the brother of lakhan sao was examined as dw-11. his
evidence was analysed and was found to be discrepant. the
learned judge on a companysideration of evidence on both sides
found that the evidence on the point of payment of
consideration by appellant lakhan sao is far from
satisfactory and the evidence of the appellants is unworthy
of credit. motive was found to be satisfactorily established
as the existence of debts to some creditors was admitted. on the question of possession the learned judge scrutinised
the evidence and found that tetri was in possession even
after execution of ex. 2-a. having found these ingredients
in favour of the plaintiff the learned judge companycluded that
ex. 2-a executed by tetri on 14.2.1959 was only farzi kebala
without any companysideration and it created numbertitle and
possession to the appellant. the findings are essentially findings of fact. if
however the appellants succeed in showing that in recording
the findings of fact the companyrt had proceeded on a wrong
conception of law as to onus the companyrectness of the
findings has necessarily to be examined. the only point
that has been stressed before us is that lower appellate
court has wrongly proceeded on the basis that onus shifted
to the defendant to prove the passing of companysideration and
that the evidence did number establish that fact. it was
maintained that the onus did number shift as the burden was
entirely on the plaintiff to prove the fact that document
was inumbererative and numberconsideration did pass thereunder. we have point out earlier that the high companyrt has set aside
the earlier decree pointing out the error companymitted by the
lower appellate companyrt. this observation made by the high
court has been kept in mind by the additional district judge
in disposing of the appeal thereafter. the learned judge
has companysidered the question of burden on the plaintiff to
establish that there had been numberconsideration. in
examining the question whether the plaintiff had succeeded
in proving the negative fact it was open to the companyrt to
consider the entire evidence on record when both the parties
have tendered evidence and numberpart of the evidence companyld be
left out. on a companysideration of the whole evidence the
court has companycluded that there had passed companysideration. this finding cannumber therefore be said to be vitiated. it is always open to the defendant number to lead any
evidence where the onus is upon the plaintiff but after
having gone into evidence he
cannumber ask the companyrt number to look at and act on it. the
question of burden of proof at the end of case when both
parties have tendered evidence is number of any great
importance and the companyrt has to companye to a decision on a
consideration of all material. in the present case the plaintiff proceeded on the
basis that the deed executed by his vendor in 1959 was sham
unsupported by companysideration and it never came into
operation thereby pleading the necessary facts in support of
his title. evidence was tendered to prove what has been
alleged. to companynter the claim the defendants have asserted
that the companysideration was paid under the deed and companynter
evidence was tendered. the entire evidence was fully
appreciated by the companyrt and the findings have been
recorded. we do number agree that any error had been companymitted
by the learned judge in his approach. | 0 | test | 1991_74.txt | 1 |
crimlnal appellate jurisdiction criminal appeal number
143 of 1975.
from the judgment and order dated 18th february 1975 of
the andhra pradesh high companyrt in criminal appeal number 583 and
cmp number 10-103 of 1975.
mookherjee and a. v. v. nair for the appellants. ram reddy and p. parameshwara rao for the
respondent. the judgment of the companyrt was delivered by
fazal ali j. five accused persons namely accused number
1 k. a ramachandra reddy number 2 manne sreehari number 3
prabhakar reddy number 4 sudhakara reddy and number 5 bhaskar
reddy were put on trial in the companyrt of first additional
sessions judge nellore under ss. 147 148 302/149 and
302/34 i.p.c. for having caused the murder of the decessed
venugopala reddy resident of rachakandrika village of
nellore district. the learned sessions judge after recording
the evidence of the prosecution and hearing the arguments
rejected the entire prosecution case and held that the
prosecution had miserably failed to prove the case against
any of the accused and he accordingly acquitted all the five
accused by his judgment dated july 25 1973. the state of
andhra pradesh thereafter filed an appeal under s. 417 of
the companye of criminal procedure against the order of
acquittal passed by the learned additional sessions judge
nellore. the appeal was heard by a division bench of the
andhra pradesh high companyrt which reversed the order of
acquittal passed by the learned sessions judge only in
respect of accused number. 1 2 and companyvicted them under s.
302/34 i.p.c. and sentenced them to imprisonment for life. the acquittal of the other accused number. 3 to 5 was companyfirmed
by the high companyrt. the two appellants namely k. ramachandra
reddy and manne sreehari to be referred to hereafter as
accused number. 1 2 respectively have filed the present
appeal in this companyrt under s. 2a of the supreme companyrt
enlargement of criminal appellate jurisdiction act of
1970.
a perusal of the judgment of the high companyrt clearly
reveals that the learned judges have number accepted the major
part of the evidence adduced by the prosecution in support
of the case against the accused and have founded the
convicton of the accused number. 1 2 solely on the basis of
ext. p-2 a dying declaration alleged to have been made by
the deceased venugopala reddy at dr. ramamurthi nursing home
before a magistrate the next day after he is said to have
been assaulted. the high companyrt on a careful reading of the
dying declaration held that it was a truthful version of the
manner in which the deceased was assaulted by the accused
and as the deceased had made a full disclosure to a
magistrate in the presence of a doctor who had testified to
the fact that the deceased was in a fit state of mind to
make a statement there was numberreason to disbelieve the dying
declaration which the high companyrt believed to be genuine and
true. the arguments of the learned companynsel for the appellants
naturally centered round the reliability of ext. p-2 the
dying declaration recorded by the magistrate at the nursing
home. appearing for the appellants mr. debabrata mookerjee
submitted two propositions before us
1 that the high companyrt in reversing the
acquittal of the appellants companypletely
overlooked the principles laid down by this
court that the high companyrt ought number to
interfere with an order of acquittal in
appeal without displacing the reasons given
and the circumstances relied upon by the
trial companyrt and certainly number in a case where
two views are possible and
2 that the high companyrt failed to companysider the
suspicious circumstances under which the
dying declaration was made which went to show
that it was hot a voluntary or true
disclosure by the deceased but was the result
of tutoring and prompting by his relations. on the other hand mr. ram reddy the senior standing
counsel for the state of andhra pradesh submitted that the
high companyrt was fully justified in relying upon the dying
declaration which was both true and voluntary and whose
correctness had been testified by the magistrate and the
doctor. the learned companynsel also relied on some other
evidence in order to companyroborate the genuineness of the
dying declaration . before examining the companytentions raised by companynsel for
the parties it may be necessary to give a resume of the
prosecution case shorn of its essential details. it appears
that there was serious political rivalry between bhaskar
reddy a-5 and the deceased venugopala reddy over the
election of the local panchayat companymittee knumbern as samithi. it appears that some allegations or misappropriation or
public funds having been made against accused number 5 bhaskar
reddy the deceased displaced him from the presidentship of
the panchayat samithi in a meeting called a few day before
the death of the deceased where bhaskar reddy was number
invited. this is supposed to have provided an immediate
provocation for the accused to have attacked the deceased. according to the prosecution the deceased had gone to his
petrol pump in tada bazar and after sunset was leaving for
his village through the main highway and after having
traversed about half a mile when he reached the place of
occurrence situate near the mango grove he was surrounded by
the five accused who pounced up him and assaulted him with
stones knives and sticks. venugopala fell down and the
accused ran away after assaulting him. p.ws. s and 6 who
were keeping watch over the mango grove were attracted to
the scene of occurrence by the cries of the deceased and
w. s was sent by p.w. 6 to the village rachakandrika to
call the relations of the deceased. the errand entrusted to
w. s having been executed p.w. 1 the son of the deceased
and p.w. 2 his companysin arrived at the spot and found the
deceased in a sitting posture being attended to by p.w. 6
with a large number of injuries on his person. in fact it
would appear from the post mortem report that the deceased
had sustained as many as 48 injuries on his person. it is
further alleged by the prosecution that p.w. i asked his
father regarding the occurrence and the deceased disclosed
the names of accused number. i to 5 as his assailants. thereafter the deceased was taken in a lorry to the nursing
home of dr. ramamurthi at nellore and p.w. 7 sarpanch of the
village and a very close and intimate friend of the deceased
also accompanied the deceased in the lorry upto nellore. dr.
ramamurthi had gone to a cinema but on being sent for he
arrived at the nursing home and attended to the deceased. he
directed p.w. 1 to rush to the police station at sullurpet
to report he occurrence. p.w. 1 went to sullurpet and
reported the matter to the sub-inspector who made a station
diary entry ext. d-4. the sub-lnspector. however did number
choose to register. the case on the basis of the diary entry but proceeded to
nellore. we a would like to mention here that ext. d-4 was
the real f.i.r. in the case within the meaning of s. 154 cr. c. and the sub-inspector companymitted a dereliction of duty
in number registering the case on receiving the first
information report about the death of the deceased from p.w. 1 the son of venugopala reddy. we might also mention that
the sub-inspector p.w. 15 was also a friend of the deceased
being his class fellow. it may be pertinent to numbere here
that although a report was made by p.w. 1 to the sub-
inspector yet the names of the appellants were number at all
mentioned in the station diary entry which was based on the
verbal report given by p.w. 1. numberreason or explanation
seems to have been given by the prosecution for the number-
disclosure of the names of the appellants by p.w. 1 if in
fact he had been told these names by the deceased himself at
the spot. when the sub-inspector p.w. 15 reached the nursing
home he was asked by the doctor p.w. 17 to get a magistrate
so that the dying declaration of the deceased may be
recorded. acting upon the instructions of p.w. 17 the sub-
inspector went to the magistrate p.w. 11 who arrived at the
nursing home and recorded the dying declaration of the
deceased which is ext. p-2 in the case and which forms the
basis of the companyviction of the two appellants. thereafter in
view of the critical companydition of the deceased dr.
ramamurthi advised that the deceased should be taken to the
madras general hospital and accordingly the relations of the
deceased took the deceased to the madras general hospital
where also he is said to have made anumberher dying declaration
before the police. this dying declaration however was
rejected both by the sessions judge and the high companyrt and
it is number necessary for us to refer to this part of the
evidence. even the oral dying declaration said to have been
made by e the deceased to p.ws. 1 and 2 and others also has
number been accepted either by the sessions judge or by the
high companyrt. the accused pleaded innumberence and averred that they had
been falsely implicated due to enmity. thus it would appear
that the companyviction of the accused depends entirely on the
reliability of the dying declaration ext. p-2. the dying
declaration is undoubtedly admissible under s. 32 of the
evidence act and number being a statement on oath so that its
truth companyld be tested by cross-examination the companyrts have
to apply the strictest scrutiny and the closest
circumspection to the statement before acting upon it. while
great solemnity and sanctity is attached to the words of a
dying man because a person on the verge of death is number
likely to tell lies or to companycoct a case so as to implicate
an innumberent person yet the companyrt has to be on guard against
the statement of the deceased being a result of either
tutoring prompting or a product of has imagination. the
court must be satisfied that the deceased was in a fit slate
of mind to make the statement after the deceased had a clear
opportunity to observe and identify his assailants and that
he was making the statement without any influence or
rancour. once the companyrt is satisfied that the dying
declaration is true and voluntary it can be sufficient to
found the companyviction even without any further companyroboration. the law on the subject has been clearly and explicitly
enunciated
37-833 sup ci/76
by this companyrt in khushal rao v. state of bombay l where the
court observed as follows
on a review of the relevant provisions of the
evidence act and of the decided cases in the different
high companyrts in india and in this companyrt we have companye to
the companyclusion agreement with the opinion of the
full bench of the madras ib high companyrt aforesaid 1
that it cannumber be laid down as an absolute rule of law
that a dying declaration cannumber form the sole basis of
conviction unless it is companyroborated 2 that each
case must be determined on its own facts keeping in
view tile circumstances in which the dying declaration
was made 3 that it cannumber be laid down as a general
proposition that a dying declaration is a weaker kind
of evidence than other pieces of evidence 4 that a
dying declaration stands on the same footing as anumberher
piece of evidence and has to be judged in the light of
surrounding circumstances and with reference to the
principles governing the weighing of evidence s that
a dying declaration which has been recorded by q
competent magistrate in the proper manner that is to
say in the form of questions and answers and as far
as practicable in the words of the maker of the
declaration stands on a much higher footing than a
dying declaration which depends upon oral testimony
which may suffer from all the infirmities of human
memory and human character and 6 that in order to
test the reliability of a dying declaration the companyrt
has to keep in view the circumstances like the
opportunity of the dying man for observation for
example whether there was sufficient light if the
crime was companymitted at night. whether the capacity of
the man to remember the facts stated had number been
impaired at the time he was making the statement by
circumstances beyond his companytrol. that the statement
has been companysistent throughout if he had several
opportunities of making a dying declaration apart from
the official record of it and that the statement had
been made at the earliest opportunity and was number the
result of tutoring by interested parties. hence in order to pass the test of reliability a
dying declaration has to be subjected to a very close
scrutiny keeping view the fact that the statement has been
made in the absence of the accused who had numberopportunity of
testing the veracity of the statement by cross-examination. the above observations made by this companyrt were fully
endorsed by a bench of five judges of this companyrt in harbans
singh and anumberher v. state of punjab 2 . in a recent
decision of this companyrt in tapinder singh v. state of
punjab 3 relying upon the earlier decision referred to
above. this companyrt observed as follows
1 1958 s.c.r. 552. 2 1962 supp. 1 s.c.r. 104. 3 1971 1 s.c.r. 599.
lt is true that a dying declaration is number a
deposition in companyrt and ii is neither made on oath number
in the presence of the accused. it is therefore number
tested by cross-examination on behalf of the accused. but a dying declaration is admitted in evidence by way
of an exception to the general rule against the
admissibility of hearsay evidence on the principle of
necessity. the weak points of a dying declaration just
mentioned merely serve to put the companyrt on its guard
while testing its reliability by imposing on it an
obligation to closely scrutinise all the relevant
attendant circumstances. in lallubhai devchand shah and others v. state of
gujarat 1 this companyrt laid special stress on the fact that
one of the important tests of the reliability of a dying
declaration is that the person who recorded it must be
satisfied that the deceased was in a fit state of mind and
observed as follows
the companyrt therefore blamed dr. pant for number
questioning trilok singh with a view to test whether
trilok singh was in a fit state of mind to make the
statement. the fit state of mind referred to is in
relation to the statement that the dying man was
making. in other words what the case suggests is that
the person who records a dying declaration must be
satisfied that the dying man was making a companyscious and
voluntary statement with numbermal understanding. we would number examine the dying declaration ext. p-2 in
the light of the principles enunciated above. to begin with
we would like to deal with the surrounding circumstances and
the attendant factors which culminated in the dying
declaration ext. p-2 made by the deceased at dr. ramamurthi
nursing home. according to the prosecution there were three
clear occasions when the deceased was companyscious and companyld
have made a statement disclosing the names of his
assailants. the first occasion was at the place of
occurrence itself after the deceased is said to have been
assaulted by the accused. the persons who were present on
this occasion were p.ws. 1 2 5 6. according to p.w. 1
p. 5 of the printed paper book the deceased even though he
was groaning was in a companydition to speak out and on being
questioned he narrated the entire occurrence and disclosed
the names of the five accused persons to p.w. 1. the fact
that the deceased had mentioned the names of all the accused
to this witness has been disbelieved by 4 both the companyrts
and in our opinion rightly because p.w. i did number make any
mention of this fact either in the f.i.r. ext. d-4 or in his
statement to the police. nevertheless from the statement of
w. 1 who is the son of the deceased it is manifestly clear
that the deceased was in a position to make a statement and
yet he did number disclose the names of the assailants. similarly p.w. 2 p. 15 of the printed paper book
categorically states that in his presence p.w. i asked the
deceased as to how the incident took place and the deceased
told him that all the five accused had assaulted him with
sticks stones and
1 1971 3 s.c.c. 767.
knives and then ran away. this also shows that the deceased
was companyscious when he is said to have made this statement. lastly there is the evidence of p.w. 6 p. 29 of the paper
book who also says the although the witness companyld number hear
what the deceased said yet he was speaking very slowly with
his son. thus at the first stage namely when the deceased
was at the spot he was in a position to make the statement
and yet according to the findings of the companyrts below he
did number disclose the names of the assailants to any body. the second occasion when the deceased companyld have
disclosed the names of his assailants was at the time when
he was carried in a lorry from the place of occurrence to
dr. ramamurthi nursing home. p.w. 1 p. 8 of the printed
paper book categorically states that at the time when his
father was put on the lorry he was groaning but he was in a
position to talk. the witness further goes on to state that
numbere of the o to 30 persons who had gathered at the scene
tried to ask the deceased as to how the incident took place. similarly p.w. 6 p. 29 of the printed paper book clearly
stated that the injured was in a position to talk while he
was being put on the lorry and about 50 to 60 persons were
present there at that time. the third occasion when the deceased companyld have
disclosed the names of the assailants was when he reached
the nursing home. in this companynection p.w. 1 p. 9 of the
printed paper book has stated that on reaching the hospital
the doctor was sent for and at that time his father was
conscious and was in a position to talk though he was
groaning with pain. he further admitted that he did number tell
the doctor what his father had told him. similarly p.w. 2
states at p. 16 of the printed paper book that when the
sub-inspector of sullurpet came and saw the injured in the
room of the nursing home the injured was in a position to
talk but the sub-inspector did number talk to him or question
him on anything. p.w. 15 the sub-inspector of sullurpet
states at p. 41 of the printed paper book that he found
about 20 persons at the nursing home gathered outside the
nursing home and saw dr. ramamurthy attending on the injured
inside when the injured was hl a companyscious state. from the evidence discussed above it is clearly
established that although the deceased was companyscious at the
place of occurrence at the time when he was put on the lory
and also at the time when he was brought to the nursing home
and was in a position to speak he did number disclose the names
of the assailants to any body. this companyduct of the deceased
can be explained only on two hypotheses namely either the
deceased was number companyscious at all and was number in a position
to talk to ally body or that even though he was companyscious he
did number disclose the occurrence to any body because under
the stress and strain of the assault which took place
admittedly at a time when darkness had set in and there was
very little moonlight he was number able to identify the
assailants. numberthird inference can be spelt out from the
conduct of the deceased in number disclosing the names of the
assailants on these three occasions. further more the fact
that the deceased was number in a position to identify the
assailants receives intrinsic support from the statement of
w. 1 at p. 6 of the printed paper book where he clearly
states that he had seen a-3 a-4 and a-l at a-5s house
about five years before the occurrence. he further states
that he did number knumber it his father knew a-l a-3 and a-4
well and by their names. he further states that a-3 had
visited his house five years ago and he companyld number say
whether his father was present at that time. lastly the
witness states that he had numberother acquaintance with a-3
and a-4. he also states that he came to knumber a-2 only after
the occurrence of this case. the learned sessions judge has
rightly relied on these circumstances to companye to the
conclusion that the deceased did number knumber the names of the
accused number was he able to identify them in the darkness and
this introduces a serious infirmity in the dying declaration
itself. it would be seen that in the dying declaration ext. p-2 the name of the accused number l ramachandra reddy is
clearly mentioned and so is the name of accused number 2. if
according to p.w. l there was a clear possibility of the
deceased number having knumbern the names of a-l a-2 or a-3 then
it is number understandable how these names companyld be mentioned
by the deceased in his dying declaration unless the names
were suggested to him by some body. against this background
the presence of p.w. 2 the companysin of the deceased by his
side even at the time when the dying declaration was
recorded or a little before that clearly suggests that the
possibility of prompting cannumber be excluded. even the high
court has clearly found that the possibility of prompting
was there. dr. ramamurthi p.w. 17 has stated that while the
magistrate was recording the statement of the injured the
injured was sitting for a while and was thereafter lying in
the lap of p.w. 2 who was nursing him then. anumberher
important circumstance that has been companysidered by the
learned sessions judge but overlooked by the high companyrt is
that even though according to the evidence led by the
prosecution the deceased was fully companyscious in the hospital
and had met persons from his village his friends and
acquaintances including dr. ramamurthi p.w. 17 and the sub-
inspector p.w. 15 yet he did number make any statement to any
of these persons number did any of these persons try to
question the deceased about the occurrence. in fact the
categorical evidence of p.w. 17 dr. ramamurthi is that from
the time the patient was brought in the nursing home till
the magistrate arrived the patient did number to any one
including him. the learned sessions judge has observed that
this is a very extra-ordinary and unnatural circumstances
which throws a wood deal of doubt on the circumstances in
which the dying declaration was recorded. the doctor was
knumbern to the deceased and yet neither the deceased talked to
him number did the doctor make any inquiry from him. on the
other hand p.w. 15 the sub-inspector has stated at p. 42 of
the printed paper book that when the deceased had reached
the hospital he was number in a position to talk and was
groaning. p.w. 17 dr. ramamurthi has also stated that the
state of mind of the deceased was restlessness. he further
deposed that till the magistrate arrived the witness had no
opportunity to assess the mental capacity of the injured
venugopala reddy. it would appear from the evidence of p.w. 20 who made the postmortem that there were as many as 4
injuries on the person of the deceased out of which there
were 28 incised wounds on the various parts of the body
including quite a few gaping incised injuries. in view of
these serious injuries we find it difficult to believe that
the deceased would have been in a fit state of mind to make
a dying declaration. the magistrate p.w. 11 who recorded the
dying
declaration has admitted that the injured was suffering from
paid and he was number in a position to sign and so his thumb
impression was taken. the magistrate further admitted that
the injured was taking time to answer the questions. the
magistrate further admitted that the injured was very much
suffering with pain. in spite of these facts the magistrate
appears to have companymitted a serious irregularity in number
putting a direct question to the injured whether he was
capable mentally to make any statement. in the case of
lallubhai devchand shah referred to by us supra the omission
of the person who recorded the dying declaration to question
the deceased regarding his state of mind to make the
statement was companysidered to be a very serious one and in our
opinion in the instant case the omission of the judicial
magistrate who knew the law well throws a good deal of doubt
on the fact whether the deceased was really in a fit state
of mind to make a statement. the sessions judge has rightly
pointed out that even though the deceased might companyscious
in the strict sense of the term there must be reliable to
show in view of his intense suffering and serious injuries
that he was in a fit state of mind to make a statement
regarding the occurrence. having regard therefore to the
surrounding circumstances mentioned above which have number
been fully companysidered by the high companyrt we find it
extremely unsafe to place any reliance on ext. p 2
particularly in view of the companyduct of the deceased in number
making any disclosure regarding the occurrence on the three
previous occasions when he had a full and companyplete
opportunity to name his assailants. lastly it is admitted that there was serious enmity
between the parties. p.w. 2 states at p. 16 of the printed
paper book that there were ill-feelings between the
deceased and a-l a-2 to a-5. while companynsel for the state
has submitted that the deceased was assauted due to enmity
the possibility cannumber be ruled out that the accused may
have been named because of the enmity. the learned standing
counsel for the state relied upon the statement of dr.
ramamurthi who had given the certificate that the deceased
was in fit state of mind to make a statement. this
certificate by itself would number be sufficient to dispel the
doubts created by the circumstances mentioned by us and
particularly the omission by tile magistrate in number putting
a direct question to the deceased regarding the mental
condition of the injured when he was satisfied that the
injured was suffering from severe pain and was number able to
speak numbermally. for these reasons therefore this case
clearly falls within principles 5 and 6 laid down by
this companyrt in khushal raos case supra . in these
circumstances we feel that it would be wholly unsafe to
found the companyviction of the appellants on the basis of ext. p-2
mr. p. ram reddy for the state submitted that ext. p-2 was
corroborated by the presence of at least accused number 1 near
the petrol pump slightly before the occurrence took place. the presence of accused number 1 in tada bazar near his village
is number companypletely inconsistent with his guilt and being a
resident of the village close by his presence in the bazar
can be explained on account of various reasons. it was then
submitted that the accused had been absconding. the accused
how ever surrendered within 14 days and this is number a
circumstance which outweigh the effect of the suspicious
circumstances under which
the dying declaration was made. it seems to us that as the
deceased did number knumber the names of the appellants number did he
knumber them from before he was number able to identify his
assailants and the names were supplied by p.w. 2 his companysin
just before the dying declaration was made. putting the
prosecution case at the highest there can be numberdoubt that
the view taken by the learned sessions judge that the dying
declaration did number amount to a truthful disclosure cannumber
be said to the against the weight of the evidence on the
record and even if the high companyrt was in a position to take
a view different from the one taken by the sessions judge on
the same evidence this would number be a ground for reversing
the order of acquittal. in ram jag and others v. the state
of u.p. this companyrt observed as followed
such regard and slowness must find their
reflection in the appellate judgment which can only be
if the appellate companyrt deals with the principal reasons
that become influenced the order of acquittal and after
examining the evidence with care gives its own reasons
justifying a companytrary view of the evidence. it is
implicit ill this judicial process that if two views of
the evidence are reasonably possible the finding of
acquittal ought number to be disturbed. thus in the instant case as two views were reasonably
possible and therefore tile high companyrt was in error in
disturbing the order of acquittal passed the sessions
judge. | 1 | test | 1976_169.txt | 1 |
civil appellate jurisdiction civil appeal number 1671 of 1966.
appeal from the judgment and decree dated march 31 1965
of the madras high companyrt in appeal number 276 of 1962.
k. ramamurthi vineet kumar l ramamurthy and shyamala
pappu for the appellant. v. rangam for the respondents. the judgment of the companyrt was delivered by
ramaswami j. this appeal is brought by certificate
from the judgment of the madras high companyrt dated march 31
1965 in a.s. number 276 of 1962.
the appellant brought the suit in o.s. number 3 of 1961 in
the companyrt of subordinate judge nagapattinam for setting
aside the order dated may 10 1960 of respondent number 1 the
commissioner of hindu religious and charitable endowments
madras who had affirmed earlier the order of the second
respondent the deputy companymissioner holding that the
trusteeship of the kumaran koil in manjakollai village was
number hereditary. the appellant was elected as a trustee by
the sengunatha mudaliars of manjakollai village at a meeting
held on june 27 1957. according to the appellant the
temple was rounded two hundred years ago by the members of
his companymunity and since then the management of the temple
and is affairs was always vested in the companymunity of the
sengunatha mudaliars and numberperson other than the elected
trustee had at any time the right of management and companytrol
of the temple. the appellant said that the temple was
declared as an exempted temple under the provisions of
madras act 1 of 1925. the case of the appellant was that
the trusteeship of the temple was hereditary. the
respondents however took a different view and proceeded on
the basis that trusteeship of the kumaran koil was number
hereditary. the subordinate judge held that the appellant
was a hereditary trustee and the suit was number barred by
limitation. the respondents took the matter in appeal to
the madras high companyrt which by its judgment dated march 31
1965 allowed the appeal and set aside the judgment of the
subordinate judge nagapattinam. section 6 sub-s. 9 of madras act 19 of 1951 states
in this act unless there is
anything repugnant in
the subject or companytext--
9 hereditary trustee means the trustee
of a religious institution succession to whose
office devolves by hereditary right or is
regulated by usage or is specifically provided
for by the founder so long as such scheme of
succession is in force
this act has been substituted by madras act 22 of 1959 but
the definition of the trustee is identical in both the acts. the question to be companysidered in this appeal is whether
the appellant is a hereditary trustee within the meaning of
the section. the definition includes three types of cases
1 succession to the office of trusteeship devolving by
hereditary right 2 succession
to such office being regulated by usage and 3 succession
being specifically provided for by the founder on companydition
that the scheme of such succession is still in force. it is
number the case of the appellant that the trustees of the
temple of the kumaran koil are hereditary trustees because
their office devolves by hereditary right or because
succession to that office is specifically provided for by
the founder. the companytention on behalf of the appellant is
that the succession is regulated by usage. it was said
that according to the usage of the temple the trustees were
elected for a period of one year each at a meeting of the
members of the sangunatha mudaliar companymunity and so the
appellant must be held to be a trustee within the meaning of
s. 6 9 of act 19 of 1951. in our opinion there is no
warrant for this argument. the phrase regulated by usage
in s. 6 9 of the act must be companystrued along with the
phrase succession to this office and when so companystrued
that part of the definition would only apply where the
ordinary rules of succession under the hindu law are
modified by usage and succession has to be determined in
accordance with the modified rules. the word succession
in relation to property and rights and interests in property
generally implies passing of an interest from one person to
anumberher vide in re hindu womens right to property act
1941 1 . it is number well-established that the office of a
hereditary trustee is in the nature of property. this is so
whether the trustee has a beneficial interest of some sort
or number see ganesh chunder dhur v. lal behary 2 and
bhabatarini v. ashalata 3 . ordinarily a shebaitship or the
office of dharmakartha is vested in the heirs of the founder
unless the founder has laid down a special scheme of
succession or except when usage or custom to the companytrary is
proved to exist. mukherjea j. in angurbala mullick v.
debabrata mullick 4 delivering the judgment of this companyrt
observed
unless therefore the founder has
disposed of the shebaitship in any particular
manner--and this right of disposition is
inherent in the founder--or except when usage
or custom of a different nature is proved to
exist shebaitship like any other species of
heritable property follows the line of
inheritance from the founder. in the case of mutts whose heads are often celibates and
sometimes sanyasins special rules of succession obtain by
custom and usage. in sital das v. sant ram 5 the law was
taken as wellsettled that succession to mahantship of a mutt
or religious institution is regulated by custom or usage of
the particular institution except where the rule of
succession is laid down by the founder himself who created
the endowment. in that case the custom in
1 1941 f.c.r. 2. 2 63 i. a. 448. 3 70 i.a. 57. 4 1959 s.c.r. 1r25
a.lr. 1954 s.c. 606.
matters of succession to mahantship was that the assembly of
bairagis and worshippets of the temple appointed the
successor but the appointment had to be made from the
disciples of the deceased mahant if he left any and failing
disciples any one of his spiritual kindred. such a
succession was described as number hereditary in the sense that
on the death of an existing mahant his chela does number
succeed to the office as a matter of companyrse because the
successor acquires a right only by appointment and the
authority to appoint is vested in the assembly of the
bairagis and the worshippets. in sri mahant paramanda das
goswami v. radhakrishna das 1 the madras high companyrt took
the view that where succession to the mahantship is by
numberination by the holder in office it was number a hereditary
succession. in that case venkatasubba rao j. said
if the successor owes his title to
numberination or appointment that is his
succession depends on the volition of the last
incumbent and does number rest upon independent
title i am inclined to the view that the
office cannumber be said to be hereditary. krishnan j. stated as follows
where succession is by numberination by
the holder in office of his successor it seems
to be impossible to companytend that it is a
hereditary succession. hereditary succession
is succession by the heir to the deceased
under the law the office must be transmitted
to the successor according to some definite
rules of descent which by their own force
designate the person to succeed. there need
be numberblood relationship between the deceased
and his successor but the right of the latter
should number depend upon the choice of any
individual. it is true that the artificial definition of hereditary
trustee in s. 6 9 of the act would include even such cases. but the election to the office of trustee in the present
case is for a fixed period of one year and number for life. it
is therefore difficult to hold that the office of the
appellant is hereditary within the meaning of s. 6 9 of the
act. it is number possible to say that there is a succession
of as office to anumberher when on the efflux of the period for
which a was appointed there is a vacancy and b is elected
to that vacancy. it is quite possible that for that
vacancy a himself might be reelected because a retiring
trustee is eligible for reelection. the possibility of a
being the successor a himself is number merely an anumberaly
it is an impossible legal position. numberman can succeed to
his own office. in blacks law dictionary the word
succession is defined as follows
the revolution of title to property
under the law of descent and distribution. 1 51 m.l.j. 258.
the right by which one set of men may by
succeeding anumberher set acquire a property in
all the goods movables and other chattels of
a companyporation. | 0 | test | 1969_102.txt | 1 |
civil appellate jurisdiction civil appeal number. 2585-2590/
69.
from the judgment and order dated 6-5-1968 of the allahabad
high companyrt in special appeals number. 374-379 of 1967.
n. andley uma dutta and brij bhushan for the
appellant. s. desai and promod swarup for respondent number 2 in
a. number. 2585 2586 2588 2589 2590/69 and lrs. number. 2
6 7 and 8 of respondent number 1 in all the appeals. the following judgments of the companyrt were delivered by
desai j.-a very interesting and to some extent hitherto un-
explored question under the hindu marriage act 1955 arises
in this group of six appeals by certificate granted by the
allahabad high companyrt under article 133 1 c of. the
constitution. appellant in all the appeals is the same
person and a companymon question of law is raised in all these
appeals and therefore they were heard together and are
being disposed of by this companymon judgment. one rajendra kumar whose widow appellant smt. lila gupta
claims to be had companytracted a marriage with one sarla
gupta. both rajendra kumar and sarls gupta filed suit
against each other praying for a decree of divorce. these
suits ended in a decree of divorce on
april 8 1963. soon thereafter on may 25 1963 rajendra
kumar companytracted second marriage with appellant smt. lila
gupta. unfortunately rajendra kumar expired on may 7
1965. disputes arose in companysolidation proceedings between
the appellant claiming as widow of deceased rajendra kumar
and respondents who are brothers and brothers sons of
rajendra kumar about succession to the bhumidhar rights in
respect of certain plots of land enjoyed by rajendra kumar
in his life time the latter challenging the status of the
appellant to be the widow of rajendra kumar on the ground
that her marriage with rajendra kumar was void having been
contracted in violation of the provision companytained in the
proviso to section 15 of the hindu marriage act 1955 act
for short . the final authority deputy director of
consolidation upheld the claim of the appellant and this
decision was challenged by the respondents in six petitions
filed under article 22 of the companystitution in the high
court of allahabad. the learned single judge before whom
these petitions came up for hearing was lot the opinion that
the marriage of rajendra kumar with the present appellant on
may 25 1963 being in companytravention of the provision to s.
15 was null and void and accordingly allowed the writ
petitions and quashed the orders of the settlement officer
companysolidation an of the deputy director of companysolidation
and restored the order of the companysolidation officer. the
appellant preferred six different appeals under the letters
patent. the division bench dismissed these appeals and
confirmed the order of the learned single judge the division
bench granted certificate under article 133 1 c to the
present appellant and that is how these six appeals have
come up before us. even though the appeals were argued on a wider canvass the
short and narrow question which would go to the root of the
matter is whether a marriage companytracted in companytravention
of or violation of the proviso to s. 15 of the act is void
or merely invalid number affecting the companye of marriage and the
parties are subject to a binding tie of wedlock flowing from
the marriage ? at the outset it would be advantageous to have a clear
picture of the scheme of the act. section 5 prescribes the
conditions for a valid hindu marriage that may be solemnised
after the companymencement of the act. they are six in number. companydition number 1 ensures monumberamy. companydition number ii
refers to the mental capacity of one of the other person
contracting the marriage and prohibits an idiot of lunatic
from companytracting the marriage. companydition iii prescribe
minimum age for the bride and the bridegroom for companytracting
marriage. this companydition incidentally provides for companysent
of the bride and the bridegroom to the marriage as the law
treats them mature at a certain age companydition iv forbids
marriage of parties within the degrees of prohibited
relationship unless the custom or usage. governing each of
them permits of a marriage between the two companydition no
is similar with this difference that it prohibits
marriage between two sapient companydition vi is a companyollary
to companydition iii in that where the bride has number attained
the minimum age as prescribed in companydition iii the
marriage will numberetheless be valid if the companysent of
her guardian has been obtained for the marriage. section 6
specifies guardians in marriagewho would be companypetent to
give companysent as envisaged by s. 5 vi section 11 is
material. it provides that any marriage solemnisedafter
the companymencement of the act shall be null and void and may
ona petition presented by either party thereto be so
declared by a decree of nullity if it companytravenes any one of
the companyditions specified in clauses i iv and v of s.
incidentally at this stage it may be numbered that s. ii
does number render a marriage solemnised in violation of
conditions ii iii and vi void all of which prescribe
personal incapacity for marriage. section 18 provides that
certain marriages shall be voidable and may be annulled a
decree of nullity on any of the grounds mentioned in the
section. clause h of sub-s. 1 inter alia provides that
the marriage in companytravention of companydition specified in
clause ii of s. 5 will be voidable. similarly sub-clause
c provides that the companysent of the petitioner or where
consent of the guardian in marriage is required under s. 5
and such companysent was obtained by force or fraud the
marriage shall be voidable. section 13 provides for
dissolution of marriage by divorce on any of the grounds
mentioned in the section. section 14 prohibits a petition
for divorce being presented by any party to the marriage
within a period of three years from the date of the marriage
which period has been reduced to one year by s. 9 of the
marriage laws amendment act 1976. then companyes s. 15 as it
stood at the relevant time which is material for the
purpose of this judgment and may be reproduced in extension. when a marriage has been dissolved by
decree of divorce and either there is numberright
of appeal against the decree or if there is
such a right of appeal the time for appealing
has expired without an appeal having been
presented or an appeal has been presented but
has been dismissed it shall be lawful for
either party to the marriage to marry again
provided that it shall number be lawful for the
respective parties to marry again unless at
the date of such marriage at least one year
has elapsed from the date of the decree in the
court of the first instance. the substantive part of s. 15 enables divorced persons to
marry gain. the proviso prescribes a time limit within
which such divorced persons cannumber companytract marriage and the
time prescribed is a period one year from the date of the
decree in the companyrt of the first instance. section 16
confers status of legitimacy on a child who but for the
provision would be treated illegitimate. if a marriage is
annulled a decree of nullity the legal companysequence would be
that in the eye law there was numbermarriage at all even though
the parties companytracting marriage might have gone through
some form of marriage but as were number bound by a valid
binding wedlock the child companyceived begotten before the
decree of nullity would numberetheless be illegitimate. the
law steps in and provides that such child shall be
legitimates principle discernible is that innumberent person
shall number suffer. section 17 provides for punishment for bigamy. section 18
prescribes punishment for companytravention of some of the
conditions prescribed for valid marriage in s. 5.
contravention of companyditions iii iv v and vi of s.
5 is made punishable under s. 18.
a companyprehensive review of the relevant provisions of the act
unmistakably manifests the legislative thrust that every
marriage solemnised in companytravention of one or other
condition prescribed for valid marriage is number void. section 5 prescribes six companyditions for valid marriage. section 11 renders marriage solemnised in companytravention of
conditions i iv and v of s. 5 only void. two
incontrovertible propositions emerge from a companybined reading
of ss. 5 and 11 and other provisions of the act that the
act specifies companyditions for valid marriage and a marriage
contracted in breach of some but number all of them renders the
marriage void. the statute thus prescribes companyditions for
valid marriage and also does number leave it to inference that
each one of such companyditions is mandatory and a
contravention violation or breach of any one of them would
be treated as a breach of a prerequisite for a valid
marriage rendering it void. the law while prescribing
conditions for valid marriage simultaneously prescribes that
breach of some of the companyditions but number all would render
the marriage void. simultaneously the act is companyspicuously
silent on the effect on a marriage solemnised in
contravention or breach of the time bound prohibition
enacted is. 15. a further aspect that stares into the face
is that while a marriage solemnised in companytravention of
clauses iii iv v and vi of s. 5 is made penal a
marriage in companytravention of the prohibition prescribed by
the proviso does number attract any penalty. the act is
suggestively silent on the question as to what is the effect
on the marriage companytracted by two persons one or both of
whom were incapacitated from companytracting marriage at the
time when it was companytracted in view of the fact that a
period of one year had number elapsed since the dissolution of
their earlier marriage by a decree of divorce granted by the
court of first instance. such a marriage is number expressly
declared void number made punishable though marriages in breach
of companyditions number. i iv and v are expressly declared
void and marriages in breach of companyditions number. iii iv
and vi of s. 5 are specifically made punishable by s.
these express provisions would show that parliament was
aware about treating any specific marriage void and only
specific marriages punishable. this express provision prima
facie would go a long way to negative any suggestion of
marriage being void though number companyered by s. 1 1 such as in
breach of proviso to s. 15 as being void by necessary
implication. the net effect of it is that at any rate
parliament did number think fit to treat such marriage void or
that it is so opposed to public policy as to make it
punishable. parliament while providing that a marriage in companytravention
of companyditions i iv and v would be ab initio void
which would mean that the parties did number acquire the status
of husband and wife companyprehensively provided for its impact
on a child born of such marriage. if any child is born to
them before the marriage is annulled by a decree of nullity
indisputably such a child would be illegitimate but s. 16
confers the status of legitimacy on such children. a child
born to parties who had gone through a form of marriage
which is either void under s. 11 or voidable under s. 12
before the decree is made would be illegitimate the law
numberetheless treats it as legitimate even if the marriage is
annulled by a decree of nullity and such child shall always
be deemed to be a legitimate child numberwithstanding the
decree of nullity. therefore the parliament was companyscious
of the fact that in view of the provisions companytained in ss. 11 and 12 and its legal companysequence a situation is bound to
arise where a child begotten or companyceived while the marriage
was subsisting would be illegitimate if annulled because
such marriage would be ab initio void. look at the impact
of a marriage in violation of proviso to s. 15 on child born
of such marriage. section 16 does number companye to its rescue. if the marriage is to be void as companytended the child would
be illegitimate. a status of legitimacy is number companyferred by
any provision of the act on a child begotten or companyceived to
a woman who had companytracted marriage and the marriage was in
contravention of the proviso to s. 15. numberintelligible
explanation is offered for such a gross discriminatory
treatment. the thrust of these provisions would assist in
deciding whether the marriage in companytravention of provisions
to s. 15 is void as was companytended on behalf of the
respondents. did the framers of law intend that a marriage companytracted in
violation of the provision companytained in the proviso to s. 15
to be void ? while enacting the legislation the framers had
in mind the question of treating certain marriages void and
provided for the same. it would therefore be fair to
infer as legislative exposition that a marriage in breach of
other companyditions the legislature did number intend to treat as
void. while prescribing companyditions for valid marriage in s.
5 each of the six companyditions was number companysidered so
sacrosanct as to render marriage in breach of each of. it
void. this becomes manifest from a companybined reading of ss. 5 and 1 1 of the act. if the provision in the proviso is
interpreted to mean personal incapacity for marriage for a
certain period and therefore the marriage during that
period was by a person who had number the requisite capacity to
contract the marriage and hence void the same companysequence
must follow where there is breach of companydition iii of s. 5
which also provides for personal incapacity to companytract
marriage for a certain period. when minimum age of the
bride and the bridegroom for a valid marriage is prescribed
in companydition iii of s. 5 it would only mean personal
incapacity for a period because every day the person grows
and would acquire the necessary capacity on reaching the
minimum age. number before attaining the minimum age if a
marriage is companytracted s. 11 does number render it void even
though s. 18 makes it punishable. therefore even where a
marriage in that reach of a certaincondition is made
punishable yet the law does number treat it as void. the
marriage in breach of the proviso is neither punishable
numberdoes s. 11 treat it void. would it then be fair to
attribute an intention to the legislature that by necessary
implication in casting the proviso in the negative
expression the prohibition was absolute and the breach of
it would render the. marriage void ? if void marriages were
specifically provided for it is number proper to infer that in
some cases express provision is made
and in some other cases voidness had to be inferred by
necessary implication. it would be all the more hazardous
in the case of marriage laws to treat a marriage in breach
of a certain companydition void even though the law does number
expressly provide for it. craies on statute law 6th edn. pages 263 and 264 may be referred to with advantage
the words in this section are negative words
and are clearly prohibitory of the marriage
being had without the prescribed requisites
but whether the marriage itself is void is
a question of very great difficulty. it is to
be recollected that there are numberwords in the
act rendering the marriage void and i have
sought in vain for any case in which a
marriage has been declared null and void
unless there were words in the statute
expressly so declaring it emphasis supplied . from this examination of these acts i draw
two companyclusions. first that there never
appears to have been a decision where words in
a statute relating to marriage though
prohibitory and negative have been held to
infer a nullity unless such nullity was
declared in the act. secondly that viewing
the successive marriage acts it appears that. prohibitory words without a declaration of
nullity were number companysidered by the legis-
lature to create a nullity. in the act under discussion there is a specific provision
for treating certain marriages companytracted in breach of
certain companyditions prescribed for valid marriage in the same
act as void and simultaneously numberspecific provision have
been made for treating certain other marriages in breach of
certain companyditions as void. in this background even though
the proviso is companyched in prohibitory and negative language
in the absence of an express provision it is number possible to
infer nullity in respect of a marriage companytracted by a
person under incapacity prescribed by the proviso. undoubtedly the proviso opens with a prohibition that it
shall number be lawful etc. is it an absolute prohibition
violation of which would render the act a nullity ? a person
whose marriage is dissolved by a decree of divorce suffers
an incapacity for a period of one year for companytracting-
second marriage. for such a person it shall number be lawful
to companytract a second marriage within a period of one year
from the date of the decree of the companyrt of first instance
while granting a decree for divorce the law interdicts and
prohibits a marriage for a period of one year from the date
at the decree of divorce. does the inhibition for a period
indicate that such marriage would be void ? while there is
a disability for a time suffered by a party from companytracting
marriage every such disability does number render the marriage
void. a submission that the proviso is directory or at any
rate number mandatory and decision bearing on the point need
number detain us because the interdict of law is that it shall
number be lawful for a certain party lo do a certain thing
which would mean that if that act is done it would be
unlawful. but whenever a statute prohibits a certain thing
being done thereby making
it unlawful without providing for companysequence of the breach
it is number legitimate to say that such a thing when done is
void because that would tantamount to saying that every
unlawful act is void. as pointed out earlier it would be
all the more inadvisable in the field of marriage laws. companysequences of treating a marriage void are so serious and
far reaching and are likely to affect innumberent persons such
as children born during the period anterior to the date of
the decree annulling the marriage that it has always been
considered number safe to treat a marriage void unless the law
so enacts or the inference of the marriage being treated
void is either inescapable or irresistible. therefore even
though the proviso is companyched in a language prohibiting a
certain thing being done that by itself is number sufficient
to treat the marriage companytracted in companytravention of it as
void. undoubtedly where a prohibition is enacting in public
interest its violation should number be treated lightly. that
necessitates examination of the object and purpose behind
enacting the proviso. till recent past a valid hindu
marriage among the twice born class in which customary
divorce was number permissible companyld only be broken by the
death of either party. subsequently the companycept of divorce
was introduced. therefore a valid hindu marriage subsists
during the life time of either party to the marriage until
it is dissolved by a decree of divorce at the instance of
either party to the marriage. a decree of divorce breaks
the marriage tie. incapacity for marriage of such persons
whose marriage is dissolved by a decree of divorce for a
period of one year was presumably enacted to allay
apprehension that divorce was sought only for companytracting
anumberher marriage or to avoid dispute about the parentage of
children. at the time of the divorce the wife may be
pregnant. she may give birth to a child after the decree. if a marriage is companytracted soon after the divorce a
question might arise as to who is the father of the child
viz. the former husband or the husband of the second
marriage. there was some such time lag provided in
comparable divorce laws and possibly such a proviso was
therefore companysidered proper and that appears to be the
purpose or object behind enacting the proviso to s. 15. is
such public policy of paramount companysideration as to render
the marriage in breach of it void ? it appears to be purely
a regulatory measure for avoiding a possible companyfusion. if it was so sacrosanct that its violation would render the
marriage void it is number possible to appreciate why the
parliament companypletely dropped it. the proviso to s. 15 is
deleted by s. 9 of the marriage laws amendment act 1976.
the net result is that number since the amendment parties whose
marriage is dissolved by a decree of divorce can companytract
marriage soon thereafter provided of companyrse the period of
appeal has expired. this will reinforce the companytention that
such marriage is number void. but we would like to reaffirm
the warning voiced in chandra mohini srivastava v. avinash
prasad srivastava anr. 1 in that case the decree of
divorce was
1 1967 1 scr 864.
granted by the high companyrt reversing the dismissal of the
petition of the husband by the trial companyrt. soon
thereafter the husband companytracted second marriage. after
some time the wife moved for obtaining special leave to
appeal under article 136 which was granted the husband
thereafter moved for revoking the leave. while rejecting
the petition for revocation of special leave granted to the
wife wanchoo j. as he then was speaking for the companyrt
observed that even though it may number have been unlawful for-
the husband to have married immediately after the high
courts decree for numberappeal as of right lies from the
decree of the high companyrt to this companyrt still it was for the
respondent to make sure whether an application for special
leave had been filed in this companyrt and he companyld number by
marrying immediately after the high companyrts decree deprive
the wife of the chance of presenting a special leave
petition to this companyrt. if a person does so he takes a
risk and companyld number ask the companyrt to revoke the special leave
on that ground. but apart from the caution any marriage
number companytracted by a person whose marriage is dissolved by a
decree of divorce soon after the decree if otherwise valid
under s. 5 would number attract any other companysequence. this
deletion clearly negatives any suggestion of any important
public policy behind the prohibition enacted in the proviso
which if companytravened would lead to the only companysequences
of rendering the marriage void. in companytract it would be
profitable to refer to marsh v. marsh. 1 . the statute
prohibited marriage by parties whose marriage was dissolved
by a decree of divorce during the period of limitation
prescribed for appeal. the companytention was that such
marriage in violation of a statutory prohibition is void. negativing this companytention it was held that the decree
absolute was a valid decree and it dissolved the marriage
from the moment it was pronumbernced and at the date when the
appeal by the intervener abated it stood unreversed. the
fact that neither spouse companyld remarry until the time for
appealing had expired in numberway affect the full operation
of the decree. it is a judgment in rem and unless and until
a companyrt of appeal reversed it the marriage for all purposes
is at an end. to say that such provision companytinues the marriage tie even
after the decree of divorce for the period of incapacity is
to attribute a certain status to the parties whose marriage
is already dissolved by divorce and for which there is no
legal sanction. a decree of divorce breaks the marital tie
and the parties forfeit the status of husband and wife in
relation to each other. each one becomes companypetent to
contract anumberher marriage as provided by s. 15. merely
because each one of them is prohibited from companytracting a
second marriage for a certain period it companyld number be said
that despite there being a decree of divorce for certain
purposes the first manage subsists or is presumed to
subsist. some incident of marriage does survive the decree
of divorce say liability to pay permanent alimony but on
that account it cannumber be said that the marriage subsists
beyond the date of decree of divorce. section 13 which pro-
vides for divorce in terms says that a marriage solemnised
may on
air 1945 pc 188.
a petition presented by the husband or the wife be dissolved
by a decree of divorce on one or more of the grounds
mentioned in that section. the dissolution is companyplete once
the decree is made subject of companyrse to appeal. but a
final decree of divorce in terms dissolves the marriage. numberincident of such dissolved marriage can bridge and bind
the parties whose marriage is dissolved by divorce at a time
posterior to the date of decree. an incapacity for second
marriage for a certain period does number have effect of
treating the former marriage as subsisting. during the
period of incapacity the parties cannumber be said to be the
spouses within the meaning of cl. i sub-s. 1 of s. 5.
the word spouse has been understood to companynumbere a husband
or a wife which term itself postulates a subsisting
marriage. the word spouse in sub-section 1 of s. 5
cannumber be interpreted to mean a former spouse because even
after the divorce when a second marriage is companytracted if
the former spouse is living that would number prohibit the
parties from companytracting the marriage- within the meaning of
cl. i of sub-s. 1 of s. 5. the expression spouse in
cl. i sub-s. 1 of s. 5 by its very companytext would number
include within its meaning the expression former spouse
it was however said that an identical provision in s. 57
of the indian divorce act 1869 has been companysistently
interpreted to mean that a marriage companytracted during the
period prescribed in the fifth paragraph of s. 57 after a
decree dissolving the marriage would be void. the indian
divorce act provides for the divorce of persons professing
christian religion. section 57 provides for liberty to
parties whose marriage is dissolved by a decree of divorce
to marry again. section 57 reads as under
when six months after the date of an
order of a high companyrt companyfirming the decree
for a dissolution of marriage made by a
district judge have expired
or when six months after the date of any
decree of a high companyrt dissolving a marriage
have expired and numberappeal has been presented
against such decree to the high companyrt in its
appellate jurisdiction
or when any such appeal has been dismissed. or when in the result of any such appeal any
marriage is declared to be dissolved
but number sooner it shall be lawful for the
respective parties to the marriage to marry
again as if the prior marriage had been
dissolved by death
provided that numberappeal to the supreme companyrt
has been presented against any such order or
decree. when such appeal has been dismissed or when
in the result thereof the marriage is declared
to be dissolved but number sooner it shall be
lawful for the respective parties to the
marriage to marry again as if the prior
marriage had been dissolved by death. we would presently examine the scheme of s. 57 to appreciate
the companytention that the section is in pari materia with s.
15 of the act. section 57 grants liberty to the parties
whose marriage is dissolved by a decree of divorce to marry
but prohibits them from marrying again within the prescribed
period. the question in terms raised was whether a marriage
during the period of prohibition was void. undoubtedly
consistently such marriage has been held to be void
following- the earliest decision in warter v. warter 1 . in
that case the matter came before the companyrt on a petition for
probate of a will made by one companyonel henry de grey warter
who had companytracted marriage with one mrs. tayloe on february
3 1880 whose former marriage with mr. tayloe was
dissolved by a decree absolute of numberember 27 1879. he made
his will on february 6 1880. subsequently on legal advice
both of them went through a second form of marriage on april
2 1881. the companytention was that by the second marriage the
will was revoked and that is how the validity of the first
marriage was put in issue. upholding the companytention it was
held that mrs. tayloe companyld only companytract a valid second
marriage by showing that the incapacity arising from her
previous marriage had been effectually removed by the
proceedings taken under that law. this companyld number be done
as the indian law like the english law does number companypletely
dissolve the tie of marriage until the lapse of a specific
time after the decree. the prescribed period was held as
in integral part of the proceedings by which alone both
parties companyld be released from their incapacity to companytract
a fresh marriage. thus the previous marriage was held to be
void and of numberconsequence in law. this decision in warter
warter was followed in j. s. battie v. g. e. brown 2
turner v. turner 3 jackson v. jackson 4 . if provision
contained in s. 15 along with its proviso was in pari
materia with s. 57 of tile indian divorce act it would have
become necessary for us to examine the companyrectness of the
ratio in aforementioned decisions. but a mere glance at s.
15 of the act and s. 57 of the indian divorce act would
clearly show that the provisions are number in pari materia. under the indian divorce act a decree nisi has to be passed
and unless companyfirmed by high companyrt it is number effective and
in the proceedings for companyfirmation the decree nisi can be
questioned. numbersuch requirement is to be found under the
act. further under s. 15 the period of one year is to be
computed from the date of decree of the companyrt of first
instance which means. that a decree of divorce is made by
the companyrt of first instance while under s. 57 of the indian
divorce act the period of six months is to be companyputed from
the date of an order of the high companyrt companyfirming the decree
for dissolution of a marriage made by a district judge or
when an appeal has been preferred in the appellate
jurisdiction of the high companyrt when the appeal is dismissed
and the parties even cannumber marry if in appeal has been
presented to the supreme companyrt. under s. 15 if the decree
of divorce is granted number by the companyrt of first instance but
by the appellate companyrt the proviso would number be attracted. there is thus a mate-
1 1 890 1 5 4probate division 152.
air 1916 madras 847.
air 1921 cal. 517.
ilr 34 allahabad 203. 9 36
rial difference in respect of the starting point of the
period under s 57. if thus apart from the scheme of the two
statutes the relevant provisions are so materially
different the decisions interpreting s. 57 cannumber be bodily
followed-to hold that the same companysequences should follow if
the proviso is companytravened. it was however said that apart from the decisions under
the indian divorce act the decision of the calcutta high
court in uma charan roy v. smt. kajal roy on a companyrect
interpretation of the proviso of s. 15 lays down that the
marriage in breach of the proviso is void. it is a decision
of the division bench and both the members companystituting the
bench have written separate but companycurring judgments. the
question came before the companyrt on a petition made by one
smt. kajal roy for annulment of her marriage with uma
charan roy alleging that the latter companytracted the marriage
within a period of one year from the date of dissolution of
his marriage with one sushma and therefore it was in
contravention of the proviso to s. 15 and the marriage was
void. s. k. chakravarti j. in paragraph 12 has observed
that as already pointed out the marriage is null and void
even if kajal bad acquiesced in it. we minutely went
through the earlier paragraphs of the judgment but except
referring to the decisions under the indian divorce act
there is numberdiscussion or reasoning or analysis which led
the learned judge to companye to the companyclusion that marriage in
contravention of s. 15 is null and void. salil kumar datta
j. in his judgment after referring to the decisions under
the indian divorce act merely observed that the principles
enunciated in those decisions should also be made applicable
to the marriages under hindu marriage act with which he was
concerned. the learned judge resorted to a fiction
observing that the former marriage despite the decreeof
divorce subsists for a period at least of one year from the
dateof such decree in the companyrt of the first instance. no
attempt ismade to scan and analyse the scheme of indian
divorce act and more particularly the provision companytained in
s. 57 number before accepting the decision under s. 57 an
attempt was made to companypare the two provisions. with
respect it is difficult to accept this reasoning and
therefore it is number possible to accept the aforementioned
decision as laying down the companyrect law. if a reference to the parallel provisions in the indian
divorce act is helpful and of some assistance it would also
be profitable to look slightly in anumberher direction. under
the mohammedan law after the divorce the traditional law did
root permit a divorced wife to companytract second marriage
during the period of iddat and in the past such marriage was
considered void. the discernible public policy behind
treating such marriage void was companyfusion about the
parentage of the child if the woman was pregnant at the time
of divorce. the marriage was treated void interpreting a
certain text of the hanafi law. recent trend of decisions
quoted in mullas principles of mahomedan law 17th edn. edited by m. hidayatullah former chief justice of india
clearly bear out the proposition that under the mohammedan
law a marriage of a woman undergoing iddat is number void but
merely irregular. at page 252 it is stated as under
air 1971 cal. 307. 9 37
a marriage with a woman before companypletion of
her iddat is irregular number void. the lahore
high companyrt at one time treated such marriages
as void jhandu v. mst. hussain bibi 1923 4
lah. 1921 but in a later decision held that
such a marriage is irregular and the children
legitimate muhammad hayat v. muhammad nawaz
1935 17 lah. 48.
in support of this proposition muhammad hayat v. muhammad
navaz 1 is relied upon. if public policy behind
prohibiting marriage of a woman undergoing iddat and persons
who are prohibited from marrying for a period of one year
from the date of the decree dissolving their marriage is the
same viz. to avoid companyfusion about the parentage of the
child which may have been companyceived or the divorce sought to
be obtained only for companytracting second marriage then the
same companyclusion may follow that such regulatory prohibition
if violated or companytravened would number render the marriage
void. similarly a reference to child marriage restraint act would
also show that the child marriage restraint act was enacted
to carry forward the reformist movement of prohibiting child
marriages and while it made marriage in companytravention of the
provisions of the child marriage restraint act punishable
simultaneously it did number render the marriage void. it
would thus appear that voidness of marriage unless
statutorily provided for is number to be readily inferred. thus examining the matter from all possible angles and
keeping in view the fact that the scheme of the act provides
for treating certain marriages void and simultaneously some
marriages which are made punishable yet number void and no
consequences having been provided for in respect of the
marriage in companytravention of the proviso to s. 15 it
cannumber be said that such marriage would be void. the appellant was denied the status of the wife of rajendra
kumar and therefore his widow and an heir to him on his
death on the only ground that her marriage with rajendra
kumar was void being in companytravention of the proviso to s.
as her marriage even though in companytravention of the
provisions of s. 15 is number void she cannumber be denied the
status of wife and therefore the widow of deceased
rajendra kumar and in that capacity as an heir to him. these appeals are accordingly allowed and the decision of
the high companyrt in special appeals number. 374 375 376 377
378 and 379 of 1967 is set aside as also the decision of the
high companyrt before the learned single judge in civil misc. writ petitions number. 4083 4084 4085 4086 4087 4088 of
1966 is quashed and set aside and the writ petitions are
dismissed. the respondents shall pay the companyts of the ap-
pellant in this companyrt in one set. pathak j.-i agree that the appeals should be allowed but i
would prefer to rest the decision on the reasons which i number
set forth. the facts have already been set out by my
brother desai. 1 1 835 17 lah. 48. 9329 sci/78
the question is whether a remarriage solemnised before the
expiry of the period of one year specified in the proviso to
section 15 of the hindu marriage act is a void marriage or
merely irregular. section 15 of the hindu marriage act
provides
when a marriage has been dissolved by a
decree of divorce and either there is numberlegal
right of appeal against the decree or if
there is such a right of appeal the time
appealing has expired without an appeal having
been presented or an appeal has been
presented but has been dismissed it shall be
lawful for either party to the marriage to
marry
provided that it shall number be lawful for the
respective parties to marry again unless at
the date of such marriage at least one year
has elapsed from the date of the decree in the
court of the first instance. it is urged on behalf of the appellant that the proviso to
section 15 is directory in nature and therefore a marriage
effected in violation of the time-period specified there is
number void. the principal argument in support of the
submission is that whenever the statute intends to treat a
marriage as a nullity it specifically so provides. we have
been referred to the observations of dr. lushington in
catterall v. sweetman 1
the words in this section are negative words
and are clearly prohibitory of the marriage
being had without the prescribed requisites
but whether the marriage itself is void . . . is a question of very great difficulty. il is
to be recollected that there are numberwords in
the act rendering the marriage void and i
have sought in vain for any case in which a
marriage has been declared null and void
unless there were words in the statute
expressly so declaring it from this
examination of these acts i draw two
conclusions first that there never appears to
have beer a decision where words in a statute
relating to marriage though prohibitory and
negative have been held to infer a nullity
unless such nullity was declared in the act. secondly that viewing the successive
marriage acts it appears that prohibitory
words without a declaration of nullity were
number companysidered by the legislature to create a
nullity. it is companytended that the question whether a marriage is a
nullity invites particular companysiderations and the ordinary
numberms of companystruction will number suffice. i find it difficult
to dispute that the question of the validity of a marriage
deserves an especial care and the greatest caution must be
exercised before a marriage is declared void. but i do number
find it possible to admit that unless the statute
specifically declares a marriage to be a nullity it cannumber
be pronumbernced so by the companyrts. to my mind the intrinsic
evidence provided by the language of the statute the
context in which the provision finds place. and the
1 18 4 9 jur. 951 954.
object intended to be served is of equal validity. dr.
lushington relied on the absence of any decision laying down
that the nullity of a marriage companyld be inferred by
statutory companystruction. it was number long after that his
observations were companysidered in chichester v. mure falsely
called chichester 1 by a companyrt companysisting of williams j.
and channell b. williams j. who delivered the judgment of
the companyrt numbered the argument of companynsel that the statute
contained numberwords nullifying-that is expressly declaring
a marriage companytracted and celebrated within the prohibited
time null and void and that in companystruing a statute which
relates to a companytract of marriage a different rule of
construction ought to prevail from that which might properly
enumbergh be applied to statutes relating to a subject-matter
other than a companytract of marriage and that in companystruing a
statute relating to a companytract of marriage it is number enumbergh
to invalidate the marriage to show a disregard of enactments
merely negative and prohibitory but the marriage must be
held good unless there are words expressly declaring that
it shall be null and void. thelearned judges pointed out
that catterall supra was distinguishable and the
observations of dr. lushington must be read in relation to
the facts of the case before him. it was a case where a
marriage if good before the act under companysideration was
passed would number be rendered void by the statute but if number
good before would number be aided byit and where the object
of the statute was number to make any marriage void that would
have been valid without its aid. the validity of the
marriage was to be judged in law independently of the
statute. it was in that companytent that dr. lushington
observed that there was numberprovision in the act which
expressly nullified the marriage. having dealt with those
observations the learned judges then said
it is however quite a different question
whether in companystruing a statute which gives
the very right to companytract at all we are then
to hold that the marriage is good numberwith-
standing a disregard of words negative and
prohibitory which relate to the very capacity
to companytract because there are numberwords
expressly nullifying the companytract. numberwithstanding that there was numberexpress ion nullifying the
marriage the companyrt held the marriage void. chichester
supra was followed in rogers otherwise briscoe falsely
called halmshaw v. halmshaw 2 . to my mind the argument
that the proviso to section 15 is directory and mandatory
because a marriage solemnised in violation of it has number
been declared a nullity by the statute does number carry
conviction. but the appellant is entitled to succeed in her companytention
on anumberher ground. the object behind the restraint imposed
by the proviso to section 15 is to provide a disincentive to
a hasty action for divorce by a husband anxious to marry
anumberher woman and also the desire to avoid the possibility
of companyfusion in parentage where the wife has become pregnant
by her husband under the earlier marriage s . a
1 1 863 3 sw. tr. 223. 2 1864 3 sw. tr. 509. 3 59th report or the law companymission of india p. 29 para
2.32.
statutory provision may be companystrued as mandatory when the
object underlying it would be defeated but for strict
compliance with the provision. it does number seem to me that
any very serious discouragement is provided by the proviso
to section- 15 to a husband anxious to marry anumberher woman. it is also worthy of numbere that the impediment to the
remarriage provided by the proviso to section 15 is a
temporary one and ceases on the expiration of the period of
one year. the proviso proceeds on the assumption that the
decree dissolving the marriage is a final decree and merely
attempts to postpone the re-marriage. it does number take into
account the defensibility of the decree in virtue of an
appeal. the defensibility of the decree because an appeal
has been provided is a matter with which the main provision
of section 15 is companycerned. so far as the intention to
safeguard against a companyfusion in parentage is companycerned one
is reminded of the principle in mahommedan law which places
a ban on marriage with a divorced or widowed woman before
the companypletion of her iddat. it has number been held in
muhammad hayat v. muhammad nawaz 1 overruling the
earlier view on the point that a marriage performedduring
the period of iddat is an irregular marriage only and number a
void marriage. further evidence that the proviso to section
15is directory only is provided by its deletion
altogether by parliamentby the marriage laws reforms act
1976. accordingly i am unable to endorse the view taken by
the calcutta high companyrt in uma charan roy v. smt. kajal
roy. 2 in my opinion a marriage performed in violation of
the proviso to section 15 of the hindu marriage act is number
void. it has also been urged on behalf of the appellant that if
parliament intended that a marriage in violation of the
proviso to section 15 should be a nullity it would have
made express provision for legitimating the offspring of
such a marriage. the absence of such a provision it is
said points to the companyclusion that the proviso to section
15 is directory. i refrain from expressing any opinion on
the validity of that argument when the appellant succeeds
on the companysiderations to which i have adverted. i hold that the marriage of rajendra kumar with the
appellant is number void and she is entitled to be companysidered
as his wife. at this stage it is appropriate to mention that the two
tests sought to be employed in the companystruction of the
proviso to section 15 that is to say that a marriage
although in violation of the statute is number void because
the legislature has number expressly declared it to be so and
also because. the legislature has made numberprovision for
legitimating the offspring of such a marriage need to be
viewed with caution. these are tests which companyld equally be
invoked to the companystruction of the main provision of section
and as i shall endeavour to show the companyclusion that
that provision is directory and number mandatory does number
necessarily follow. 1 193 5 17 l.r. lah. 48.
a.i.r. 1971 cal. 307.
the main provision of section 15 provides that when a
marriage has been dissolved by a decree of divorce either
party to the marriage may marry again if there is numberlegal
right of appeal against the decree or if there is such a
right of appeal the time for appealing has expired without
an appeal having been presented or an appeal having been
presented has been dismissed. in other words the right to
remarriage shall number be exercised before the decree of
divorce has reached finality. similar provision is
contained in the english statutes. the companyrts in england
have companysistently taken the view that the right to remarry
pertains to the capacity of the parties to enter into
marriage and when a limitation in point of time is placed
on the exercise of the right it is regarded as a
qualification of the right itself. and a remarriage effected
in violation of the time limitation has been held to be a
void marriage. see chichester supra . in india among the earliest enactments relevant to our
purpose is the indian divorce act 1869 section 57 of which
provides
when six months after the date of an
order of a high companyrt companyfirming the decree
for a dissolution of marriage made by a
district judge have expired
or when six months after the date of any
decree of a high companyrt dissolving a marriage
have expired and numberappeal has been presented
against such decree to the high companyrt in its
appellate jurisdiction. or when any such appeal has been dismissed
or when in the result of any such appeal any
marriage is declared to be dissolved
but number sooner it shall be lawful for the
respective parties to the marriage to marry
again as if the prior marriage had been
dissolved by death
provided that numberappeal to the supreme companyrt
has been presented against any such order or
decree. when such appeal has been dismissed or when
in the result thereof the marriage is declared
to be dissolved but number sooner it shall be
lawful for the respective parties to the
marriage to marry again as if the prior
marriage had been dissolved by death. the section was companystrued in warter v. warter 1 which in
turn influenced the decision in le mesurier v. le
mesurier 2 and boettcher v. boettcher 3 . these cases
were companysidered with approval by the high companyrt of australia
in miller v. teale 4 . in india warter supra has been
followed in j. s. battie v. g. e. brown 5 turner
turner 6 and jackson v. jackson 7 cases which involved
the
1 1 890 15 pr bate division. 152. 2 1929 46 t.l.r. 203. 3 1949 weekly numberes 83. 4 1954-55 92 c.l.r. 406.
a.i.r. 1916 madras 847.
a.i.r. 1921 cal. 517.
i.l.r. 34 allahabad 203.
application of section 57 of the indian divorce act. judicial opinion appearing from those decisions seems to
be that a marriage solemnised before the expiry of the
period of limitation for presenting an appeal or where an
appeal has been presented during the pendency of that
appeal must be regraded as a void marriage. the law in this
regard was precisely stated in miller supra where dixon
j. pointed out
.lm15
in english law a restraint on remarriage so as to allow
time for appealing appears to be regarded as designed to
give a provisional or tentative character to the decree
dissolving the marriage so that it does number yet take effect
in all respects. it is regarded as ancillary to the
provision of the law which for a companyparatively brief time
makes the decree absolute for dissolution companytingently
defensible in the event of appeal. it is as if there is a
rasidual incapacity to remarry arising out of the previous
marriage and number yet removed by the process provided for
dissolving it. in the same case kitto j. said
whateverbe the law by which a persons general capa-
city to marry is to be determined according to the rules
applied by the english companyrts if he is a divorced person
those companyrts will recognize an incapacity to remarry which
is imposed upon him by the law of the companyntry in which his
former marriage was dissolved provided that the incapacity
is imposed incidentally to the provision of a right of
appeal against the judgment of dissolution. the main provision of section 15 of the hindu marriage act
which bears almost identical resemblance to the relevant
statutory provisions in the cases mentioned above would
perhaps attract a similar companyclusion in regard to its
construction. at the lowest there is good ground for
saying that a companytention that a marriage solemnised in
violation of the main provision of section 15 is a nullity
cannumber be summarily rejected. the question which arises
before us in this case does number directly involve the
construction of the main provision of section 15 and
therefore i refrain from expressing any opinion on the
validity of such a marriage. the appeals are allowed the judgment of the division bench
of the high companyrt in special appeals number. | 1 | test | 1978_126.txt | 1 |
criminal appellate jurisdiction criminal appeal number 385
of 1991.
from the judgment and order dated 18.4.1988 of the
andhra pradesh high companyrt in crl. revision petition number 41
of 1987.
c. bhandare and ms. c.k. sucharita for the appellants. n. sreekumar and g. prabhakar for the state for the
respondents. the judgment of the companyrt was delivered by
sawant j. leave is granted. appeal is taken oj board
for final hearing by companysent of parties. the 1st appellant and the 1st respondent were married ar
tirupati on february 27 1975. they separated in july 1978.
the 1st appellant filed a petition for dissolution of
marriage in the circuit of st. louis companyntry missouri usa. the 1st respondent sent her reply from here under protest. the circuit companyrt passed a decree for dissolution of
marriage on february 19 1980 in the absence of the 1st
respondent. the 1st appellant had earlier filed a petition for
dissolution of marriage in the sub-court of tirupati being
p. number 87/86. in that petition the 1st appellant filed an
application for dismissing the same as number pressed in view
of the decree passed by the missouri companyrt. on august 14
1991 the learned sub-judge of tirupati dismissed the
petition. on numberember 2 1981 the 1st appellant married the
2nd appellant in yadgirigutta 1st respondent filed a
criminal companyplaint against the appellants for the offence of
bigamy. it is number necessary to refer to the details of the
proceedings in the said companyplaint. suffice it to say that in
that companyplaint the appellants filed an application for
their discharge in view of the decree for dissolution of
marriage passed by missouri companyrt. by this judgment of
october 21 1986 the learned magistrate discharged the
appellants holding that the companyplainant i.e. the 1st
respondent had failed to make out a prima facie case against
the appellants. against the said decision the 1st
respondent preferred a criminal revision petition to the
high companyrt and the high companyrt by the impugned decision of
april 18 1987 set aside the order of the magistrate holding
that a photostat companyy of the judgment of the missouri companyrt
was number admissible in evidence to prove the dissolution of
marriage. the companyrt further held that since the learned
magistrate acted on the photostat companyy he was in error in
discharging the accused and directed the magistrate to
dispose of the petition filed by the accused i.e. appellants herein for their discharge afresh in accordance
with law. it is aggrieved by this decision that the present
appeal is filed. it is necessary to numbere certain facts relating to the
decree of dissolution of marriage passed by the circuit
court of st. louis companyntry missouri usa. in the first
instance the companyrt assumed jurisdiction over the matter on
the ground that the 1st appellant had been a resident of the
state of missouri for 90 days next preceding the
commencement of the action and that petition in that companyrt. secondly the decree has been passed on the only ground that
there remains numberreasonable likelihood that the marriage
between the parties can be preserved and that the marriage
is therefore irretrievably broken. thirdly the 1st
respondent had number submitted to the jurisdiction of the
court. from the record it appears that to the petition she
had filed two replies of the same date. both are identical
in nature except that one of the replies begins with an
additional averment as follows without prejudice to the
contention that this respondent is number submitting to the
jurisdiction of this honble companyrt this respondent sub-
mits as follows. she had also stated in the replies among
other things that i the petition was number maintainable
she was number aware if the first appellant had been
living in the state of missouri for more than 90 days and
that he was entitled to file the petition before the companyrt
the parties were hindus and governed by hindu law
she was an indian citizen and was number governed by laws
in force in the state of missouri and therefore the companyrt
had numberjurisdiction to entertain the petition v the
dissolution of the marriage between the parties was governed
by the hindu marriage act and that it companyld number be dissolved
in any other way except as provided under the said act vi
the companyrt had numberjurisdiction to enforce the foreign laws
and numbere of the grounds pleaded in the petition was
sufficient to grant any divorce under the hindu marriage
act. fourthly it is number disputed that the 1st respondent was
neither present number represented in the companyrt passed the
decree in her absence. in fact the companyrt has in terms
observed that it had numberjurisdiction in personam over
the respondent or minumber child which was born out of the wed-
lock and both of them had domiciled in india. fifthly in
the petition which was filed by the 1st appellant in that
court on october 6 1980 besides alleging that he had been
a resident of the state of missouri for 90 days or more
immediately preceding the filing of the petition and he was
then residing at 23rd timber view road kukwapood in the
country of st. louis missouri he had also alleged that the
1st respondent had deserted him for one year or more next
preceding the filing of the petition by refusal to companytinue
to live with the appellant in the united states and
particularly in the state of missouri. on the other hand
the averments made by him in his petition filed in the companyrt
of the subordinate judge tirupati in 1978 shows that he was
a resident of apartment number 414 6440 south claiborn
avenue new orleans louisiana united states and that he
was a citizen of india. he had given for the service of all
numberices and processes in the petition the address of his
counsel shri pr ramachandra rao advocate 16-11-1/3
malakpet hyderabad-500 036. even according to his averments
in the said petition the 1st respondent had resided with
him at kuppanapudi for about 4 to 5 months after th
marriage. thereafter she had gone to her parental house at
relangi tanuka taluk west godawari district. he was
thereafter sponsored by his friend prasad for a placement
in the medical service in the united states and had first
obtained employment in chicago and thereafter in oak forest
and greenville springs and ultimately in the charity
hospital in louisiana at new orleans where he companytinued to
be emp-
loyed. again according to the averments in the said
petition when the 1st respondent joined him in the united
states both of them had stayed together as husband and wife
at new orleans. the 1st respondent left his residence in new
orleans and went first to jackson texas and thereafter to
chicago to stay at the residence of his friend prasad. thereafter she left chicago for india. thus it is obvious
from these averments in the petition that both the 1st
respondent and the 1st petitioner had last resided together
at new orleans louisiana and never within the jurisdiction
of the circuit companyrt of st. louis companyntry in the state of
missouri. the averments to that effect in the petition filed
before the st. louis companyrt are obviously incorrect. under the provisions of the hindu marriage act 1955
hereinafter referred to as the act only the district
court within the local limits of whose original civil
jurisdiction i the marriage was solemnized or ii the
respondent at the time of the presentation of the petition
resides or iii the parties to the marriage last resided
together or iv the petitioner is residing at the time of
the presentation of the petition in a case where the
respondent is at the time residing outside the territories
to which the act extends or has number been heard of as being
alive for a period of seven years of more by those persons
who would naturally have heard of him if he were alive has
jurisdiction to entertain the petition. the circuit companyrt of
st. louis companyntry missouri had therefore numberjurisdiction
to entertain the petition according to the act under which
admittedly the parties were married. secondly irretrievable
breakdown of marriage is number one of the grounds recognised
by the act for dissolution of marriage. hence the decree of
divorce passed by the foreign companyrt was on a ground
unavailable under the act. under section 13 of the companye of civil procedure 1908
hereinafter referred to as the companye a foreign
judgment is number companyclusive as to any matter thereby
directly adjudicated upon between the parties if a it has
number been pronumbernced by a companyrt of companypetent jurisdiction
b it has number been given on the merits of the case c it
is founded on an incorrect view of international law or a
refusal to recognize the law of india in cases in which such
law is applicable d the proceedings are opposed to
natural justice e it is obtained by fraud f it
sustains a claim founded on a breach of any law in force in
india. as pointed out above the present decree dissolving
the marriage passed by the foreign companyrt is without
jurisdiction according to the act as neither the marriage
was celebrated number the parties last
resided together number the respondent resided within the
jurisdiction of that companyrt. the decree is also passed on a
ground which is number available under the act which is
applicable to the marriage. what is further the decree has
been obtained by the 1st appellant by stating that he was
the resident of the missouri state when the record shows
that he was only a bird of passage there and was ordinarily
a resident of the state of louisiana. he had if at all
only technically satisfied the requirement of residence of
ninety days with the only purpose of obtaining the divorce. he was neither domiciled in that state number had he an
intention to make it his home. he had also numbersubstantial
connection with the forum. the 1st appellant has further
brought numberrules on record under which the st. louis companyrt
could assume jurisdiction over the matter. on the companytrary
as pointed out earlier he has in his petition made a false
averment that the 1st respondent had refused to companytinue to
stay with him in the state of missouri where she had never
been. in the absence of the rules of jurisdiction of that
court we are number aware whether the residence of the 1st
respondent within the state of missouri was necessary to
confer jurisdiction on that companyrt and if number of the
reasons for making the said averment. relying on a decision of this companyrt in smt. satya v.
teja singh 1975 2 scr 1971 it is possible for us to
dispose of this case on a narrow ground viz. that the
appellant played a fraud on the foreign companyrt residence does
number mean a temporary residence for the purpose of obtaining
a divorce but habitual residence or residence which is
intended to be permanent for future as well. we remain from
adopting that companyrse in the present case because there is
numberhing on record to assure us that the companyrt of st. louis
does number assume jurisdiction only on the basis of a mere
temporary residence of the appellant for 90 days even is such
residence is for the purpose of obtaining divorce. we would
therefore presume that the foreign companyrt by its own rules
of jurisdiction had rightly entertained the dispute and
granted a valid decree of divorce according to its law. the
larger question that we would like to address ourselves to
is whether even in such cases the companyrts in this companyntry
should recognise the foreign divorce decrees. the rules of private international law in this
country are number companyified and are scattered in different
enactments such as the civil procedure companye the companytract
act the indian succession act the indian divorce act the
special marriage act etc. in addition some rules have also
been evolved by judicial decisions. in matters of status or
legal capacity of natural persons matrimonial disputes
custody of
children adoption testamentary and intestate succession
etc. the problem in this companyntry is companyplicated by the fact
that there exist different personal laws and numberuniform rule
can be laid down for all citizens. the distinction between
matters which companycern personal and family affairs and those
which companycern companymercial relationships civil wrongs etc. is
well recognised in other companyntries and legal systems. the
law in the former area tends to be primarily determined and
influenced by social moral and religious companysiderations
and public policy plays a special and important role in
shaping it. hence in almost all the companyntries the
jurisdicational procedural and substantive rules which are
applied to disputes arising in this area are significantly
different from those applied to claims in other areas. that
is as it ought to be. for numbercountry can afford to
sacrifice its internal unity stability and tranquility for
the sake of uniformity of rules and companyity of nations which
considerations are important and appropriate to facilitate
international trade companymerce industry companymunication
transport exchange of services technumberogy manpower etc. this glaring fact of national life has been recognised both
by the hague companyvention of 1968 on the recognition of
divorce and legal seperations as well as by the judgments
convention of the european companymunity of the same year. article 10 of the hague companyvention expressly provides that
the companytracting states may refuse to recognise a divorce or
legal separation if such recognition is manifestly
incompatible with their public policy. the judgments
convention of the european companymunity expressly excludes from
its scope a status or legal capacity of natural persons
b rights in property arising out of a matrimonial
relationship c wills and succession d social security
and e bankruptcy. a separate companyvention was companytemplated
for the last of the subjects. we are in the present case companycerned only with the
matrimonial law and what we state here will apply strictly
to matters arising out of and ancillary to matrimonial
disputes. the companyrts in this companyntry have so far tried to
follow in these matters the english rules of private
international law whether companymon law rules or statutory
rules. the dependence on english law even in matters which
are purely personal has however time and again been
regretted. but numberhing much has been done to remedy the
situation. the labours of the law companymission poured in its
65th report on this very subject have number fructified since
april 1976 when the report was submitted. even the
british were circumspect and hesitant to apply their rules
of law in such matters during their governance of this
country and had left the family law to be governed by the
customary rules of the diffe-
rent companymunities. it is only where was a void that they had
stepped in by enactments such as the special marriage act
indian divorce act indian succession act etc. in spite
however of more than 43 years of independence we find that
the legislature has number thought it fit to enact rules of
private international law in this area and in the absence of
such initiative from the legislature the companyrts in this
country their inspiration as stated earlier from the
english rules. even in doing so they have number been uniform
in practice with the result that we have some companyflicting
decisions in the area. we cannumber also lose sight of the fact that today
more than ever in the past the need for definitive rules
for recognition of foreign judgments in personal and family
matters and particularly in matrimonial disputes has surged
to the surface. many a man and woman of this land with
different personal laws have migrated and are migrating to
different companyntries either to make their permanent abode
there or for temporary residence. likewise there is also
immigration of the nationals of other companyntries. the
advancement in companymunication and transportation has also
made it easier for individuals to hop from one companyntry to
anumberher. it is also number unusual to companye across cases where
citizens of this companyntry have been companytracting marriages
either in this companyntry or abroad with nationals of the
other companyntries or among themselves or having married here
either both or one of them migrate to other companyntries. there
are also cases where parties having married here have been
either domiciled or residing separately in different foreign
countries. this migration temporary or permanent has also
been giving rise to various kinds of matrimonial disputes
destroying in its turn the family and its peace. a large
number of foreign decrees in matrimonial matters is becoming
the order of the recognition of the foreign judgments in
these matters. the minimum rules of guidance for securing
the certainty need number await legislative initiative. this
court can accomplish the modest job within the framework of
the present statutory provisions if they are rationally
interpreted and extended to achieve the purpose. it is with
this intention that we are undertaking this venture. we
aware that unaided and left solely to our resources the
rules of guidance which we propose to lay down in this area
may prove inadequate or miss some aspects which may number be
present to us at this juncture. but a begining has to be
made as best as one can the lacunae and the errors being
left to be filled in and companyrected by future judgments. we believe that the relevant provisions of section
13 of the companye are capable of being interpreted to secure
the required certainty in the sphere of this branch of law
in companyformity with public policy justice equity and good
conscience and the rules so evolved will protect th
sanctity of the institution of marriage and the unity of
family which are the companyner stones of our societal life. clause a of section 13 states that a foreign judgment
shall number be recognised if it has number been pronumbernced by a
court of companypetent jurisdiction. we are of the view that
this clause should be interpreted to mean that only that
court will be a companyrt of companypetent jurisdiction which the
act or the law under which the parties are married
recognises as a companyrt of companypetent jurisdiction to entertain
the matrimonial dispute. any other companyrt should be held to
be a companyrt without jurisdiction unless both parties
voluntarily and unconditionally subject themselves to the
jurisdiction of that companyrt. the expression companypetent
court in section 41 of the indian evidence act has also to
be companystrued likewise. clause b of section 13 states that if a foreign has
number been given on the merits of the case the companyrts in this
country will number recognise such judgment. this clause
should be interpreted to mean a that the decision of the
foreign companyrt should be on a ground available under the law
under which the parties are married and b that the
decision should be a result of the companytest between the
parties. the latter requirement is fulfilled only when the
respondent is duly served and voluntarily and
unconditionally submits himself herself to the jurisdiction
of the companyrt and companytests the claim or agrees to the
passing of the decree with or without appearance. a mere
filing of the reply to the claim under protest and without
submitting to the jurisdiction of the companyrt or an
appearance in the companyrt either in person or through a
representative for objecting to the jurisdiction of the
court should number be companysidered as a decision on the merits
of the case. in this respect the general rules of the
acquiescence to the jurisdiction of the companyrt which may be
valid in other matters and areas should be ignumbered and
deemed inappropriate. the second part of clause c of section 13 states that
where the judgment is founded on a refusal to recognise
the law of this companyntry in cases in which such law is
applicable the judgment will number be recognised by the
courts in this companyntry. the marriages which take place in
this companyntry can only be under either the customary or the
statutory law in force in this companyntry. hence the only law
that can be applicable
to the matrimonial disputes is the one under which the
parties are married and numberother law. when therefore a
foreign judgment is founded on a jurisdiction or on ground
number recognised by such law it is a judgment which is in
defiance of the law. hence it is number companyclusive of the
matters adjudicated therein and therefore unenforceable in
this companyntry. for the same reason such a judgment will
also be unenforceable under clause f of section 13 since
such a judgment would obviously be in breach of the
matrimonial law in force in this companyntry. clause d of section 13 which makes a foreign judgment
unenforceable on th ground that the proceedings in which it
is obtained are opposed to natural justice states numbermore
than an elementary principle on which any civilised system
of justice rests. however in matters companycerning the family
law such as the matrimonial disputes this principle has to
b extended to mean something more than mere companypliance with
the technical rules of procedure. if the rule of audi
alteram partem has any meaning with reference to the
proceedings in a foreign companyrt for the purposes of the rule
it should number be deemed sufficient that the respondent has
been duly served with the process of the companyrt. it is
necessary to ascertain whether the respondent was in a
position to present or represent himself herself and
contest effectively the said proceedings. this requirement
should apply equally to the appellate proceedings if and
when they are file by either party. if the foreign companyrt has
number ascertained and ensured such effective companytest by
requiring the petitioner to make all necessary provisions
for the respondent to defend including the companyts of travel
residence and litigation where necessary it should be held
that the proceedings are in breach of the principles of
natural justice. it is for this reason that we find that the
rules of private international law of some companyntries insist
even in companymercial matters that the action should be filed
in the forum where the defendant is either domiciled or is
habitually resident. it is only in special cases which is
called special jurisdiction where the claim has some real
link with other forum that a judgment of such forum is
recognised. this jurisdiction principle is also recognised
by the judgments companyvention of this european companymunity . if
therefore the companyrts in this companyntry also insist as a
matter of rule that foreign matrimonial judgment will be
recognised only it it is of the forum where the respondent
is domiciled or habitually and permanently resides the
provisions of clause d may be held to have been satisfied. the provision of clause e of section 13 which
requires that the
courts in this companyntry will number recognise a foreign judgment
if it has been obtained by fraud is self-evident. however
in view of the decision of this companyrt in smt. satya v. teja
singh supra it must be understood that the fraud need number
be only in relation to the merits of the mater but may also
be in relation to jurisdictional facts. from the aforesaid discussion the following rule
can be deduced for recognising foreign matrimonial judgment
in this companyntry. the jurisdiction assumed by the foreign
court as well as the grounds on which the relief is granted
must be in accordance with the matrimonial law under which
the parties are married. the exceptions to this rule may be
as follows i where the matrimonial action is filed in the
forum where the respondent is domiciled or habitually and
permanently resides and the relief is granted on a ground
available in the matrimonial law under which the parties are
married ii where the respondent voluntarily and
effectively submits to the jurisdiction of the forum as
discussed above and companytests the claim which is based on a
ground available under the matrimonial law under which the
parties are married iii where the respondent companysents to
the grant of the relief although the jurisdiction of the
forum is number in accordance with the provisions of the
matrimonial law of the parties. the aforesaid rule with its stated exceptions has the
merit of being just and equitable. it does numberinjustice to
any of the parties. the parties do and ought to knumber their
rights and obligations when they marry under a particular
law. they cannumber be heard to make a grievance about it
later or allowed to bypass it by subterfuges as in the
present case. the rule also has an advantage of rescuing
the institution of marriage from the uncertain maze of the
rules of the private international law of the different
countries with regard to jurisdiction and merits based
variously on domicile nationality residence-permanent or
temporary or ad hoc forum proper law etc. and ensuring
certainty in the most vital field of national life and
conformity with public policy. the rule further takes
account of the needs of modern life and makes due allowance
to accommodate them. above all it gives protection to
women the most vulnerable section of our society whatever
the strata to which they may belong. in particular it frees
them from the bondage of the tyrannical and servile rule
that wifes domicile follows that of her husband and that it
is the husbands domicilliary law which determines the
jurisdiction and judges the merits of the case. since with regard to the jurisdiction of the forum
as well as the ground on which it is passed the foreign
decree in the present case
is number in accordance with the act under which the parties
were married and the respondent had number submitted to the
jurisdiction of the companyrt or companysented to its passing it
cannumber be recognised by the companyrts in this companyntry and is
therefore unenforceable. the high companyrt as stated earlier set aside the
order of the learned magistrate only on the ground that the
photostat companyy of the decree was number admissible in evidence. the high companyrt is number companyrect in its reasoning. under
section 74 1 iii of the indian evidence act hereinater
referred to as the act documents forming the acts or
records of the acts of public judicial officers of a foreign
country are public documents. under section 76 read with
section 77 of the act certified companyies of such documents
may be produced in proof of their companytents. however under
section 86 of the act there is presumption with regard to
the genuineness and accuracy of such certified companyy only if
it is also certified by the representative of our central
government in or for that companyntry that the manner in which
it has been certified is companymonly in use in that companyntry for
such certification. section 63 1 and 2 read with section 65 e and f
of the act permits certified companyies and companyies made from the
original by mechanical process to be tendered as secondary
evidence. a photostat companyy is prepared by a mechanical
process which in itself ensures the accuracy of the
original. the present photostat companyies of the judicial
record of the companyrt of st. louis is certified for the
circuit clerk by the deputy clerk who is a public officer
having the custody of the document within the meaning of
section 76 of the act and also in the manner required by
the provisions of the said section. hence the photostat
copy per se is number inadmissible in evidence. it is
inadmissible because it has number further been certified by the
representative of our central government in the united
states as required by section 86 of the act. | 0 | test | 1991_506.txt | 1 |
civil appellate jurisdiction civil appeal number 183 of 1956.
appeal from the judgment and order dated september 11 1953
of the bombay high companyrt in income-tax reference number 23 of
1953.
v. viswanatha sastri s. n. andley and j. b.
dadachanji for the appellants. c. setalvad attorney-general for -india k. n.
rajagopal sastri and d. gupta for the respondent. 1959. august 4. the judgment of the companyrt was delivered by
das c. j.-this is an appeal from the judgment and order of
the high companyrt of bombay delivered on september 11 1953 on
a reference made by the income-tax appellate tribunal under
s. 66 1 of the indian income-tax act whereby the high
court answered the referred question in the affirmative and
directed the appellant to pay the companyts of the respondent. the appellant which is a registered firm and is hereinafter
referred to as the assessee firm was appointed the
managing agent of godrej soaps limited hereinafter called
the managed companypany . it has been working as such
managing agent since october 1928 upon the terms and
conditions recorded originally in an agreement dated october
28 1928
which was subsequently substituted by anumberher agreement
dated december 8 1933 hereinafter referred to as the
principal agreement . under the principal agreement the
assessee firm was appointed managing agent for a period of
thirty years from numberember 9 1933. clause 2 of that
agreement provided as follows-
the companypany shall during the subsistence of this agreement
pay to the said firm and the said firm shall receive from
the companypany the following remuneration that is to say
a companymission during every year at the rate of twenty
per cent. on the net profits of the said companypany after
providing for interest on loans advances and debentures if
any working expenses repairs outgoings and depreciation
but without any deduction being made for income-tax and
super-tax and for expenditure on capital account or on
account of any sum which may be set aside in each year out
of profits as reserved fund. in case such net profits of the companypany after providing
for interest on loans advances and debentures if any
working expenses depreciation repairs and outgoings and
after deduction therefrom the companymission provided for by
sub-clause a shall during any year exceed a sum of rupees
one lac the amount of such excess over rupees one lac up to
a limit of rupees twenty four thousand. in case such net profits of the companypany after providing
for interest on loans advances and debentures if any
working expenses depreciation repairs and outgoings and
after also deducting therefrom the companymission provided for
by subclause a shall during any year exceed a sum of
rupees one lac and twenty four thousand one half of such
excess over rupees one lac and twenty four thousand shall be
paid to the firm and the other half to the shareholders. some of the shareholders and directors of the managed
company felt that the scale of remuneration paid to the
assessee firm under cl. 2 of the principal agreement was
extraordinarily excessive and unusual and
should be modified. accordingly negotiation were started
for a reduction of the remuneration and after some
discussion the assessee firm and the managed companypany
arrived at certain agreed modifications which were
eventually recorded in a special resolution passed at the
extraordinary general meeting of the managed companypany held on
october 22 1946. that resolution was in the following
terms-
resolved that the agreement arrived at between the
managing agents on the one hand and the directors of your
company on the other hand that the managing agents in
consideration of the companypany paying rs. 750000 as
compensation for releasing the companypany from the onerous
term as to remuneration companytained in the present managing
agency agreement should accept as remuneration for the
remaining term of their managing agency ten per cent. of the
net annual profits of the companypany as defined in s. 87c sub-
s. 3 of the indian companypanies act in lieu of the higher
remuneration to which they are number entitled under the
provisions of the existing managing agency agreement be and
the same is hereby approved and companyfirmed. resolved that the companypany and the managing agents do execute
the necessary document modifying the terms of the original
managing agency agreement in accordance with the above
agreement arrived at between them. such document be
prepared by the companypanys solicitors and approved by the
managing agents and the directors shall carry the same into
effect with or without modification as they shall think
fit. the agreed modifications were thereafter embodied in a
supplementary agreement made between the assessee firm and
managed companypany on march 24 1948. after reciting the
appointment of the assessee firm as the managing agent upon
terms companytained in the principal agreement and further
reciting the agreement arrived at between the parties and
the resolution referred to above it was agreed and declared
as follows
that the remuneration of the managing agents as from
the 1st day of september 1946 shall be ten per cent. of the
net annual profits of the companypany as defined in s. 87c sub-
s. 3 of the indian companypanies act 1913 in lieu of the
higher remuneration as provided in the above recited cl. 2
of the principal agreement. subject only to the variations herein companytained and
such other alterations as may be necessary to make the
principal agreement companysistent with these presents the
principal agreement shall remain in full force and effect
and shall be read and companystrued and be enforceable as if the
terms of these presents were inserted therein by way of
substitution. the sum of rs. 750000 was paid by the managed companypany and
received by the assessee firm in the calendar year 1947
which was the accounting year for the assessment year 1948-
49.
in the companyrse of the assessment proceedings for the
assessment year 1948-49 it was companytended by the
departmental representative i that though the payment of
rs. 750000 had been described as companypensation the real
object and companysideration for the payment was the reduction
of remuneration ii that being the character of payment
it was a lump sum payment in companysideration of the variation
of the terms of employment and was therefore number a capital
receipt but was a revenue receipt and iii that there was
in fact numberbreak in service and the payment was made in
course of the companytinuation of the service and therefore
represented a revenue receipt of the managing agency
business of the assessee firm. the assessee firm on the
other hand maintained that the sum of rs. 750000 was a
payment made by the managed companypany to the assessee firm
wholly in discharge of its companytingent liability to pay the
higher remuneration and in order to discharge itself of an
onerous companytingent obligation to pay higher remuneration
and it was therefore a capital expenditure incurred by the
managed companypany and a capital receipt obtained by the
assessee firm and was as such number liable to tax. the income-tax officer treated the sum of rs. 750000 as a
revenue receipt in the hands of the assessee firm and taxed
it as such. on appeal this decision was companyfirmed by the
appellate assistant companymissioner and thereafter on further
appeal was upheld by the tribunal by its order dated july
23 1952. at the instance of the assessee-firm the
tribunal under s. 66 1 of the act made a reference to the
high companyrt raising the following question of law-
whether on the facts and in the circumstances of the case
the sum of rs. 750000 is a revenue receipt liable to tax. the said reference was heard by the high companyrt and by its
judgment pronumbernced on september 11 1953 the high companyrt
answered the referred question in the affirmative and
directed the assessee-firm to pay the companyts of the
reference. the high companyrt however gave to the assessee-
firm a - certificate of fitness for appeal to this companyrt and
that is how the appeal has companye before us. as has been said by this companyrt in companymissioner of income-tax
and excess profits tax madras v. the south india pictures
ltd. 1 it is number always easy to decide whether a
particular payment received by a person is his income or
whether it is to be regarded as his capital receipt. eminent judges have observed that income is a word of
the broadest companynumberation and that it is difficult and
perhaps impossible to define it by any precise general
formula. though in general the distinction between an
income and a capital receipt is well recognised cases do
arise where the item lies on the borderline and the problem
has to be solved on the particular facts of each case. no
infallible criterion or test has been or can be laid down
and the decided cases are only helpful in that they indicate
the kind of companysideration which may relevantly be borne in
mind in approaching the problem. the character of payment
received may vary according to the circumstances. thus the
amount received as companysideration for the sale of a plot of
land may ordinarily be capital but if the business of the
recipient is to
1 1956 s.c.r. 223. 228.
buy and sell lands it may well be his income. it is
therefore necessary to approach the problem keeping in view
the particular facts and circumstances in which it has
arisen. there can be numberdoubt that by paying this sum of rs. 750000 the managed companypany has secured for itself a
release from the obligation to pay a higher remuneration to
the assesee firm for the rest of the period of managing
agency companyered by the principal agreement. prima facie
this release from liability to pay a higher remuneration for
over 17 years must be an advantage gained by the managed
company for the benefit of its business and the immunity
thus obtained by the managed companypany may well be regarded as
the acquisition of an asset of enduring value by means of a
capital outlay which will be a capital expenditure according
to the test laid down by viscount cave l.c. in atherton v.
british insulated and helsby cables limited 1 referred to
in the judgment of this companyrt in assam bengal cement company
ltd. v. companymissioner of income-tax 2 . if the sum of rs. 750000 represented a capital expenditure incurred by the
managed companypany it should according to learned companynsel for
the assessee firm be a capital receipt in the hands of the
assessee firm for the intrinsic characteristics of capital
sums and revenue items respectively are essentially the same
for receipts as for expenditure. see simons income-tax ii
edn. vol. 1 para. 44 p. 31 . but as pointed out by the
learned author in that very paragraph this cannumber be an
invariable proposition for there is always the possibility
of a particular sum changing its quality according as the
circumstances of the payer or the recipient are in question. accordingly the learned attorney-general appearing for the
respondent companytends that we are number companycerned in this appeal
with the problem whether from the point of view of the
managed companypany the sum represented a capital expenditure
or number but that we are called upon to determine whether this
sum represented a capital receipt in the hands of the
assessee firm. 1 1925 10 tax cas. 155. 2 19551 1 s.c.r. 972.
in the resolution adopted by the managed companypany as well as
in the recitals set out in the supplementary agreement this
sum has been stated to be a payment as companypensation for
releasing the companypany from the onerous term as to
remuneration companytained in the principal agreement. it is
true as said by the high companyrt and as reiterated by the
learned attorney-general that the language used in the
document is number decisive and the question has to be
determined by a companysideration of all the attending
circumstances nevertheless the language cannumber be ignumbered
altogether but must be taken into companysideration along with
other relevant circumstances. this sum of rs. 750000 has undoubtedly number been paid as
compensation for the termination or cancellation of an
ordinary business companytract which is a part of the stock-in-
trade of the assessee and cannumber therefore be regarded as
income as the amounts received by the assessee in the
commissioner of income-tax and excess profits tax v. the
south india pictures limited 1 and in the companymissioner of
income-tax nagpur v. rai bahadur jairam valji 2 had been
held to be. number can this amount be said to have been paid
as companypensation for the cancellation or cessation of the
managing agency of the assessee firm for the managing
agency companytinued and therefore the decision of the
judicial companymittee of the privy companyncil in the companymissioner
of income-tax v. shaw wallace and company 1 cannumber be invoked. it is however urged that for the purpose of rendering the
sum paid as companypensation to be regarded as a capital
receipt it is number necessary that the entire managing agency
should be acquired. if the amount was paid as the price for
the sterilisation of even a part of a capital asset which is
the framework or entire structure of the assessees profit
making apparatus then the amount must also be regarded as a
capital receipt for as said by lord wrenbury in glenboig
union fireclay company limited v. the companymissioners of inland
revenue 4 what is true of the whole must be equally true
of part -a principle which has been adopted by
1 1956 s.c.r. 223 228. 3 1932 l.r. 59 i.a. 206. 2 1959 35 i.t.r. 148 1959 s.c.r. supp. 110. 4 1922 12 tax cas. 427.
this companyrt in the companymissioner of income-tax hyderabad-
deccan v. messrs. vazir sultan and sons 1 . the learned
attorney-general however companytends that this case is number
governed by the decisions in shaw wallaces case 2 or
messrs. vazir sultan and sons case 1 because in the
present case there was numberacquisition of the entire managing
agency business or sterilisation of any part of the capital
asset and the business structure or the profit-making
apparatus namely the managing agency remains unaffected. there is numberdestruction or sterilisation of any part of the
business structure. the amount in question was paid in
consideration of the assessee firm agreeing to companytinue to
serve as the managing agent on a reduced remuneration and
therefore it bears the same character as that of
remuneration and therefore a revenue receipt. we do number
accept this companytention. if this argument were companyrect
then on a parity of reasoning our decision in messrs.
vazir sultan and sons case 1 would have been different
for there also the agency companytinued as before except that
the territories were reduced to their original extent. in
that case also the agent agreed to companytinue to serve with
the extent of his field of activity limited to the state of
hyderabad only. to regard such an agreement as a mere
variation in the terms of remuneration is only to take a
superficial view of the matter and to ignumbere the effect of
such variation on what has been called the profit-making
apparatus. a managing agency yielding a remuneration
calculated at the rate of 20 per cent. of the profits is number
the same thing as a managing agency yielding a remuneration
calculated at 10 per cent. of the profits. there is a
distinct deterioration in the character and quality of the
managing agency viewed as a profit-making apparatus and this
deterioration is of an enduring kind. the reduced
remuneration having been separately provided the sum of rs. 750000 must be regarded as having been paid as
compensation for this injury to or deterioration of the
managing agency just as the amounts paid in glenboigs case
3
civil appeal number 346 of 1957 decided
2 1932 l.r. 59 i. a. 206. on march 20 1959 1959 36
t.r. 175. 3 1922 12 tax cas. 427.
or messrs. vazir sultans case 1 were held to be. this is
also very nearly companyered by the majority decision of the
english house of lords in hunter v. dewhurst 2 . it is true
that in the later english cases of prendergast v. cameron 3
and wales tilley 4 the decision in hunter v. dewharst 2
was distinguished as being of an exceptional and special
nature but those later decisions turned on the words used in
r. 1 of sch. e. to the english act. further they were
cases of companytinuation of personal service on reduced
remuneration simpliciter and number of acquisition wholly or
in part of any managing agency viewed as a profit-making
apparatus and companysequently the effect of the agreements in
question under which the payment was made upon the profit
making apparatus did number companye under companysideration at all. on a companystruction of the agreements it was held that the
payments made were simply remuneration paid in advance
representing the difference between the higher rate of
remuneration -and the reduced remuneration and as such a
revenue receipt. the question of the character of the
payment made for companypensation for the acquisition wholly or
in part of any managing agency or injury to or
deterioration of the managing agency as a profit-making
apparatus is companyered by our decisions hereinbefore referred
to. in the light of those decisions the sum of rs. 750000
was paid and received number to make up the difference. between
the higher remuneration and the reduced remieration but was
in reality paid and received as companypensation for releasing
the companypany- from the onerous terms as to remuneration as it
was in terms expressed to be. in other words so far as the
managed companypany was companycerned it was paid for see-tiring
immunity from the liability to pay highser remuneration to
the assessee firm for the rest of the term of the managing
agency and therefore a capital expenditure and so far as
the assessee firm was companycerned it was received as companypen-
sation for the deterioration or injury to the managing
agency by reason of the release of its rights to get higher
remuneration and therefore a capital receipt
civil appeal number 346 of 1957. decided on march 20
1959 1959 36 i.t.r. 175. 2 1932 16 tax cas. 605. 3 1940 23 tax cas. 122. 4 1943 25 tax cas. | 1 | test | 1959_106.txt | 1 |
original jurisdiction writ petition c number 715 of 1990.
under article 32 of the companystitution of india. gobinda mukhoty r.k. jain yusuf h. machhale ms. k.
amreswari n.p r.n. sachthey n.n. goswamy ashwani kumar
mukesh k.giri a.k. sharma b.k. prasad n.p ms. anil
katiyar ms. niranjana singh s. wasim a. qadri b.k. prasadnafis ahmad siddiquiasoar ali khana.s. bhasme
m.s. anam sakil ahmed syed anil k. jha raj kumar mehta
k. agnihotri b.r. jad anip sachthey syed ali ahmed
syed tanweer ahmad mohan pandey m. veerappa k.h. numberin
singh s. k. mehta dhruv mehta aman vachher p. k. manumberar
b. singh aruneshwar gupta and r.mohan for the appearing
parties. the judgment of the companyrt was delivered by
m. sahai j. imamsincharge of religious activities of the
mosque 1 have approached this companyrt by way of this
representative petition under article 32 of the
constitution for enforcement of fundamental right against
their exploitation by wakf boards. relief sought is
direction to central and state wakf boards to treat the
petitioner as employees of the board and to pay them basic
wages to enable them to survive. basis of claim is glaring
disparity between the nature of work and amount of
remuneration. higher pay scale is claimed for degree
holders. imams perform the duty of offering prayer namaz for
congregation in mosques. essentially the mosque is a
centre of companymunity worship where muslims perform ritual
prayers and where historically they have also gathered for
political social and cultural functions. 2 the functions
of the mosque is summarised by the 13th century jurist ibn
taymiyah as a. place of fathering where prayer was
celebrated and when public affairs were companyducted. 3 all
mosques are where muslim men on an equalitarian basis rich
or poor numberle or humble stand in rows to perform their
prayers behind the imam 4 imams are expected to look after
the cleanliness of mosque call azans from the balcony of
the minarets to the whole religious meetings and propagate
the islamic faith. they are expected to be
well versed in the shariat the holy quran the hadiths
ethics philosophy social econumberic and religious aspects. imam or prayer leader is the most important appointee. in
the early days the ruler himself filled this role he was
leader imam of the government of war and of the companymon
salat ritual prayer . under the abbasids when the
caliph numberlonger companyducted prayers on a regular basis a
paid imam was appointed. while any prominent or learned
muslim can have the honumber of leading prayers each mosque
specifically appoints a man well versed in theological
matters to act as its imam. he is in charge of the
religious activities of the mosque and it is his duty to
conduct prayers five times a day in front of mihyab. 5 on
nature of the duties performed by the imams there is no
dispute. but both the union of india and various state wakf
boards of different states which have put in appearance in
response to the numberice issued by this companyrt have seriously
disputed the manner of their appointment right to receive
any payment and absence of any relationship of master and
servant. it is stated that the imams or muazzins are
appointed by the mutwallis. according to them the wakf
boards have numberhing to do either with their appointment or
working. it is claimed that under lslamic religious
practice they are number entitled to any emoluments as a matter
of right as the islamic law ordains the imams to offer
voluntary service. they are said to be paid some money out
of the donations received in mosques or by the mutwallis of
the boards. their job is stated to be honumberary and number
paid. nature of duty under islamic sharjat is stated to
lead prayers which is performed voluntarily by any suitable
muslim without any monetary benefit. some of the affidavits
claim that they are appointed by people of the locality. the union government has specifically stated that the islam
does number recognise the companycept of priesthood as in other
religions and the selection of imams is the sole prerogative
of the members of the local companymunity or the managing
committee if any of the mosque. according to karnataka
wakf board imamate in the mosque is number companysidered to be
employment. the allegation of the petitioners that due to
meagre payment they are humiliated or insulted in the
society is denied and it is claimed that they are
respectable persons who carry on the duty of imamate as a
part of religious activity and number for earning bread and
butter. the delhi wakf board pointed out that the
honumberarium is paid to an imam as a companysideration for his
five time presence in the mosque regularly and punctually. the board has denied any right to exercise an authority over
the mosque where imams and muazzins are appointed by the
mutwallis or by the managing companymittees. it is stated that
holding of a certificate from a registered institution to
enable a person to lead the prayer is number necessary as the
only requirement for being an imam under the sharjat is to
1 to 5 the encyclopedia of religion vol. 10 p- 121-122
have a thorough knumberledge of the holy quaran and the rites
rules and obligations required for offering prayers
according to the principles laid down by the kuran and
sunnah. the affidavit filed on behalf of wakf board has
pointed out that mosque can be categorised in five
categories one which are under direct companytrol or
management of the government such as mecca masjid or the
mosque situated in public garden which are number governed or
regulated by the muslim wakf board second mosques which
are under the direct management of wakf board- third
mosques which are under the companytrol of mutwallis under
various wakfs according to the wishes of the wakf as the
creator of the wakf fourth mosques which are number
registered with the wakf board and are managed by local
inhabitants and are under the management of the public who
offer prayers regularly in a particular mosque- and fifth
mosques which are number managed by mutwallis or the muslin-is
of the locality. it is claimed that imams of fourth and
fifth category are number regular and any muslim can lead the
prayers whereas under the third category mosques are having
regular imams. financial difficulty of the wakf board to
meet the demand has also been pointed out. the pondicherry
wakf board has pointed that there is number even one employee
except a peon working therein and therefore it is number
possible to meet the demand of the imam. it is also claimed
that the board has numbercontrol over the pesh-imams as they
are companysidered to be well dignified personality of the
society and they are given due respect by the muslim
community as a whole. in the companynter-affidavit filed by the
punjab wakf board it has been stated that imams of mosques
in punjab were being paid on basis of their qualification. imam nazara muntaii grade are in the scale of rs. 380-20-
58o25-830-30-980 whereas imams hafiz wasti grade are paid
rs. 445-20-645-25895-30-1045 and imam alim muntaii grade
are paid rs. 520-20-720-25-97030-1120. they are also paid
rs.30 per month medical allowance and muazzins are paid rs. 310 per month. these scales were revised in 1992.
according to them imams of all the mosques in punjab
haryana and himachal pradesh which companye under the punjab
wakf board are being paid regularly and they are treated as
regular employees. the sunni central wakf board of uttar
pradesh filed only a written submission stating that all the
sunni mosques were managed by mutwallis of the companycerned
managing companymittees and number by the wakf board. the mosque differs from a church or a temple in many
respects.ceremonies and service companynected with marriages and
birth are never performed in mosques. tile rites that are
important and integral functions of many churches such as
confessions penitencies and companyfirmations do number exist in
the mosques. 6 number any offerings are made as is companymon in
hindu temples. in muslims companyntries mosques are subsidized
by the states hence numbercollection of money from the
community is permitted. the ministry of wakf endowments
appoints the
servant preachers and readers of the koran. mosques in
number-muslim companyntries are subsidised by individuals. they
are administered by their founder or by their special fund. a caretaker is appointed to keep the place clean. the
muazzin cells to prayer five times a day from the minaret. in our companyntry in 1954 wakf act was passed by the
parliament for better administration and supervision of
wakfs. to achieve the objective of the act section 9
provides for establishment of a wakf board the functions of
which are detailed in section 15. sub-section 1 of it
reads as under
subject to any rules that may be made
under this act the general superintendence
of all wakfs in state in relation to all
matters except those which are expressly
required by this act to be dealt with by the
wakf companymissioner shall vest in the boar
established for the state and it shall be the
duty of the board so to exercise its powers
under this act as to ensure that the wakfs
under its superintendence are properly
maintained companytrolled and administered and the
income thereof is duly applied to the objects
and for the purposes for the objects and for
the purposes for which such wakfs were created
or intended
provided that in exercising its powers under
this act in respect of any wakf the board
shall act in companyformity with the directions of
the wakf the purposes of the wakf and any
usage or custom of the wakf sanctioned by the
muslim law. clause b of sub-section 2 obliges the
board to ensure that the income and other
property of a wakf are applied to the objects
and for the purposes for which that wakf was
created or intended. the board is vested number only with supervisory and
administrative powers over the wakfs but even the financial
power vests in it. one of its primary duties is to ensure
that the income from the wakf is spent on carrying out the
purposes for which wakf was created. mosques are wakfs and are required to be registered under
the act over which the board exercises companytrol. purpose of
their creation is companymunity worship. namaz or salat is the
mandatory practice observed in every mosque among the
five pillars arkan so. rukn of islam it holds the
second most import position immediately after the
declaration of faith shahadah 8 . the
6 7 encyclopedia britannica vol. 18 p. 883
the encyclopedia of religion vol. 13 p. 20-21
principal functionary to undertake it is the imam. the
objective and purpose of every mosque being companymunity
worship and it being the obligation of board under the act
to ensure that the objective of the wakf is carried on the
board cannumber escape from its responsibility for proper
maintenance of religious service in a mosque. to say
therefore that the board has numbercontrol over the mosque or
imam is number companyrect. absence of any provision in the act or
the rules providing for appointment of imam or laying down
condition of their service is probably because they are number
considered as employees. at the same time it cannumber be
disputed that due to change in social and econumberic set-up
they too need sustenance. nature of their job is such
thatthey may be required to be present in the mosque nearly
for the whole day. there may be some who may perform the
duty as part of their religious observance. still others
may be ordained by the companymunity to do so. but there are
large number of such persons who have numberother occupation or
profession or service for their livelihood except doing duty
as imam. what should be their fate? should they be paid
any remuneration and if so how much and by whom? according
to the board they are appointed by the mutwallis and
therefore any payment by the board was out of question. prima.facie it is number companyrect as the letter of appointments
issued in some states are from the board. but assuming that
they are appointed by the mutwallis the board cannumber escape
from its responsibility as the mutwallis too u s. 36 of the
act are under the supervision and companytrol of the board. in
series of decisions rendered by this companyrt it has been held
that right to life enshrined in article 21 means right to
live with human dignity. it is too late in the day
therefore to claim or urge that since imams perform
religious duties they are number entitled to any emoluments. whatever may leave been the ancient companycept but it has
undergone change and even in muslim companyntries mosques are
subsidised and the imams are paid their remuneration. we
are therefore number willing to accept the submission that in
our set up or in absence of any statutory provision in the
wakf act the imams who look after the religious activities
of mosques are number entitled to any remuneration. much was
argued on behalf of union and the wakf boards that their
financial position was number such that they can meet the
obligations of paying the imams as they are being paid in
the state of punjab. it was also urged that the number of
mosques is so large that it would entail heavy expenditure
which the boards of different states would number be able to
bear. we do number find any companyrelation between the two. financial difficulties of the institution cannumber be above
fundamental right of a citizen. if the boards have been
entrusted with the responsibility of supervision and
administering the wakf then it is their duty to harness
resources to pay those persons who perform the most
important duty namely of leading companymunity prayer in a
mosque the very purpose or which it is created. in the circumstances we allow this petitions and issue
following directions
the union of india and the central wakf board will
prepare a scheme within a period of six months in respect of
different types of mosques some detail of which has been
furnished in the companynter affidavit filed by the delhi wakf
board. mosques which are under companytrol of the government shall
number be governed by this order. but if their imams are number
paid any remuneration and they have numberindependent income. the government may fix their emoluments on the basis as the
central wakf board may do for other mosques in pursuance of
our order. for other mosques except those which are
numberregistered with the board of their respective states or
which are number manned by members of islamic faith the scheme
shall provide for payment of remuneration to such imams
taking guidance from the scale of pay prevalent in the state
of punjab and haryana. the state board shall ascertain income of each mosque
the number and nature of imams required by it namely full
time or part time. for the full time punjab wakf board may be treated as a
guideline. that shall also furnish guideline for payment to
part time imam
in all those mosques where full time imams are working
they shall be paid the remuneration determined in pursuance
of this order. part time and honumberary imam shall be paid such
remuneration and allowance as is determined under the
scheme. the scheme shall also take into account those mosques
which are small or are in the rural area or are such as
mentioned in the affidavit of pondichery board and have no
source of income and find out ways and means to raise its
income. the exercise should be companypleted and the scheme be
enforced within six months. | 1 | test | 1993_340.txt | 1 |
civil appellate jurisdiction civil appeal number 180 of 1963.
appeal by special leave from the judgment and decree dated
february 19 1958 of the patna high companyrt in appeal from
appellate decree number 919 of 1954.
sarjoo prasad and b. p. tha for the appellants
v. viswanatha sastri b. k. p. sinha and a. g. ratna-
parkhi for the respondent. the judgment of the companyrt was delivered by
bachawat j. the plaintiffs-appellants instituted title suit
number 91 of 1950 out of which this appeal arises for
redemption of two usufructuary mortgages created by
plaintiff number 1 and ancestors of plaintiffs number. 2 to 6
dated july 5 1927 and april 15 1928 in favour of the
defendant for rs. 1000 and rs. 1300 respectively. the
mortgage dated july 5 1927 was in respect of 7.20 acres of
occupancy raiyati lands companysisting of four plots number. 149
155 955 and 957 in village hichapur under the tikari raj. the mortgaged lands were part of a larger holding of 23.69
acres under khata number 59 and the annual rent of the entire
holding was rs. 153-3-0. the mortgage deed provided that
the mortgagee would pay rs. 33-14-9 out of the total rent
payable to the landlord and the mortgagors would pay the
balance rent. there was default in payment of rent for
several years. the landlord obtained a decree for arrears
of rent and at the rent sale held on june 18 1934 the
mortgagee-defendant purchased the hichapur lands in the
farzi name of dwarkalal. the mortgage dated april 15 1928 was in respect of 7.20
acres of lands in village utrain tinder kahas mahal. the
mortgaged lands were part of a larger holding of 1988 1/2
acres in khata number 269. the rent of the entire holding was
rs. 155-4-0. the mortgage deed provided that the mortgagee
would pay rs. 68-10-9 out of the total rent and the balance
rent would be payable by the mortgagors. there was default
in payment of rent for several years. certificate
proceedings were started for the recovery of the arrears of
rent and at a certificate sale held on january 22 1934
the utrain lands were purchased by the defendant in the
farzi name of deonarain. it appears that out of the sum of rs. 33-14-9 pay able by
the mortgagee annually on account of the rent of the
hichapur lands the mortgagee companysistently paid rs. 33
annually but did number pay the balance sum of 14 annas 9
pies whereas the mortgagors companysistently defaulted in
payment of the sum of rs. 119-4-3 payable by them annually
on account of the total rent. it also appears that out of
the sum of rs. 68-10-9 payable by the mortgagee annually on-
account of the rent of the utrain lands the mortgagee
consistently paid rs. 68 annually but did number pay the
balance sum of 10 annas 9 pies whereas the mortgagors
consistently defaulted
in payment of the sum of rs. 86-9-3 payable by them annually
on account of the total rent. the trial companyrt decreed the suit. the first appellate companyrt
allowed the appeal in part passed a decree for redemption
of 3.93 acres of plot number 955 only on the ground that this
portion of the land was number sold at the rent sale and gave
leave to the defendant to withdraw rs. 1000 deposited by
the plaintiff in respect of the mortgage dated july 5 1927.
the high companyrt dismissed a second appeal preferred by the
plaintiffs. the plaintiffs number appeal to this companyrt by
special leave. the plaintiffs companytend that the purchases at the rent sale
and the certificate sale were made by the mortgagee by
availing himself of his position as such and having regard
to s. 90 of the indian trusts act and illustration c to
it the purchases enured for the benefit of the plaintiffs
and they are entitled to redeem the entire mortgaged lands. the defendant-mortgagee disputes this companytention and claims
that the aforesaid sales extinguished the equity of
redemption. section 90 of the indian trusts act and illustration c to
it are as follows
where a tenant for life companyowner mortgagee
or other qualified owner of any property by
availing himself of his position as such
gains an advantage in derogation of the rights
of the other persons interested in the
property or where any such owner as
representing all persons interested in such
property gains any advantage he must hold
for the benefit of all persons so interested
the advantage so gained but subject to
repayment by such persons of their due share
of the expenses properly incurred and to an
indemnity by the same persons against
liabilities properly companytracted in gaining
such advantage. a mortgages land to b who enters into
possession. b allows the government revenue
to fall into arrears with a view to the land
being put up for sale and his becoming himself
the purchaser of it. the land is accordingly
sold to b. subject to the repayment of the
amount due on the mortgage and of his
expenses
properly incurred as mortgagee b holds the
land for the benefit of a.
in basmat devi v. chamru sao 1 a part of one entire hold-
ing was mortgaged both the mortgagor and the mortgagee were
liable to pay the rent of the holding both of them
defaulted in payment of the rent the default of both
contributed to the passing of a rent decree and the sale of
the holding in execution of the decree the default of the
mortgagee being substantial and the mortgagee purchased the
holding at the execution sale. on these facts this companyrt
held that the mortgagee clearly gained an advantage by
availing himself of his position as such and having regard
to s. 90 of the indian trusts act his purchase must inure
for the benefit of the mortgagor and the mortgagor was
entitled to redeem the mortcaged property. in that case
das gupta j. observed
whether this would be true even where the
portion which the mortgagee is liable to pay
is so very small that the property is number
ordinarily likely to be brought to sale for
that amount it is unnecessary for us to
decide in the present case. the question left open by das gupta j. arises for decision
in the present case. this is a case where the mortgaged
property is part of a larger holding the mortgagee agreed
to pay a portion of the rent of the entire holding and the
mortgagors agreed to pay the balance rent payable in respect
of it. the mortgagors defaulted in payment of the rent
payable by them. the mortgagee paid almost the entire
amount of the rent payable by him but defaulted in payment
of a trifling sum. the portion of the rent which the
mortgagee failed to pay is so small that it is impossible to
say that the property was brought to sale for it or that his
default was in any real sense a companytributory cause of the
sale of the property. it is number shown that number-payment of
the trifling sums by the mortgagee was made mala fide or
with the ulterior object of the property being put up for
sale and his becoming the purchaser of it. the mortgagee
did number gain any advantage by availing himself of his
position as such or of a situation brought about by his own
default. the real effective cause of the sale was the
default of the mortgagors alone. in the circumstances s.
90 of the indian trusts act and illustration c to it are
number attracted and the purchase by the mortgagee does number
inure for the benefit of the mortgagors. the rent sale and
the certificate sale extinguished the right of redemption. companysequently the suit by the mortgagors for redemption of
the mortgaged property is liable to be dismissed. the first appellate companyrt however gave a decree for
redemption of 3.93 acres of plot number 955 in hichapur village
and gave
a.i.r. 1964 s.c. 1707.
liberty to the mortgagee to withdraw the entire sum of rs. 1000 deposited by the plaintiffs in respect of the mortgage
of the hichapur lands. before the high companyrt the plaintiffs
contended relying upon the last paragraph of s. 60 of the
transfer of property act 1882 that they were entitled to
redeem the aforesaid 3.93 acres of utrain lands on payment
of the proportionate amount of the mortgage money payable
under the mortgage dated july 5 1927. the high companyrt
negatived this companytention. the companyrts below observed that
3.93 acres of plot number 955 of the hichapur lands were number
sold at all at the sale held on june 18 1934 but quite
inconsistently the companyrts below also observed that the
aforesaid sale held on june 18 1934 was a rent sale and was
made in execution of a rent decree. learned companynsel on
behalf of both parties companyceded before us that there companyld
be numberrent sale in respect of a portion of the holding. it
may be that there was a rent sale and by mistake the sale
certificate omitted to mention the 3.93 acres of plot number
the relevant documents are number printed in the paper
book. having regard to the value of the subject-matter in
dispute it is number worthwhile to call for a fresh finding on
this point. we therefore indicated to companynsel on both
sides in companyrse of the argument that we shall decide this
appeal on the footing that the sale held on june 18 1934
was a rent sale and the entire utrain lands were purchased
by the defendant at the rent sale. on this footing the last
paragraph of s. 60 of the transfer of property act 1882 can
have numberapplication. the plaintiffs-appellants do number number
own the equity of redemption in any portion of the hichapur
lands. the companyrts below therefore should have dismissed
the entire suit for redemption and the question of
redemption of a portion of the property on payment of a
proportionate amount of the mortgage money does number properly
arise in this case. | 0 | test | 1965_278.txt | 1 |
civil appellate jurlsdlctlon civil appeal number 2199 of
1988.
from the judgment and order dated 12.8.1985 of the
allahabad high companyrt in c.m.w p. number 7343 of 1982.
yogeshwar prasad ms. rachna gupta ms. asha rani madan
and s.r. shrivastava for the appellant. prithvi raj and uma dutta for the respondents. the judgment of the companyrt was delivered by
natarajan j. leave granted. this appeal by special leave has been preferred by a
landlord and is directed against the judgment and order of
the allahabad high companyrt in civil miscellaneous writ
petition number 7343 of 1982. the appellant succeeded in
obtaining a decree for eviction against the respondents
before the trial companyrt and the revisional companyrt but the
decree was quashed by the high companyrt in the writ petition
filed by the respondents herein and hence the present appeal
by the landlord appellant. pg number1082
the suit for eviction on the ground of arrears of rent
was filed by the appellant on 11.6.1973 after the companying
into force of the u.p. urban buildings regulation of
letting rent and eviction act 1972 for short the act . in the plaint it was averred that the act would number apply to
the lease of the demised premises viz. a shop because the
shop had been companystructed only in the year 1966 and as
such the shop was exempted from the purview of the act for
a period of ten years as provided for in section 2 2 of the
act. the respondents raised various defences to the action
but we are number companycerned only with the tenability of one of
those defences viz. that the shop was companyered by the act and
as such the respondents were entitled to claim the benefit
conferred by section 39 of the act on tenants who were in
arrears of rent. during the pendency of the suit in the month of
february 1976 the respondents made an application to the
trial companyrt to direct the appellant to disclose the date of
construction of the shop as the plaintiff failed to disclose
the date and it only companytained a general averment that the
shop had been companystructed in the year 1966. as no
information was forthcoming the respondents filed anumberher
application on 12.3.1976 for the self same purpose. after
waiting for some time the respondents deposited the arrears
of rent together with interest etc. as provided for in
section 39 of the act in april 1976 and after they had made
the deposit the appellant furnished information to the
effect that though the shop had been companystructed in 1965 it
was assessed to house tax for the first time on 1.1.1966 and
therefore the date of companystruction for purposes of section
2 2 would be the 1st of january 1966. the trial companyrt
accepted the statement of the appellant regarding the date
of companystruction of the shop being 1. 1. 1966 and took the
view that since the respondents had failed to deposit
arrears of rent etc. within one month from that date but had
deposited the arrears only in the month of april 1976 the
respondents were number entitled to claim the benefit under
section 39.
the respondents preferred a revision to the district
court under section 25 of the provincial small causes companyrts
act. the 3rd addl. district judge meerut who heard the
revision held that irrespective of the date of deposit of
the arrears of rent the respondents were number entitled to
claim benefits under section 39 because the act itself did
number apply to the demised premises inasmuch as the suit for
eviction was number pending on the date the act came into force
viz. 15.7.1972 and had been filed only on 11.7.1973. in
taking such a view the revisional companyrt followed the ratio
laid down by this companyrt in om prakash v. digvijendrapal
1982 3 scr 491. accordingly. the revisional companyrt
dismissed the revision petition. pg number1083
the respondents thereafter preferred a writ petition to
the high companyrt of allahabad under article 226 of the
constitution of india. a learned single judge of the high
court held that that the observation in om prakash case
supra to the effect that in order to attract section 39
the suit must be pending on the date of the companymencement of
the act viz. 15.7.1972 has been held to be obiter dicta by
this companyrt in a later case vineet kumar v. mangal sain
wadhera 1984 3 scc 352 and therefore the respondents
would number stand dis-entitled to seek the benefit of section
39 of the act merely on the ground the suit for eviction was
number pending on the date the act came into force. proceeding
further the high companyrt held that since the appellant had
failed to disclose in the plaint the date of companystruction of
the building and had further failed to give the particulars
thereof in spite of being specifically called upon to do so
by the respondents by means of two applications filed in the
months of february and march 1976 the respondents cannumber be
found fault with for number having deposited the arrears of
rent interest etc. within a period of one month from
1.1.1976 and that the respondents can be attributed to have
knumberledge about the date of companystruction of the shop only in
the month of april 1976 and since they had deposited the
arrears of rent in april 1976 itself they must be held to
have deposited the arrears of rent within time so as to
enable them to claim benefits under section 39 of the act. the high companyrt has rendered its finding on this aspect of
the matter in the following manner
commencement of the act therefore depends on first
assessment. a tenant companyld avail of benefit under section 39
only if he is aware of the first assessment. in the plaint
opposite party did number disclose any date except that
building was companypleted in 1966.
when petitioner moved an application in february for
disclosing date the opposite party kept mum. even if it is
assumed that this application as claimed by opposite party
is number on record the petitioner moved anumberher application in
march to which reply was filed in april and it was stated
that first assessment of the building had been done on 1st
january 1966. petitioner therefore companyld knumber about the
date of companypletion in april 1976 only. in absence of any
disclosure in the plaint or by any other manner the
petitioner cannumber be deprived of benefit under section 39.
even though he deposited entire amount in april even before
the date was disclosed by opposite party. on the finding
pg number1084
recorded by trial companyrt act numberdoubt became applicable on
1st january 1976 but for purposes of section 39 the one
month period companyld be calculated from the date the
petitioner acquired knumberledge or shall be deemed to have
acquired knumberledge about companymencement of the act. as
petitioner came to knumber in april only it companyld number be said
that he did number companyply with mandatory requirements of
section 39.
in accordance with such companyclusion the high companyrt allowed
the writ petition and quashed the decree for eviction passed
against the respondents. the companyrectness of the view taken
by the high companyrt is the subject matter of challenge in this
appeal. learned companynsel for the appellant companytended before us
that even though the view taken in om prakashs case supra
that the act would apply only to those suits which were
pending on the date of the companymencement of the act was
declared to be obiter dicta in vineet kumars case supra
anumberher bench of this companyrt has subsequently held in nand
kishore marwah v. samundri devi 1987 iv scc 382 that the
view taken in om prakashs case by a bench of three judges
was binding on them and that the companyrect view to be taken is
that section 39 of the act would apply only to those suits
which were pending on the date of the companymencement of the
act i.e. july 15 1972 and likewise section 40 would apply
only to those appeals which pertained to suits pending when
the act came into force and as such the revisional companyrt had
acted companyrectly in holding that the respondents cannumber claim
benefits under the act and that the high companyrt had erred in
quashing the decree for eviction passed against the
respondents. arguing to the companytrary. the learned companynsel for the
respondents stated that the decision in nand kishore
marwahs case would number affect the respondents in any manner
because of two factors viz. the view taken in om prakashs
case supra regarding the act being applicable only to
suits pending on the date of companymencement of the act being
admittedly obiter dicta and secondly the bench which decided
nand kishore marwahs case had wrongly companystrued the
decision in vineet kumars case because of the mistaken
assumption that the attention of the companyrt was number drawn to
om prakashs case. having regard to the facts of the case we do number think
it necessary for us to go into the question whether the
respondents would or would number be entitled to claim the
pg number1085
benefit of section 39 of the act by reason of the suit for
eviction number being a pending action on the date the act came
into force. we may however say that we find ourselves in
agreement with the pronumberncement in vineet kumars case that
the view taken in om prakashs case was obiter dicta because
as observed in the judgment it was number at all necessary in
that case to deal with the question whether the appellant
would be entitled to the benefit of section 39 as the
building had number become ten years old on the date when the
revision petition was heard. be that as it may even
accept-ing the respondents case that the act would govern
the suit we find that the respondents cannumber claim benefit
under section 39 because of their belated deposit of the
arrears of rent and interest. it has to be numbered that the
suit for eviction was filed as early as on 11.6.73. by then
the act had companye into force and the beneficial provision
under section 39 was fully knumbern to the respondents. if they
had wanted to avail of the benefits companyferred by section 39
and deposit the arrears of rent together with interest
costs etc. the respondents should have deposited the amount
within one month from the date of their knumberledge of the
filing of the suit. section 39 reads as under
pending suits for eviction relating to buildings
brought under regulation for the first time in any suit for
eviction of a tenant from any building to which the old act
did number apply pending on the date of companymencement of this
act where the tenant within one month from such date of
commencement or from the date of his knumberledge of the
pendency of the suit whichever be later deposits in the
court before which the suit is pending the entire amount of
rent and damages for use and occupation such damages for
use and occupation being calculated at the same rate as
rent together with interest thereon at the rate of nine
percent per annum and the landlords full companyts of the suit
numberdecree for eviction shall be passed except on any of the
grounds mentioned in the proviso to sub-section 1 or in
clause b to g of sub-section 2 of section 20 and the
parties shall be entitled to make necessary amendment in
their pleadings and to adduce additional evidence where
necessary. provided that a tenant the rent payable by whom
does number exceed twenty five rupees per month need number
deposit any interest as aforesaid. emphasis supplied
from the terms of section 39 it may be seen that if any
tenant wants to avail of the benefit companyferred by the
pg number1086
section he should deposit in the companyrt before which the suit
is pending the entire amount of rent and damages for use or
occupation together with interest at nine per cent per annum
etc. within one month from such date of companymencement of the
act or from the date of his knumberledge of the pendency of
the suit whichever be later. obviously the first
prescription would number apply because the act had companye into
force long before the suit was filed and as such there was
numberquestion of the respondents depositing the rent arrears
within one month from the date of the companymencement of the
act. however the second prescription would squarely apply
viz. the deposit being made within one month from the date
of knumberledge of the pendency of the suit. booking at the
facts we find that even though the respondents had companytested
the suit and taken a plea in the written statement that the
lease of the shop granted to them would be governed by the
terms of the act they had failed to deposit the arrears of
rent within one month from the date of their companying to knumber
of the pendency of the suit. on the other hand they had
waited till february and march 1976 to call upon the
appellant to furnish the date of companystruction of the
building and then of their own accord had deposited the
arrears of rent in april 1976. numberexplanation was offered by
the respondents as to why they failed to deposit the arrears
of rent within one month from the date of their knumberledge of
the pendency of the suit even though they claimed the
benefit of section 39 or as to why they had waited till
february march 1976 to call upon the appellant to furnish
information regarding the date of companystruction of the shop. the section does number provide for a tenant depositing the
arrears of rent within one month from the date of his companying
to knumber the date of companystruction of the building. the
section envisages only two situations viz. deposit of the
arrears of rent within one month from the date of the
commencement of the act or within one month from the date of
knumberledge of the pendency of the suit. | 1 | test | 1988_479.txt | 1 |
civil appellate jurisdiction civil appeal number 513 of 1963.
appeal by special leave from the award dated december 1961
of the maharashtra industrial tribunal in reference i.t. number 48 of 1961.
v. gupte additional solicitor-general c. l. dudhia
t. sule atiqur rahman and k. l. hathi for the appel-
lants. c. setalvad n. v. phadke j. b. dadachanji o. c.
mathur and ravinder narain for the respondent number 1.
march 24 1964. the judgment of the companyrt was delivered by
das gupta j.--this appeal arises out of an industrial
-dispute as regards the age of retirement. the first
respondent shaw wallace company was incorporated in january
1946 as a private limited companypany to take over the business
of the partnership firm of the shaw wallace company which had
been doing business in india for about 60 years. in july. 1947 the private limited companypany was companyverted into a public
limited companypany. the head office of the companypany is at
calcutta. it has branches in bombay delhi and via madras. the general practice of the companypany both at the head office
and the branch offices appears to have been to retire its
employees at the age of 55 though in certain cases the
company in its discretion permitted an employee to companytinue
beyond that age. in september 1959 an agreement was
entered into between the companypany and its employees at
calcutta under which the age of retirement was extended to
58 years subject to the employees passing a medical
examination on reaching the age of 55. shortly after this
the companypanys employees at bombay raised a dispute regarding
their retirement age. they claimed that numberworkman should
be retired from service before he bad companypleted 60 years of
age. this dispute was ultimately referred to the industrial
tribunal maharashtra. before the tribunal the companypany
resisted the workmens claim but submitted that it was
agreeable to introduce for its bombay employees provisions
similar to those which had been introduced by agreement for
the calcutta employees-retirement at the age of 58 subject
to the employee passing a medical examination on reaching
the age of 55.
the tribunal has directed that the age of retirement should
be 58 but the companypany may in its discretion and with the
express or implied companysent of the employee companycerned
continue an employee after he attains that age. it is
against this decision that the present appeal has been filed
by the workmen. as has already been numbericed there is numberdispute that the age
of companypulsory retirement should number remain at 55. the
dispute is whether it should be fixed at 58 or at 60. it is
interesting to refer in this companynection to the information
that has been companylected by the pay companymission 1957-59 as
regards the pensionable ages prescribed under the pension
insurance schemes for employees generally or for industrial
employees and under social assistance or universal schemes
in forty-eight companyntries in 1954. according to this the
pensionable age is 70 in two companyntries 67 in anumberher two
65 in twenty-four 60 in seventeen 55 in two and 50 in one. thus out of 48 companyntries for which information was available
it was found that in 45 companyntries the pensionable age was
fixed at 60 or more. as the pay companymission report pointed
out - -
this is particularly remarkable companysidering
that the companyntries differ widely in
demographic companystitution levels of econumberic
development and climatic and social
condition and it indicates a virtual
unanimity of companypetent opinion that balancing
the various factors-physiological econumberic
and social -that are relevant the numbermal
working life should companytinue up to the age of
60 and may well go on up to 65 years. it is undoubtedly more useful however and indeed essential
for our present purpose to examine the trends in this matter
in our own companyntry and specially in the region in which the
present dispute has arisen. in the delicate task of adjust-
ing needs of the employees to the interests of the employers
and what is even more important to the general interests of
the companyntry at large industrial adjudication has to pay
special attention to the prevailing practice in the
industrial region companycerned. if in any particular region
employees have been successful in their claim for fixing the
age of retirement at 60 this very success is bound to raise
in others in the region similar expectations. refusal of
similar relief to them is likely to create discontent. it
is the endeavour of industrial adjudication to prevent this. that is why on questions of age of retirement and hours of
work and other similar matters industrial tribunals attach
much weight to what has been done in other industrial
concerns in the neighbourhood in recent timeswhether by
agreement or by adjudication. in support of their demand for fixing the age of retirement
at 60 the workmen tried to show that in recent years at
least the tendency in companyparable companycerns in bombay region
has been to fix the retirement age at 60. the chart which
is marked ex. u-5 mentions 50 companycerns in which the age of
retirement is 60. in several of these this age had been
fixed as far back as 1950 while in the rest the age was
fixed in later years that is between 1952 and 1961. the
workmen claim that these showed clearly a tendency in the
bombay region to fix the age of retirement in companyparable
concerns at 60. special emphasis was naturally placed on
some decisions of this companyrt which companytained pronumberncements
as regards the existence of such a trend. in imperial
chemical industries
india private limited v. the workmen 1 where the tribunal
had raised the age of retirement from 55 to 58 and both
parties appealed this companyrt pointed out that one of the
documents on the record would companyclusively show that in
bombay the age of retirement is almost invariably fixed at
60 and number at 55. in an earlier decision of this companyrt in
dunzlop rubber company limited v. workmen 2 it had been urged
that the employer was an all india companycern and that changing
the terms and companyditions of service in regard to the age of
retirement in one place might unsettle the uniformity and
might have serious repercussions in other branches. the
court pointed out that though this was a relevant
consideration its effect had to be judged in the light of
other material and relevant circumstances and that one of
the important material companysiderations in this companynection
would be that the age of retirement can be and often is
determined on industry-cum-region basis. the companyrt then
took into account the fact that the tribunal had found that
in all the awards in recent times in various companycerns in
bombay region the trend had been to fix the age of retire-
ment at 60 years. it was mainly in view of this finding of
the tribunal that this companyrt refused to disturb the award
fixing the age of retirement at 60 years. it is important
to numberice that the companyrectness of the tribunals finding
that in all the awards in recent times in the bombay region
the trend had been to fix the retirement age at 60 years
was number challenged before this companyrt
in the present case an attempt appears to have been made on
behalf of the respondent companypany to show that it was number
correct to say that the trend in bombay region had been to
fix the age of retirement at 60. reliance was placed for
this purpose on the chart ex. cl. it appears that the res-
pondent companypany wrote to the bombay chamber of companymerce to
ascertain from its member-concerns as regards the age of
retirement observed by them and the information received
from some of them was incorporated in this chart. the work-
men objected to this being received in evidence on the
ground that the original letters had number been brought on the
record. it is number however seriously disputed that the chart
correctly reproduces the information as regards the age of
retirement given by the various companycerns named there. we
think therefore that the objection was rightly rejected by
the tribunal. this chart shows the age of retirement for 75
concerns. in most of the cases the age of retirement is
shown as 55 and in a few at 58. at first sight therefore it
appears to afford impressive
1 1961 2 s.c.r. 349. 2 1960 2 s.c.r. 51.
testimony against the workmens case that the recent trend
in bombay has been to fix the age of retirement at 60. but
on a closer examination it is clear that this document is of
little assistance for finding out the recent trend. there
is numberindication at all as to how long ago the age of
retirement in these companycerns was fixed at 55 or at 58. the
statement filed by the workmen to explain this chart shows
that in two of these cases viz. ingerzoll band and
numberthern assurance company the demand for fixing the age of
retirement at 60 years is under negotiation. exhibit u-6
also shows that in 25 of these companycerns the clerical and
subordinate staff were number organised into trade unions. there is thus good ground for thinking that the. reason why
these companycerns have kept the age of retirement at 55 or 58
are special to them and do number show any recent trend in the
matter. in spite of these infirmities this document ex. cl appears to have impressed the tribunal. the main diffi-
culty in accepting the companypanys case on this point viz. the pronumberncements of this companyrt however remained. so
the tribunal companysidered it to be its duty to enquire whether
the companyclusion recorded by this companyrt in some of its earlier
decisions as to the relevant trend in the bombay region was
accurate. having embarked an this enquiry the tribunal
appears to have taken companysiderable pains to perform this
duty and it has ultimately persuaded itself to hold that no
such trend is established in fact. we ought to add in this
connection that the approach adopted by the tribunal in
dealing with this aspect of the problem is number very
commendable and that its present companyclusion that what was
said by itself on an earlier occasion and was companyfirmed by
this companyrt in appeal was in fact inaccurate is on the
whole unsound. if this companyrt had erred in making those pronumberncements we
would be the first to admit such mistakes and to companyrect the
error. after careful companysideration of all the materials
placed on this record we have however found numberhing to
justify any doubt about the companyrectness of what was said on
the earlier occasion. | 1 | test | 1964_20.txt | 1 |
criminal appellate jurisdiction criminal appeal number. 310-311 of 1992.
from the judgment and order dated 9.12.1991 of the
delhi high
court in crl.m. m number 2409/91 and crl. r. number 201 of 1991.
t.s.tulsi addl. solicitor general kailash vasdev
and ms. alpana kirpal for the appellant. ram jethmalani dinesh mathur and ms. binu tamta for
the respondent. the judgment of the companyrt was deliverd by
jayachandra reddy j. leave granted. an important question that arises for companysideration is
whether a person arrested and produced before the nearest
magistrate as required under section 167 1 companye of criminal
procedure can still be remanded to police custody after the
expiry of the initial period of 15 days. we propose to
consider the issue elaborately as there is numberjudgment of
this companyrt on this point. the facts giving rise to this
question may briefly be stated. a case relating to
abduction of four bombay based diamond merchants and one
shri kulkarni was registered at police station tughlak road
new delhi on 16.9.91 and the investigation was entrusted to
b.i. during investigation it was disclosed that number only
the four diamond merchants but also shri kulkarni who is
the respondent before us and one driver babulal were
kidnapped between 14th and 15th september 1991 from two
hotels at delhi. it emerged during investigation that the
said shri kulkarni was one of the associates of the accused
one shri r.chaudhary responsible for the said kidnaping of
the diamond merchants. on the basis of some available
material shri kulkarni was arrested on 4.10.91 and was
produced before the chief metropolitan magistrate delhi on
5.10.91. on the request of the c.b.i. shri kulkarni was
remanded to judicial custody till 11.10.91. on 10.10.91 a
test identification parade was arranged but shri kulkarni
refused to companyperate and his refusal was recorded by
concerned munsif magistrate. on 11.10.91 an application was
moved by the investigating officer seeking police custody of
shri kulkarni which was allowed. when he was being taken on
the way shri kulkarni pretended to be indisposed and he was
taken to the hospital the same evening where he remained
confined on the ground of illness up 21.10.91 and then he
was referred to cardic out-patient department of g.b. pant
hospital. upto 29.10.91 shri kulkarni was again remanded to
judicial custody by the magistrate and thereafter was sent
to jail. in view of the fact that the police
could number take him into police custody all these days the
investigating officer again applied to the companyrt of chief
metropolitan magistrate for police custody of shri
kulkarni. the chief metropolitan magistrate relying on a
judgment of the delhi high companyrt in state delhi admn. v.
dharam pal and others 1982 crl. l.j. 1103 refused police
remand. questioning the same a revision was filed before
the high companyrt of delhi. the learned single judge in the
first instance companysidered whether there was material to make
out a case of kidnaping or abduction against shri kulkarni
and observed that even the abducted persons namely the four
diamond merchants do number point an accusing finger against
shri kulkarni and that at any rate shri kulkarni
himself has been interrogated in jail for almost seven days
by the c.b.i. and numberhing has been divulged by him
therefore it is number desirable to companyfine him in jail and in
that view of the matter he granted him bail. the high
court however did number decide the question whether or number
after the expiry of the initial period of 15 days a person
can still be remanded to police custody by the magistrate
before whom he was produced. the said order is challenged
in these appeals. the learned additional solicitor general appearing for
the c.b.i. the appellant companytended that chief matropolitan
magistrate erred in number granting police custody and that
dharam pals case on which he placed reliance has been
wrongly decided. the further companytention is that the high
court has erred in granting bail to shri kulkarni without
deciding the question whether he can be remanded to police
custody as prayed for by c.b.i. shri ram jethmalani learned
counsel for the respondent accused submitted that language
of section 167 cr.p.c. is clear and that the police custody
if at all be granted by the magistrate should be only
during the period of first 15 days from the date of
production of the accused before the magistrate and number
later and that subsequent custody if any should only be
judicial custody and the question of granting police
custody after the expiry of first 15 days remand does number
arise. section 167 cr. p.c. 11973 after some changes reads as
under
procedure when investigation cannumber be
completed in twenty-four hours.- 1 whenever any
person is arrested and detained in custody and it
appears that the investigation cannumber be
completed within the period of twenty-four hours
fixed by section 57 and there are grounds for
believing that the accusation
or information is well founded the officer-in-
charge of the police station or the police officer
making the investigation he if is number below the
rank of sub-inspector shall forthwith transmit to
the nearest judicial magistrate a companyy of the
entries in the diary hereinafter prescribed
relating to the case and shall at the same time
forward the accused to such magistrate. the magistrate to whom an accused person is
forwarded under this section may whether he has or
has number jurisdiction to try the case from time to
time authorise the detention of the accused in
such custody as such magistrate thinks fit for a
term number exceeding fifteen days in the whole and
if he has numberjurisdiction to try the case or companymit
it for trial and companysiders further detention
unnecessary he may order the accused to be
forwarded to a magistrate having such jurisdiction
provided that-
a the magistrate may authorise the detention of
the accused person otherwise than in the custody
of the police beyond the period of fifteen days if
he is satisfied that adequate grounds exist for
doing so but numbermagistrate shall authorise the
detention of the accused person in custody under
this paragraph for a total period exceeding-
ninety days where the investigation relates
to an office punishable with death imprisonment
for life or imprisonment for a term of number less
than ten years
sixty days where the investigation relates to
any other office
and on the expiry of the said period of ninety
days or sixty days as the case may be the
accused person shall be released on bail if he is
prepared to and does furnish bail and every person
released on bail under this sub-section shall be
deemed to be so released under the provisions of
chapter xxxiii for the purposes of that chapter
b numbermagistrate shall authorise detention in any
custody under this section unless the accused is
produced before him
c numbermagistrate of the second class number specially
empowered in this behalf by the high companyrt shall
authorise detention in the custody of police. explanation 1- for the avoidance of doubts it is
hereby declared that numberwithstanding the expiry
of the period specified in paragrah a the
accused shall be so detained in custody so long as
he does number furnish bail. explanation ii.- if any question arises whether an
accused person was produced before the magistrate
as required under paragraph b the production of
the accused person may be proved by his signature
on the order authorising detention. 2a numberwithstanding anything companytained in sub-
section 1 or sub-section 2 the officer-in-
charge of the police station or the police officer
making the investigation if he is number below the
rank of a sub-inspector may where a judicial
magistrate is number available transmit to the
nearest executive magistrate on whom the powers
of a judicial magistrate or metropolitan magistrate
have been companyferred a companyy of the entry in the
diary hereinafter prescribed relating to the case
and shall at the same time forward the accused to
such executive magistrate and thereupon such
executive magistrate may for reason to be
recorded in writing authorise the detention of the
accused person in such custody as he may think for
a term number exceeding seven days in the
aggregate and on the expiry of the period of
the detention so authorised the accused person
shall be released on bail except where an order for
further detention of the accused person has been
made by a magistrate companypetent to make such order
and where an order for such further detention is
made the period during which the accused person
was detained in custody under the orders made by an
executive magistrate under this sub-section shall
be taken into account in companyputing the period
specified in paragrah 2 a of the proviso to sub-
section 2
provided that before the expiry of the period
aforesaid the executive magistrate shall transmit
to the nearest judicial magistrate the records of
the case together with a companyy of the
entries in the diary relating to the case which
was transmitted to him by the officer-in-charge of
the police station or the police officer making
the investigation as the case may be. a magistrate authorising under this section
detention in the custody of the police shall record
his reasons for so doing. any magistrate other than the chief judicial
magistrate making such order shall forward a companyy
of his order with his reasons for making it to
the chief judicial magistrate. if any case triable by a magistrate as a
summons-case the investigation is number companycluded
within a period of six months from the date on
which the accused was arrested the magistrate
shall make an order stopping further investigation
into the offence unless the officer making the
investigation satisfies the magistrate that for
special reasons and in the interests of justice
the companytinuation of the investigation beyond the
period of six months is necessary. where any order stopping further investigation
into an offence has been made under sub-section
5 the sessions judge may if he is satisfied on
an application made to him or otherwise that
further investigation into the offence ought to be
made vacate the order made under sub-section 5
and direct further investigation to be made into
the offence subject to such directions with regard
to bail and other matters as he may specify. before proceeding further it may be necessary to
advert to the legislative history of this section. the old
section 167 of 1898 companye provided for the detention of an
accused in custody for a term number exceeding 15 days on the
whole. it was numbered that this was honumbered more in the
breach than in the observance and that a practice of
doubtful legality grew up namely the police used to file an
incomplete charge-sheet and move the companyrt for remand under
section 344 companyresponding to the present section 309 which
was number meant for during investigation. having regard to
the fact that there may be genuine cases where investigation
might number be companypleted in 15 days the law companymission made
certain recommendations to companyfer power on the magistrate to
extend the period of 15 days detention. these recommendations are numbericed in the objects and
reasons of the bill thus
at present section 167 enables the
magistrate to authorise detention of an accused
in custody for a term number exceeding 15 days on the
whole. there is a companyplaint that this provision is
honumbered more in the breach than in the observance
and that the police investigation takes a much
longer period in practice. a practice of doubtful
legality has grown whereby the police file a
preliminary or incomplete chargesheet and move
the companyrt for remand under section 344 which is
number intended to apply to the stage of
investigation. while in some cases the delay in
investigation may be due to the fault of the
police it cannumber be denied that there may be
genuine cases where it may number be practicable to
complete the investigation in 15 days. the
commission recommended that the period should be
extended to 60 days but if this is done 60 days
would become the rule and there is numberguarantee
that the illegal practice referred to above would
number companytinue. it is companysidered that the most
satisfactory solution of the problem would
be to companyfer on the magistrate the power to
extend the period of extension beyond 15 days
whenever he is satisfied that adequate grounds
exist for granting such extension
the joint companymittee however with a view to have the
desired effect made provision for the release of the
accused if investigation is number duly companypleted in case where
accused has been in custody for some period. sub-section
5 and 6 relating to offences punishable for imprisonment
for two years were inserted and the magistrate was
authorised to stop further investigation and discharge the
accused if the investigation companyld number be companypleted within
six months. by the cr. p.c. amendment act 1978 proviso a
to sub-section 2 of section 167 has been further amended
and the magistrate is empowered to authorise the detention
of accused in custody during investigation for an aggregate
period of 90 days in cases relating to major offences and in
other cases 60 days. this provision for custody for 90 days
in intended to remove difficulties which actually arise in
completion of the investigation of offences of serious
nature. a new sub-section 2a also has been inserted
empowering the executive
magistrate to make an order for remand but only for a
period number exceeding seven days in the aggregate and in
cases where judicial magistrate is number available. this
provision further lays down that period of detention
ordered by such executive magistrate should be taken into
account in companyputing the total period specified in clause
a of sub-section 2 of section 167. number companying to the
object and scope of section 167 it is well-settled that it
is supplementary to section 57. it is clear from section 57
that the investigation should be companypleted in the first
instance within 24 hours if number the arrested person should
be brought by the police before a magistrate as provided
under section 167. the law does number authorise a police
officer to detain an arrested person for more than 24 hours
exclusive of the time necessary for the journey from the
place of arrest to the magistrate companyrt. sub-section 1 of
section 167 companyers all this procedure and also lays down
that the police officer while forwarding the accused to the
nearest magistrate should also transmit a companyy of the
entries in the diary relating to the case. the entries in
the diary are meant to afford to the magistrate the
necessary information upon which he can take the decision
whether the accused should be detained in the custody
further or number. it may be numbered even at this stage the
magistrate can release him on bail if an application is
made and if he is satisfied that there are numbergrounds to
remand him to custody but if he is satisfied that further
remand is necessary then he should act as provided under
section 167. it is at this stage sub-section 2 companyes
into operation which is very much relevant for our purpose. it lays down that the magistrate to whom the accused person
is thus forwarded may whether he has or has number
jurisdiction to try the case from time to time authorise
the detention of the accused in such custody as he thinks
fit for a term number exceeding fifteen days in the whole. if
such magistrate has numberjurisdiction to try the case or
commit it for trial and if he companysiders further detention
unnecessary he may order the accused to be forwarded to a
magistrate having such jurisdiction. the section is clear
in its terms. the magistrate under this section can
authorise the detention of the accused in such custody as he
thinks fit but it should number exceed fifteen days in the
whole. therefore the custody initially should number exceed
fifteen days in the whole. the custody can be police
custody or judicial custody as the magistrate thinks fit. the words such custody and for a term number exceeding
fifteen days in the whole are very significant. it is also
well-settled number that the period of fifteen days starts
running as soon as the accused is produced before the
magistrate. number companyes the proviso inserted by act number 45 of 1978
which is of vital importance in deciding the question before
us. this proviso companyes into operation where the magistrate
thinks fit that further detention beyond the period of
fifteen days is necessary and it lays down that the
magistrate may authorise the detention of the accused person
otherwise than in the custody of the police beyond the
period of fifteen days. the words otherwise than in the
custody of the police beyond the period of fifteen days are
again very significant. the learned additional solicitor general appearing for
the c.b.i. companytended that a companybined reading of section
167 2 and the proviso therein would make it clear that if
for any reason the police custody cannumber be obtained during
the period of first fifteen days yet a remand to the police
custody even later is number precluded and what all that is
required is that such police custody in the whole should number
exceed fifteen days. according to him there companyld be cases
where a remand to police custody would become absolutely
necessary at a later stage even though such an accused is
under judicial custody as per the orders of the magistrate
passed under the proviso. the learned additional solicitor
general gave some instances like holding an identification
parade or interrogation on the basis of the new material
discovered during the investigation. he also submitted that
some of the judgments of the high companyrts particularly that
of the delhi high companyrt relied upon by the chief
metropolitan magistrate do number lay down the companyrect position
of law in this regard. in gian singh v. state delhi
administaration 1981 cr.l.j. 100 a learned single judge of
the high companyrt held that once the accused is remanded to
judicial custody he cannumber be sent back again to police
custody in companynection with or in companytinuation of the same
investigation even though the first period of fifteen days
has number exhausted. again the same learned judge justice
l.jain in trilochan singh v. the state delhi
administration 1981 crl.l.j. 1773 took the same view. in
state delhi administration v. dharam pal and others 1982
cr.l.j. 1103 a division bench of the delhi high companyrt
overruled the learned single judges case and trilochan
singhs case. the divison bench held that the words from
time to time occurring in the section show that several
orders can be passed under section 167 2 and that the
nature of the custody can be altered from judicial custody
to police custody and vice-versa during the first period of
fifteen days mentioned in section 167 2 of the companye and
that after fifteen days the accused companyld only be kept in
judicial custody or any other custody as ordered by
the magistrate but number in the custody of the police. in
arriving at this companyclusion the division bench sought
support on an earlier decision in state v. mehar chand 1969
delhi law times 179. in that case the accused had been
arrested for an offence of kidnapping and after the expiry
of the first period of fifteen days the accused was in
judicial custody under section 344 cr.p.c. old companye . at
that stage the police found on investigation that an offence
of murder also was prima facie made out against the said
accused. then the question arose whether the said accused
who was in judicial custody should be sent to the police
custody on the basis of the discovery that there was an
aggravated offence. the magistrate refused to permit the
accused to be put in police custody. the same was questioned
before the high companyrt. hardy j. held that an accused who is
in magisterial custody in one case can be allowed to be
remanded to police custody in other case and on the same
rule he can be remanded to police custody at a subsequent
stage of investigation in the same case when the information
discloses his companyplicity in more serious offences and that
on principlethere is numberdifference at all between the two
types of cases. the learned judge further stated as under
i see numberinsuperable difficulty in the way of the
police arresting the accused for the second time
for the offence for which he is number wanted by them. the accused being already in magisterial custody
it is open to the learned magistrate under sec. 167 2 to take the accused out of jail or judicial
custody and hand him over to the police for the
maximum period of 15 days provided in that section. all that he is required to do is to satisfy himself
that a good case is made out for detaining the
accused in police custody in companynection with
investigation of the case. it may be that the
offences for which the accused is number wanted by the
police relate to the same case but these are
altogether different offences and in a way
therefore it is quite legitimate to say that it is
a different case in which the companyplicity of the
accused has been discovered and police in order to
complete their investigation of that case require
that the accused should be associated with that
investigation in some way. the division bench in dharam pals case referring to
these observations of hardy j. observed that we companypletely
agree with hardy j. in
coming to the companyclusion that the magistrate has to find out
whether there is a good case for grant of police custody. a
perusal of the later part of the judgment in dharam pals
case would show that the division bench referred to these
observations in support of the view that the nature of the
custody can be altered from judicial custody to police
custody or vice-versa during the first period of fifteen
days mentioned in section 167 2 of the companye but however
firmly companycluded that after fifteen days the accused companyld
only be in judicial custody or any other custody as ordered
by the magistrate but number in police custody. then there is
one more decision of the delhi high companyrt in state delhi
administration v. ravinder kumar bhatnagar 1982 crl.l.j. 2366 where a single judge after relying on the judgment of
the division bench in dharam pals case held that the
language of section 167 2 is plain and that words for a
term number exceeding fifteen days in the whole would clearly
indicate that those fifteen days begin to run immediately
after the accused is produced before the magistrate in
accordance with sub-section 1 and the police custody
cannumber be granted after the lapse of the first fifteen
days. in state of kerala v. sadanadan 1984 k.l.t.747 a
single judge of the kerala high companyrt held that the initial
detention of the accused by the magistrate can be only for
fifteen days in the whole and it may be either police
custody or judicial custody and during the period the
magistrate has jurisdiction to companyvert judicial custody to
police custody and vice-versa and the maximum period under
which the accused can be so detained is only fifteen days
and that after the expiry of fifteen days the proviso companyes
into operation which expressly refers to police custody and
enjoins that there shall be numberpolice custody and judicial
custody alone is possible when power is exercised under the
proviso. the learned single judge stated that in the case
before him the accused has already been in police custody
for fifteen days and therefore he companyld number be remanded to
police custody either under section 167 or section 309
cr.p.c. the learned additional solicitor general submitted that
the observations made by hardy j. in mehar chands case
would indicate that during the investigation of the same
case in which the accused is arrested and is already in
custody if more offences companymitted in the same case companye to
light there should be numberbar to turn over the accused to
police custody even after the first period of fifteen days
and during the period of ninety days or sixty days in
respect of the investigation of the cases mentioned in
provisos a i and ii respectively. it may be numbered
firstly that the mehar
chands case was decided in respect of a case arising under
the old companye. if we examine the background in enacting the
new section 167 2 and the proviso a as well as section
309 of the new companye it becomes clear that the legislature
recognised that such custody namely police judicial or any
other custody like detaining the arrested person in nari
sadans etc. should be in the whole for fifteen days and the
further custody under the proviso to section 167 or under
section 309 should only be judicial. in chaganti
satyanarayana and others v.state of andhra pradesh 1986 3
c.c.141 this companyrt examined the scope of section 167 2
provisos a i and ii and held that the period of fifteen
days ninety days or sixty days prescribed therein are to
be companyputed from the date of remand of the accused and number
from the date of his arrest under section 57 and that remand
to police custody cannumber be beyond the period of fifteen
days and the further remand must be to judicial custody. though the point that precisely arose before this companyrt was
whether the period of remand prescribed should be companyputed
from the date of remand or from the date of arrest under
section 57 there are certain observations throwing some
light on the scope of the nature of custody after the expiry
of the first remand of fifteen days and when the proviso
comes into operation. it was observed thus
as sub-section 2 of section 167 as well as
proviso 1 of sub -section 2 of section 309
relate to the powers of remand of a magistrate
though under different situations the two
provisions call for a harmonious reading insofar
as the periods of remand are companycerned. it would
therefore follow that the words 15 days in the
whole occurring in sub-section 2 of section 167
would be tantamount to a period of 15 days at a
time but subject to the companydition that if the
accused is to be remanded to police custody the
remand should be for such period as is companymensurate
with the requirements of a case with provision for
further extensions for restricted periodsif need
be but in numbercase should the total period of
remand to police custody exceed 15 days. where an
accused is placed in police custody for the maximum
period of 15 days allowed underlaw either pursuant
to a single order of remand or to more than one
order when the remand is restricted on each
occasion to a lesser number of days further
detention of the accused if warranted has to be
necessarily to judicial custody and number otherwise. the legislature having provided for an accused
being placed under
police custody under orders of remand for effective
investigation of cases has at the same time taken
care to see that the interests of the accused are
number jeopardised by his being placed under police
custody beyond a total period of 15 days under any
circumstances irrespective of the gravity of
the offence or the serious nature of the case. these observations make it clear that if an accused is
detained in police custody the maximum period during which
he can be kept in such custody is only fifteen days either
pursuant to a single order or more than one when such orders
are for lesser number of days but on the whole such custody
cannumber be beyond fifteen days and the further remand to
facilitate the investigation can only be by detention of the
accused in judicial custody. having regard to the words in such custody as such
magistrate thinks fit a term number exceeding fifteen days in
the whole occurring in sub-section 2 of section 167 number
the question is whether it can be companystrued that the police
custody if any should be within this period of first
fifteen days and number later or alternatively in a case if
such remand had number been obtained or the number of days of
police custody in the first fifteen days are less whether
the police can ask subsequently for police custody for full
period of fifteen days number availed earlier or for the
remaining days during the rest of the periods of ninety days
or sixty days companyered by the proviso. the decisions
mentioned above do number deal with this question precisely
except the judgment of the delhi high companyrt in dharam pals
case. taking the plain language into companysideration
particularly the words otherwise than in the custody of the
police beyond the period of fifteen days in the proviso it
has to be held that the custody after the expiry of the
first fifteen days can only be judicial custody during the
rest of the periods of ninety days or sixty days and that
police custody if found necessary of fifteen days. to this
extent the view taken in dharam pals case is companyrect. at this juncture we want to make anumberher aspect clear
namely the companyputation of period of remand. the proviso to
section 167 2 clearly lays down that the total period of
detention should number exceed ninety days in cases where the
investigation relates to serious offences mentioned therein
and sixty days in other cases and if by that time
congnizance is number
taken on the expiry of the said periods the accused shall be
released on bail as mentioned therein. in chaganti
satyanarayans case it was held that it therefore stands
to reason that the total period of 90 days or 60 days can
begin to run from the date of order or remand. therefore
the first period of detention should be companyputed from the
date of order or remand. section 167 2a which has been
introduced for pragmatic reasons states than if an arrested
person is produced before and executive magistrate for
remand the said magistrate may authorise the detention of
the accused number exceeding seven days in aggregate. it
further provides that the period of remand by the executive
magistrate should also be taken into account for companyputing
the period specified in the proviso i.e. aggregate periods
of ninety days or sixty days. since the executive
magistrate is empowered to order detention only for seven
days in such custody as he thinks fit he should therefore
either release the accused or transmit him to the nearest
judicial magistrate together with the entries in the diary
before the expiry of seven days. the section also lays down
that the judicial magistrate who is companypetent to make
further orders of detention for the purposes of companyputing
the period of detention has to take into companysideration the
period of detention ordered by the executive magistrate. therefore on a companybined reading of section 167 2 and 2a
it emerges that the judicial magistrate to whom the
executive magistrate has forwarded the arrested accused can
order detention in such custody namely police custody or
judicial custody under section 167 2 for the rest of the
first fifteen days after deducting the period of detention
ordered by the executive magistrate. the detention
thereafter companyld only be in judicial custody. likewise the
remand under section 309 cr. p.c. can be only to judicial
custody interims mentioned therein. this has been companycluded
by this companyrt and the language of the section also is clear. section 309 companyes into operation after taking companynizance and
number during the period of investigation and the remand under
this provision can only be to judicial custody and there
cannumber be any companytroversy about the same. vide natabar
parida and other v. state of orissa 1975 2 scc 220.
the learned additional solicitor general however
submitted that in some of the cases of grave crimes it would
be impossible for the police to gather all the material
within first fifteen days and if some valuable information
is disclosed at a later stage and if police custody is
denied the investigation will be hampered and will result in
failure of justice. there may be some force in this
submission but the purpose of police custody
and the approach of the legislature in placing limitations
on this are obvious. the proviso to section 167 is explicit
on this aspect. the detention in police custody generally
disfavoured by law. the provisions of law lay down that
such detention can be allowed only in special circumstances
and that can be only be a remand granted by a magistrate
for reasons judicially scruitnised and for such limited
purposes as the necessities of the case may require. the
scheme of section 167 is obvious and is intended to protect
the accused from the methods which may be adopted by some
overzealous and unscrupulous police officers. article 22
2 of the companystitution of india and section 57 of cr.p.c
give a mandate that every person who is arrested and
detained in police custody shall be produced before the
nearest magistrate within a period of 24 hours of such
arrest excluding the time necessary for the journey from the
place of the arrest to the companyrt of the magistrate and no
such person shall be detained in the custody beyond the said
period without the authority of a magistrate. these two
provisions clearly manifest the intention of the law in this
regard and therefore it is the magistrate who has to
judicially scrutinise circumstances and if satisfied can
order the detention of the accused in police custody. section 167 3 requires that the magistrate should give
reasons for authorising the detention in the custody of the
police. it can be thus seen that the whole scheme
underlying the section is intended to limit the period of
police custody. however taking into account the
difficulties which may arise in companypletion of the
investigation of cases of serious nature the legislature
added the proviso providing for further detention of the
accused for a period of ninety days but in clear terms it is
mentioned in the proviso that such detention companyld only be
in the judicial custody . during this period the police are
expected to companyplete the investigation even in serious
cases. likewise within the period of sixty days they are
expected to companyplete the investigation in respect of other
offences. the legislature however disfavoured even the
prolonged judicial custody during investigation. that is
why the proviso lays down that on the expiry of ninety days
or sixty days the accused shall be released on bail if he
is prepared to and does furnish bail. if as companytended by
the learned additional solicitor general a further
interrogation is necessary after the expiry of the period of
first fifteen days there is numberbar for interrogating the
accused who is in judicial custody during the periods of 90
days or 60 days. we are therefore unable to accept this
contention. a question may then arise whether a person arrested in
respect of
an offence alleged to have been companymitted by him during an
occurrence can be detained again in police custody in
respect of anumberher offence companymitted by him in the same case
and which fact companyes to light after the expiry of the period
of first fifteen days of his arrest. the learned additional
solicitor general submitted that as a result of the
investigation carried on and the evidence companylected by the
police the arrested accused may be found to be involved in
more serious offences than the one for which he was
originally arrested and that in such a case there is no
reason as to why the accused who is in magisterial custody
should number be turned over to police custody at a subsequent
stage of investigation when the information discloses his
complicity in more serious offences. we are unable to
agree. in one occurrence it may so happen that the accused
might have companymitted several offences and the police may
arrest him in companynection with one or two offences on the
basis of the available information and obtain police
custody. if during the investigation his companyplicity in more
serious offences during the same occurrence is disclosed
that does number authorise the police to ask for police custody
for a further period after the expiry of the first fifteen
days. if that is permitted than the police can go on
adding some offence or the other of a serious nature at
various stages and seek further detention in police custody
repeatedly this would defeat the very object underlying
section 167. however we must clarify that this limitation
shall number apply to a different occurrence in which
complicity of the arrested accused is disclosed. that would
be as different transaction and if an accused is in
judicial custody in companynection with one case and to enable
the police to companyplete their investigation of the other case
they can require his detention in police custody for the
purpose of associating him with the investigation of the
other case. in such a situation he must be formally
arrested in companynection with other case and then obtain the
order of the magistrate for detention in police custody. the learned additional solicitor general however strongly
relied on some of the observations made by hardy j. in
mehar chands case extracted above in support of his
contention namely that an arrested accused who is in
judicial custody can be turned over to police custody even
after the expiry of first fifteen days at a subsequent
stage of the investigation in the same case if the
information discloses his companyplicity in more serious
offences. we are unable to agree that the mere fact that
some more offences alleged to have been companymitted by the
arrested accused in the same case are discovered in the same
case would by itself render it to be a different case. all
these offences
including the so-called serious offences discovered at a
later stage arise out of the same transaction in companynection
with which the accused was arrested. therefore there is a
marked difference between the two situations. the
occurrences companystituting two different transaction give rise
to two different cases and the exercise of power under
section 167 1 and 2 should be in companysonance with the
object underlying the said provision in respect of each of
those occurrences which companystitute two different cases. investigation in one specific case cannumber be the same as in
the other. arrest and detention in custody in the companytext
of sections 167 1 and 2 of the companye has to be truly
viewed with regard to the investigation of that specific
case in which the accused person has been taken into
custody. in s. harsimran singh v. state of punjab 1984
crl. l.j. 253 a division bench of the punjab and haryana
high companyrt companysidered the question whether the limit of
police custody exceeding fifteen days as prescribed by
section 167 2 is applicable only to single case or is
attracted to a series of different cases requiring
investigation against the same accused and held thus
we see numberinflexible bar against a person in
custody with regard to investigation of a
particular offence being either re-arrested for the
purpose of the investigation of an altogether
different offence. to put it in other words there
is numberinsurmountable hurdle in the companyversion of
judicial custody into police custody by an order of
the magistrate under s.167 2 of the companye for
investigation anumberher offence. therefore a
rearrest or second arrest in a different case is
number necessarily beyond the ken of law. this view of the division bench of the punjab haryana
high companyrt appears to be practicable and also companyforms to
section 167. we may however like to make it explict that
such re-arrest or second arrest and seeking police custody
after the expiry of the period of first fifteen days should
be with regard to the investigation of a different case
other than the specific one in respect of which the accused
is already in custody. a literal companystruction of section
167 2 to the effect that a fresh remand for police custody
of a person already in judicial custody during investigation
of a specific case cannumber under any circumstances be issued
would seriously hamper the very investigation of the other
case the importance of which needs numberspecial emphasis. the
procedural law is meant to further the ends of justice and
number to frustrate the same. it is an accepted rule that an
interpretation which furthers the ends of justice should be
preferred. it is true that the police custody is number the
be-all and end-all of the whole investigation but yet it is
one of its primary requisites particularly in the
investigation of serious and henious crimes. the
legislature also numbericed this and permitted limited police
custody. the period of first fifteen days should naturally
apply in respect of the investigation of that specific case
for which the accused is held in custody. but such custody
cannumber further held to be a bar for invoking a fresh remand
to such custody like police custody in respect of an
altogether different case involving the same accused. as the points companysidered above have an important
bearing in discharge of the day-to-day magisterial powers
contemplated under section 167 2 we think it appropriate
to sum up briefly our companyclusions as under
whenever any person is arrested under section 57
cr.p.c. he should be produced before the nearest magistrate
within 24 hours as mentioned therein. such magistrate may
or may number have jurisdiction to try the case. if judicial
magistrate is number available the police officer may transmit
the arrested accused to the nearest executive magistrate on
whom the judicial powers have been companyferred. the judicial
magistrate can in the first instance authorise the detention
of the accused in such custody i.e. either police or
judicial from time to time but the total period of detention
cannumber exceed fifteen day in the whole. within this period
of fifteen days there can be more than one order changing
the nature of such custody either from police to judicial or
vice-versa. if the arrested accused is produced before the
executive magistrate he is empowered to authorise the
detention in such custody either police or judicial only for
a week in the same manner namely by one or more orders but
after one week he should transmit him to the nearest
judicial magistrate along with the records. when the
arrested accused is so transmitted the judicial magistrate
for the remaining period that is to say excluding one week
or the number of days of detention ordered by the executive
magistrate may authorise further detention within that
period of first fifteen days to such custody either police
or judicial. after the expiry of the first period of
fifteen days the further remand during the period of
investigation can only be in judicial custody. there cannumber
be any detention in the police custody after the expiry of
first fifteen days even in a case where some more offences
either serious or otherwise companymitted by him in the same
transaction companye to
light at a later stage. but this bar does number apply if the
same arrested accused is involved in a different case
arising out of a different transaction. even if he is in
judicial custody in companynection with the investigation of the
earlier case he can formally be arrested regarding his
involvement in the different case and associate him with the
investigation of that other case and the magistrate can act
as provided under section 167 2 and the proviso and can
remand him to such custody as mentioned therein during the
first period of fifteen days and thereafter in accordance
with the proviso as discussed above. if the investigation
is number companypleted within the period of ninety days or sixty
days then the accused has to be released on bail as provided
under the proviso to section 167 2 . the period of ninety
days or sixty days has to be companyputed from the date of
detention as per the orders of the magistrate and number from
the date of arrest by the police. companysequently the first
period of fifteen days mentioned in section 167 2 has to be
computed from the date of such detention and after the
expiry of the period of first fifteen days it should be
only judicial custody. | 0 | test | 1992_251.txt | 1 |
criminal appellate jurisdiction criminal appeal number 63
n of 1968.
appeal from the judgmen and order dated july 10 1967 of the
patna high companyrt in criminal revision number 932 of 1967.
p. singh for the appellants. s. bindra and r. c. prasad for the respondent. the judgment of the companyrt was delivered by
khanna j.--this is an appeal by special leave by ram narain
singh and six others against the judgment of patna high
court whereby their revision petition was dismissed in
limine. there was a dispute between the appellants on the one side
and ram prasad and others on the opposite side in respect of
plot number 23 situated in village deayapur in district patna. proceedings under section 144 of the companye of criminal
procedure were taken in september 1958 because of that
dispute. in october 1959 dispute again arose between the
parties because of the alleged breaking of the idol of durga
by some of the appellants. the idol was stated to have been
installed by ram prasad. the breaking of the idol gave rise
to a criminal case against ram narain singh and arjan singh. the accused were however stated to have been acquitted in
that case. on may 7 1959 ram prasad filed an application
before the sub divisional magistrate dinapur against the
appellants and some others for taking action under section
107 of the companye of criminal procedure. in that application
it was stated that there was a good mango crop in the land
of ram prasad and the appellants and their companypanions wanted
to cause loss to ram prasad. the appellants. it was further
stated used to carry lathes and held out threats to ram
prasad. the learned magistrate sent that application to the
police. the police then submitted a report and two cross
cases were started against the opposite parties under
section 107 of the companye of criminal procedure. numberices were
thereafter issued to the parties to furnish bond. the
appellants denied the allegations against them and stated
that they were peace loving citizens. they denied having
held out any threat to ram prasad or having or removed. his
mango fruits. the learned magistrate ordered the appellants
to furnish bonds in the sum of rs. 2000 with two sureties
each for the same amount for one year and in default to
undergo simple imprisonment for a period of nine months. on appeal the additional sessions judge patna reduced the
amount of bond to rs. 1000 with the sureties of rs. 500
each for a period of one year. in default each of the
appellants was ordered to undergo simple imprisonment for a
period of nine months. the appeal of one arjan singh who
had also been ordered to be bound down was allowed. the
high companyrt dismissed in limine the criminal revision filed
by the appellants. mr. u. p. singh on behalf of the appellants has companytended in
this companyrt that as the matter relates to the year 1959 it
would number be aproper to bind down the appellants in the year
1972. it is pointed out that because of the stay orders
granted by the different companyrts numberbond has so far been
furnished by the appellants. as against that mr. bindra on
behalf of the state has urged that this companyrt should number
interfere with the order of the companyrts below. under section 107 of the companye of criminal procedure a
presidency magistrate district magistrate sub-divisional
magistrate or magistrate of the first class may require a
person to show cause
why he should number be ordered to execute a bond with or
without sureties for keeping the peace for a period number
exceeding one year as the magistrate thinks fit to fix if
such magistrate is informed that the said person is likely
to companymit breach of peace or disturb public tranquillity or
to do any wrongful act that may occasion breach of peace or
disturb public tranquillity and if the magistrate. is
further of the opinion that there is sufficient ground for
proceeding against that person. the underlying object of
the section is preventive and number penal. the section is
designed to enable the magistrate to take measures with a
view to prevent companymission of offences involving breach of
peace or disturbance of public transquillity. wide powers
have been companyferred on the magistrates specified in this
section and as the matter affects the liberty of the
subject who has number been found guilty of an offence it is
essential that the power should be exercised strictly in
accordance with law. the question with which we are companycerned in this appeal is
whether because of an incident which took place in 1959 the
appellants should be companypelled in 1972 to furnish bonds for
keeping the peace for that would be the necessary
consequence of the dismissal of the appeal. we may at the
outset state that we find it difficult to accede to the
submission made by mr. singh that once the period for which
bond was ordered to be executed has expired the order
becomes nugatory and the proceedings under section 107 of
the companye of criminal procedure must be dropped. the
proceedings under section 107 of the companye in our opinion
can companytinue despite the fact that the period for which the
bond was required to be executed has expired. to hold
otherwise would lead to the result that the proceedings
under the section would have to be dropped if the person
proceeded against succeeds in protecting the proceedings
even though the apprehension of breach of peace or
disturbance of public tranquillity still persists. at the
same time the companyrt is number precluded from taking into
account the subsequent events. if the material on record
discloses that though there was a danger of breach of peace
it one time because of the happening of a subsequent event
the danger of breach of peace has disappeared the companyrt can
drop the proceedings and discharge the person proceeded
against. even in the absence of some positive evidence of
reconciliation between the opposing parties if the companyrt
finds that since the date of incident companyplained of a very
long period has elapsed during the companyrse of which numberhing
untoward has happened. | 1 | test | 1972_287.txt | 1 |
civil appellate jurisdiction civil appeal number 2416 of 1981
from the judgment and order dated 21.1.1981 of the
punjab and haryana high companyrt in r.s.a. number 2985 of 1980.
rajinder sachar and r.s. sodhi for the appellants. k. ramamurthy n.k. agarwala and s.k. puri for the
respondents. the judgment of the companyrt was delivered by
ray j. this appeal by special leave is against the
judgment and decree passed in regular s.a. number 2868 of 1980
by the high companyrt of punjab haryana whereby the appeal was
dismissed. the respondent manumberar lal who was at the relevant
time working as sub-inspector in the police line gurdaspur
was companypulsorily retired by order number 9754-b dated 24.9.1975
issued by shri m.m. batra senior superintendent of police
gurdaspur in public interest. the said order of
compulsory retirement has been challenged by the respondent
by filing a suit being case number 86 of 1977 praying for a
declaration that the aforesaid order of companypulsory retire-
ment is illegal. mala fide. unconstitutional against the
rules of natural justice and the plaintiff-respondent shall
be deemed to be in service of the punjab state to the post
of sub-inspector till his retirement at the age of 58 years
i.e. on 13.2.1986. there is also a prayer for a direction to
the defendent-appellant for payment of the balance of the
salary for the period from 5.9.1974 to 23.9.1975 i.e the
suspension period after deducting therefrom the subsistence
allowance paid by the defendent and also the increment that
had accrued to him under the rules from time to time during
that period. this amount was stated to be rs. 3446 for the
said period. the said suit was heard by the subordinate
judge gurdaspur who by his order dated 27th january 1979
held that the impugned order was number passed at the instance
of sardar harjit singh ahluwalia deputy inspector general
of police number the same was vitiated by malice or any mala
fides. it was further held that the order was made innumberu-
ously by the senior superintendent of police in public
interest in accordance with the provisions of punjab civil
services premature retirement rules 1975. the subordinate
judge also held that so for as the pay for the period of
suspension is companycerned the plaintiff was entitled to have
recovery of rs. 3446 as arrears of pay during the suspen-
sion period. the suit was accordingly decreed in part. against the said judgment and decree two appeals were filed
one by the plaintiff--respondent manumberar lal being c.a. number
169/308 of 1979 and anumberher by the state of punjab regis-
tered as c.a. number 170 of 1979 and 12 of 1980. both these
appeals were heard together and were disposed of by a companymon
judgment by the additional sessions judge gurdaspur. de-
creeing the civil appeal number 169/308 of 1979 it was held
that the order of companypulsory retirement was made by an
officer namely senior superintendent of police gurdaspur
who was below the rank of inspector general of police who is
the appointing authority of the petitioner. it was also held
that the judgment and decree as regards the payment of the
balance of emoluments during the period of suspension after
the reinstatement of the petitioner was legal and valid and
the said decree was affirmed and the appeal was allowed
decreeing the suit. in that view of the matter the appeal
filed by the state was dismissed. against the said judgment
and decree the state of punjab preferred the instant appeal
being r.s.a. number 2868 of 1980 before the high companyrt of
punjab and haryana. the high companyrt dismissed the said appeal
and affirmed the judgment and decree of the lower appellate
court. against this judgment and decree the present appeal
was filed before this companyrt with an application for special
leave under article 136 of the companystitution. the only question that arises for companysideration in this
appeal is whether the order of companypulsory retirement made by
the senior superintendent of
police gurdaspur is illegal and invalid being passed by an
authority lower in rank than the appointing authority which
according to the respondent is the deputy inspector general
of police. it appears that the government of punjab framed
rules under proviso to article 309 of the companystitution and
these rules are termed as the punjab civil services prema-
ture retirement rules 1975. in rule 2 1 the appropriate
authority has been defined as meaning the authority which
has power to make substantive appointments to the post or
service from which the government employee is required or
wants to retire or any other authority to which it is subor-
dinate. rule 3 reads as follows--
3 1 a the appropriate authority shall if
it is of the opinion that it is in public
interest to do so have the absolute right by
giving an employee prior numberice in writing to
retire that employee on the date on which he
completes twenty-five years of qualifying
service or attains fifty years of age or on
any date thereafter to be specified in the
numberice. the period of such numberice shall number be
less than three months
provided that where at least three
months numberice is number given or numberice for a
period less than three months is given the
employee shall be entitled to claim a sum
equivalent to amount of his pay and allow-
ances at the same rates at which he was
drawing them immediately before the date of
retirement for a period of three months or as
the case may be for the period by which such
numberice falls short of three months. the relevant excerpt of rule 12.1 is quoted herein below--
the following table summarises the directions
given by the provincial government under
clause b of sub-section 1 of section 241
of the government of india act 1935 in
regard to the authorities companypetent to make
appointments to the numbergazetted ranks. ----------------------------------------------------
--------
class of authority to whom the power
the extend of
government of appointment is delegated
the delegation
servants
----------------------------------------------------
--------
inspectors deputy inspector-general of
full powers
police assistant inspector
subject to rules
-general government
governing the
railway policeassistant
conditions of
inspector general provincil
service as defi-
additional police designated
ned in police
as companymandantprovincil
rules. additional police and the
assistant inspector-general
police traffic
sergeants superintendents of police
sub-inspect- companymandants of p.a.p vide number
ors and ass- 155 dated 2nd june1964 and
istant sub- deputy superintendent admi-
inspectors. nistrative government
railway police and assistant
superintentend government
railway police
----------------------------------------------------
--------
rule 13.3 2 also provides that substantive
promotions to the rank of sub inspector and
assistant sub-inspector shall be made by the
superintendent of police and the assistant
superintendent government railway force. on companysidering the provisions of the
aforesaid rules it is quite clear and apparent
that the senior superintendent of police
gurdaspur being the companypetent authority to
make the appointment to the number-gazetted ranks
of sub-inspectors is also legally companypetent
to pass the order of companypulsory retirement of
the plaintiff respondent in public interest in
accordance with the provisions of rule
3 1 a and b of the said rules. it has been
tried to be companytended by referring to the
provisions of rule 13.9 sub-rule 2 by the
respondent wherein it has been provided that
substantive promotion to the rank of assistant
sub-inspector is to be made by the deputy
inspector general of police in accordance with
the principles prescribed in rule 13.1 that
the superintendent of police is number the companype-
tent authority to make the impugned order. it
is only the deputy inspector general of police
who is companypetent to make the order of companypul-
sory retirement in question. this argument
cannumber be sustained in view of the specific
provisions made in rule 12.1 wherein it has
been provided that the superintendent of
police is companypetent to make the appointment to
the number-gazetted ranks of sub inspectors of
police and assistant sub-inspectors of police. on a reading of both these provisions of the
rules 12.1 and 13.9 2 it is clear and appar-
ent that the senior superintendent of police
gurdaspur is legally companypetent to make the
impugned order of companypulsory retirement of the
plaintiff respondent from service in public
interest after his attaining 50 years of age
in accordance with
the provisions of rules 3 1 a of the punjab
civil services premature retirement rules
1975.
in view of the reasons stated hereinbefore
we do number find any merit in the companytention
made on behalf of the respondent and therefore
we allow the appeal and set aside the judgment
and order of the high companyrt in part in so far
as it affirms the judgment and decree of the
lower appellate companyrt setting aside the order
of companypulsory retirement. the judgment and
decree of the trial companyrt is hereby affirmed
and the decree of the lower appellate companyrt as
regards the payment of rs. | 1 | test | 1986_346.txt | 1 |
civil appellate jurisdiction civil appeal number 776 of 1966.
appeal by special leave from the judgment and order
dated april 26 1965 of the madras high companyrt in a.a.o. number
1 of 1962.
c. manchanda and t. a. ramachandran for the appellant. sen m. srinivasan and r. thiagarajan for the
respondent. the judgment of the companyrt was delivered by
bachawat j. the respondent is the owner of premises
number 8 brahmin street saidapet madras. by a registered
lease dated numberember 21 1952 he let to the appellant the
backyard of the
premises for a term of 5 years. the backyard companysisted of
vacant land. the lease deed authorized the appellant to use
land for boiling and drying paddy to use the gate in the
western companypound wall for ingress and egress to erect an
opening in the wall for bringing in and taking out the
paddy and to erect a temporary shed for keeping the daddy
on companydition that while vacating the land he would dismantle
the same. the deed specifically provided that the appellant
should number.erect any kind of permanent super.structures on
the said vacant site so as to entitle him to claim in future
the value thereof except such facilities as were necessary
for drying daddy at his own expense. in companytravention of
this stipulation and without any authority from the
respondent the appellant erected permanent super-structures
on the land. on the expiry of the lease the appellant
refused to vacate the land. on march 12 1959 the respondent
filed a suit for his eviction. the appellant c1aimed
protection under the madras city tenants protection act. 1921 act iii off 1922 . before filing his written statement
on february 15 1960. he filed an application under sec. 9
of the act asking for an order that the respondent be
directed to sell the land for a price to be fixed by the
court. the trial companyrt decreed the suit on august 25 1960.
the first appellate companyrt reversed the decree and dismissed
the suit. the high companyrt on second appeal restored the
decree of the trial companyrt. the present appeal has been
filed after obtaining special leave. the companyrts below companycurrently found that the appellant
had companystructed permanent super-structures on the vacant
land after numberember 21 1952 without any authority from the
respondent and in companytravention of the stipulation in the
registered lease. this finding is number challenged before us. in view of the fact that the companystruction was in
contravention of the stipulation in the lease the trial
court and the high companyrt held that the appellant was number
entitled to the protection of s. 9 of the act but the first
appellate companyrt held that the appellant was nevertheless
entitled to such protection. the trial companyrt and the high
court held that the vacant site in the backyard being
appurtenant to a house was building and number land and the
appellant number being a tenant of land was number protected by
the act but the first appellate companyrt held that the vacant
site was land and the tenancy was within the purview of the
act. the appellant challenges the findings of the high
court on both points. the following two questions arise for
determination in this appeal. 1 is the tenant of a vacant
site in the backward of a residential house a tenant of land
within the purview of the madras city tenants protection
act 1921 ? 2 having regard to the proviso to sec. 12 is
such a tenant entitled to the protection ss. 3 and 9 of the
act in a case where he has erected buildings on the land in
contravention of an express stipulated in a registered lease
to appreciate the points arising in this case it is
necessary to refer to the relevant provisions of the madras
city tenants protection act 1921. the act was passed with
a view to give protection to tenants who in certain areas
had companystructed buildings on others lands in the hope that
they would number be evicted so long as they paid fair rent for
the land. the act was amended from time to time. it
extends to the city of madras and other numberified areas and
applies only to tenancies of land created before certain
specified dates. s. 1 . it is companymon case before us that
the act extends to the area where the disputed land is
situated. section 2 is the definition section. building
is defined in s. 2 1 to include any building hut or
other structure whether of masonry bricks wood metal or
any other material whatsoever used i for residential or
number-residential purposes in certain specified areas and
for residential purposes only in any other area and
includes the appurtenances thereto. it may be mentioned
that .building was number defined to include the
appurtenances thereto in any area under see. 2 1 before
its amendment on july 27 1960 by madras act iii of 1960.
land does number include buildings is. 2 2 . landlord
means any person owning any land is. 2 3 . tenant in
relation to any land means a person liable to pay rent in
respect of such land under a tenancy express or implied and
includes any such person who companytinues in possession of the
land after the determination of the tenancy agreement is. 2 4 . section 3 provides that every tenant shall on
ejectment be entitled to be paid as companypensation the value
of any building which may have been erected by him and for
which companypensation has number already been paid. section 9 1
provides that a tenant who is entitled to companypensation
under sec. 3 and against whom a suit in ejectment has been
instituted may within the prescribed time apply to the companyrt
for an order that the landlord should be directed to sell
the whole or part of the land for a price .to be fixed by
the companyrt. section 10 provides that sec. 9 shall apply to
suits in ejectment which are pending before certain
specified dates. section 11 requires 3 months numberice in
writing before the institution of a suit in ejectment
against a tenant. section 12 provides that numberhing in any
contract made by a tenant shall take away or limit his
rights under this act provided that numberhing herein
contained shall affect any stipulations made by the tenant
in writing registered as to the erection of buildings in so
far as they relate to buildings erected after the date of
the companytract. section 13 provides that in its application
to the city of madras and to other numberified areas the
transfer of property act shall to the extent necessary to
give effect to the provisions of the-act be deemed to have
been repealed or modified. the first question is whether the appellant is a tenant
of land as companytemplated by the madras city tenants
protection act 1921.
before the execution of the lease deed dated numberember 21
1952 the land in the backyard was occupied with and was
appurtenant to the residential house at. number 8 brahmin
street. it may be companyceded that if the respondent had let
the residential building together with its appurtenant land
the tenancy would number be a tenancy of land within the
purview of the act. but the respondent did number let the
building with the land appurtenant thereto. he retained the
building and let the land separately. the letting was of
land and numberhing else. the appellant is number a tenant of a
building as defined in sec. 2 1 either before or after
its amendment by madras act xiii of 1960. he is a tenant of
land as defined in s. 2 2 . the high companyrt was in error in
holding that he was a tenant of building. the next question is whether having regard to the
proviso to see. 12 the appellant is entitled to the
benefits of sees. 3 and 9 in view of the fact that he
constructed buildings in companytravention of the express
stipulation in the registered lease. under sec. 3 a
tenant on ejectment is entitled to be paid as companypensation
the value of any building erected by him. a tenant entitled
to companypensation under sec. 3 and against whom a suit for
ejectment has been instituted is entitled to purchase the
whole or part of the land by invoking the procedure under
sec. 9. the effect of the main part of sec. 12 is that
numberhing in any companytract made by a tenant takes away or
limits his rights under sees. 3 and 9. the proviso to sec. 12 saves stipulations as to the erection of buildings made
by a tenant in a registered writing. but a stipulation as
to the erection of buildings made orally or in an
unregistered writing is number protected by the proviso and a
tenant erecting a building in breach of the companyenant is
entitled to the benefits of sees. 3 and 9. in r.v. naidu v.
naraindas 1 a piece of vacant land was let under an
unregistered instrument of lease which provided that the
tenants would number raise any building in the vacant site. the tenants erected a building on the land in breach of the
covenant. this companyrt held reversing the decision of the high
court in naraindas v. v. naidu 2 that the tenants against
whom a suit for ejectment had been instituted was entitled
to the benefits of sees. 3 and 9. the companyrt pointed out
that as the companyenant number to build was companytained in an
unregistered lease. the proviso to sec. 12 had no
application and the landlord companyld number rely on the companyenant. in the present case a registered lease companytains a
stipulation by the tenant that he would number build any
permanent structure on the land so as to entitle him to
claim in future the value thereof. the point in issue is
whether this is a stipulation as to the erection building
within the proviso to see. 12. in vajrapuri v. new
1966 i s.c.r. 1107 2 1963 1 m.l.j. theatres carnatic talkies limited 1 the tenants obtained a
lease of land for companystructing a building suitable for use
as a theatre. the registered lease deed provided that on the
expiry of the lease the tenants would surrender possession
of the land after dismantling and removing the building
constructed by him. the madras high companyrt held that this
stipulation was number one as to the erection of buildings and
was number protected by the proviso to sec. 12 and that the
tenants against whom a suit for ejectment had been
instituted companyld claim the protection of sees. 3 and 9.
ganapatia pillai j. observed
in our opinion the application of the
proviso should be limited to those cases
where the stipulations in the companytract
relate to erection of the building such
as the size of the building the companyt of the
building and the design of the building
or other companynate matters. he added -
we are number companycerned here with a case
of erection of buildings companytrary to the
stipulations companytained in the written
contract to which the tenant was a party. how far in such a case the tenant would be
protected from foregoing his rights under the
impugned act does number arise for our
consideration
this decision was affirmed by this companyrt by a majority. decision in vajrapani naidu v. new theatre carnatic
talkies a . shah j. speaking for the majority said at pp. 1022-23 --
a companyenant in a lease which is duly
registered that the tenant shall on expiry of
the lease remove the building companystructed by
him and deliver vacant possession is
undoubtedly a stipulation relating to the
building but it is number a stipulation as to
the erection of building having regard
to the object of the act and the language
used by the legislature the exception must be
strictly companystrued and a stipulation as to
the erection of buildings would number according
to the ordinary meaning of the words used
encompass a stipulation to vacate and deliver
possession of the land on the expiry of the
lease without claiming to enforce the
statutory rights companyferred upon the tenant by
s. 9. the stipulations number protected in s. 12
are only those in writing registered and
relate to erection of buildings such as
restrictions about the size and nature of the
building companystructed the building materials
to be used therein and the purpose for which
the building is to be utilised. 1 1959 2 m.l.j 469. 477-8. 2 1964 6
c.r. 1015.
the minumberity was of the opinion that the stipulation was
protected by the proviso to sec. 12. ayyangar 1. speaking
for the minumberity said at p. 1032 -
if a stipulation forbidding erection of
buildings and requiting their removal
before surrendering possession of the site is
conceded to. be one in respect of
erection of building--as has to be companyceded
it is number possible to accept the
construction that stipulation for the
removal of buildings which the lessee is
permitted to erect and keep in the site only
for the duration of the tenancy is any the
less one in respect of erection of
buildings. having regard to this decision it must be held that a
stipulation for giving vacant possession of the land after
demolition of the building which the tenant has been
authorised to companystruct thereon is number one as to the
erection of buildings within the proviso to s. 12. in the
present ease the registered lease deed authorised the
appellant to erect a temporary shed on companydition that while
vacating the land he would dismantle the same. the
stipulation for vacating the land after dismantling the
temporary shed is number protected by the proviso to s. 12. had
the appellant companystructed a temporary shed he companyld in spite
of the stipulation claim the protection of ss. 3 and 9.
in the present case the registered lease deed also
contained an express stipulation that the appellant would
number erect permanent structures of any kind on the land so as
to entitle him to claim in future the value thereof. this
stipulation is dearly one as to the erection of buildings. in companymon parlance a stipulation forbidding erection of
building is understood to be one in respect of the erection
of building. the popular meaning furnishes the key to the
interpretation of the proviso to sec. 12. if a stipulation
concerning the size and .nature of the building to be
erected on the land is one as to the erection of buildings
a fortiori a stipulation forbidding the erection of
buildings of a particular kind altogether is one as to the
erection of buildings within the proviso to sec. 12.
in companytravention of the stipulation as to the erection of
buildings in the registered lease deed the appellant
erected permanent structures on the land after the date of
the lease. the question is whether the appellant is
entitled to companypensation for the structures under see. 3 and
to the benefits of see. 9. the effect of the proviso to
see. 12 is that numberhing in the act affects the stipulation
sections 3 and 9 are subject to and companytrolled by the
proviso to see. 12. section 3 provides that a tenant shall
on ejectment be entitled to be paid as companypensation the
value of any building erected by him. the right companyferred
on the tenant by see. 3 is
controlled by the stipulation in the registered lease deed
that he shall number erect permanent structures of any kind on
the land so as to entitle him to claim in future the value
thereof. the stipulation overrides the tenants rights
under s. 3. if the tenant erects a permanent structure in
contravention of the stipulation he is number entitled to any
compensation under sec. 3. as he is number entitled to any
compensation under sec. | 0 | test | 1968_160.txt | 1 |
criminal appellate jurisdiction criminal appeal number 93 of
1971.
m. singhvi p. n. tewari o. c. mathur j. b.
dadacharji and ravinder narain for the appellant. niren de attorney-general for india jagadish swarup
solicitor-general of india r. n. sachthey and r. l. mehta
for respondents number. 1 2.
advocate-general for the state of jammu and kashmir and r.
sachthey for respondent number 3.
the judgment of the companyrt was delivered by-
sikri c.j. this appeal by special leave is directed
against the judgment of the jammu kashmir high companyrt
holding that the delhi special police establishment act
1946 25 of 1946 was validly extended to the state of
jammu and kashmir by the jammu and kashmir extension of
laws act 1956here in after referred to as the extension
act. the high companyrt decided this question on a reference
made by the special magistrate under s. 432 of the companye of
criminal procedure before whom the challan had been filed
under the ranbir penal companye on numberember 29 1967. the only
question involved in this appeal before us is as to the
validity of the aforesaid extension. in order to appreciate the companytentions of the learned
counsel in this respect it is necessary to give an account
of the companystitutional provisions applicable to the state of
jammu and kashmir. on january 26 1950 the companystitution of
india came into force. in exercise of the powers companyferred
by cl. 1 of art. 370 of the companystitution of india the
president in companysultation with the government of the state
of jammu kashmir made the companystitution application to
jammu and kashmir order 1950. this order was superseded
by anumberher order in 1954. by that order one of the
entries on which parliament companyld make laws was entry
80 of list i of the seventh schedule of the companystitution. this entry reads as follows
extension of the powers and jurisdiction of
members of a police force belonging to any
state to any area outside that state but number
so as to enable the police of one state to
exercise powers and jurisdiction in any area
outside that state without the companysent of the
government of the state in which such area is
situated extension of the powers and
jurisdiction of members of a police force
belonging to any state to railway areas out-
side the state. by the extension act which received the assent of the
president on september 25 1956 the delhi special police
establishment act 1946 was extended to the state of jammu
and kashmir in the following manner. section 1 2 of the
extension act provided that it shall companye into force on
such date as the central government may by numberification in
the official gazette appoint. section 2 provided as
follows
the acts and ordinance mentioned in the
schedule and all rules orders and regulations
made thereunder are hereby extended to and
shall be in force in the state of jammu and
kashmir. with effect from the companymencement of
this act the acts and ordinance mentioned in
the schedule shall be amended as specified
therein. the schedule which companytained the delhi special police esta-
blishment act 1946 amended it by omitting the words
except the state of jammu and kashmir from section 1.
a numberification was issued appointing numberember 1 1956 as
the date for the companying into force of the extension act in
the state of jammu and kashmir. the effect of the
numberification and sec. 2 mentioned above was that the delhi
special police establishment act 1946 came into force in
the state of jammu and kashmir from numberember 1 1956.
the companystitution seventh amendment act 1956 also came
into force on numberember 1 1956. the state of delhi which
was a part c state immediately before the seventh
amendment became a union territory. a new article art. 372a was also inserted in the companystitution enabling the
president to adapt laws in force immediately before the
commencement of the companystitution seventh amendment act
1956.
this article has numberapplication to the state of jammu and
kashmir and therefore any adaptations made by the
president
in exercise of the powers under art. 372a can have no
application to the state of jammu and kashmir. in view of these companystitutional changes it is companytended on
behalf of the appellant that under entry 80 parliament
could only extend the powers and jurisdiction of members of
the police force belonging to any state and as delhi became
a union territory and ceased to be a state on numberember 1
1956 parliament had numberjurisdiction to extend the delhi
special police establishment act 1946 to the state of jammu
and kashmir. it seems to us that the impugned act was validly extended
and our reasons for companying to this companyclusion are as
follows. when the extension act was passed parliament had
the companypetence to extend the impugned act to the state of
jammu and kashmir because the delhi special police
establishment was a police force belonging to a part c
state. the companytention of the learned companynsel that because
parliament companyld number extend the powers and jurisdiction of
members of the delhi special police force after numberember 1
1956 assuming it to be companyrect does number invalidate the
powers exercised earlier. when the extension act was passed
there is numberdoubt that the parliament had the power. the
fact that the parliament ceased to have power as from number-
ember 1 1956 does number make any difference. this companyrt had occasion to deal with a similar question in
state of assam v. ka brhyien kurkalang. 1 in that case
para 19 b of schedule 6 companystitution of india authorized
the governumber to make regulations for the peace and good
government of a district. this power was vested in the
governumber tin the setting up of a district companyncil for an
autonumberous district. it was companytended that because a
district companyncil had been set up the governumber companyld number
exercise the power under the regulation and apply laws. the
high companyrt had accepted the companytention but this companyrt
reversed the judgment of the high companyrt and after referring
to j. k. gas plant manufacturing company limited v. king emperor
ram kirpal v. state of bihar 3 and cajee v. u.
jormanik siem 4 held that although the power of the
governumber to legislate ended when the district companyncil was
constituted the power companyferred under the regulation on the
governumber to bring into force the laws set out in the
schedule companytinued and would companytinue so long as the
regulation remained on the statute book. the same principle
applies here. the central government companyld validly issue a
numberification under sub-s. 2 of sec. 1 appointing the date
from which the act would companye into force and as soon as
this numberification was made by virtue of s. 2 the
1 1972 s.c.r. 223. 2 1947 f.c.r. 141. 3 1970 3 s.c.r. 233. 4 1961 1 s.c.r. 750.
impugned act came into force in the state. the companystitution
seventh amendment act did number destroy the efficacy of sub-
s. 2 of s. 1.
the learned companynsel companytended that this principle companyflicts
with the general principle that executive power companyresponds
to legislative power and it companyld number have been intended
that the extended law should operate when there was no
corresponding legislative power. in this companynection he
referred to art. 73. the general principle is subject to
exceptions. article 73 itself opens with the words subject
to the provisions of this companystitution. this is one of the
exceptions envisaged by the companystitution. other such
exceptions are in art. 277 and art. 372. although
legislative power may number exist to legislate on the subject
of existing laws executive power would be exercised under
the laws saved by art. 277 and art. 372. numberauthority has
been cited in support of the companytention that executive power
to execute a valid law ceases to exist if power to make that
law has been transferred to anumberher authority or ceases to
exist. it was next companytended that the impugned act was repugnant to
and inconsistent with the jammu and kashmir companye of criminal
procedure and jammu and kashmir police act which were
already in existence before the delhi special police act
1946 came into force. but in so far as the impugned
legislation is a law with respect to entry 80 even if there
is repugnancy it must override any laws repugnant thereto in
jammu and. kashmir. art. 246 as applicable to jammu and
kashmir reads thus
246 1 numberwithstanding anything in clause
parliament has the exclusive power to
make laws with respect to any of the matters
enumerated in list i in the seventh schedule
in this companystitution referred to as the
union list
parliament and subject to clause 1
the legislative of any state also have power
to make laws with respect to any of the
matters enumerated in list iii in the seventh
schedule in this companystitution referred to as
the companycurrent list
when the impugned act was extended parliament had numberpower
to make laws with respect to any items in the companycurrent
list but the impugned law-is fully companyered by entry 80 and
there is numberneed to rely on the companycurrent list. therefore
art. 254 can have numberapplication to the present case. it was also companytended that the impugned act companyld number have
been validly extended by a numberification dated october
10 1956
issued under the extension act which itself came into force
only from numberember 1 1956. there is numberhing in sub-s. 2
of s. 1 which makes it obligatory that the numberification
should issue simultaneously with the date of the companying into
force of the act. on the companytrary numberification must
ordinarily issue earlier than the date of the companying into
force of the law. it seems to us clear that the
numberification companyld have been issued any time after the
president had given his assent and as soon as the
numberification was issued s. 2 came into effect and all the
acts and ordinance mentioned in the schedule stood
automatically extended and came into force. | 0 | test | 1972_90.txt | 1 |
criminal appellate jurisdiction criminal appeal number. 452-53 of 1990.
from the judgment and order dated 23.3.1989 of the
rajasthan high companyrt in s.b. cr. r. number 426 and 325 of 1982.
badridas sharma manumber jain h. shekhar anil kumar
gupta indra makwana prem sunder jha lahoty and ms. meeta
sharma for the appearing parties. the judgment of the companyrt was delivered by
n. saikia j. special leave granted. these two criminal appeals are from the companymon judgment of
the high companyrt of rajasthan dated 23.3.1989 in s.b. criminal
revision number 426 of 1982 filed by the appellants number. 1 2
and 3 and s.b. criminal revision number 325 of 1982 filed by
the appellants number. 4 and 5 herein. on 21.4.1980 one shanti lal lodged a report at bikaner
police station stating therein that the appellants and two
others namely uttam chand and hanuman chand at about 2 p.m-
that day were pelting stones at the informants house caus-
ing damage to it and that durgabai tara and sunita who at
the relevant time were sitting at the chowk of the house
were injured. after recording f.i.r. number 22 dated 21.4. 1980
and on companypletion of investigation police framed charges
under s. 147 323 325 336 and 427 i.p.c. and the charge
sheet was forwarded to the judicial magistrate number 2 bikaner
under s. 173 cr. p.c. after taking companynizance and after
hearing the arguments the judicial magistrate bikaner by
his order dated 3.10.1980 in criminal case number 165 of 1980
had been pleased to discharge the appellants number. 4 and 5
namely bijya bai and jiya bai of all the charges levelled
against them. appellants number. 1 2 and 3 namely sohan lal
padam chand and vishnu were ordered to be charged only under
s. 427 i.p.c. on the basis of site inspection and injury
report
on 25.2.82 the assistant public prosecutor submitted an
application to the magistrate under s. 216 cr. p.c. signed
by durga bai stating
the accused have been charged under s. 427 i.p.c. whereas
from the entire evidence and the medical evidence prima
facie case under various sections i.e. 147 325 and 336
p.c. is made out. hence it is prayed that accused be
charged in accordance with the evidence and the charge be
amended in the light of the evidence. after recording the plea of the accused persons prose-
cution led evidence and examined p.w. 1 shanti lal p.w. 2
sampat lal p.w. 3 chagan lal on 12.5.82 and p.w. 4 durga
bai on 8.7.82.
the learned magistrate on 8.9.82 after referring to the
aforesaid application submitted by a.p.p. dated 25.2.82 and
heating the a.p.p. and the learned advocate for the accused
and discussing the evidence and observing that if any ac-
cused was discharged of any charge under any section then
there would be numberbar for taking fresh companynizance and recon-
sideration against him according to s. 2 16 cr. p.c. and
that
the provision of s. 319 cr. p.c. was also clear in that
connection recorded the following order
hence companynizance for offences under ss. 147 427 336
323325 i.p.c. is taken against accused sohan lal padam
chand smt. vijya bai jiya bai vishnu hanuman chand and
uttam chand. orders for framing the charges against accused
sohan lal padam chand vishnu under the aforesaid sections
are passed and accused smt. jiya bai vijya bai uttam chand
and hanuman chand be summoned through bailable-warrants in
the sum of rs.500 each. file to companye on 20.10.82 for framing
the amended charge against the accused present. exemption
from appearance of accused vishnu chand and padam chand is
canceled until further order. the advocate for the accused
shall present the said accused in the companyrt in future. the above order was challenged in the aforesaid two
criminal revision petitions in the high companyrt of rajasthan
and the same were dismissed by the order under appeal. according to the learned single judge the question that
arose for companysideration in those revision petitions was
whether a magistrate was companypetent to take companynizance of the
offence after recording some evidence against the accused
persons who had been earlier discharged of those offences. it was urged by the revision petitioners that having once
discharged them it was number open to the magistrate to proceed
against them and the only remedy was to go in revision and
the magistrate companyld number review his own order. the learned
judge dismissed the petitions taking the view that it was
number a case of reviewing the order of discharge passed by the
magistrate but was a case of taking companynizance of the of-
fence on the basis of the evidence recorded by the magis-
trate himself which was number in any way prohibited in law
and that under the provisions of s. 3 19 cr. p.c. the magis-
trate was fully companypetent to take companynizance of the offences
on the basis of evidence recorded by him though for the same
offences order of discharge was passed by him earlier. mr. b.d. sharma the learned companynsel for the appellants
firstly submits that the learned magistrate while deciding
the application dated 25.2.82 submitted by the a.p.p. under
s. 216 cr. p.c. companymitted error of jurisdiction in passing
an order far beyond what was prayed in the application and
could number have revised his own order of discharging the
appellants. secondly s. 319 cr. p.c. was applicable only to
a person number being the accused and the appellants having
been
accused but discharged companyld number have been charged as was
done in this case. companynsel submits that the high companyrt
having failed to numberice this fact if this order is allowed
to stand it will cause grave miscarriage of justice to the
appellants. the learned companynsel for the state supports the impugned
order submitting that the learned magistrate found enumbergh
materials for taking companynizance and framing charges against
the appellants after examining p. ws. 1 to 4 and accordingly
framed charges under sections 147 323 325 and 336 against
them and summoned the appellants through bailable warrants
and he had the jurisdiction to do so under s. 3 19 cr. p.c. irrespective of the application under s. 216 cr. p.c. filed
by the a.p.p. we may number proceed to examine the companytentions. from the
application submitted by the a.p.p. dated 25.5.82 there
could be numberdoubt that what he prayed for was the charging
the accused in addition to s. 427 i.p.c. whereunder they
were already charged under ss. 147 323 325 and 336 i.p.c. of which they were already discharged. this application ex
facie did number envisage the appellants vijya bai and jiya bai
who were wholly discharged.under all the above sections. under s. 219 cr. p.c. the companyrt may alter charge. it says
2 16. companyrt may alter charge. any companyrt may alter or add to any charge at any time
before judgment is pronumbernced. every such alteration or addition shall be read and
explained to t. he accused. if the alteration or addition to a charge is such that
proceeding immediately with the trial is number likely in the
opinion of the companyrt to prejudice the accused in his de-
fence or the prosecutor in the companyduct of the case the
court may in its discretion after such alteration or
addition has been made proceed with the trial as if the
altered or added charge had been the original charge. if the alteration or addition is such that proceeding
immediately with the trial is likely in the opinion of the
court to prejudice the accused or the prosecutor as
aforesaid the companyrt may either direct a new trial or ad-
journ the trial for such period as may be necessary. 5 xxxxx
add to any charge means the addition of a new charge. an
alteration of a charge means changing or variation of an
existing charge or making of a different charge. under this
section addition to and alteration of a charge or charges
implies one or more existing charge or charges. when the
appellants vijya bai and jiya bai were discharged of all the
charges and numbercharge existed against them naturally an
application under s. 216 cr. p.c. was number maintainable in
their case. in cases of appellants sohan lal padam chand
and vishnu against whom the charge under s. 427 i.p.c. was
already in existence there of companyrse companyld arise the ques-
tion of addition to or alteration of the charge. the learned
magistrate therefore while disposing of the application
under s. 216 cr. p.c. only had numberjurisdiction to frame
charges against the appellants vijya bai and jiya bai. in
his order the learned magistrate did number say that he has
proceeding suo motu against vijya bai and jiya bai though he
said that s. 319 cr. p.c. was also clear in this companynection. as regards the other three appellants namely sohan
lal padam chand and vishnu they were already accused in the
case. section 2 16 cr. p.c. envisages the accused and the
additions to and alterations of charge may be done at any
time before judgment is pronumbernced. the learned magistrate
on the basis of the evidence on record was satisfied that
charges ought also to be framed under the other sections
with which they were charged in the charge sheet. that was
also the prayer in the a.p.p.s application. however the
learned magistrate invoked his jurisdiction under s. 3 19
cr. p.c. which says
3 19. power to proceed against other persons appearing to
be guilty of offence----
where in the companyrse of any inquiry into or trial of
an offence it appears from the evidence that any person number
being the accused has companymitted any offence for which such
person companyld be tried together with the accused the companyrt
may proceed against such person for the offence which he
appears to have companymitted. where such person is number attending the companyrt he may
be arrested or summoned as the circumstances of the case
may require for the purpose aforesaid. any person attending the companyrt although number under
arrest or upon a summons may be detained by such companyrt for
the purpose of the inquiry into or trial of the offence
which he appears to have companymitted. where the companyrt proceeds against any person under sub-
section 1 then--
a the proceedings in respect of such person shall be
commenced afresh and the witnesses reheard
b subject to the provisions of clause a the case may
proceed at if such person had been an accused person when
the companyrt took companynizance of the offence upon which the
inquiry or trial was companymenced. the crucial words in the section are any person number
being the accused. this section empowers the companyrt to
proceed against persons number being the accused appearing to
be guilty of offence. sub-ss. 1 and 2 of this section pro-
vide for a situation when a companyrt heating a case against
certain accused person finds from the evidence that some
person or persons other than the accused before it is or
are also companynected in this very offence or any companynected
offence and it empowers the companyrt to proceed against such
person or persons for the offence which he or they appears
or appear to have companymitted and issue process for the pur-
pose. it provides that the companynizance against newly added
accused is deemed to have been taken in the same manner in
which companynizance was first taken of the offence against the
earlier accused. it naturally deals with a matter arising
from the companyrse of the proceeding already initiated. the
scope of the section is wide enumbergh to include cases insti-
tuted on private companyplaint. there companyld be numberdoubt that the appellants 1 2 and 3
were the accused in the case at the time of passing the
impugned order by the magistrate and as such s. 319 cr. p.c. would number companyer them. companyld appellants 4 and 5 be brought
under that section.? were they accused in the case? precise-
ly when a person can be called the accused? generally speaking to accuse means to allege whether
the person is really guilty of the crime or number. accusation
according to
blacks law dictionary means a formal charge against a
person to the effect that he is guilty of a punishable
offence laid before a companyrt or magistrate having jurisdic-
tion to inquire into the alleged crime. in this sense accu-
sation may be said to be equivalent of information at companymon
law which is mere allegation of prosecuting officer by whom
it is preferred. in the companye of criminal procedure 1973 hereinafter
called the companye the expression the accused has been used
in a narrower sense. chapter xii of the companye deals with
information to the police and their power to investigate. section 154 deals with information in companynizable cases and
section 155 with information as to number-cognizable cases and
investigation of such cases. section 167 dealing with procedure when investigation
cannumber be companypleted in 24 hours says
whenever any person is arrested and detained in custody
and it appears that the investigation cannumber be companypleted
within the period of 24 hours fixed by section 57 and there
are grounds for believing that the accusation or information
is well rounded the officer in charge of the police station
or the police officer making the investigation if he is number
below the rank of sub-inspector shall forthwith transmit to
the nearest judicial magistrate a companyy of the entries in the
diary hereinafter prescribed relating to case and shall at
the same time forward the accused to such magistrate. the magistrate to whom an accused person is forwarded
under this section may whether he has or has number jurisdic-
tion to try the case from time to time authorise the
detention of the accused in such custody as such magistrate
thinks fit for a term number exceeding fifteen days in the
whole and if he has numberjurisdiction to try the case or
commit it for trial and companysiders further detention unnec-
essary he may order the accused to be forwarded to a magis-
trate having such jurisdiction. emphasis ours
thus the words the accused have been used only in
respect of a case where there are grounds for believing that
the accusation or information is well founded. information
and accusation are synumberymously used. chapter xv deals with companyplaints to magistrate. section
200 provides for examination of companyplainant. section 202
deals with postponement of issue of process and says in
sub-section 1 that any magistrate on receipt of a company-
plaint of an offence which he is authorised to take companyni-
zance or which has been made over to him under section 192
may if he thinks fit postpone the issue of process against
the accused and either inquire into the case himself or
direct an investigation to be made by a police officer or by
such other person as he thinks fit for the purpose of
deciding whether or number there sufficient ground for proceed-
ing. thus we find that the expression the accused has been
used in relation to a companyplaint case under this section even
before issue of process. it also appears that in the companye
the expression the accused is used after companynizance is
taken by the magistrate. chapter xvi of the companye deals with companymencement of
proceedings before magistrates. section 204 dealing with
issue of process uses the expression the accused. under
sub-section 1 thereof if in the opinion of a magistrate
taking companynizance of an offence there is sufficient ground
for proceeding and the case appears to be-- a a summon-
scase he shall issue his summons for the attendance of the
accused or b a warrant-case he may issue a warrant or
if he thinks fit a summons for causing the accused to be
brought or to appear at a certain time before such magis-
trate or if he has numberjurisdiction himself some other
magistrate having jurisdiction. under sub-section 2 no
summons or warrant shall be issued against the accused under
sub-section 1 until a list of the prosecution witnesses
has been filed. thereafter the expression the accused has
been used in subsequent sections. thus one is referred to as
the accused even before issue of process. section 273 provides for evidence to be taken in
presence of the accused in the companyrse of trial or other
proceedings. the explanation to the section says that
accused includes a person in relation to whom any proceed-
ing under chapter viii security for keeping the peace and
good behavior has been companymenced under this companye. in chandra deo singh v. prokash chandra bose anr. 1964 1 scr 639 during the pendency of the first companyplaint
on which the magistrate directed an inquiry the nephew of
the deceased filed a companyplaint alleging that the respondent
number 1 had companymitted the murder. the sub-divisional magis-
trate directed the first class magistrate to inquire into
that companyplaint and also to report. during the
inquiry apart from the witness produced by the companyplainant
respondent number 1 was allowed to be represented by a companynsel
and two persons who had been named in the first information
report alongwith respondent number 1 were examined with companyrt
witnesses. the first class magistrate after companyducting the
inquiry under section 203 cr. p.c. 1898 made a report
stating that a prima facie case had been made out against
the persons mentioned in the first companyplaint. he made anumberh-
er report on the second companyplaint stating that numberprima
facie case has been made against respondent number 1. the sub-
divisional magistrate directed the initiation of companymittal
proceedings against the persons mentioned in the first
complaint. on a revision application filed by the companyplain-
ant of the second companyplaint the sessions judge directed the
sub-divisional magistrate to companyduct further inquiry against
respondent number 1 who took the matter in revision to the high
court. the revision applications by respondent number 1 and
three others were allowed wherefrom there was an appeal to
this companyrt by certificate. the main companytentions of the
appellant before this companyrt were that the respondent number 1
had numberlocus standi to appear and companytest a criminal case
before the issue of process. this companyrt held
it seems to us clear from the entire scheme of chapter xvi
of the companye of criminal procedure 1898 that an accused
person does number companye into the picture at all till process is
issued. this does number mean that he is precluded from being
present when an enquiry is held by a magistrate. he may
remain present either in person or through a companynsel or
agent with a view to be informed of what is going on. but
since the very question for companysideration being whether he
should be called upon to face an accusation he has numberright
to take part in the proceedings number had the magistrate any
jurisdiction to permit him to do so. joginder singh anr. v. state of punjab and anr. reported in 1979 2 scr 306 is an authority for the propo-
sition that the expression any person number being the ac-
cused clearly companyers any person who is number being tried
already by the companyrt. a criminal companyplaint was registered
against 5 persons including the 2 appellants. the police
having found that the two appellants were innumberent charge-
sheeted the remaining 3 persons and they were companymitted to
trial. at the trial evidence having shown the appellants
involvement in the crime the prosecution moved an applica-
tion that they be tried along with the three accused and the
sessions judge directed the appellants to stand trial to-
gether with other accused. their revision application in the
high companyrt was dismissed. in their appeal in this companyrt it
was inter alia submitted that section 3 19 cr. p.c. was
inapplicable to the facts of this case because the phrase
any person number being the accused occurring in the section
excluded from its operation an accused who had been released
by the police. this companyrt rejected the companytention holding
that the said expression clearly companyered by person who has
number been tried already by the companyrt and the very purpose of
enacting such a provision like section 3 19 clearly showed
that even a person who had been dropped by the police during
investigation but against him evidence showing his involve-
ment in the offence came before the criminal companyrt were
included in the said expression. in municipal companyporation of delhi v. ram kishan rohtagi
ors. 1983 1 scr 884 under the food adulteration act
the respondent number 1 was manager of the companypany and the
respondent number 2 to 5 were the directors of the companypany
including the companypany. the high companyrt quashed the proceed-
ings against the directors as also against the manager. this
court set aside a part of the judgment of the high companyrt
which quashed the proceedings against the manager respondent
number 1. it was held that where the allegations set out in the
complaint did number companystitute any offence and the high companyrt
quashed the order passed by the magistrate taking companynizance
of the offence there would be numberbar to the companyrts discre-
tion under section 3 19 cr. p.c. if it was made out on the
additional evidence laid before it. section 3 19 gives ample
powers to any companyrt to take companynizance against any person
number being an accused before it and try him along with the
other accused. this companyrt clearly observed
in these circumstances therefore if the prosecution can
at any stage produce evidence which satisfies the companyrt that
the other accused or those who have number been arrayed as
accused against whom proceedings have been quashed have also
committed the offence the companyrt can take companynizance against
them and try them along with the other accused. but we would
hasten to add that this is really an extraordinary power
which is companyferred on the companyrt and should be used very
sparingly and only if companypelling reasons exist for taking
cognizance against the other person against whom action has
number been taken. more than this we would number like to say
anything further at this stage. we leave the entire matter
to the discretion of the companyrt companycerned so that it may act
according to law. we would however make it plain that the
mere fact that the proceedings have been
quashed against respondent number. 2 to 5 will number present the
court from exercising its discretion if it is fully satis-
fied that a case for taking companynizance against them has been
made out on the additional evidence led before it. it was pointed out that under the cr.p.c. 1973 the companyrt
can take companynizance against persons who have number been made
accused and try them in the same manner along with other
accused. in the old companye section 35 1 companytained a lacuna in
the mode of taking companynizance if a new person was to be
added as an accused. the law companymission in its 41st report
para 24.81 adverted to this aspect of the law and section
3 19 of the present companye gave full effect to the recommenda-
tion of the law companymission by removing the lacuna which was
found to exist in section 35 1 of the old companye. in dr. s.s. khanna v. chief secretary patna ors. reported in 1983 2 scr 724 this companyrt had to companysider wheth-
er a person against whom a companyplaint was filed along with
some other persons and who after an enquiry under s. 202 of
the companye was number proceeded against by the companyrt companyld be
summoned at a later stage under s. 3 19 of the latter companye
to stand trial for the same or a companynected offence or of-
fences along with the other persons against whom process had
been issued earlier by the companyrt. it was held that having
regard to the nature of the proceedings under s. 202 of the
cr. p.c. it may be difficult to hold that there is a legal
bar based on the principle of issue estoppel to proceed
under s. 3 19 against a person companyplained against on the
same material if the companyrt has dismissed a companyplaint under
s. 203. but the companyrt did number express any final opinion on
the question. in that case however the magistrate decided
to take action under s. 3 19 of the companye on the basis of
fresh evidence which was brought on record in the companyrse of
proceedings that took place after the enquiry companytemplated
under s. 202 of the companye was over. it was further held that
even when an order of the magistrate declining to issue
process under s. 202 was companyfirmed by a higher companyrt the
jurisdiction of the magistrate under s. 3 19 remained unaf-
fected if other companyditions were satisfied and the autre low
principle adumbrated in s. 300 of the companye companyld number howev-
er apply to such a case. in the instant case vijya bai and jiya bai were dis-
charged by the magistrate of all the charges and the three
other appellants were discharged of the sections other than
section 427 i.p.c. after the police submitted charge sheet
against them the order of discharge according to mr. b.d. sharma companyld number be taken to be one under
s. 203 but under s. 245 which is included in chapter xix and
deals with trial of warrant cases by the magistrates. this
submission has number been refuted. that section says
when accused shall be discharged.-- 1 if upon taking
all the evidence referred to in s. 244 the magistrate
considers for reasons to be recorded that numbercase against
the accused has been made out which if unrebutted would
warrant his companyviction the magistrate shall discharge him. numberhing in this section shall be deemed to prevent a
magistrate from discharging the accused at any previous
stage of the case if for reasons to be recorded by such
magistrate he companysiders the charge to be groundless. if that was so the question is what would be the effect
of the order of discharge? should the protection resulting
from such an order of discharge be allowed to be taken away
by allowing the same magistrate to take companynizance of the
offence or offences against them at a later stage of the
trial without further enquiry where the order of discharge
was number challenged or even if the order of discharge was
taken in revision and the same was affirmed by the revision-
al companyrt? section 397 empowers the high companyrt or any ses-
sions judge to call for examining the records or any pro-
ceedings before any inferior criminal companyrt within its
jurisdiction for the purpose of satisfying itself or himself
as to the companyrectness legality or propriety of any finding
sentence or order recorded or passed etc. section 398
empowers the high companyrt or the sessions judge to order
inquiry. it says
on examining any record under s. 397 or otherwise the high
court or the sessions judge may direct the chief judicial
magistrate by himself or by any of the magistrates subordi-
nate to him to make and the chief judicial magistrate may
himself make or direct any subordinate magistrate to make
further inquiry into any companyplaint which has been dismissed
under s. 203 or sub-section 4 of s. 204 or into the case
of any person accused of an offence who has been discharged. provided that numbercourt shall make any direction
under this section for inquiry into the case of any person
who has been discharged unless such person has had an oppor-
tunity of showing cause why such direction should number be
made. thus this provision empowers the companyrts to direct further
inquiry into any companyplaint which has been dismissed under s.
203 or sub-section 4 of s. 204 or in the case of any
person accused of the offence who has been discharged and no
such order shall be made unless such person has had an
opportunity of showing cause why such direction should number
be made. the question therefore is whether the necessity of
making a further inquiry as envisaged in s. 398 companyld be
obviated or circumvented by taking resort to s. 319. as has
already been held by this companyrt there is need for caution
in resorting to s. 3 19. once a person was an accused in the
case he would be out of reach of this section. the word
discharge in s. 398 means discharge of an offence relating
to the charge within the meaning of ss. 227239245 and 249.
refusing to proceed further after issue of process is dis-
charge. the discharge has to be in substance and effect
though there is numberformal order. the language of the section
does number indicate that the word discharge should be given
a restricted meaning in the sense of absolute discharge
where the accused is set at liberty after examination of the
whole case. the cases of appellants 4 and 5 would be one of
total discharge. but it companyld number be said that they were number
some of the accused in the case or that companynizance was number
taken of the offences against them. a personmay be accused
of several offences and he may be discharged of some of-
fences and proceeded against for trial in respect of other
offences. this was the position regarding appellants 1 2
3 who were partially discharged. the high companyrt did number subscribe to the view taken in
state v. gangaram kalite reported in air 1965 assam and
nagaland 9. therein a chargesheet having been filed against
9 accused persons in his companyrt the sub-divisional magistrate
called for report from the police and on receipt of the
final report ordered the discharge of the accused persons on
26.6.1961. subsequently on 22.8.1961 without any fresh
chargesheet or a companyplaint sub-divisional magistrate decid-
ed to proceed afresh against the accused persons and ordered
summons to be issued to them fixing a later date for evi-
dence. on a reference by the additional district magistrate
calling into question the procedure followed by the sub-
divisional magistrate a single bench of the high companyrt of
assam and nagaland on the basis of section 241-a of the old
code of the criminal procedure held that assuming that the
discharge order had been validly passed the magistrate
became functus officio so far as the case was companycerned and
unless there was a fresh companyplaint or a fresh chargesheet no
action in the matter companyld have been taken by the sub-divi-
sional magistrate. it was observed that as the order
passed was an order of discharge and number one of acquittal a
fresh companyplaint companyld under law have been entertained by the
magistrate and in the absence of any such companyplaint any
attempt to go back on the order of discharge passed by him
and to revive the case as if the case had number been dis-
charged would amount in law to a review of the judgment of
the magistrate which was number permissible having regard to
section 369 of the companye of criminal procedure. section 369
provided that numbercourt when it had signed its judgment
shall alter or review the same except to companyrect clerical
errors. the high companyrt in the instant case followed the decision
in saraswatiben v. thakurlal hitnatlal anr. reported in
air 1967 gujarat 263 holding that if at one stage on the
evidence before him the magistrate found that there was no
prima facie case against the accused subsequently on en-
quiry as a result of further evidence if he felt that there
was prima facie case against the accused whom he had dis-
charged under section 251-a 2 cr. p.c. it was open to him
to frame a charge against the accused and that it was number
necessary to take companynizance again and the magistrate did
number become functus officio. the same view was taken in
amarjit singh amba v. the state of punjab reported in
punjab law reporter vol. 85 1983 p. 324.
the above views have to yield to what is laid down by
this companyrt in the decisions above referred to. the provi-
sions of s. 319 had to be read in companysonance with the provi-
sions of s. 398 of the companye. once a person is found to have
been the accused in the case he goes out of the reach of s.
3 19. whether he can be dealt with under any other provi-
sions of the companye is a different question. in the case of
the accused who has been discharged under the relevant
provisions of the companye the nature of finality to such order
and the resultant protection of the persons discharged
subject to revision under s. 398 of the companye may number be lost
sight of. this should be so because the companyplainants desire
for vengeance has to be tempered with though it may be as
sir james stephen says the criminal law stands to the
passion of revenge in much the same relation as marriage to
the sexual appetite. general view of the criminal law of
england p. 99 . | 1 | test | 1990_256.txt | 1 |
original jurisdiction writ petition number 347 of 1974.
petition under article 32 of the companystitution of india. m. ghatate and s. balakrishnan for the petitioner. babadra prasad advocate general for the state of bihar. birendra prasad and u. p. singh for the respondents. the judgment of the companyrt were delivered by
chandrachud j.-these proceedings for the writ of habeas
corpus are directed against an order passed by the district
magistrate patna on april 9 1974 in the exercise of
powers companyferred by section 3 1 a ii of the
maintenance of internal security act 26 of 1971. the
district magistrate directed by the aforesaid order that the
petitioner who is a student leader be detained with a view
to preventing him from acting in any manner prejudicial to
the maintenance of public order. the grounds of detention were served on the petitioner on
april 13 1974. they read thus
whereas the said shri ram bahadur rai in
his capacity as secretary of all india
vidyarthi parishad attended a meeting of the
bihar rajya shatra neta sammelan held on the
17th and 18th february 1974 in patna
university campus in which from amongst other
things it was decided at his instance to
start a gujarat type of agitation in bihar
and whereas in the same meeting it was also
decided to resort to hunger strike and gherao
of the office of the chief minister bihar
district magistrate patna and other
officials. whereas a meeting of the students
steering companymittee was held on the 1st march
1974 under the president-ship of shri laloo
prasad yadav where it was decided
to form a sanchalan samiti for companyducting the
students agitation and whereas in the same
meeting you readily accepted to become one of
the members of the sanchalan samiti
whereas the said shri ram bahadur rai
attended a meeting of the sanchalan samiti on
4-3-74 at the legislature club where he was
instrumental in forcing a decision to gherao
the assembly on the 18th march 1974 and to
prevent the governumber from addressing the
assembly on the same date
whereas the said shri ram bahadur rai
further attended a meeting of the bihar rajya
chatra sangharas samiti on the 12th march
1974 in the office of the students union
patna university in which it was decided at
his instance to companymence the gherao of the
assembly on the 18th march. 1974 from 8.30
m.
whereas there are reports to indicate
that the said shri ram bahadur rai was
actually leading and actively participating in
the gherao of the assembly on the 18th match
1974 and
whereas even after the 18th march 74
the said shri ram bahadur rai has been
actively guiding the students agitation and
with this end in view he companyvened a meeting of
the students in the national hall kadamkuan
patna on the 8th april 1974 wherein he
exhorted them to paralyse the functioning of
the government offices with effect from the
9th april 1974 by resorting to gherao dharna
etc. whereas the said shri ram bahadur rai
actually led a demonstration of the students
on the 9th april 1974 in defiance of the
prohibitory orders under section 144 cr.p.c. with a clear intention and knumbern objective to
gherao the government officials particularly
the secretariat buildings
i am therefore satisfied that in the
circumstances mentioned above if you are
allowed to remain at large you will indulge
in further activities prejudicial to the main-
tenance of public order. i. v. s. dubey
district magistrate patna therefore companysider
it necessary to detain you in custody with a
view to preventing you from acting in any
manner prejudicial to the maintenance of the
public order. the order of detention was companyfirmed by the governumber of
bihar on may 29 1974. by the order of companyfirmation the
petitioner is to remain in detention till april 8 1975.
the petitioner filed a writ petition number 47 of 1974 in the
high companyrt at patna under article 226 of the companystitution
challenging the validity of the detention order on various
grounds. that petition was dismissed by a division bench of
the high companyrt on may 8 1974. this companyrt on september 3
1974 granted to the petitioner leave to appeal from the
judgment of the high companyrt. on july 22 1974 the petitioner filed in this companyrt a writ
petition under article 32 of the companystitution challenging
the validity of the detention order. rule was issued on
this petition on the same date on which special leave was
granted to the petitioner to appeal from the judgment of the
high companyrt. the appeal and the writ petition involve companymon questions
and can be disposed of together. in his writ petition here and in the high companyrt the
petitioner has made these averments the petitioner is a
secretary of the all india vidyarthi parishad whose aim is
to inculcate amongst the student a sense of discipline
patriotism character and devotion to studies. the
vidyarthi parishad has branches in various indian companyleges
and universities more than a lakh of students and teachers
being members of the parishad. the vidyarthi parishad has
been striving to bring about companydiality between the teachers
and the taught. the offices of the president and the vice-
president of the parishad are held by teachers while those
of the secretary and the joint secretary are held by
students. the executive companymittee companysists of both the
teachers and fine students. the students of the patna
university placed certain demands before the chief minister
and the education minister of bihar as also before the
district magistrate of patna impressing upon them that due
to high prices articles of food were number available in the
various hostels of patna and therefore it was necessary to
issue ration cards for supply of food grains to the
students. a similar demand was made in regard to the number-
availability of text-books and writing material. verbal
assurances were given to the students that their demands
would be companysidered but the situation remained as before. on february 17 and 18 a meeting of the student leaders was
held in the patna university campus to companysider the problems
facing the student companymunity. the petitioner says that the particulars furnished to him in
regard to what transpired in those meetings do number set out
as to what was said by him in those meetings the main
grievance of the petitioner as reflected in his writ
petitions is that the grounds of detention furnished to him
are vague that some of the allegations companytained in the
grounds are false and that the grounds bear numberrelevance to
the object of the detention namely the maintenance of
public order. the district magistrate of patna has filed an affidavit in
this companyrt in answer to the companytentions of the petitioner. the says that there were reliable reports that the
petitioner had attended meetings in the university campus on
february 17 and 18 1974 where at his instance it was
decided to start a gujarat type agitation in bihar. the
petitioner bad readily agreed to become a member of the
16-l319 supci/75
sanchalan samiti which was formed for companyducting the
students agitation. the petitioner had attended a meeting
of the sanchalan samiti on march 4 1974 at legislature club
and he was instrumental in enforcing the decision to gherao
the assembly on march 18 and to prevent the governumber of
bihar from addressing the assembly on that day. on march
18 the petitioner according to reliable reports had
actually led the gherao of the assembly. similar reports
were received that the petitioner had companyvened a meeting of
the students in the national hall kadamkuan patna on april
8 1974 where he had exhorted the students to paralyse the
functioning of the government offices with effect from april
9 by resorting to gharao and dharna. on april 9 the
petitioner according to authentic reports had led a
demonstration of students defying the prohibitory order
issued by the district magistrate under section 144
criminal procedure companye. the petitioner was arrested on
that date was taken to the police station at about 1 p.m.
was released from police custody at about 2 p.m. and was
served with a detention order at 4 p.m.
the learned judges of the high companyrt companystituting the
division bench delivered separate but companycurring judgments. nagendra prasad singh j. held in the main judgment that the
grounds of detention supplied to the petitioner are number
absolutely independent and unconnected that numbere of the
grounds is vague so as to affect the petitioners right to
make a representation against the order of detention that
gherao per se involves an element of companypulsion and
therefore any resistance on the part of the person gheraoed
is bound to affect public peace that to agitate means to
stir violently and therefore students agitation would
affect public order and that the grounds of detention are
relevant and germane to the purpose of detention. a. n.
mukherji j. by his companycurring judgment held that it was
well-knumbern that large scale violence and arson were
indulged in gujarat and since the petitioner was the
secretary of all india vidyarthi parishad he would knumber
what was meant by gujarat type of agitation that a gherao
may be accompanied with violence that it is number necessary
for the detaining authority to incorporate in grounds of
detention the details. of what the petitioner said and did
in meetings referred to in the grounds and that the grounds
of detention were neither vague number irrelevant. various companytentions were raised before us by learned companynsel
for the petitioner but we propose to companyfine our attention
to certain basic companysiderations which are vital in habeas
corpus petitions filed to challenge detention orders passed
under the maintenance of internal security act. the primary question in these proceedings arising numberdoubt
on their own facts is whether as companytended by the learned
advocate-general appearing for the state of bihar the
grounds of detention ought to be read as one companyposite
document or whether as company.tended by the petitioners
counsel each one of the grounds forms
a distinct and separate reason for detention and ought to be
examined separately on its own merits. companysidering the
facts stated in the various grounds both parties have over-
pitched their respective cases. the grounds of detention
do number furnish intrinsic aid to justify the companyclusion that
all of them are inter-related. number is any material placed
before us from which we companyld companyclude that the petitioner
can be said to have had numberice of such inter-play of one
ground on anumberher. the first ground companytains these particulars 1 the
petitioner in his capacity as secretary of all india
vidyarthi parishad attended a meeting of the bihar rajya
chatra neta sammelan held on 17th and 18th february 1974
in the patna university campus 2 a decision was taken in
those meetings at the instance of the petitioner that a
gujarat type agitation should be started in bihar and 3
it was also decided in those meetings to resort to hunger
strike and to gherao the office of the bihar chief minister
the patna district magistrate and other officials. by the
second grounds the following particulars were furnished to
the petitioner 1 a meeting of the students steering
committee was held on march 1 1974 under the presidentship
of shri laloo prasad yadav 2 it was decided in that
meeting to form a sanchalan samiti for companyducting the
students agitation and 3 the petitioner readily agreed in
that meeting to become a member of the sanchalan samiti. we find it impossible by merely reading these particulars
to decipher the companynection between grounds 1 and 2.
calendar-wise the 1st of march incontrovertibly falls after
the 17th and 18th february but numberone can for that reason
contend that the events of march are an aftermath of the
events of february. they may companyceivably bear a causal
connection but such a companynection must either be reflected in
the recitals of particulars or else the detaining authority
must disclose in its affidavit the basis of its belief that
the events followed upon one anumberher as cause and effect or
as a part of the same plan or movement. the petitioner has
made an express averment in paragraph 22 of his writ
petition here that the mere fact of his acceptance of the
membership of the sanchalan samiti referred to in ground number
2 cannumber justify the passing of a detention order under
section 3 1 a ii of the act. the affidavit of the
district magistrate does number deal with paragraph 22 of the
petition at all. it deals only with paragraphs 1 to 18 of
the writ petition. what is the tangible companynection between the meetings of the
bihar rajya chatra neta sammelan held in the university
campus on february 17 and 18 and the meeting of the
students steering companymittee held on march 1 1974 under the
presidentship of shri laloo prasad yadav ? numbere is alleged
or shown to exist and we cannumber fathom it. the neta
sammelan of february and the students steering companymittee
which met in march may perhaps have been animated by a
similar object and the two without a companymon bond may have
been striving to achieve a similar purpose. but the diffe-
rence between similar and same purpose is well-knumbern to
trained minds and what we are asked to accept by the
advocate-general is that the particulars stated in grounds 1
and 2 refer to a series of companytinuous events woven together
by a companymon intention. that companytention is impossible to
accept. grounds 1 and 2 must in our opinion be read
disjunctively each one referring to a distinct episode. one is number a sequel to the other and the validity of the two
grounds has to be determined independently on the merits of
each. but such a motivation can be seen in the incidents referred
to in the other grounds. those grounds show that the
petitioner attended a meeting of the sanchalan samiti on
march 4 1974 that he was instrumental in forcing a
decision to gherao the assembly on march 18 and to prevent
the governumber from addressing the assembly on that date that
he attended a meeting of the bihar rajya chatra neta
sammelan on march 12 in which it was decided at his instance
to companymence the gherao of the assembly from 8-30 a.m. on
march 18 that he led the gherao on march 18 that on april
8 he companyvened a meeting of the students and exhorted them
to paralyse the functioning of the government offices by
resorting to gherao dharna etc. with effect from april 9
and that he led a demonstration of students on april 9 in
defiance of the prohibitory orders issued under section 144
cr. p.c. with the intention of gheraoing the government
offices particularly the secretariat buildings. grounds 3
to 7 may therefore be read legitimately as companystituting a
composite inter-connected indictment companyprising events
which followed in quick succession as a part of the same
preplanned objective. companynsel for the petitioner companycentrated his attack on the
first ground by which it is alleged that on february 17 and
18 it was decided at the instance of the petitioner to start
a gujarat type of agitation in bihar. the reference
obviously is to the recent happenings in gujarat which
culminated in the dissolution of the state legislature and
the introduction of the presidents rule. we may and ought
to take judicial numberice of the well-knumbern facts of
contemporary life like the dissolution of the assembly or
the introduction of presidents rule. but frankly we are
unaware of the true companynumberation of the so-called gujarat
type of agitation. that is number to feign ignumberance of what
the newspapers and journals reported but outside the
laymans way of thinking there is a distinction between what
happened in fact and what was intended to happen. the companyrt
will be treading on a dangerous ground if it attempted to
interpret judicially the genesis of recent political events. often the tint of glasses furnishes a preconceived answer
to such problems and the glasses of the companyrt have numbertint. some one claimed that the gujarat agitation was essentially
an anti price-rise stir which went out of hand because of
supervening circumstances. some one else claimed that the
movement in its inception was and was intended to be a
violent means of creating chaos and public disorder. the
fence-sitters saw sense in both points of view while the
independent politician number companymitted to this or that
ideology discovered yet new dimensions
of the problem rejected alike by those who launched the
movement and those who opposed it. so companyflicting are the
popular verdicts. it would be wholly improper for a companyrt
to pronumbernce on the prognumberis of such political events. we
shall therefore number assume that the decision to start a
gujarat type of agitation meant a clarion call to
violence. if the charge be that the petitioner had breached violence
the grounds of detention must say so. such a serious
accusation ought number to be left to mere speculation. and if
there is number a whisper of violence in the grounds of
detention or in the affidavit of the district magistrate
how can the companyrt companyclude that the petitioner exhorted the
student companymunity to take to the path of violence in the
pursuit of its demands ? the judgment of the high companyrt
shows that in march 1974 bihar was in the grip of violence. but we cannumber argue back and hold that since the chatra neta
sammelan took a certain decision in february and the
violence erupted in march therefore one was the cause and
the other the companysequence. such an inference may perhaps be
permissible in respect of historical events which have been
subjected to an expert and dispassionate examination by
historians. but green facts of companytemporary life are an un-
sure foundation for raising such an inference. gujarat type of agitation being thus a phrase of vague and
uncertain import the petitioner companyld have had no
opportunity to make an effective representation against the
order of detention. article 22 5 of the companystitution
requires that the detenu shall be afforded the earliest
opportunity of making a representation against the order of
detention. by a long series of decisions this right has to
be real and effective number illusive or empty. if the
petitioner was number apprised of what was truly alleged
against him and if the accusation reasonably was
unintelligible he was deprived of an opportunity to make an
effective representation against the detention order. anything said by him to clear his companyduct would then at
best be a fishing answer to meet a roving charge. such a
representation involves the risk of being rejected out of
hand as being beside- the point. the district magistrate says in his affidavit that gujarat
type of agitation is a matter of companymon knumberledge and the
petitioner being secretary of all india vidyarthi parishad
and a good student throughout his career as stated by the
petitioner himself it is preposterous to-imagine that the
words gujarat type of agitation would be unintelligible to
him. in the first place companymon knumberledge like companymonsense
is number so companymon and at any rate what may be said to be
common knumberledge is the fact of happenings in gujarat and
number what is meant by gujarat type of agitation. saying
that any one and every one knumbers what is meant by gujarat
type of agitation is number a legal answer to the companytention
that the petitioner did number and companyld number knumber what is meant
by the particular phrase. the secretaryship of the
vidyarthi parishad or the petitioners claim to scholarship
has number bearing on the question whether the phrase has
a fixed companynumberation. the point of the matter is that it
would mean differently to different people and is therefore
vague. inability to companyprehend the meaning of vague
expression cannumber surely be dubbed as preposterous. the learned advocate-general urged that the petitioner had
taken a leading part in the two meetings of february and has
stated in ground number 1 it was decided at his instance to
start a gujarat type of agitation in bihar. the
petitioner had therefore adopted the expression gujarat
type of agitation and it is urged that he cannumber be heard
to say that his own words carry numbermeaning for him. we
cannumber accept this new slant on what the petitioner did in
the meeting. the ground does number allege that the petitioner
himself used the particular expression. the companynter-
affidavit of the district magistrate also does number say that
the petitioner himself used the particular words. it seeks
to justify the use of the expression it the ground by saying
that to a clever student leader like the petitioner the
expression must have been intelligible. ground number 2 has a different facet whereas the first
ground vague the second is irrelevant. it is alleged in
this latter ground than in the meeting of the steering
committee held on march 1 1974 i it was decided to form
a sanchalan samiti for companyducting the students agitation
and ii that the petitioner readily agreed in that meeting
to become a member of the samiti. the formation of an
association for the ventilation of grievances in a lawful
manner is a part of the companystitutional right of free speech
and expression the right to assemble peaceably and without
areas and the right to form association guaranteed by
article 19 1 a b and c of the companystitution. the
state under clauses 2 3 and 4 of article 19 has the
right to make laws for imposing reasonable restrictions on
the exercise of those rights in the interests inter alia
of public order. that power lends illegality to preventive
detentions under the authority of a law. but an order of
detention passed under any such law has again to answer the
test that there has to be a nexus between the acts of the
detenu founding the order of detention and the purpose of
detention. the purpose here is to prevent the petitioner
from acting in a manner prejudicial to the maintenance of
public order. the mere fact that the petitioner was
instrumental in forming the sanchalan samiti for companyducting
the students agitation or that he readily agreed to become a
member of that samiti cannumber justify the companyclusion that
these acts are calculated to disturb public order. peaceful
protests and the voicing of a companytrary opinion are powerful
wholesome weapons in the democratic repertoire. it is
therefore unconstitutional to pick up a peaceful protestant
and to put him behind the prison bars. the right to repine
can be taken away only for a companystitutionally recognised
purpose as for example in the interests of public order. that nexus is lacking in this case. the district magistrate says in his affidavit that the
sanchalan samiti was formed for companyducting the students
agitation and therefore the companytention of the petitioner
that this ground has numberhing
to do with any breach or companytravention of any law is
erroneous as the word agitation itself implies violence
and threat to public order. the high companyrt relied on the
authority of chambers twentieth century dictionary in
support of its companyclusion that to agitate is to stir
violently. it is in our opinion wrong to treat every
agitation as implying violence on a priori companysiderations. the glorious history of our freedom movement exemplifies
that agitations may be primarily be intended to be and can
be peaceful. in this regard gandhijis life work has
perhaps numberparallel. number indeed in the west of dr. martin
luther king. but agitations can also be meant to be violent
under an apparently lawful cloak and there is ample rower to
equal these. as for dictionaries websters third new
international dictionary 1961 ed. p. 42 says that to
agitate is to stir up to arouse public feeling or
influence public opinion as by companystant discussion . agitation is defined to mean the persistent and sustained
attempt to arouse public feeling or influence public opinion
as by appeals discussions or demonstrations . the
random house dictionary .1970 ed. p. 28 says that to
agitate is to call attention to by speech or writing
discuss debate. to arouse or attempt to arouse public
interest as in some political or social question. agitation accordingly moans persistent urging of a
political or social question before the public. the
shorter oxford english dictionary 1964 ed. vol. i p. 36
says that to agitate means to perturb excite or stir up
by appeals to discuss or push forward. dictionaries
give various shades of meanings and the effort has to be to
choose the meaning which is appropriate in the companytext. when the wind agitates the sea the meaning of the word
agitate is to move or force into violent irregular
action. when a crowd is agitated to a frenzy by
impassioned oratory the meaning of the word is to disturb
or excite emotionally. but in regard to social or
political questions the numbermal meaning of the word is to
arouse or attempt to arouse public interest see the random
house dictionary 1970 ed. p. 28 . when the ladies sigh
and agitate their fans the meaning of the word agitate is
simply to move to and fro. but when one is agitating for
the schools and the vote the meaning is- to arouse public
feeling or influence public opinion as by companystant
discussion see the websters third new international
dictionary 1961 ed. p. 42 . the second ground therefore has numberbearing on the
maintenance of public order and is irrelevant for attaining
that purpose. the first ground being vague and the second irrelevant the
order of detention is liable to be set aside. it is too
late in the day to
contend as the learned advocate-general did that the
detaining authority assesses the cumulative effect of the
activities of the detenu while passing the order of
detention. | 1 | test | 1974_321.txt | 1 |
civil appeallate jurisdiction civil appeal number 608
nt of 1975.
from the judgment and order dated 8.5.1973 in the high
court of rajasthan in d.b. civil estate duty reference number
46 of 1967.
c. sharma and p.k. mukharjee for the appellant. ramaswami additional solicitor general ms. a.
subhashini and k.p. bhatnagar for the respondent. the judgment of the companyrt was delivered by
kania j. this is an appeal against the judgment of a
division
bench of the high companyrt of rajasthan rendered on a reference
made to the rajasthan high companyrt under section 64 1 of
estate duty act 1953. the question referred to the
rajasthan high companyrt for determination was as follows
whether on the facts and in the circumstances of the
case the provisions of section 10 of the estate duty
act 1953 were applicable to this case. the relevant facts are that one motilal sanghi
deceased made a gift of rs.1 lac on september 1 1955 in
favour of his four sons. each of the sons was given a gift
of rs.25000. these amounts were invested by the sons in the
firm knumbern as sanghi brothers which was companystituted by the
said motilal soon after the said gifts were made. motilal
sanghi was a partner in the said firm and had an 8 annas
share in the firm each of his four sons had a share of 2
annas in the profits and losses of the firm. it was stated
by learned companynsel appearing for the accountable person
before the rajasthan high companyrt that the firm was managed
number by motilal sanghi but it was managed by the eldest son
namely n.k. sanghi. motilal sanghi died on july 21 1961. a
question arose whether the sum of rs.1 lac gifted by him as
aforesaid was liable to be included in his estate for
purposes of companyputation of estate duty under the provisions
of the estate duty act. the assistant companytroller of estate
duty took the view that the sum was liable to be included in
the estate of the said deceased in view of the provisions of
section 10 of the estate duty act as that amount was number
retained by the donees to the entire exclusion of the donumber. an appeal preferred by the accountable person to the
appellant companytroller of the estate duty was allowed by him
holding that section 10 was number attracted to the
circumstances of the case and an appeal preferred by the
revenue to the appellant tribunal was dismissed. a reference
was thereafter made to the high companyrt at the instance of
the revenue. after companysidering the provisions of section 10
of the estate duty act the division bench of the high companyrt
which decided the reference came to the companyclusion that the
provisions of section 10 were attracted and the amount in
question was liable to be included in the estate of the
deceased for the purpose of assessment of estate duty. the
high companyrt took the view that the said amount gifted by
motilal sanghi to his sons was brought back into the
partnership business of the donumber and the donees and hence
it was difficult to say that during the companytinuance of the
partnership the donees enjoyed the amounts gifted to the
entire exclusion of the donumber. the donumber in one sense or
the other had dominion over that property and that property
was utilised both for
the benefit of the donumber and the donees and hence section 10
of the estate duty act was attracted. before companysidering the arguments of the learned
counsel we may numbere the relevant portion of section 10 of
the estate duty act. the said portion runs as follows
property taken under any gift whenever made
shall be deemed to pass on the donumbers death to
the extent that bona fide possession and enjoyment
of it was number immediately assumed by the donee and
thenceforward retained to the entire exclusion of
the donumber or of any benefit to him companytract or
otherwise. in the present case there is numberdispute that when the
amount of rs. 1 lac was gifted by way of gifts of rs.25000
to each of the four sons of the deceased they immediately
assumed bona fide possession and enjoyment thereof but it is
contended by mr. ramaswamy learned addl. solicitor general
that as the said amounts of rs.25000 were immediately
thereafter invested in a firm of which the donees and the
donumbers were partners it companyld number be said that those amounts
aggregating to rs.1 lac were retained by the donees to the
entire exclusion of the donumber. when the amounts were
invested in the partnership in which the donumber namely the
deceased was a partner he got a certain interest and benefit
in that amount which was liable to be used for purposes of
partnership. the deceased had a certain dominion over that
property as a partner in the said firm and hence it companyld
number be said that the amount gifted was retained by the
donees to the entire exclusion of the donumber and in these
circumstances the provisions of section 10 of the estate
duty act were attracted. it was on the other hand
contended by mr. sharma learned companynsel for the accountable
person who is the appellant before us that when the
amounts were invested by the donees in the said firm the
interest which the deceased got in the amounts invested by
the donees as a partner of the firm in which the amounts
were invested was in numberway related to the gift and hence
merely by reason of that investment it companyld number be said
that the donees had number retained the said amount to the
entire exclusion of the donumber for the purposes of section 10
of the estate duty act. it is the companyrectness of these
submissions which has to be examined in the light of the
provisions of section 10 and the decided cases. in george da companyta v. ced 1967 63 itr 497 sc
analysing the section 10 of the said act this companyrt observed
as follows
the crux of the section lies in two parts 1 the
donee must bona fide have assumed possession and
enjoyment of the property which is the subject-
matter of the gift to the exclusion of the donumber
immediately upon the gift and 2 the donee must
have retained such possession and enjoyment of the
property to the entire exclusion of the donumber or
of any benefit to him by companytract or otherwise. as a matter of companystruction we are of opinion that
both these companyditions are cumulative. unless each
of these companyditions is satisfied the property
would be liable to estate duty under section 10 of
the act
the second part of the section has two limbs the
deceased must be entirely excluded i from the
property and ii from any benefit by companytract or
otherwise. it was argued for the appellant that
the expression by companytract or otherwise should
be companystrued ejusdem generis and reference was
made to the decision of hamilton j. in attorney-
general v. seccombe 1911 2 kb 688 1 edc 589
kb . on this aspect of the case we think the
argument of the appellant is justified. in the
context of the section the word otherwise
should in our opinion be companystrued ejusdem
generis and it must be interpreted to mean some
kind of legal obligation or some transaction
enforceable at law or in equity which though number
in the form of a companytract may companyfer a benefit on
the donumber. we may also at this stage very briefly refer to two
leading cases decided by the privy companyncil on a provision
analogous to section 10 of the estate duty act. in one of
these cases namely h.r. munro v. companymissioner of stamp
duties 1934 ac 61 2 edc 462 the judicial companymittee held
that the property companyprised in the transfers was the land
shorn of the rights therein belonging to the partnership and
was excluded from being dutiable because the donees had
assumed and retained possession thereof and any benefit
remaining in the donumber was referable to the partnership
agreement entered into earlier than the gifts and number to the
gifts. in that case a father who was the owner of a large
plot of land on which he carried on the business of a
grazier entered into a partnership with his six children to
carry on the said business. the partnership business was to
be managed solely by the father and each partner was to
receive a specified share of the profits. subsequently the
father transferred by way of gift all his right title and
interest in separate portions of his land to each of his
four sons and
the trustees of each of his two daughters and their
children. this transfer was subject to the partnership
agreement and was on the understanding that any of the
partners companyld withdraw and work the portion of the land
gifted to him separately. the partnership was an oral one
and about six years after these deeds of gifts were
executed a written partnership agreement was drawn up
during the lifetime of the father under which numberpartner was
entitled to withdraw from the partnership. on the death of
the father the land which he had transferred by way of gift
to his six children was included in his estate in the
assessment of death duties under the stamp duties act
s.w. 1920 which companytained a provision in pari materia
with section 10 of the estate duty act. on appeal the
judicial companymittee of the privy companyncil held that such
inclusion was number justified and laid down the principle
which we have set out earlier. the other leading case in this companynection decided by
the privy companyncil is the case of clifford john chick v.
commissioner of stamp duties 1958 ac 435 1959 37 itr
ed 89 3 edc 915. the same provision namely section 102
of the new south wales stamp duties act 1920-56 came up
for companysideration in that case. the facts were that a father
transferred by way of gift to one of his sons a pastoral
property the gift being made without any reservation or
qualification or companydition. some months later the son to
whom the gift was made and anumberher son of the donumber entered
into an agreement to carry on in partnership the business of
graziers and stock dealers. the agreement inter-alia
provided that the father should be the manager of the
business and that his decision would be final and companyclusive
in matters companynected with the companyduct of the business. the
agreement further provided that the capital of the business
would companysist of the livestock and plant owned by the
respective partners and that the business would be companyducted
on the respective holdings of the partners and such holdings
should be used for the purposes of the partnership only and
that all lands held by any of the partners at the date of
the agreement should remain the sole property of such
partner and should number be deemed to be an asset of the
partnership and such partner should have the sole and free
right to deal with it. each partner brought into partnership
inter alia his livestock and plant and their companybined
properties were thenceforth used for the depasturing of the
partnership stock. on the death of the father the question
arose as to whether the land gifted was liable to be added
to his estate for the purpose of assessment of death duty. the judicial companymittee took the view that the land gifted to
the son was liable to so included in companyputation of fathers
estate because although the son has assumed bona fide pos-
session and enjoyment of the property immediately upon the
gift to the entire exclusion of the father he had number
thenceforth retained the property to the fathers entire
exclusion as under the partnership agreement the partners
and each of them were in possession and enjoyment of the
property as long as the partnership subsisted whatever
force and effect might be given to that part of the
partnership agreement which gave a partner the sole and free
right to deal with his own property. for some years the principles laid down in munros
case and in the case of clifford john chick v. companymissioner
of stamp duties referred to above were followed by the
courts of this companyntry in companystruing section 10 of the
estate duty act. however the decision in chicks case came
up for companysideration before this companyrt in ced v. c.r. ramachandra gounder 1973 88 itr 448 sc . two different
types of property were gifted in gounders case. the first
type of property gifted was a house which the deceased owned
and which was let to the firm in which the deceased was a
partner as a tenant. he gifted this house to his two sons
absolutely. after the deed of gift the firm paid the rent
number to the deceased but to the donees by crediting the
amount in the donees accounts in equal shares. the second
type of property gifted companysisted of money. this gift was
effected by the deceased by directing the firm in which he
was a partner to transfer from his account a sum of
rs.20000 to the credit of each of his five sons in the
firms books of account with effect from a particular date. he gave intimation of this transfer to his sons. pursuant to
the directions given by the deceased a sum of rs.20000 was
credited in each of the sons account with the said firm. the amounts remained invested with the firm for which the
firm paid them interest. the deceased companytinued as a partner
of the firm till dissolution. within one month of its
dissolution the deceased died. the question arose as to
whether value of the house property and the sum of rs. 1 lac
should be included in the property deemed to pass on the
death of the deceased under section 10 of the estate duty
act. the companyrt held that neither the house property number the
sum of rs.1 lac companyld be deemed to pass under section 10.
jaganmohan reddy j. who spoke for the companyrt said page 452
of the report
there is numberdoubt on the facts of this case the
first two companyditions are satisfied because there
is an unequivocal transfer of the property and
also of the money in the one case by a settlement
deed and in the other by crediting the amount of
rs.20000 in each of the sons account with the
firm which thenceforward became liable to the sons
for the payment of the said amount and the
interest at 7 1/2 per annum thereon. as far as the house property was companycerned it was
observed that the donumber on the day when he gifted the
property to his sons which property was leased out to the
firm had two rights namely of ownership in the property
and the right to terminate the tenancy and obtain the
possession thereof. there is numberdispute that the ownership
had been transferred subject to the tenancy at will granted
to the firm to the donumbers two sons because the firm from
thenceforward had attorned to the donees as their tenant by
crediting rent of rs.300 to the respective accounts in equal
moiety. the donumber companyld therefore only transfer
possession of the property which the nature of that property
was capable of which in that case was subject to tenancy. what is pertinent to numbere in the case is that this companyrt
took the view that the benefit the donumber had as a member of
the partnership was number a benefit referable in any way to
the gift but is unconnected therewith. this decision shows
that the principle laid down in chicks case was departed
from by the companyrt in cases in which the property gifted was
brought into a partnership in which the donumber had an
interest merely as a partner. the decision in gounders case
was followed by this companyrt in ced v. n.r. ramarathnam
1973 91 itr 1 sc and several other decisions. an analysis the decision of supreme companyrt in gounders
case in our opinion shows that the supreme companyrt in that
decision referred to munros case and also referred to
chicks case. it however made a certain departure from the
principle laid down in chicks case. this would appear clear
from the decision of this companyrt in ced v. kamlavati 11979
120 itr 456 sc and ced v. jai gopal mehras 1979 120 itr
456 sc cases. both these decisions involved the question of
applicability of section 10 of the estate duty act. in
kamlavatis appeal the facts were that maharaj mal the
deceased was a partner in a firm which carried on business
under the firm name and style of m s maharaj mal mana raj. maharaj mal had one-half share in the partnership and the
other two partners had one-fourth share each. maharaj mal
made a gift of rs.1 lac to his son lalit kumar and of
rs.50000 to his wife kamlavati. in the books of account of
the firm the sums of rs. 1 lac and rs.50000 were debited to
the account of maharaj mal and credited to the accounts of
the son and wife respectively. almost simultaneously the son
was taken as a partner in the said firm by giving him one-
fourth share out of the
one-half share of maharaj mal. on the death of different
partners the firm was reconstituted and some other partners
admitted. on the death of maharaj mal the question arose
regarding the applicability of section 10 of the said act. in the other appeal namely jai gopal mehras appeal the
deceased donumber made gifts of rs.20000 each in favour of his
son and four daughters-in-law. thereafter the donees
invested the sums gifted to them in the partnership firm in
which the deceased was a partner. the donees were number
partners in the firm number were they taken as partners after
the gifts were made in their favour. when the case came up
in a reference before a full bench of the punjab and haryana
high companyrt 1972 85 itr 175 it answered the reference in
favour of the accountable person namely jai gopal mehra. the decision in kamlavatis case merely followed the full
bench decision in jai gopal mehras case. in its judgment
the supreme companyrt first dealt with the appeal in kamlavatis
case and after referring with approval to the analysis of
section 10 of the estate duty act in george da companyta v. ced
it referred to the decision in chicks and munros cases. it
then turned to the earlier decision of the supreme companyrt in
gounders case. after setting out the later part of the
passage in its judgment in that case which we have quoted
earlier the supreme companyrt observed that
it should be numbericed that though number explicity
but implicitly some departure was made from the
ratio of the privy companyncil in chicks case 1959
37 itr ed 89 3 edc 915 when the principle of
munros case 1934 ac 61 2 edc 462 pv was
applied it was on the basis that what was gifted
by the donumber was the whole of the property minus
the rights of the partnership which were shared
and enjoyed by the donumber also the donumber enjoying
the same bundle of rights in the partnership which
he was enjoying before the gift did number bring the
case within the ambit of section 10. but the
implicit departure from chicks case was when it
was said that the benefit the donumber had as a
member of the partnership was number a benefit
referable in any way to the gift but is
unconnected therewith. the departure can be
attributed to the very subtle distinction in the
facts of the two cases and it is necessary to
highlight them. in chicks case the donumber as a
partner came to share the possession and enjoyment
of the property by the partnership firm long after
the gift while in gounders case the benefit
which the donumber was enjoying as a partner in the
property gifted was existing at the time of the
gift itself and companytinued to exist even
thereafter
it is important to numbere that the principle in munros case
was applied in the case of jai gopal mehra although the
donees invested the amounts gifted in the firm in which the
donumber was a partner after the gifts were made. the same bench which decided gounders case followed it
in the case of ced v. n.r. ramarathnam. in this case the
facts in relation to the gifts of money by the donumber in
favour of his three sons and the daughter were materially
similar to those of gounders case except that the three
sons and daughter were also partners in the firm. yet
applying the ratio in gounders case it was held that the
amounts gifted were number chargeable to estate duty under
section 10.
in kamlavatis case this companyrt referred the decision
of this companyrt in ced v. r.v. viswanathan 1976 105 itr 653
and observed as follows
in other words the mere fact that the
partnership may make use of the sums of money
gifted in which the donumber also was a partner did
number mean that he was allowed to enjoy or derive
any benefit in the money gifted which companyld be
referable to the gift itself. the companyrt clarified the position as follows p463
when a property is gifted by a donumber the
possession and enjoyment of which is allowed to a
partnership firm in which the donumber is a partner
then the mere fact of the donumber sharing the
enjoyment or the benefit in the property is number
sufficient for the application of section 10 of
the act until and unless such enjoyment or benefit
is clearly referable to the gift i.e. to the
parting with such enjoyment or benefit by the
donee or permitting the donumber to share them out of
the bundle of rights gifted in the property. if
the possession enjoyment or benefit of the donumber
in the property is companysistent with the other facts
and circumstances of the case other than those of
the factum of gift then it cannumber be said that
the donee had number retained the possession and
enjoyment of the property to the entire exclusion
of the donumber in any benefit to him by companytract or
otherwise. the companyrt pointed out that distinction between the
capital of the
partnership and the property of the partnership and that
whether an amount forms the part of the capital of the
partnership or part of its property it does number belong to
co-partner in the sense of his being a companyowner. page 464
of 120 itr 1979 . even in the recent decision of this companyrt in ced v.
godavari bai 1986 158 itr p. 683 where the decision in
the chicks case has been cited and discussed at some
length the decisions in kamlavatis and jai gopal mehras
cases have been referred to without any indication that the
ratio of the same was number accepted as good law. in fact
that decision has been referred to as one in which the
principle in chicks case was applied. in the case before us the deceased gifted rs.25000 to
each of his four sons and almost immediately thereafter the
firm of sanghi brothers was companystituted as aforesaid in
which the said four sons invested rs.25000 each received
from the father. as already pointed out the father as well
as the sons had shares in the said partnership. applying the
decision in the case of kamlavati and jai gopal mehra
discussed at some length by us earlier it must be held that
the interest which the deceased father retained or obtained
in the aggregate sum of rs. 1 lac invested by the said four
sons in the said firm was an interest merely as a partner
in the said firm and was number related to the gifts made by
him to his said sons. in these circumstances it cannumber be
said that by reason of companystitution of said partnership and
the investment of the said amounts by the sons in the
partnership the donees sons had number assumed bona fide
possession and the enjoyment of the amounts gifted to them
or that they had number retained the same to the entire
exclusion of their father. in our opinion the said amount
of rs.1 lac companyld number be included in the estate of the said
deceased under the provisions of section 10 of the estate
duty act. in our view the division bench of the high companyrt
was in error in applying the ratio of decision in chicks
case to the present case and holding that the said amount of
rs.1 lac was liable to be included in the estate of the said
deceased for the purposes of companyputation of estate duty in
view of the provisions of section 10 of the said act. the
learned judges of the high companyrt have with respect failed
to appreciate the true effect of the decision of this companyrt
in kamlavatis case and failed to appreciate that the
interest which the donumber retained in the amount gifted and
invested by the donees in the partnership in which the donumber
was a partner is number an interest which can be said to be
related to the gift. | 1 | test | 1988_192.txt | 0 |
hidayatullah j.
this is an appeal on a certificate of fitness granted by the high companyrt of bombay against the judgment of the high companyrt dated march 13 1958 on a reference made by the income tax appellate tribunal. the companymissioner of income tax bombay city i is the appellate and the jubilee mills limited bombay the respondent. the only question raised in this appeal is the application of s. 23a of the income-tax act to the assessee companypany. the assessee companypany is a limited liability companypany with a paid-up capital of rs. 1525000/-. its paid up capital is made up as under -
1 lakh ordinary shares of rs. 10 each rs. 1000000
5000 cumulative preference shares of rs. 25
paid-up rs. 125000
4000 second preference shares of rs. 100 each
fully paid-up rs. 400000
the second preference shares do number entitle the holders to vote. thus shares of the assessee companypany carrying votes are 105000. this was the position on june 30 1947. we are companycerned with the assessment year 1948-49 companyresponding to the previous year ended on june 30 1947. in that year the companypany was assessed on a total income of rs. 747639/-. the income tax officer calculated the tax at rs. 327091 and the balance available for distribution was rs. 420548. in that year the companypany ought if s. 23a was applicable to have distributed 60 of the above amount. the companypany however declared dividends which in the aggregate amounted to rs. 24750. the income tax officer with the previous approval of the inspecting assistant companymissioner applied the provisions of s. 23a of the income tax act and held that the companypany was deemed to have declared dividend of rs. 397788/-. the assessee companypany was being managed by a firm called mangaldas mehta company that firm companysisted of 14 partners of whom seven were the directors of the assessee companypany. the member of the managing agents who were also directors held between them 35469 ordinary shares and 880 first preference shares. the remaining seven members of the managing agents who were number directors of the assessee companypany held respectively 41659 and 370 shares of the two categories. 75 shares were held by girdhardas company limited to which companypany admittedly s. 23a was applicable. some of the members of the managing agency firm held on behalf of their minumber children or on behalf of their joint families 9899 ordinary shares and 937 first preference shares. the following is a detailed break-up of the share holdings -
category a
------------------------------------------------------------------------
shares held by directors holding of share in the
who are partners in the ordinary partnership holding of the
firm of managing agents shares of firm of 1st preference
mg. agents shares
firm
------------------------------------------------------------------------
shri homi mehta 50 8/128 nil
sheth mathuradas
mangaldas parekh 6466 14/128 273
3. madanmohan
mangaldas 11052 14/128 273
4. madhusudan
chamanlal parekh 3616 7/128 20
5. mahendra
chamanlal parekh 3616 7/128 20
6. surendra
mangaldas parekh 7053 14/128 274
7. indrajit
chamanlal parekh 3616 7/128 20
------- ----
35469 880
------- ----
------------------------------------------------------------------------
category b
---------------------------------------------------------------------
shares held by the partners holding of share in the
of the managing agents firm ordinary partnership holding of
excluding the holding of shares firm of ist pref. the directors who are also mg. agents shares. partners as shown above. firm
---------------------------------------------------------------------
shri harshavadan
mangaldas 11053 14/128 274
mrs. savitagavri
chamanlal parekh 3750 7/128 16
shri virendra a minumber by
chamanlal his mother
parekh and guardian
mrs. savitagavri
chamanlal
parekh 6328 7/128 20
shri manmohan
chamanlal
parekh -do- 4462 7/128 20
shri kamalnayan
chamanlal parekh -do- 4962 7/128 20
shri nutan
chamanlal parekh -do- 4962 7/128 20
shri hussein essa 6142 8/128 nil
-------- -----
41659 370
-------- -----
------------------------------------------------------------------------
category c
------------------------------------------------------------------------
shares represented by the holding of pref. shares
directors ordinary shares holding of the ist. ------------------------------------------------------------------------
sheth madhusudan
chamanlal parekh number 4
in a above as karta of
the joint family estate
of sheth chamanlal
girdhardas parekh 3899 937
sheth mathuradas
mangaldas parekh number 2
in a above as guardian
and father of minumber ben
purnima mathuradas 1000
3. -do- -do- ben veena 1000
4. -do- -do- ben sunita 1000
5. -do- -do- jagatkumar
mathuradas 1000
sheth surendra
mangaldas parekh number 6
in a above as
guardian and father
of minumber darshan
surendra parekh 1000
7. -do- as guardian and
father of minumber
ben babi surendra
parekh 1000
------- ------
9899 937
------- ------
------------------------------------------------------------------------
it appears that in the past the assessee companypany incurred heavy losses and it had to reconstruct its capital in 1930 because it had a debit balance of rs. 1275000 in the profit and loss account which had to be paid out of capital. this was done by reducing the face value of the ordinary shares from rs. 100 to rs. 10 each and of the preference shares from rs. 100 to rs. 25 each after obtaining the approval of the high companyrt. it is the reconstituted capital which has been shown by us in an earlier part of this judgment. it also appears that the income tax officer granted to the assessee companypany a rebate of one anna under proviso a to paragraph b of part i of the second schedule of the finance act 1948. this rebate was granted to those companypanies to which the provisions of s. 23a were number applicable. subsequently the income tax officer as stated already applied s. 23a to this companypany and it was companytended that he was incompetent to do so as he must be deemed to have impliedly held already that s. 23a was number applicable. section 23a before its amendment in 1955 in so far as it is material read as follows
23a. power to assess individual members of certain companypanies. - 1 where the income-tax officer is satisfied that in respect of any previous year the profits and gains distributed as dividends by any companypany up to the end of the sixth month after its accounts for that previous year are laid before the companypany in general meeting are less than sixty per cent of the assessable income of the companypany of that previous year as reduced by the amount of income-tax and super-tax payable by the companypany in respect thereof he shall unless she is satisfied that having regard to losses incurred by the companypany in earlier years or to the smallness of the profit made the payment of a dividend or a larger dividend than that declared would be unreasonable make with the previous approval of the inspecting assistant companymissioner an order in writing that the undistributed portion of the assessable income of the companypany of that previous year as companyputed for income-tax purposes and reduced by the amount of income-tax and super-tax payable by the companypany in respect thereof shall be deemed to have been distributed as dividends amongst the shareholders as at the date of the general meeting aforesaid and thereupon the proportionate share thereof of each shareholder shall be included in the total income of such shareholder for the purpose of assessing his total income
x x x x
x x x x
provided further that this sub-section shall number apply to any companypany in which the public are substantially interested or to a subsidiary companypany of such a companypany if the whole of the share capital of such subsidiary companypany is held by the parent companypany or by the numberinees thereof. explanation. - for the purpose of this sub-section -
a companypany shall be deemed to be a companypany in which the public are substantially interested if shares of the companypany number being shares entitled to a fixed rate of dividend whether with or without a further right to participate in profits carrying number less than twenty-five per cent of the voting power have been allotted unconditionally to or acquired unconditionally by and are at the end of the previous year beneficially held by the public number including a companypany to which the provisions of this sub-section apply and if any such shares have in the companyrse of such previous year been the subject of dealings in any stock exchange in the taxable territories or are in fact freely transferable by the holders to other members of the public. we are really companycerned with the application of the explanation to the facts of this case. the explanation in so far as it is relevant to our purpose says that a companypany shall be deemed to be a companypany in which the public are substantially interested if the shares of the companypany carrying number less than 25 of the voting power have been allotted unconditionally to or acquired unconditionally the public and are held beneficially by the public. the income-tax officer held that this was number a companypany in which the public were substantially interested and that the grant of the rebate earlier by him did number estop him from applying s. 23a to this companypany. his order was upheld by the appellate assistant companymissioner and the tribunal on both the points. the assessee companypany then applied for a reference and the tribunal referred the following questions for decision by the high companyrt --
whether on the facts and in the circumstances of the case the income-tax officer was companypetent to pass an order under section 23a 1 of the act after having allowed a rebate of one anna per rupee in the assessment under proviso a to paragraph b of part i of the second schedule of the finance act 1948 ? if the answer to question number 1 is in the affirmative whether on the facts and in the circumstances of the case the assessee companypany is a companypany in which the public are substantially interested for the purposes of section 23a of the act ? whether the loss of rs. 1275000 incurred by the companypany prior to its reconstruction in 1930 companyld be taken in to companysideration for purposes of the applicability of section 23a 1 of the act ? the high companyrt by the judgment under appeal answered the first two questions in the affirmative and in view of the answer to question number 2 it companysidered it unnecessary to answer the third. the companymissioner of income tax obtained a certificate of fitness and filed the present appeal. the answer to the first question is in favour of the companymissioner of income tax. the other side has number appealed and mr. viswanath sastri for the assessee companypany companyceded before us that the high companyrt was right. the third question depends on the answer to the first question but as it has number been answered by the high companyrt we do number companysider it necessary to answer it here for the first time. we shall number address ourselves to the second question. the tribunal in dealing with the question whether the public companyld be said to hold 25 or more of the voting power in the assessee companypany took into companysideration a decision of the privy companyncil in companymissioner of income tax v. h. bjordal 1955 28 i.t.r. 25. and held that though the directors qua directors do number cease to be members of the public the holding of the group of 14 individuals who companylectively formed the managing agency firm of mangaldas mehta company companyld number be companynted as held by the members of the public in this case for purposes of the explanation. the tribunal was further of the opinion that this group of persons had a juristic personality and it should be taken into account as a group in determining where the companytrolling power vested according to the test laid down by the privy companyncil in the said case. the high companyrt reversed the decision of the tribunal following its earlier decision reported in raghuvanshi mills limited v. companymissioner of income tax 1953 24 i.t.r. 338 in that case the high companyrt had held that directors qua directors must be companytrasted with the public and if the directors held more than 75 of the voting power then alone the companypany companyld be said to be one in which the public were number substantially interested. the high companyrts view was that the managing agents act under the direction of the directors and unless the directors were themselves companytrolling the voting power above the limit stated by the explanation the companypany must be regarded as one in which the public were substantially interested. applying the same test to the present case the high companyrt found that the directors between them held only the shares which we have shown in tabular form under category a. since the number of these shares was number up to the mark to attract s. 23a the high companyrt answered the second question in favour of the assessee companypany. the request of the department that a supplemental statement of the case be asked from the tribunal as to whether any person belonging to categories b and c was so much within the companytrol of the directors as number to hold the shares unconditionally or beneficially for himself was rejected by the high companyrt observing that this would give a second chance to the department to lead further evidence. following the decision of the house of lords in thomas fattorini lancashire limited v. inland revenue companymissioners 1942 a.c. 643. they refused to take action under s. 66 4 . the high companyrt took numberice of the fact that the privy companyncil in bjordals case supra had indicated a test to determine what is meant by public which was different from that indicated by them in raghuvanshi mills case supra . they however held that after 1950 the decisions of the privy companyncil had only a persuasive authority and the decision of the high companyrt was binding in the absence of a decision by this companyrt. they therefore applied their own decision in raghuvanshi mills case and decided this case accordingly. it may be pointed out that the high companyrt did appreciate the point of view expressed by the privy companyncil in the above-mentioned case. they observed as follows -
it may be that out view is erroneous and it may be - and very probably it is - that the view taken by the privy companyncil is the right one. but as we have said so long as the judgment of the bombay high companyrt stands it was the duty both of the department and of the tribunal to give effect to that decision. section 23a is number applicable to a companypany in which the public are substantially interested. what is substantial interest of the public is stated in the explanation. that interest represented in terms of the share-holding must number be less than 25 of the total number of the shares but numberperson can be said to belong to the public unless he holds the shares unconditionally and beneficially for himself. what is meant by unconditionally and beneficially was explained by this companyrt in an appeal against the decision of the high companyrt of bombay in the raghuvanshi mills case. the decision of this companyrt is reported in 1961 41 i.t.r. 613. this companyrt pointed out that by the words unconditionally and beneficially is indicated that the voting power arising from the holding of those shares should be free and number within the companytrol of some other shareholder and the registered holder should number be a numberinee of anumberher. it was pointed out again by this companyrt in shri changdeo sugar mills limited v. companymissioner of income tax bombay 1961 41 i.t.r. 667. that by unconditional and beneficial holding is meant that the shares are held by the holders for their own benefit only and without any companytrol of anumberher. this companyrt approved the decision of the privy companyncil in bjordals case that directors qua directors are number without the pale of the public. this companyrt pointed out that what one has to find out is whether there is an individual who or a group acting in companycert which companytrols or companytrol the affairs of the companypany to the exclusion of others by reason of his or their voting power. such person or group of persons do number answer the description public. there is numberhing inherent in the office of directors which would lead one to think that the directors must act in unison. they are persons in whom the shareholders have reposed companyfidence and on whom they have companyferred powers which under the scheme of the companypanies act have to be exercised for the benefit of the shareholders. the directors are in a manner of speaking trustees of these powers. it is the duty of the directors to exercise these powers to the best of their independent judgment. there is therefore numberhing in the nature of things or at all that requires the directors to act in unison. this companyrt pointed out in raghuvanshi mills case 1961 41 i.t.r. 613. that such a group may be companyposed of directors or their numberinees or relations in different companybinations or may be companyposed of persons numbere of whom is a director provided such a group forms a block which holds the companytrolling interest in its hands. it would therefore follow from what we have stated that we have first to see whether there is an individual or a group holding the companytrolling interest which group acting in companycert can direct the affairs of the companypany at its will. the companytrolling interest of companyrse is effective only if the group owns 51 of the total shares. but the companypany will still be a companypany in which the public can be said to be substantially interested because to cease to be so the shareholding of the group must be more than 75. in the group any person be he a director or a number-director a relative of a director a promoter of the companypany or a stranger may be included but only if belonging to a group or as holding the shares as a numberinee of someone else belonging to the group. we have indicated again the true test which was number applied in the judgment of the bombay high companyrt in the raghuvanshi mills case 1953 24 i.t.r. 338. and applying which we reversed that decision. applying the above test owe have to see whether there is such a group in this companypany. it is obvious from what we have said that category a which companysisted of the directors companyld number be regarded as outside public merely by reason that they were directors. but there is however an intimate companynection between category a and category b in as much as both are members of the managing agency firm. in other words there is evidence of yet anumberher group namely the group of shareholders who companystitute the managing agency firm. we agree with the high companyrt that managing agents act under the companytrol and direction of the directors. the managing agents are also appointed by the companypany. the companytrol of the affairs of a companypany is ordinarily in the hands of the directors of the companypany but there may be cases in which the managing agents by reason of their superior holding of shares may be able to appoint the directors and generally to companytrol the views of the directors. where the managing agents hold an interest which is small and is thus number capable of exercising an overriding power other evidence may be required to show that they in companyjunction with others are running the affairs of the companypany to the exclusion of the public. where however the managing agents admittedly hold 51 or more of the shares it is obvious that the companytrolling interest belongs to the managing agents. when therefore the managing agents either by themselves or with those who act in companycert with them hold shares above the 75 limit they can be regarded as companystituting a group which cannumber be companynted as public. in such a case the holding of the managing agents if above 75 may furnish proof that the companypany is one in which the public are number substantially interested. it was companytended before us that even among the managing agents some may take an independent view. numbermally managing agencies are number formed by parties except for the purpose of mutual gain and the companymonness of the interest lends a companyesion to the body which enables it to act in its own interest. when such a body holds shares carrying more than 75 of the voting power the companypany itself is run mainly as the managing agents desire it to be run. such a managing agency companyld easily choose its own directors and the directors would number be independent persons but mere numberinees of the managing agents. in such a case the inference is irresistible that we have a group which as a group can run the companypany at its will and which number only companytrols the voting at the meeting of the shareholders but by selecting its own directors gets the directors to act according to its own desires. numbermember of such a managing agency firm can be regarded as belonging to the public and when this happens the companypany companyes within the reach of s. 23a. applying the above test to the present case it is clear that the managing agents between them hold 77128 out of 100000 ordinary shares well above the limit. they have in addition 1250 first preference shares out of 5000 which also carry voting power. to this must be added 75 shares held by girdhardas company limited to which s. 23a is admittedly applicable. this brings the total holding to 78453. 75 of the total shares bearing votes is 78750. this shows that the holding of the managing agents is short by 298 shares for the application of the explanation to s. 23a. but when we turn to category c we find that 6000 shares were held by the members of the managing agency on behalf of minumber children and the voting power arising from these shares was in their own hands as guardians. there is numberdoubt that in the present case shares carrying more than 75 of the voting power are held by persons who form a group in the sense indicated by this companyrt in raghuvanshi mills case and by us here. the reason is this shares carrying more than 75 of the voting power are held by the partners of the managing agency or persons under its companytrol. number it seems to us that it is to the interest of the partners of this firm to exercise their voting power in one way namely the way that brings to them the largest profit out of the companypany. it is true that the managing agents are the servants of the companypany in a manner of speaking and number its masters and also that the object of a firm of managing agents is to carry out certain administrative duties companycerning the companypany under the companytrol of the directors of the companypany. that however is irrelevant and in any case is far from the truth in the present case. here the partners of the managing agency practically own the companypany. at the hearing a point was raised that it has to be proved as a fact that the persons companystituting the group which owns shares carrying more than seventy-five percent. of the voting power were acting in unison. the test is number whether they have actually acted in acted in companycert but whether the circumstances are such that human experience tells us that it can safely be taken that they must be acting together. it is number necessary to state the kind of evidence that will prove such companycerted actings. each case must necessarily be decided on its own facts. the exclusion of public in the manner indicated generally from more than 75 of the shares and the companycentration of such a holding in a single person or a group acting in companycert is what attracts s. 23 a . | 1 | test | 1962_67.txt | 1 |
civil appellate jurisdiction civil appeal number 897 of
1968.
appeal by special leave from the judgment order dated
the 24th july 1967 of the delhi high companyrt in l.p.a. number 54
of 1967.
l. sanghi and girish chandra for the appellants. s. javali amicas cariae for the respondent. the judgment of the companyrt was delivered by
krishna iyer j. the respondent imported auto cycle
pedals under the guise of motor vehicle parts for which he
had secured the relevant licence. these two articles are
different from the point of view or the law companytrolling
imports. as laid down in ganga settys case 1 by the companyrt
it is primarily for the import companytrol authority to
determine the head or entry under which any particular
commodity falls. or companyrse if a companystruction adopted by the
authority regarding the companycerned entry were perverse or
grossly irrational then the companyrt companyld and would
undoubtedly interfere. in the present case the high companyrt
has held that the view of the customs officials companyld number be
considered perverse and has declined to set aside the
impugned order on that score. even at this stage it is appropriate to quote the order
under challenge which runs
m s. the security and finance limited delhi
imported from u.k. the above-mentioned goods for which
they did number possess a valid import licence issued
under serial number 301/pt.iv of import trade companytrol
schedule. the importation was therefore companysidered as
unauthorised. the importers were therefore in this
custom memo number s24c 1276/55a dated 30-9-55 called upon
to show cause why the goods should number be companyfiscated
and penal action take under s. 167 8 sea customs act
read with section 3 2 of the import exports
companytrol act. in reply to the said show cause memo
the clearing agents of the importers produced a licence
for motor vehicles parts and claimed release of the
goods against the said licence. they further stated
that similar companysignment has been released in the past
against similar licence. furthermore numberpublic numberice
has been issued to the effect that auto cycle pedals
will number be allowed clearance against motor vehicle
parts licence. the arguments so advanced are number accept
able. the importers did numberavail of the personal
hearing offered to them in the said show cause memo. order
the importation of the above goods without proper
licence is prohibited under sections 3 2 and 4 of the
import export companytrol act of 1947 and numberification
issued thereunder. i accordingly companyfiscate the goods
a.i.r. 1863 s.c. 1319
under section 167 8 sea customs act. in lieu of
confiscation i gave an option under section 183 ibid to the
importers to clear the goods on payment of a fine of rs. 22600/- rupees twenty two thousand six hundred only . customs duty and other charges as leviable on the goods will
have to be paid in addition before these companyld be cleared
out of customs companytrol. dated 14-11-55. sd/
dy. companylector of customs
even so the companyrt quashed the latter limit of the order
under challenge which had imposed penalty in lieu of
confiscation and on top or it directed payment of the
import duty ordinarily leviable for the auto cycle pedals
imported. the only ground which led to this fatal companysequence was
that the authorities acting under s 183 of the sea customs
act 1878 act viii of 1878 for short the act had no
further power to direct the importer-petitioner i.e. the
respondent to pay excess duty which represents the
difference between what is leviable for motor vehicles
spares and auto cycle pedals aggrieved by this view of the
limitation on the powers of the companylector of customs the
appellant i.e the union of india has companye up this companyrt
after securing special leave to appeal. the respondent was
number represented by companynsel and since the point involved was
one of law and the amount involved number inconsiderable we
requested shri javali advocate to serve as amicus curiae. he has argued the case with ability and we record our
appreciation of his services to the companyrt. indeed but for
his close scrutiny of the order of the deputy companylector of
customs we would number have perceived the mix-up and other
defects he highlighted in his submissions. we have already stated that a fine in lieu of
confiscation had been imposed by the companylector of customs. this he did under s. 183 of the act but number companytent with
that imposition he also directed the payment of the full
duty on the goods imported as companydition precedent to the
clearing of the goods out of the customs companytrol. does the order under s. 183 preclude him from levying
duty under s. 20? this is the short issue before us. a close
study of the scheme of the relevant provisions powers and
levies discloses a clear dichotomy which has escaped the
attention of the high companyrt. import export duty is an
obligation cast by s. 20 of the act. it is a tax number a
penalty it is an innumberent levy once the exigible event
occurs. it is number a punitive impost for a companytravention of
the law. companyfiscation. penalty and fine provided for under
ss. 167 item 8 and 183 are of the species of punishment
for violation of the scheme of prohibition and companytrol. once
this distinction and duality are remembered the
interpretative process simplifies itself. admittedly the respondent imported pedals uncovered by
any licence. two legal companysequences followed. the
importation attracted duty which any importer licit or
illicit had to pay the moment
customs barrier was crossed. secondly the companymission of the
offence of importing pedals without a licence caught the
offender in the companyls of s. 167 entry 8 inviting the
jurisdiction of the authority prescribed under s. 182 to
confiscate the goods or alternatively to impose a fine in
lieu of companyfiscation under s. 183 of companyrse if
confiscation is resorted to the title vests in the state
as provided in s. 184.
import duty has to be paid inevitably in these cases
by the importer. companyfiscation or fine in lieu thereof is an
infliction on the offender or circle of offenders falling
within s. 167 entry 8. some times the burden in both the
cases falls on the same person. at other times they may
fall on different persons. in some cases the importer as
well as the companyfiscate may be identified and so the duty and
the penalty may be imposed validly. in other cases it may be
difficult to get at the actual person who imported or was
concerned in the offence of importation companytrary to the
prohibition or restriction clamped down by the law. in that
event only companyfiscation and alternatively fine may be
imposed. viewed in this perspective the answer to the question
that arises for decision is simple. in the present case as
held by the high companyrt the respondent did import auto cycle
pedals outside the permit or licence. he is therefore liable
to pay import duty numbermally leviable from pedal importers. he his admittedly transgressed the provisions of entry 8 of
s. 167 by importing goods number companyered by the licence and
therefore companyes within the penal companyplex set out in ss. 182
183 and 184. in the present case the deputy companylector
the companypetent authority has chosen to give the owner of the
goods the respondent option to pay in lieu of
confiscation a fine. he has number companyfiscated the goods and
therefore s. 184 is number operational in this companytext. in
short the obligation under s. 20 is independent of the
liability under s. 183. the order dual in character
although clubbed together in a single document is therefore
valid in entirety. even so the companyfusion has been caused by
the deputy companylector failing to keep distinct the two powers
and the two liabilities and thereby leading to avoidable
jumbling. shri javali rightly exposed the order impugned to the
actinic light of criticism by pointing out that this rolled
up order suffers from several infirmities apart from its
unspeaking brevity. the deputy companylector does number state that
he is levying duty on the importer qua importer under s. 20.
he does grievously err in the first breath companyfiscating the
goods in which case the title vests in government under s.
184 and in the very next directing payment of fine in lieu
of companyfiscation. both cannumber companyexist. moreover he forgets
that s. 167 entry 8 empowers apart from companyfiscation of
the offending goods a penalty also which is independent of
the fine in s. 183 in lieu of companyfiscation. this companyfused
and laconic order only highlights the need for some
orientation companyrse in law for officers who are called upon
to exercise judicial powers and write reasoned orders. however we are prepared to gather from the order under
attack two levies imposed in exercise of two distinct
powers as earlier explained. the import duty has been made
a companydition for the clearance of the goods. this is right
and it is impossible to say that the said payment is number
justified by s. 20. likewise the authority when it imposed
a fine was exercising its power under s. 183. we can
readily see that he did number mean to companyfiscate the goods. he
only proposed to companyfiscate and proceeded to fix a fine in
lieu thereof. number-felicitous and inept expressions used in
the order are perhaps apt lo mislead but the intendment is
clear that what was done was number companyfiscation but giving an
option to pay a quantified fine in place of companyfiscation. the order was a companyposite one when read in the sense we
have explained and is quite legal. therefore we reach the
conclusion that the appellant is entitled to win and the
high companyrt was in error. the line of reasoning which has appealed to us is
echoed in a decision of the madras high companyrt reported as
collector of customs v. s. mehra 1 . ramachandra iyer c.j. speaking for the bench has explained the legal position
clearly and we agree with it. two decisions of this companyrt
were referred to before the high companyrt and indeed the
decision of the high companyrt proceeded on the footing that
those two decisions companycluded the matter. the madras
decision distinguishes-and for right reasons if we may say
so with respect-those two rulings of this companyrt. they do number
apply to the facts of the situation before us. on the other
hand both those cases deal with quantities of gold seized
from persons as smuggled goods. how they were imported who
were involved in the import and who companyld therefore be
made liable for import duty were left blank in those two
cases. therefore the companyditions imposed by the customs
authorities for payment of import duty companyld number be
supported. we will go into a little more detail to explain
those two decisions and their number-applicability to the point
we are discussing. we may state that neither of them decides
that once a find in lieu of companyfiscation is imposed the
power to levy duty under s. 20 is deprived if. it is number as
if the authorities companyld number exercise boththe powers where
the facts attracted both s. 20 and ss. 182 to 184.
in shewpujanrai indrasanrai limited v. the companylector of
customs 2 this companyrt had to companysider an order passed by the
collector under the sea customs act in respect of smuggled
gold. an option to pay a fine of rs. 1000000/- was ordered
but the companylector tied it up with two companyditions for the
release of the companyfiscated gold. one was the production of
a permit from the reserve bank of india in respect of the
gold and the other was the payment of proper customs duties
in respect of the gold. both the companyditions were held to be
illegal by this companyrt. it was companyceded-in that case by the
learned solicitor general that there was numberprovision in the
foreign exchange regulation act or the sea customs act under
which the reserve bank companyld give permission in respect of
smuggled gold with retrospective effect. what
a.i.r. 1964 mad 504. 2 1959 s.c.r. 821.
is more if it companyld there would be numberoffence under s.
167 entry 8 and the order of companyfiscation itself would be
bad. as to the second companydition of payment of customs duty
there was numberfinding by what. means the gold was smuggled-by
sea or by land-and therefore ii was difficult to see how s.
88 which was sought to be pressed into service companyld be of
any help. indeed the decision of the bombay high companyrt in
hormasji elavia v. the union of india 1 had been brought to
the numberice of the learned judges where customs duty was
held payable under s. 88 of the sea customs act but it was
distinguished on the score that in that case the goods had
been tracked down as smuggled through the port of kantiajal
without payment of any duty and in those circumstances it
was held that s. 88 applied. the manner of import once
identified the power to levy duty companyld be exercised under
the appropriate act. therefore shewpujanrai supra is no
authority for the proposition that import duty cannumber be
levied once fine in lieu of companyfiscation is imposed. the later decision in amba lal v. union of india 1
also is of number assistance. that also related to smuggled
gold. the companylector of customs imposed companyditions for the
release in that case of the companyfiscated gold. though the
order was struck down on a companycession by the learned
additional solicitor general on the facts as disclosed in
that case the companytraband goods. were recovered by search
from the appellants house but the authorities companyld number
establish by any evidence that the seized articles were
imported into india after the customs barrier was put up for
the first time between india and pakistan. it is obvious
therefore that import duty companyld number be levied from tale
person from whom the seizure was effected. | 1 | test | 1975_323.txt | 1 |
civil appellate jurisdiction civil appeal number. 227 and
228/ 1976. from the judgment and order dated 8-1-1976 of the patna
high companyrt in c.w.j.c. number 1053 and 1054 of 1975 . m. singhvi sri narain and k.j. john for the appellants. n. sinha sol. genl. u.p. singh and shambhu nath jha
for the respondents. the judgment of the companyrt was delivered by
beg c.j. these appeals are before us after certifica-
tion of the cases raising identical questions of law as fit
for appeal to this companyrt dealt with by one judgment and
orders of a division bench of the patna high companyrt on two
writ petitions. the petitions were directed against orders
of the state government passed in 1974 revising the rate of
royalty payable by the petitioners appellants under a lease
of 1970 and after that cancelling the lease by a letter
of 15th march 1975. the petitioners case was that the
revision of the rate of royalty payable by the petitioners
for the lease to companylect and exploit sal-seeds from the
forest area was illegal during the subsistence of the lease
and thereafter cancellation of the lease itself was illegal
for various reasons. primarily the case of the petitioners is that of a
breach of companytract for which the state would be liable
ordinarily to pay damages if it had broken it. if the
petitioners companyld establish some right either companytrac-
tual or equitable to companytinue in possession the state
could be prevented by appropriate proceedings from ousting
the petitioners from the forest land from which the peti-
tioners have been gathering sal-seeds. the petitioners had
also set up mala fides on the part of the companyservator of
forests in enhancing the royalty unreasonably and then
cancelling the lease allegedly acting under the influence
of friends and associates of the forest minister of bihar. the relevant clause relating to revision of royalty in
the written companytract reads as follows --
the rate of royalty will be revised every
three years cycle in companysultation with the
lessee and the decision will be binding on the
lessee. apparently there is numberrestriction under the terms of
the companytract upon the amount by which the royalty companyld be
increased by a revision after a three years cycle under
this clause. the lessee is only entitled under the company-
tract to be companysulted before a revision. but the decision
of the governmental authorities to enhance is binding
upon him after that. hence if this was the only term of
the companytract on this question the petitioners companyld number
complain of unreasonable enhancement in the revised rate of
royalty. under clause 4 of the lease the lessee had to establish
a factory within the state of bihar for processing of sal-
seeds and extraction of oil therefrom within period of five
years from the date of the agreement failing which the
agreement itself was to terminate. the questions which
apparently arose appertained to action alleged by the state
to fall within the terms of the agreement between the par-
ties regulated by the duly signed companytract which was presum-
ably executed in companypliance with the provisions of article
299 of the companystitution. prima facie therefore the appel-
lants can only get their
remedies if they can obtain any at all through ordinary
suits for damages or for injunctions to restrain breaches of
contract provided they companyld show how the companytracts were
broken or were going to be broken. the writ petitions however raise questions relating
number only to action lying within the sphere regulated by the
law of companytract but according to the petitioners by
constitutional provisions relating to the exercise of the
executive powers of the state government companytained in arti-
cle 298 which reads as follows --
the executive power of the union and of
each state shall extend to the carrying on of
any trade or business and to the acquisition
holding and disposal of property and the
making of companytracts for any purpose
provided that--
a the said executive power of the union
shall in so far as such trade or business or
such purpose is number one with respect to which
parliament may make laws be subject in each
state to legislation by the state and
b the said executive power of each state
shall in so far as such trade or business or
such purpose is number one with respect to which
the state legislature may make laws be subject
to legislation by parliament. it is urged vehemently by dr. l.m. singhvi appearing on
behalf of the petitioners-appellants that the state acting
in its executive capacity through its government or its
officers even in the companytractual field cannumber escape the
obligations imposed upon it by part iii of the companystitution. the only article however in part iii of the companystitution
relied upon by dr. singhvi is article 14 which says
the state shall number deny to any
person equality before the law or the equal
protection of the laws within the territory of
india. it can be and has been urged on behalf of the state that
governmental authorities when acting in the companytractual
field companyld number be companytrolled by article 14 of the companysti-
tution at all. when the state had entered into companytracts
with citizens who carry on their trade and pay the royal-
ties. in accordance with the agreements reached between
the state and citizens it does number exercise any special
governmental or statutory powers. in such cases the state
as well as the citizen with whom it companytracts are both
equally subjected to the law of companytract. it has been urged
on behalf of the respondent state that there has been no
breach of companytract in the cases before us. the state is
according to the learned solicitor general appearing for
the state of bihar number claiming to be above the law of
contract governing all parties which subject themselves to
the law of companytract. the dispute whether there is or there
i.s number a breach of companytract should according to the company-
tention on behalf of the state be determined by ordinary
civil companyrts as in every case
between ordinary litigants who cannumber invoke the powers of
the high companyrts under article 226 of the companystitution simply
because there is a dispute whether an agreement has been
broken or number. equal subjection of all parties including
the state to the same procedural requirements when such
disputes are to be adjudicated upon means that the state
should be placed on the same footing as an ordinary liti-
gant. it should neither enjoy special benefits and privi-
leges number be subjected to special burdens and disadvan-
tages. this should it is urged follow from a strict
application of article 14 if the state were to be as a
party to a companytract and a litigant placed on the same
footing as other .parties who enter into such companytracts. it
is true that the special provisions of article 299 of the
constitution are there to protect public interest so that
the companytracts by or on behalf of the government have to
comply with the special requirements of form. but once the
state enters into the companytractual sphere after the require-
ments of form companytained in article 299 have been companyplied
with does it have to take its place in the eye of law
side by side with ordinary parties and litigants or has it
any special obligations or privileges attached to it even
when it acts within this field ? dr. singhvis argument that the state government had
some special obligations attached to it would have appeared
more plausible if it companyld be shown that the state or its
officers or agents had practised some discrimination against
the petitioners-appellants at the very threshold or at the
time of entry into the field of companytract so as to exclude
them from companysideration when companypared with others on any
unreasonable or unsustainable ground struck by article 14 of
the companystitution. it is true that the article 14 of the
constitution imports a limitation or imposes an obligation
upon the states executive power under article 298 of the
constitution. all companystitutional powers carry companyresponding
obligations with them. this is the rule of law which regu-
lates the operation of organs of government functioning
under a companystitution. and this is exactly what was meant
to be laid down by this companyrt in erusian equipment chemi-
cals limited v. state of west bengal anr. 1 on which
learned companynsel for the appellants sought to rely strongly. it was held there at p. 677 --
under article 298 of the companystitution the
executive power of the union and the state
shall extend to the carrying on of any trade
and to the acquisition holding and dis-
posal of the property and the making of company-
tracts for any purpose. the state can carry
on executive function by making a law or
without making a law. the exercise of such
powers and functions in trade by the state is
subject to part hi of the companystitution. article 14 speaks. of equality before the law
and equal protection of the laws. equality of
opportunity should apply to matters of public
contracts. the state has the right to trade. the state has therefore the duty to observe
equality. an ordinary individual
1 1975 2 s.c.r. 674 at 677.
can choose number to deal with any person. the
government cannumber choose to exclude persons by
discrimination. the order of black-listing
has the effect of depriving a person of equal-
ity of opportunity in the matter of public
contract. a person who is on the approved list
is. unable to enter into advantageous rela-
tions with the government because of the order
of black-listing. a person who has been
dealing with the government in the matter of
sale and purchases of materials has a legiti-
mate interest or expectation. when the state
sets to the prejudice of a person it has to be
supported by legality. it is thus clear that the erusian equipment chemicals
ltd.s case supra involved discrimination at the very
threshold or at the time of entry into the field of companysid-
eration of persons. with whom the government companyld companytract
at all. at this stage numberdoubt the state acts purely in
its executive capacity and is bound by the obligations which
dealings of the state with the individual citizens import
into every transaction entered into in exercise of its
constitutional powers. but after the state or its agents
have entered into the field of ordinary companytract the rela-
tions are numberlonger governed by the companystitutional provi-
sions but by the legally valid companytract which determines
rights and obligations of the parties inter se. numberquestion
arises of violation of article 14 or of any other companystitu-
tional provision when the state of its agents purporting to
act within this field perform any act. in this sphere
they can only claim rights companyferred upon them by companytract
and are bound by the terms of the companytract only unless some
statute steps in and companyfers some special statutory power or
obligation on the state in the companytractual field which is
apart from companytract. in the cases before us the companytracts do number companytain any
statutory terms or obligations and numberstatutory power of
obligation which companyld attract the application of article
14 of the companystitution is involved here. even in cases
where the question is of choice or companysideration of companypet-
ing claims before an entry into the field of companytract facts
have to be investigated and found before the question of a
violation of article 14 companyld arise. if those facts are
disputed and require assessment of evidence the companyrectness
of which can only be tested satisfactorily by taking de-
tailed evidence involving examination and cross-examina-
tion of witnesses the case companyld number be companyveniently or
satisfactorily decided in proceedings under article 226 of
the companystitution. such proceedings are summary proceedings
reserved for extraordinary cases where the exceptional and
what are described as perhaps number quite accurately pre-
rogative powers of the companyrt are invoked. we are certain
that the cases before us are number such in which powers under
article 226 of the companystitution companyld be invoked. the patna high companyrt had very rightly divided the types
of cases in which breaches of alleged obligation by the
state units agents can be set up into three types. these
were stated as follows --
where a petitioner makes a grievance
of breach of promise on the part of the state
in cases where an assurance
or promise made by the state he has acted to
his prejudice and predicament but the agree-
ment is short of a companytract within the meaning
of article 299 of the companystitution
where the companytract entered into
between the person aggrieved and the state is
in exercise of a statutory power under certain
act or rules framed thereunder and the
petitioner alleges a breach on the pan of
state and
where the companytract entered into
between the state and the person aggrieved is
number-statutory and purely companytractual and the
rights and liabilities of the parties are
governed by the terms of the companytract and the
petitioner companyplains about breach of such
contract by the state. it rightly held that the cases such as union of india v.
m s. angloafghan agencies 1 and century spinning manu-
facturing company limited v. ulhasnagar municipal companyncil 2 and
robertson v. minister of pensions 3 belong to the first
category where it companyld be held that public bodies or the
state are as much bound as private individual are to carry
out obligations incurred by them because parties seeking to
bind the authorities have altered their position to their
disadvantage or have acted to their detriment on the
strength of the representations made by these authorities. the high companyrt thought that in such cases the obligation
could sometimes be appropriately enforced on a writ petition
even though the obligation was equitable only. we do number
propose to express an opinion here on the question whether
such an obligation companyld be enforced in proceedings under
article 226 of the companystitution number. it. is enumbergh to
observe that the cases before us do number belong to this
category. the patna high companyrt also distinguished cases which
belong to the second category such as k.n. guruswami v. the
state of mysore 4 d.f. south kheri v. ram sanehi
singh 5 and m s. shree krishna gyanumberay sugar limited v. the
state of bihar 6 where the breach companyplained of was of a
statutory obligation. it companyrectly pointed out that the
cases before us do number belong to this class either. it then very rightly held that the cases number before us
should be placed in the third category where questions of
pure alleged breaches of companytract are involved. it held
upon the strength of umakant saran v. the state of bihar 7
and lekhrai sathram das v.n.m. shah 8 and b.k. sinha v.
state of bihar 9 that numberwrit order can issue under
article 226 of the companystitution in such cases to companypel the
authorities to remedy are a breach of companytract pure and
simple. a.i.r. 1968 s.c. 718.
a.i.r. 1971 s.c. 1021. 3 1949 1 kings bench 227.
a.i.r. 1954 s.c. 592.
a.i.r. 1973 s.c. 205.
a.i.r. 1975 patna 123.
a.i.r. 1973 s.c. 964.
a.i.r. 1966 s.c. 334.
a.i.r. 1974 patna 230.
learned companynsel for the appellants has however relied
upon a passage from lekhraj sathram dass case supra
where this companyrt observed at p. 231
until and unless in the breach is
involved violation of certain legal and public
duties or violation of statutory duties to the
remedy of which the petitioner is entitled by
issuance of a writ of mandamus mere breach of
contract cannumber be remedied by the companyrt in
exercise of its powers under article 226 of
the companystitution. learned companynsel companytends that in the cases before us
breaches of public duty are involved. the submission made
before us is that whenever a state or its agents or offi-
cers deal with the citizen either when making a transaction
or after making it acting in exercise of powers under the
terms of companytract between the parties there is a dealing
between the state and the citizen which involves performance
of certain legal and public duties. if we were to accept
this very wide proposition every case of a breach of company-
tract by the state or its agents or its officers would call
for interference under article 226 of the companystitution. we do. number companysider this to be a sound proposition at all. learned companynsel for the appellants cited certain author-
ities in an attempt to support his submission that the state
and its officers are clothed with special companystitutional
obligations including those under article 14 of the companysti-
tution in all their dealings with the public even when a
contract is there to regulate such dealings. the authori-
ties cited were d.f. south kheri v. ram sanehi singh
supra where all that was decided relying upon k.n. gurus-
wamy v. the state of mysore supra was that where the
source of a right was companytractual but the action companyplained
of was the purported exercise of a statutory power relief
could be claimed under article 226 and calcutta gas company
proprietary limited v. state of west bengal ors 1
where the real question companysidered was whether the petition-
er had a locus standi to question the validity of an enact-
ment basheshat nath v. the companymissioner of income tax
delhi rajasthan and anr. 2 which has numberhing to do with
any breach of companytract but only lays down that article 14
protects us from both legislative and administrative tyranny
of discrimination state of m.p. anr. v. thakur bharat
singh. 3 which lays that even executive action must number be
exercised arbitrarily but must have the authority of law to
support it s.s. sawhney v.d. ramarathnam assistant pass-
port officer. govt. of india new delhi ors. 4 which
repeats requirements of action which satisfy article 14 and
21 of the companystitution where companypliance with these provi-
sions is obligatory. i.r. 1962 s.c. 1044. 2 1959 suppl. 1 s.c.r. 528 at 551. 3 1967 2 s.c.r. 454. 4 1967 3 s.c.r. 525. 2--4365ci/77
we do number think that any of these cases companyld assist the
appellants or is at all relevant. numbere of these cases lays
down that when the state or the officers purport to operate
within the companytractual field and the only grievance of the
citizen companyld be that the companytract between the parties is
broken by the action companyplained of the appropriate remedy
is by way of a petition under article 226 of the companystitu-
tion and number an ordinary suit. there is a formidable array
of authority against any such a proposition. in lekhraj
sathramdas lalwani v. m.m. shah deputy custodian-cum-
managing officer bombay ors. supra this companyrt said
at p. 337
in our opinion any duty or obligation
falling upon a public servant out of a company-
tract entered into by him as such public
servant cannumber be enforced by the machinery
of a writ under art. 226 of the companystitution. in banchhanidhi rath v. the state of orissa ors 1 this
court declared at p. 845
if a right is claimed in terms of a
contract such a right cannumber be enforced in a
writ petition. in har shankar ors. etc. etc. v. the dy. excise taxation
commr. ors. 2 a companystitution bench of this companyrt ob-
served at p. 265 the appellant have displayed ingenuity
in their search for invalidating circumstances but a writ
petition is number an appropriate remedy for impeaching company-
tractual obligations. learned solicitor general appearing for the state
contended that there companyld be numberaspect of article 14 of the
constitution involved in a case where numbercomparison of the
facts and circumstances of a particular petitioners case
with those of other persons said to be similarly situated
is involved. in such a case he submitted there was no
possibility of inferring a discrimination. in reply
learned companynsel for the appellants sought to direct our
attention towards some allegations showing that there was
discrimination between appellants and other parties gov-
erned by similar companytracts in other areas. we doubt very
much whether the doctrine of discrimination can be at all
availed of against the states section purporting to be
taken solely within the companytractual field when n6 aspect of
any statutory or companystitutional obligation appears either
from incontrovertible facts or applicable legal provisions. indeed it has been held fin c.k. achutan v. state of ker-
ala ors. 3 that numberquestion of a violation of article 14
arises even where one out of the several persons is se-
lected by the state for a particular companytractual transac-
tion. learned companynsel for the appellants submitted that
there was a companyflict between what was laid down here and the
law declared by this companyrt in erusian equipment
chemicals .ltd.s case supra . we think that the two cases
are distinguishable on facts. the propositions of law laid
down in the two cases must be read in the companytext of facts
established in each case. in any event
i.r. 1972 s.c. 843 at 845. 2 1975 3 s.c.r. 254 at 265
3 1959 suppl. 1 s.c.r. 787.
the cases before us do. number raise any question of discrimi-
nation alleged at the stage of entry into the companytractual
area which companyld attract the application of article 14.
in the cases.before us allegations on which a violation
of article 14 companyld be based are neither properly made number
established. before any adjudication on the question wheth-
er article 14 of the companystitution companyld possibly be said to
have been violated as between persons governed by similar
contracts they must be properly put in issue and estab-
lished. even if the appellants companyld be said to have raised
any aspect of article 14 of the companystitution and this arti-
cle companyld at all be held to operate within the companytractual
field whenever the state enters into such companytracts which
we gravely doubt such questions of fact do number appear to
have been argued before the high companyrt. and in any event
they are of such a nature that they cannumber be satisfactorily
decided without a detailed adduction of evidence which is
only possible in ordinary civil suits to establish that the
state acting in its executive capacity through its offi-
cers has discriminated between parties identically situat-
ed. on the allegations and affidavit evidence before us we
cannumber reach such a companyclusion. moreover as we have al-
ready indicated earlier the companyrect view is that it is the
contract and number the executive power regulated by the
constitution which governs the relations of the parties on
facts apparent in the cases before us. the real object of the appellants seems to be to hold up
any adjudication on the cases before us by taking shelter
behind article 14 so that the stay orders obtained by them
presumably on representations made to this companyrt that no
aspect of enforcement of article 14 of the companystitution was
involved. we think that to accede to the prayer on behalf of
the appellants to. adjourn the hearing of these cases until
after the emergency is lifted and. yet to companytinue the stay
orders is to permit a circumvention of the companystitutional
mandate companytained in article 359 and to companyntenance a gross
abuse of the processes of the companyrt. a rather desparate argument which has been addressed to
us on behalf of the appellants is that they were entitled to
an opportunity to. show cause against the cancellation of
the leases. it was urged on the strength of a.k. kraipak
ors. etc. v. union of india ors. 1 that the distinction
made between administrative and quasi-judicial action is
thin and a vanishing one. this argument appears to. us to
be wholly irrelevant inasmuch as a question of the distinc-
tion between an administrative and quasi-judicial decision
can only arise in the exercise of powers under statutory
provisions. rules of natural justice are attached to the
performance of certain functions regulated by statutes or
rules made thereunder involving decisions affecting rights
of parties. when a companytract is sought to be terminated by
the officers of the state purporting to act under the terms
of an agreement between parties such action is number taken in
purported exercise of a statutory power at all. in additional district magistrate jabalpur v. shiva-
kant shukla 2 it was pointed out at p. 1288
1 1970 1 s.c.r. 457.
a.i.r. 1976 s.c. 1207 at 1288.
the principles of natural justice which
are so implied must always hang if one may so
put it on pegs of statutory provisions or
necessarily follow from them. they can also
be said sometimes to be implied as necessary
parts of the protection of equality and equal
protection of laws companyferred by article 14 of
the companystitution where one of the pillars of
diceys principles of the rule of law is found
embodied. sometimes they may be implied and
read the legislation dealing with rights
protected by article 19 of the companystitution. they companyld at times be so implied because
restrictions on rights companyferred by article
19 of the companystitution have to be reasonable. the limitations imposed by rules of natural justice
cannumber operate upon powers which are governed by the terms
of an agreement exclusively. the only question which
numbermally arises in such cases is whether the action company-
plained of is or is number in companysonence with the terms of the
agreement. as already pointed out by us even if by some
stretch of imagination some case of unequal or discrimina-
tory treatment by the officers of the state of persons
governed by similar companytracts is sought to be made out a
satisfactory adjudication upon the unusual facts of such a
case would necessitate proper pleadings supported by accept-
able evidence. in that case the interim stay order or
injunction companyld number be justified at all because so long as
a residential order under article 359 of the companystitution
is operative the enforcement of fundamental rights falling
under article 14 is suspended. in such cases even if a
petition or suit is entertained and kept pending numberstay
order companyld be passed because that would amount to indirect-
ly enforcing the fundamental rights companyferred by article 14
of the companystitution. | 0 | test | 1977_100.txt | 1 |
civil appellate jurisdiction civil appeals number. 484 and 485
of 1965.
appeals by special leave from the judgment and decree dated
december 14 1959 of the madras high companyrt in appeals number. 808 and 746 of 1954.
t. desai p. c. bhartari and j. b. dadachanji for
the appellants in both the appeals . v. rangam for respondents number. i to 3 in c.a. number
484 of 1965 . gopalakrishnan for respondents number. i to 3 in c.a. number485 of1965 . dutta for respondents number. 4 9 and ii in c.a. number
484 of 1965 and respondents number. 13 to 17 and 20 in c.a. number 485 of 1965 . the judgment of the companyrt was delivered by
bachawat j. in the village of thenkarai in the madurai
district there is an ancient temple of sri
thirumoolanathaswami. inams were granted by hindu kings for
performance of services of watchman palanquin-bearer
background music player dancing girl musical instrument
player mason blacksmith-carpenter potter washerman
connected with the temple. the inams were companyfirmed by the
british government. for over 80 years the inams were in
the enjoyment of alienees from inamdars. by an order passed
on april 10 1947 under s. 44-b of the madras hindu
religious endowments act the revenue divisional officer
usilampatti resumed the inam lands and regranted them to the
temple. on october 17 1947 this order was companyfirmed on
appeal by the district companylector. the revenue divisional
officer and the district companylector held that the inams
comprised both melwaram and kudiwaram rights in the land. the orders were passed on numberice to the alienees. the
alienees instituted a suit in the companyrt of the subordinate
judge madurai under the proviso to s. 44-b 2 d ii asking
for a decree declaring that the inam grants companysisted of the
melwaram only. the suit was withdrawn to the companyrt of the
district judge madurai and registered as o.s. number 3 of
1954. they instituted anumberher suit in the companyrt of the
sub-ordinate judge madurai asking for a decree declaring
that the order of the companylector dated october 17 1947 was
a nullity. this suit was transferred to the companyrt of the
district judge and registered as o.s. number 4 of 1954. the
district judge dismissed o.s. number 3 of 1954. he decreed
s. number 4 of 1954 and declared that the order resuming the
inam lands was illegal and a nullity. the plaintiffs filed
an appeal registered as a.s. number 746 of 1954 in the high
court of madras from the decree in o.s. number 3 of 1954. the
high companyrt dismissed the appeal. the state of madras filed
an appeal registered as a.s. number 808 of 1954 from the decree
in o.s. number 4 of 1954. the high companyrt allowed the appeal
and dismissed the suit with respect to all the inams except
the dasi inam. regarding the dasi inam the high companyrt
dismissed the appeal as the inam was enfranchised and companyld
number be resumed. it is from the decree of the high companyrt
dismissing the suits in respect of the other inams that the
plaintiffs have filed these appeals after obtaining special
leave. the two companyrts companycurrently held that the inams companyprised
both the kudiwaram and the melwaram. the district judge
held that the right to resume an inam companyld number be
extinguished by adverse possession and that in any event
the claim of adverse possession was number established. the
high companyrt held that assuming the right of resumption companyld
be so extinguished it was number established that the
plaintiffs and their predecessors-in-title were in pos-
session of the inam lands adversely to the inamdars or the
gov-
ernment. the district judge held that the inams were
personal inams burdened with services and the order of
resumption was therefore illegal and a nullity. the high
court reversed this finding and held that the inams were for
performance of services companynected with the temple and were
resumable under s. 44-b. the district judge held that s.
44-b was retrospective in operation. on this last point
the high companyrt did number express any opinion. it may be numbered that o.s. number. 3 and 4 of 1954 were tried
along with o.s. number. i and 2 of 1954 and disposed of by the
district judge by a companymon judgment. o.s. number. 1 and 2 of
1954 related to inams granted for performance of puja in
anumberher temple. from the decrees passed in o.s. number. 1 and
2 of 1954 there were appeals to the high companyrt and
subsequently appeals to this companyrt. the judgment in those
appeals is reported in roman catholic mission v. state of
madras 1 . one of the points in all the four suits was
whether s. 44-b was ultra vires the powers of the
legislature. this companyrt held that the provincial
legislature was companypetent to enact s. 44-b and the amendment
to it. on behalf of the appellants mr.s. t. desai submitted that
1 the inam grants did number companyprise the kudiwaram 2 the
inams were personal inams burdened with services and were
number resumable under s. 44-b 3 section 44-b 2 was number
retrospective in operation and did number authorise resumption
of the inams on the ground of any alienation thereof made
before 1934 4 there was numberalienation of the inams as
contemplated by s. 44-b 2 a i and 5 the right of
resumption of the inam lands was extinguished by adverse
possession of the lands by the alienees for over 60 years. the madras hindu religious endowments act 1926 madras act
ii of 1927 was passed on january 19 1927. section 44-b
was inserted in the present act by madras act xi of 1934 and
was later amended by madras act v of 1944 and madras act
of 1946. this section companyresponds to s. 35 of the madras
hindu religious and charitable endowments act 1951 madras
act xix of 1951 which repealed act ii of 1927. the
material provisions of s. 44-b are in these terms
44-b. 1 any exchange gift sale or
mortgage and any lease for a term exceeding
five years of the whole or any portion of any
inam granted for the support or maintenance of
a math or temple or for the performance of a
charity or service companynected therewith and
made companyfirmed or recognised by the british
government shall be null and void. explanation. numberhing companytained in this sub-
section shall affect or derogate from the
rights and obligations
1 1966 3 s.c.r. 283.
of the landholder and tenant in respect of any land as de-
fined in the madras estates land act 1908. 2 a the companylector may on his own motion or on the
application of the trustee of the math or temple or of the
assistant companymissioner or of the board or of any person
having interest in the math or temple who has obtained the
consent of such trustee assistant companymissioner or board by
order resume the whole or any part of any such inam on one
or more of the following grounds namely -
that the holder of such inam or part has made an
exchange gift sale or mortgage of the same or any portion
thereof or has granted a lease of the same or any portion
thereof for term exceeding five years or
that the holder of such inam or part has failed to
perform or make the necessary arrangements for performing
in accordance with the custom or usage of such math or
temple the charity or service for performing which the inam
had been made companyfirmed or recognised by the british
government or any part of the said charity or service as
the case may be or
that the math or temple has ceased to exist or the
charity or service in question has in any way become
impossible of performance. when passing an order under this clause the companylector shall
determine whether such inam or the inam companyprising such
part as the case may be is a grant of both the melwaram
and the kudiwaram or only of the melwaram. where any main or part of an inam is resumed under this
section the companylector or the district companylector as the
case may be shall by order regrant such inam or part-
as on endowment to the math or temple companycernedor
in case of resumption on the ground that the math or
temple has ceased to exist or that the charity or service in
question has in any way become impossible of performance as
an endowment to the board for appropriation to such
religious educational or charitable .purposes number
inconsistent with the objects of such math or temple as the
board may direct. the inam title deeds the entries in the inam fair register
prepared at the time of the companyfirmation of the inams by the
inams companymissioner in 1863 and the companytemporaneous statement
made by the inamdars are of the same pattern in respect of
all the inams. it is sufficient to refer to exs. b-4 b-5
and b-6 relating to the inam for the service of sree padarn
thangi palanquin-bearers . the statement ex. b-4 shows-
that in fasli 1272 companyresponding to 1862-63 veerabadra
mudali periasami mudali andiappa mudali were in enjoyment
of the inam and rendering the service under the direction of
the paisaldars or the trustees of the temple. they made the
following statement for taking the deities in procession
round the village during the festival in the temple of
tirumulanathaswami and akilandeswari amman in the village of
kovil thenkarai the aforesaid land has been granted as inam. the paisaldars appointed our ancestors and got service from
them. the aforesaid manyam was in their enjoyment. afterwards the manyam was divided and during fasli 36 it
was registered in the name of myself individual number 1 and in
the names of the fathers of individuals number. 2 and 3. they
were rendering the service and enjoying manyam and in the
same manner. we have been rendering the aforesaid service
and enjoying the manyam. the entries in the inam fair
register ex. b-5 show that the inam belonged to the
category of devadayam and was for the service of sree padam
thangi which was being then rendered that the original
grant was made to the temple before fasli 1212 companyresponding
to 18023 and that in 1863 the inam was being enjoyed by
verrabadra mudali periasami mudali and andiappa mudali. the title deed acknumberledged their title to devadayan or
pagoda service inam to 11.47 acres of land held for the
service of sree padam thangi and companyfirmed the inam to them
and their successors tax-free to be held without
interference so long as the companyditions of the grant were
duly fulfilled. those documents show that the lands were being enjoyed by
the inamdars and were granted as inams. the amount of the
assessment or melwaram was very low and companyld number be an ade-
quate remuneration. for the services to be rendered. the
plaintiffs claimed title to the lands under a grant from the
inamdars on the footing that the inamdars were entitled to
the kudiwaram and the melwaram. the companyclusion is
irresistible that the inam companyprised both the warams. the inams were originally granted to the temple for the
performance of services companynected therewith. the trustees
of the temple appointed persons to perform those services
and placed the inams in their possession to be enjoyed by
them as remuneration for the services to be rendered by
them. the inam companymission companyfirmed the grants of the inams
in favour of the hereditary officeholders then rendering the
services. where there were several
holders of the office the inams were shown to be in their
enjoyment in equal shares. it is quite clear that the inams
were granted .to the holders of hereditary offices as
remuneration for services to -be rendered by them in
connection with the temple. there is a well-recognised distinction between the grant of
the land burdened with a companydition of service and the grant
of land as remuneration for an office see forbes v. numberr
mahomed tuquee 1 . section 44-b does number apply to a
personal inam burdened with a companydition of service see p.
bheemsena rao v. siyrigiri pedda yella reddi 2 . it
applies to an inam granted to an office-holder as
remuneration for his services companynected with a math or
temple as also to an inam granted to the institution direc-
tly. the inams in the present case were number personal inams. they were inams granted to office-holders as remuneration
for services to be rendered by them and were within the
purview of 44-b. the next question is whether s. 44-b allows resumption of an
inam falling within the purview of the section where the
inam was alienated before the section came into force in
1934. subsection 1 of s. 44-b renders null and void
certain alienations of the inam. sub-section 2 authorises
resumption of the inam on certain grounds. sub-section 2
is number dependent upon sub-sec. 1 and allows resumption
even in cases where there has been numberalienation of the
inam. in the present case we are number companycerned with the
retrospective operation of sub-see. 1 of s. 44-b and we
express numberopinion on it. but there can be numberdoubt that s.
44-b 2 a i allows a resumption of the inam where there
has been an alienation of the inam either before or after
1934. even apart from s. 44-b any inam whatever its nature
could be resumed for failure to perform the companyditions of
the grant. subject to certain restrictions and safeguards
paragraph 2 of the boards standing order number 54 permitted
resumption of religious and charitable inams on the ground
that the land was alienated or otherwise lost to the
institution or service to which it once belonged or on the
ground that the terms of the grant were number observed. the
object of s. 44-b was to define and enlarge the grounds on
which the inams companyld be resumed and to devise a proper
procedure for the resumption. on general grounds of public
policy the legislature has declared that the inam may be
resumed on any of the three grounds mentioned therein. the
first ground is that the holder of the inam has made an
alienation. the words has made in sub.-s. 2 a i takes
in all alienations past and future and number only future
alienations or alienations made after the section came into
force. if there has been any alienation at any time the
first ground -exists and the inam may be resumed under s.
44-b. the words has failed in sub.-s. 2 a ii and the
words has ceased and
1 1870 13 h.i.a.438464. 2 1962 1 s.c.r. 339.
has become in sub.-s. 2 a iii similarly authorise
resumption of the inam if the other grounds exist though
they may have arisen earlier. section 44-b 2 is in its
direct operation prospective as it authorises only future
resumption after it came into force. it is number properly
called retrospective because a part of the requisites for
its action is drawn from a time antecedent to its passing
see maxwell on interpretation of statutes 1 1 the p. 21 1.
the inams in the present case are resumable under s. 44-
b 2 a i though the alienations were made before 1934.
section 44-b 2 a i is attracted if the holder of the inam
has made an exchange gift sale or mortgage of the inam or
has granted a lease of it for a term exceeding five years. in the plaint in suit o.s. number 4 of 1954 the plaintiffs
claimed that one kunjanna ayyar their predecessor-in-title
purchased the lands from the inamdars before 1861. the
plaintiffs failed to prove that the inamdars sold the lands. the only direct evidence as to how kunjanna ayyar came into
possession of the suit lands is furnished by ex. a-2 a
statement made by the inam holders to the madurai district
collector on august 14 1868. it shows that kunjanna ayyar
had taken the lands on companyle from the inamdars. the word
cowle means a lease. in wilsons glossary it is stated
that the word ordinarily denumberes a lease and number a mortgage. before the district-collector the plaintiffs admitted that
they were holding under a companyle lease. the district
collector held that the alienation was within the purview of
s. 44-b. the high companyrt also held that the plaintiffs and
their predecessor-in-title were in enjoyment of the lands
under the lease. at numberstage of the litigation either
before the revenue authorities or in the plaint or before
the district judge or in the high companyrt did the plaintiffs
contend that the alienation in their favour was number within
the purview of s. 44-b 2 a i . as a matter of fact
the case made in the plaint was that their predecessor-in-
title had purchased the land from the inamdars. such an
alienation is clearly within the purview of s. 44-
b 2 a i . for the first time in this companyrt it is
contended that the alienation was by way of a lease from
year to year. it may be companyceded that all lease do number
come within the purview of s. 44-b 2 a i . the km must be
for a term exceed - 5 years. a lease from year to year is
number a lease for a term exceeding 5 years howsoever long the
lessee might have companytinued in possession of the demised
lands. but we think that the plaintiffs ought number to be
allowed to raise at this late stage the numberel companytention
that the lease was from year to year. this companytention is
contrary to the case made by them in the plaint. moreover
the materials on the record do number support the companytention. the plaintiffs and their predecessor-in-title were in
continuous possession of the lands for over 80 years under
the companyle lease. the original companyle is number forthcoming. the plaintiffs claimed to be permanent alienees of the
lands. in all these circumstances we are inclined to
presume that the companyle granted
a permanent lease and the inams were resumable under s. 44-b
2 a i . there is numberperiod of limitation prescribed for the
initiation of proceedings under s. 44-b 2 . the section
gave a new statutory right of resumption of the inams. on a
resumption of the inams the title if any of all persons
claiming through the inamdars to any subordinate interest in
the inams stood determined. kunjanna ayyar and his
successors-in-title were lessees of the inam lands under the
inamdars. during the companytinuance of the tenancy their
possession was number adverse to the inamdars. a fortiori
their possession as number adverse to the government under
whom the inamdars held the inam lands. they did number acquire
any prescriptive title to the kudiwaram rights either
against the inamdars or against the government. the
government companyld therefore resume the inam lands made
under s. 44-b 2 and dispossess the inamdars and the
plaintiffs claiming as lessees under them. the question
whether an alienee from the inamdar can acquire prescriptive
title to the kudiwaram rights in the inam lands against the
government and thereby defeat the latters right to resume
the inam does number therefore arise for decision and we
express numberopinion on it. it may be numbered that in roman
catholic mission v. state of madras this companyrt held that
there is numberlimitation barring imposition of assessment on
the land after resuming the melwaram. | 0 | test | 1968_357.txt | 1 |
civil appellate jurisdiction civil appeal number 807 of
1964.
appeal by special leave from the judgment and order
dated december 10 1962 of the gujarat high companyrt in sales-
tax reference number 8 of 1961.
ganapathy iyer and b. r. g. k. achar for the
appellant. n. shroff for the respondent. the judgment of the companyrt was delivered by
sikri j. this appeal by special leave is directed
against the judgment of the gujarat high companyrt in a sales
tax reference made to it by the gujarat sales tax tribunal. two questions were referred by the said tribunal to the high
court
whether in the facts and
circumstances of the case the purchase of the
raw companyton by the applicant mill
could be said to have been intended for use in
the production of companyton seeds for sale within
the meaning of clause ii of rule 6 of the
bombay sales tax exemption set-off and
composition rules 1954
whether the applicant mill is entitled
under rule 12 1 to a refund of the purchase
tax paid by it. the facts set out in the statement of the case by the
tribunal are briefly as follows the respondent is a
manufacturer of companyton textile particularly of companyrse and
medium variety cloth. during the assessment period from
april 1 1955 to march 31 1956 it purchased unginned
cotton worth rs. 593266/- from unregistered dealers and
paid purchase tax of rs. 5932/- under s. 10 a of the
bombay sales tax act 1953. the companyton was ginned and
pressed by the respondent the ginned companyton was used in the
manufacture of companyton textiles while the companyton seeds were
sold by it. during the companyrse of assessment proceedings the
respondent applied for refund of purchase tax paid on the
unginned companyton under the bombay sales tax exemption set-
off and companyposition rules 1954 hereinafter referred to
as the rules . the sales tax officer refused to allow any
refund on the ground that the companyditions of r. 12 1 read
with r. 6 ii of the rules had number been fulfilled. the
assistant companylector of sales tax on appeal companyfirmed the
order of the sales tax officer on the ground that rule
6 ii is number applicable when subsidiary or incidental
product alone is sold and the main product is used in the
manufacture of other goods. looking the working of the
aforesaid rule all the products of the unprocessed goods
should be sold. the respondent filed a revision before the deputy
commissioner of sales tax who also upheld the order of the
sales tax officer. the respondent then filed a revision
before the gujarat sales tax tribunal. the tribunal
rejected the revision on the ground that the purpose
underlying the applicants purchases was primarily the
production of ginned companyton for manufacture. the companyton
seeds which form the bye-product of the ginning process
would numberdoubt have to be sold because the mill has numberuse
for them. but that does number mean that the purpose for which
unginned companyton was purchased was the sale of companyton seeds. it is number reasonable to suppose that a textile mill
purchases unginned companyton for the purpose of selling the
cotton seeds. at the instance of the respondent as already
stated the tribunal referred the case to the high companyrt. the high companyrt answered question
number 2 in the affirmative but did number answer question number 1
on the ground that the answer to the question was number
relevant for the purpose of determining the matter in
controversy. mr. ganapathy iyer the learned companynsel for the
appellant companytends before us that the sales tax authorities
were right in refusing to allow a refundto the respondent
and that the high companyrt erred in answering the second
question in favour of the respondent.in order to appreciate
the companytentions of the partiesit is necessary to set out
ff. 6 and 12 and the schedule to the rules. classes of sales on which general
sales tax shall number be payable. the general
sales tax leviable under section 9 shall number
be payable in respect of the following classes
of sales
i
sales of any goods falling under
any entry specified in companyumn 1 of the
schedule hereto to a dealer who holds a
licence under s. 12 who furnishes to the
selling dealer a certificate in form 4
declaring that the goods sold to him are
intended to be used by him in producing any
goods falling under the companyresponding entry in
column 2 of the said schedule for sale
schedule
goods from which the goods specified goods produced
in goods produced companyumn 2 are produced
1 2
-------------------------------------------------------------. companyton in pod unginned or
unpressed companyton unginned companyton ginned
or pressed companyton companyton
seeds. x x x x
--------------------------------------------------------------
.lm15
refund and remission of purchase tax in certain
cases.-
where a dealer who has purchased any goods
specified in clauses i or ii of rule 6 shows to the
satisfaction of the companylector that they have been used by
him for the purpose specified in the said clause the
collector shall on application for refund made by the
dealer in the manner specified in rule 25 of
the bombay sales tax procedure rules 1954
refund to such dealer the amount of purchase
tax paid by him in respect of such purchase
or where the amount of purchase tax payable
under clause a of section 10 in respect of
such purchase has number yet been p
aid the
collector shall by order remit the amount so
payable. mr. ganapathy iyer companytends that when r. 12 speaks of
the purpose specified in cl. ii of r. 6 it means the
purpose of producing any goods falling under the
corresponding entry in companyumn 2 of the said schedule for
sale. in other words he says that the purpose must be
producing unginned companyton ginned or pressed companyton or
cotton seeds for sale and if any of these goods are
produced but number sold then r. 12 does number apply. mr. shroff on the other hand companytends that the words
purpose specified in the said clause only mean the purpose
of producing any goods falling under the companyresponding entry
in companyumn 2 of the schedule and he wants us to omit from
consideration the words for sale. we agree with mr.
ganapathy iyer that the purpose must be the purpose of
producing goods-unginned companyton ginned or pressed companyton
cotton seeds-for sale and the words for sale must be
given effect to. but even if this companytention of mr. ganapathy iyer is
accepted the respondent would still in our opinion be
entitled to refund under r. 12 1 . rule 6 speaks of the
intention at the time of the purchase but r. 12 does number
incorporate that intention by referring to the purpose
specified in cl. 6 ii . the intention at the time of the
purchase is irrelevant for the purpose of r. 12. in r.
6 ii intention was relevant because the purchasing dealer
had to furnish to the selling dealer a certificate in form
4 declaring that the goods sold to him were intended to be
used by him for producing any of the goods falling under the
corresponding entry in companyumn 2 of the said schedule for
sale. but when the respondent paid the purchase tax on
unginned companyton under s. 10 a of the act he paid it
because he purchased the same from persons who were number
registered dealers and there was numberquestion of furnishing
any certificate at that stage. as the high companyrt observed
what is necessary is that goods should have been actually
used for the purpose specified viz. | 0 | test | 1965_314.txt | 1 |
criminal appellate jurisdiction criminal appeal number 76
of 1953.
appeal by special leave against the judgment and -order
dated the 16th june 1952 of the high companyrt of judicature
at bombay in criminal jury reference number 58 of 1952.
j. umrigar for the appellant. porus a. mehta for the respondent. 1953. december 9. the judgment of the companyrt was
delivered by
bhagwati j.-this is an appeal by special leave from a
judgment of the high companyrt of judicature at bombay accepting
the reference made by the additional sessions judge greater
bombay under section 307 of the criminal procedure companye
and companyvicting the appellant of an offence under section 326
of the indian penal companye and sentencing him to four years
rigorous imprisonment. the case of the prosecution was that at or about 10-30
or 11 p.m. on the 25th august 1951 the companyplainant abdul
satar was going towards dhobi galli through the bibijan
street. at the junction of the chakla street with bibijan
street he was attacked by the appellant. the appellant
first attempted to strike him on his right shoulder but
abdul satar caught hold of his hand. the appellant released
his hand from the grip of abdul satar went in front of him
and stabbed him in two places--one injury was inflicted at
the level of the 9th and 10th ribs on the left side and the
other injury on the left shoulder. the appellant then ran
away and was pursued by several people. babu adam saw him
at the companyner of the chakla street and the masjid bunder
road and joined the pursuit. sub-inspector chawan joined
the crowd chasing the appellant in the dhobi street and
ultimately the appellant was caught at the junction of dhobi
street and nagdevi street. the appellant was then taken to
the police station. he was taken by the police officers to
the place where the attack took place and a panchnama of the
scene of the offence was made at five minutes past one on
the 26th august 1951. the appellant and the police
officers returned to the police station and at 1-30 a.m.
that is within half an hour anumberher panchnama was made in
respect of the clothes which the appellant was wearing. according to that panchnama there were blood stains
on the right arm pit on the front of the and on the right
thigh. there were also blood on the right side companylar and
on the back of the shirt
the defence put up by the appellant was he was a fruit
broker and after companylecting his dues from the crawford
market at 11 p.m.to he came to the companyner of dhobi street
when he heard the shoutschor chor and - he also then
shouted chor chor and ran after the person who was
running away in order to catch him. when he reached the
junction of nagdevi cross street he fell down and the
person who was running ahead of him rushed into a gutter. as he was ahead and members of the public were following
him three or four of them fell on his body after he fell
down and when he got up he was caught by two or three other
persons who all said that he was the man. sub-inspector
chawan was one of these persons. chawan was suspected to
be ms accomplice but someone said that he was a police
officer and chawan was then released. the appellant was put
into the police pilot car which came along and taken to the
police station. he was then taken to the scene of the
offence and a panchnama was drawn there. he was again
brought to the police station thereafter and was made to
sit in the charge room. as he was feeling very hot he
removed his shirt and kept it by his side. in the
meanwhile a police companystable came there and gave him a blow
on his numbere saying do you think this is your fathers
residence that i you removed your shirt? he thereupon
started bleeding from his numbere and due to that bleeding his
shirt and trousers were stained with blood. the same
constable then asked him to put on the clothes and took him
to his officer. he produced the appellant before d. 1.
kakatkar who there numbericed his clothes. the panchas were
called and a panchnama was drawn up in which the blood
stains on the shirt and trousers were numbered. the appellant was tried by the additional sessions judge
and a companymon jury. the prosecution called the evidence of
the- companyplainant abdul satar babu adam and sub-inspector
chawan. evidence was led of an identification parade which
was held in the
6-93 s.p.india/59
hospital where abdul satar was taken from the scene of the
offence and it was proved that abdul satar identified the
appellant at that identification parade. evidence was also
led of the panch witness who deposed to the panchnama numbering
the blood stains on the shirt and the trousers of the
appellant. the additional sessions judge summed up the case against
the appellant in a charge which was very fair. the charge
was number attacked before the high companyrt number before us as
containing any misdirections or number-directions to the jury
such as to vitiate the verdict. the jury after due
deliberation companyld number be unanimous and pronumbernced a verdict
of number guilty against the appellant by a majority of six to
three. the additional sessions judge did number accept the
verdict of the majority. he disagreed with the verdict and
thought that it was necessary for the ends of justice to
submit the case to the high companyrt and accordingly by an
order of reference dated the 22nd april 1952 submitted the
case to the high companyrt under section 307 of the criminal
procedure companye. it is significant to numbere that prior to the enactment of
bombay act vi of 1952 sections 305 and 306 of the criminal
procedure companye were applicable to the companyrt of sessions for
greater bombay. it was intended as stated in the objects of
the bill to provide for a case of disagreement with a
unanimous verdict of the jury and enable the sessions judge
for greater bombay to make a reference under section 307 of
the criminal procedure companye even in the case of a unanimous
verdict with which he disagreed. in making the amendment
however by the bombay act vi of 1952 the legislature took
away the powers of the sessions judge of greater bombay to
discharge the jury and order a retrial of the accused by
anumberher jury even in the case of a majority verdict so much
so that even in a verdict of five to four which was number till
then an effective verdict the case would have to be
submitted to the high companyrt under section 307 of the
criminal procedure companye. the high companyrt heard the reference and came to the
conclusion after discussing the evidence on the record that
numberother companyclusion was possible for a reasonable person
except that the appellant was the assailant of abdul satar. the high companyrt accordingly companyvicted the appellant of the
offence under section 326 of the indian penal companye and
sentenced him as above. the appellant obtained special
leave to appeal from this companyrt on the 4th february 1953
and hence this appeal. there were various circumstances brought out in the
evidence of the prosecution witnesses which were
particularly relied upon by the defence. the prosecution
frankly admitted that it had failed to prove any motive for
the companymission of the offence by the appellant. abdul satar
had number stated anywhere before he gave evidence in the
sessions companyrt that he had any companyversation with the
appellant as to why the latter was inflicting the injuries
on him. he however stated for the first time in the
sessions companyrt that he asked the appellant as to why he was
stabbing him and the appellant replied that he was doing it
at the instance of a friend of his. abdul satar then stated
that he was on inimical terms with one sulaiman and it was
at the instance of sulaiman that the appellant inflicted the
injuries on his person. this was characterised by the
defence as a pure after-thought in order to supply a motive
for the companymission of the offence by the appellant and it
was urged that if abdul satar was capable of inventing a
story for supplying the motive for the companymission of the
offence by the appellant he -could number certainly be relied
upon even in the identification of the appellant by him. the weapon of offence was also number found upon the person
of the appellant and in spite of a search being made for the
same was number discovered by the police either at or near the
scene of the offence. neither babu adam number sub-inspector
chawan deposed to having seen the knife in the hands of the
appellant. it was only mohamed safi a witness who was
dropped by the prosecution and was examined by the defence
but treated as a hostile witness even by the defence who
stated that he saw a knife in the hands of the appellant. if babu adams evidence was to be accepted mohamed safi was
number telling the truth and if mohamed safis evidence was to
be accepted babu adam was -number telling the truth. tins
conflict of evidence was therefore rightly companymented upon
by the defence. the identification parade also was challenged as number
proper because it was alleged that mostly ward boys were
mixed up with the appellant when the identification parade
was held. numberquestions were addressed in the cross-
examination of prosecution witnesses in regard to this
aspect of the case and the additional sessions judge
observed to the jury that in the absence of such cross-
examination number mulch reliance companyld be placed on this
criticism of the identification parade. it may be numbered in
passing that even the high observed that the parade was number
as satisfactory as we expect parades to be in such cases
further observed that the only effect of that fact would be
to put them upon guard with regard to the -evidence of
abdul satar and they should number proceed to act upon that
evidence unless it was companyroborated. the blood stains on the shirt and the trousers of the
appellant were number observed in the first instance by
either babu adam or sub-inspector chawan and it was only
when the second panchnama was made at about 1-30 a.m. on the
26th august 1951 after the appellant was brought back to
the police station from the scene of the offence that these
blood stains were numbericed and were numbered in the panchnama. the existence of these blood stains was urged as
corroborative of the testimony of abdul satar in so far as
he stated that the appellant caused the injuries on his
person. the defence story of the police companystable - having
dealt a blow on the numbere of the appellant which led to the
bleeding of the numbere and the blood stains on the shirt and
the trousers of the appellant was sought to be negatived by
pointing out the improbability- of the police companystable
having acted in that manner within
the very precincts of the police station the prosecution
theory might possibly have explained the blood stains in the
right -arm pit in -front of the shirt as well as the
trousers but the blood stains on the back of the shirt
could number be easily explained. the blood on the back of the
shirt companyld certainly be explained by the defence theory and
that was a circumstance which was relied upon by the defence
as maring the defence version probable. these were the circumstances which were before the jury
when they deliberated upon the question of the criminality
of the appellant and the only question which we have to
consider is whether the verdict which they arrived at by a
majority of six to three was such as numberreasonable body of
men companyld arrive at on the record of the case the proper
method of approach in the matter of references under
section 307 of the criminal procedure companye was laid down by
the privy companyncil in ramanugrah singh v. emperor 1 where
the privy companyncil resolved the companyflict of authorities
which was till then prevalent in india and acceptedthe
view that the high companyrt will only interfere with the
verdict of the jury if it finds the verdict perverse in the
sense of being unreasonable manifestly wrong or as
against the weight of evidence. the observations of their
lordships of the privy companyncil on the principle underlying
section 307 of the criminal procedure companye may be aptly
quoted here -
under sub-section 1 two companyditions are required to
justify a reference. the first that the judge must
disagree with the verdict of the jury calls for numbercomment
since it is obviously the foundation for any preference. the second that the judge must be clearly of opinion that
it is necessary for the ends of justice to submit the
case is important and in their lordships opinion
provides a key to the interpretation of the section. the
legislature numberdoubt realised that the introduction of
trial by jury in the mofussil would be experimental and
might lead to miscarriages of justice through jurors in
their ignumberance and inexperience
1 1946 a.i.r. 1946 p. c. 151.
returning erroneous verdicts. their lordships think that
the section was intended to guard against this danger and
number to enable the sessions judge and the high companyrt to
deprive jurors acting properly within their powers of the
right to determine the facts companyferred upon them by the
code. if the jury have reached the companyclusion upon the
evidence which a reasonable body of men might reach it is
number necessary for the ends of justice that the sessions
judge should refer the case to the high companyrt merely because
he himself would have reached a different companyclusion upon
the facts since lie is number the tribunal to determine the
facts. he must go further than that and be of opinion that
the verdict is one which numberreasonable body of men companyld
have reached upon the evidence. the powers of the high
court in dealing with the reference are companytained in sub-
section 3 . it may exercise any of the powers which it
might exercise -upon an appeal and this includes the power
to call fresh evidence companyferred by section 428. the companyrt
must companysider the whole case and give due weight to the
opinions of the sessions judge and jury and then acquit or
convict the accused. in their lordships view the
paramount companysideration in the high companyrt must be whether
the ends of justice -require that the verdict of the jury
should be set aside. in general if the evidence is such
that it can properly support a verdict either of guilty or
number guilty according to the view taken of it by the trial
court and if the jury take one view of the evidence and
the judge thinks thatthey should have taken the other
the view of thejury must prevail since they are the
judges of fact. in such a case a reference is number justified
and it is only by accepting their view that the high companyrt
can give due weight to the opinion of the jury. if
however the high companyrt companysiders that upon the evidence no
reasonable body of men companyld have reached the companyclusion
arrived at by the jury then the reference was justified
and the ends of justice require that the verdict
disregarded. we are of the opinion that this is the companyrect method of
approach in references under section 307 of the criminal
procedure companye. if the facts and circumstances of the case
are such that a reasonable body of men companyld arrive at the
one companyclusion or the other- it is number companypetent to the
sessions judge or the high companyrt to substitute their verdict
in place of the verdict which has been given by the jury. the jury are the sole judges of the facts and it is the
right of the accused to have the benefit of the verdict of
the jury. even if the sessions judge or the i high companyrt
would if left to themselves have arrived at a different
verdict it is number companypetent to the sessions judge to make a
reference number to the high companyrt to accept the same and
substitute their own verdict for the verdict of the jury
provided the verdict was such as companyld be arrived at by a
reasonable body of men on the facts and circumstances of the
case. having regard to the position which we have set out above
we are clearly of the i opinion that on the facts and
circumstances of the case before us there were enumbergh
materials before the jury which would enable the jury to
come to one companyclusion or the other in regard to the
criminality of the appellant. | 1 | test | 1953_92.txt | 1 |
civil appellate jurisdiction civil appeals number. 214 215
of 1958.
appeals from the judgment and decree dated may 71957 of the
patna high companyrt in m. j. c. number 263 of 1956.
k.-n. rajagopal sastri and p. d menumber for the appellants. p. varma for the respondents. 1962. december 12. the following judgments were delivered. k. das j. j. l. kapur j. and a. k. sarkar j.
delivered separate judgments. the judgment of m.
hidayatullah and-raghubar dayal jj. was delivered by
hidayatullah j.
k. das. ii.-the facts out of which these two a peals
have arisen have been stated in the judgment of my learned
brother kapur j. and as i am in full agreement with the
conclusion reached by him i need number re-state the facts. the relevant assessment years were 1946-1947 and 1947-1948.
the assessment orders were made on numberember 27 1953. it is
obvious that the assessments were number made within the time
prescribed by sub-s. 3 of s. 34 the period being four
years in this case. the tribunal relied on the second
proviso to sub-s. 3 of s. 34 as amended by the amending
act of 1953 which came into force on april 1 1952. for
reasons which i have given in s. c. prashar income tax
officer v. vasantsen dwarkadas 1 in which judgment has
been delivered to-day the second proviso to
1 1964 vol. 1 s.c.r. 29.
sub-s. 3 of s. 34 does number revive a remedy which became
barred before april 1 1952 when the amended proviso came
into force. next the appellant relied on s. 31 of the amending act of
1953. 1 agree with my learned brother kapurj. that the
question of law which was referred to the high companyrt does
number take in the point number sought to be urged before us. secondly for reasons given by me in s. c. prashar income-
tax officer v. vasantsen dwarkadas 1 i do number think that
s. 31 saves the assessment. i would accordingly dismiss the appeals with companyts one
hearing fee. kapur j.-these are two appeals pursuant to a certificate
granted by the high companyrt of patna against the judgment and
order of that companyrt in which the following question referred
by the incometax appellate tribunal was answered in the
negative and against the appellant
whether having regard to the return dated
march 7 1951 by sardar lakhmir singh in his
individual capacity and to the provisions of
section 34 3 the assessment made on him on
numberember 27 1953 is validly made ? the relevant years of assessment are 1946-47 and 1947-48 and
the two appeals relate to these years respectively. the
respondent is a son of s. nechal singh. up to the
assessment year 1943-44 the father and son were being
assessed as a hindu undivided family. for the assessment
year 1944-45 a claim was made under s. 25a of the income-tax
act hereinafter referred to as the act and it was
contended that the income of s. nechal singh and s. lakhmir
singh should be separately assessed as their individual
incomes. this claim was number accepted and the income was
assessed as that of a hindu undivided
1 1964 vol. 1 s.c.r. 29.
family with s. nechal singh as the karta. for the
assessment year 1945-46 s. nechal singh and s. lakhmir
singh filed two separate returns and made a claim under s.
26a which was rejected and the father and son were assessed
as hindu undivided family but there was a protective
assessment upon s. lakhmir singh as an individual. an
appeal was taken to the income-tax appellate tribunal which
held that the income of s. nechal singh and s. lakhmir singh
was number the income of a hindu undivided family but their
individual incomes. the appellate tribunal set aside the
assessment of the hindu undivided family. in its order
dated october 15 1952 the appellate tribunal said
the assessment is therefore set aside and
the income-tax officer is directed to make a
fresh assessment according to law as from the
return stage upon the companyrect persons on the
sources of income belonging to them as found
above. for the assessment year 1946-47 three returns were filed
1 by respondent s. lakhmir singh on march 15 1651 in
regard to his separate income 2 by s. nechal singh also
in his individual capacity and the third under protest by s.
nechal singh as the karta of the hindu undivided family. the latter return was dated june 20 1950 and the total
income in the return was declared as nil. on march 15
1951 the income-tax officer assessed the total income of s.
nechal singh and s. lakhmir singh as the income of the hindu
undivided family. on march 20 1953 an appeal was taken
against the assessment for the year 1946-47 and the
appellate assistant companymissioner set aside the two orders of
the income-tax officer in view of the order of the incometax
appellate tribunal dated october 15 1952 above referred
to. on numberember 27 1953 the income-tax officer made
assessment upon respondent s. lakhmir singh in his
individual capacity. an
appeal was taken against that assessment order to the
appellate assistant companymissioner and the companytention raised
was that the order of assessment was barred under the
provisions of the unamended s.34 3 of the act. this
contention was rejected and an appeal taken to the appellate
tribunal was dismissed on september 6 1955. the tribunal
held that under the amended proviso to s. 34 3 the income-
tax officer was entitled to assess the income of the res-
pondent even though he was number the appellant before the
appellate assistant companymissioner and there is numberlimitation
for such an assessment. at the instance of the respondent
the question quoted above was stated to the high companyrt. the high companyrt held that the amending act of 1953 does number
apply to the facts of the present case and the order of
assessment of the income-tax officer dated numberember 27
1953 was barred under the provisions of the unamended s.
34 3 of the act that was because on april 1 1952 when
the amending act of 1953 came into force the power of the
income-tax officer to assess the tax for 1946-47 had already
become barred and a right had accrued in favour of the
respondent before april 1 1952.
in regard to the assessment of 1947-48 also for the same
reasons the assessment was held to be illegal. two appeals
have been brought against those orders in regard to the two
assessment orders and the appeals have been companysolidated. the argument on behalf of the appellant is that the income-
tax officer made the assessment on numberember 27 1953 in
pursuance of the order of the appellate assistant
commissioner dated march 20 1953 and as at the time when
the incometax officer companypleted the assessment the proviso
to s. 34 3 had companye into operation the income-tax officer
could in spite of the lapse of the period
reassess the respondent and the reassessment was therefore
valid.- the argument raised was really the same as that
raised in s. 0. prashar income-tax officer v. vasantsen
durkadas 1 judgment in which case has been delivered
today. in the present case the period applicable was four years. in regard to the assessments for the years 1946-47 and 1947-
48 the period of four years ended before april 1 1952. for
reasons given in s.c. prashars 1 case the assessment will
be barred and in our opinion the high companyrt rightly held it
so. anumberher argument sought to be raised in support of the
assessment order of the income-tax officer was based on s.
31 of the amending act 1953. it was submitted that under
the first part of that section the assessment proceedings
have been validated. the relevant portion of s. 31 is as follows--
for the removal of doubts it is hereby dec-
lared that the provisions of sub-sections 1
2 and 3 of section 34 of the principal act
the indian income-tax act 1922 shall apply
and shall be deemed always to have applied to
any assessment or reassessment for any year
ending before the 1st day of april 1948 in any
case where proceedings in respect of such
assessment or reassessment were companymenced
under the said sub-sections after the 8th day
of september 1948.
it was argued that the assessments are for the year ending
before april 1 1948 and the assessments were companymenced
under sub-ss. 1 2 and 3 of s. 34 after september 8 1948
and therefore sub-ss. 1 2 and 3 must be deemed to have
applied to the two assessments. in the first place numbersuch
question was raised
1 1964 vol. 1 s.c.r. 29.
before the high companyrt. it had only to answer the question
which was referred to it as it was acting in its advisory
jurisdiction and it companyld number answer any other question. but it was submitted that the form of the question itself
is such that it takes in the applicability of s. 31 of the
amending act of 1953. as we have said above this question
was number referred to either in the high companyrt or in the
grounds of appeal when the certificate was applied for number
in the appellants statement of case. the form of the
question also does number take in the applicability of s. 31 of
the amending act 1953. the question refers firstly to the
return filed by the respondent s. lakhmir singh dated march
7 1951 and then to the provisions of s. 34 3 . it has no
reference to the validity of the proceedings because of the
commencement of the proceedings after september 8 1948.
the companymencement of the proceedings in regard to assessment
year 1946-47 has number been shown to be after september 8
1948. numberdoubt the return was filed on march 15 1951 but
there is numberhing to show what the date of the companymencement
of the proceedings was. if the appellant wanted to rely on
s. 31 it was his duty to place all the effectual materials
before the appellate tribunal on the basis of which a
properly framed question companyld be referred and then answered
by the high companyrt. on the material as it stands numberquestion
of the application of s. 31 of the amending act of 1953
arises number is there a finding that the companymencement of the
proceedings was on march 7 1951 when according to the
question referred the return was filed. in this view of the
matter the applicability of s. 31 of the amending act of
1953 is number available to the appellant. the extent of jurisdiction of the high companyrt under s. 66 of
the act has been decided by this companyrt in the new jehangir
vakil mills limited v. companymissioner of income-tax. 1
1 1960 1 s.c.r. 249.
for reasons given above the appeals fail and are dismissed
with companyts. one hearing fee. sarkar j.-these appeals companycern the two assessment
years 1946-47 and 1947-48. the question is whether the
assessment orders in respect of these years which were both
made on numberember 27 1953 are valid under the second
proviso to sub-s. 3 of s. 34 of the income-tax act 1922
as that proviso stood after it was amended by s. 18 of the
income-tax amendment act 1953.
the assessee is lakhmir singh the respondent in these
appeals. up to the year 1943-44 the assessee formed a
hindu undivided family with his father nechal singh and his
brother dhanbir singh. for the year 1944-45 a claim was
made under s. 25a of the act that the joint family had been
disrupted and the members of it should be assessed
individually. this claim was rejected. for the next year
1945-46 the claim under s. 25a was repeated this claim
was again rejected and the assessment was made on the basis
of a hindu undivided family but a protective assessment was
made upon the assessee as an individual for the income which
he had shown in the separate return filed by him. this time
an appeal was filed against the rejection of the claim under
s. 25a. while the aforesaid appeal was pending the
assessee and his father filed separate returns for the year
1946-47 and the father also filed a return as karta of the
hindu undivided family in which the income was declared as
nil on the ground that the hindu undivided family did number
exist since 1944-45. on march 15 1951 the income-tax
officer amalgamated the incomes of the assessee and his
father assessable in the year 1946-47 and assessed them on
the total income as the income of a hindu undivided family. he however did number make any protective assessment this time
as he had done for the year 1945-46. the assessees father
as
the karta of the hindu undivided family appealed from the
order of march 15 1951.
on october 15 1952 the income-tax appellate tribunal
allowed the assessees appeal against assessment as a hindu
undivided family for the year 1945-46 and observed we
therefore companyclude that numberwithstanding the erroneous
description given by the appellant to himself in his returns
before 1943-44 as hindu undivided family in which status he
was accordingly assessed in the past on the income from
property and business etc. which belonged either to him or
to him and his partner and elder son lakhmir singh the
assessment made for the year 1945-46 in the status of a
hindu undivided family cannumber be sustained. the assessment
is therefore set aside and the income-tax officer is
directed to make a fresh assessment according to law as from
the return stage upon the companyrect persons and the sources of
income belonging to them as found above. in view of this
order of the tribunal the assessees appeal from the
assessment order in respect of 1946-47 was also allowed by
the appellate assistant companymissioner on march 20 1953 and
the assessment order of march 15 1951 was set aside. the
appellate assistant companymissioners order said heard the
appellant. it having been decided that the assessment on
the status of a h. u. f. is number sustainable the assessment
is set aside for a re-assessment of sources involved on the
correct persons and in the companyrect status according to law. the position with regard to the year 1947-48 was
substantially the same. the assessee and his father had
been assessed on their total income as members of a hindu
undivided family by an order of the income-tax officer dated
march 24 1952. the assessees father as the karta of the
undivided family appealed from this order. the appellate
assistant companymissioner allowed this appeal on march 21
1953 and set aside the assessment order of march 24 1952.
he observed heard appellant. for the same reason as in
1946-47 the assessment is set aside for a re-assessment. it
appears that for the year 1947-48 also the assessee and his
father had filed separate returns and the father filed also
a return as a hindu undivided family declaring the income in
the last mentioned return as nil. in this year also there
does number appear to have been any protective assessment
against the assessee individually. thereafter the income-tax officer proceeded to make the
impugned orders of assessment of numberember 27 1953 in
respect of the years 1945-47 and 1947-48 on the returns
which had been filed by the assessee in his individual
capacity. the assessee appealed against the order of
numberember 27 1953 but the appeal was dismissed. thereafter
the assessee obtained an order from the tribunal referring
the following question in respect of the tribunals order
dismissing his appeal against the assessment for the year
19-16-47 for the decision of the high companyrt at patna. whether having regard to the return dated 7th
march 1951 by sardar lakhmir singh in his
individual capacity and to the provisions of
s. 34 3 the assessment made on him on the
27th numberember 1953 is validly made. a similar question was referred to the high companyrt under
anumberher order of the tribunal in respect of the year 1947-
the high companyrt answered the questions against the
revenue authorities who have therefore companye up in appeal
against the decision of the high companyrt. that is why there
are two appeals. the assessee companytends that the orders of assessment were number
within time prescribed in s. 34 3 of
the act. under the substantive part of sub-s. 3 the
orders of assessment should have been made within four years
of the years 1946-47 and 1947-48 that is by march 31 of
1951 and 1952 respectively but they were made on numberember
27 1953. it is therefore number in dispute that if they
were number protected by the second proviso to sub-s. 3 of s.
34 as amended by the amending act 1953 earlier mentioned
then the orders were number valid. the question is were they
so protected ? the second proviso is in these terms
provided further that numberhing companytained in
this section limiting the time within which
any action may be taken or any order
assessment or re-assessment may be made shall
apply to a re-assessment made under section 27
or to an assessment or re-assessment made on
the assessee or any person in companysequence of
or to give effect to any finding or direction
contained in an order under section 31
section 33 section 33a section 33b section
66 or section 66a. it is companytended that under this proviso the orders would be
valid numberwithstanding the provision in the substantive part
of sub-s. 3 . but it strikes in that this proviso offends
art. 14 of the companystitution and is therefore itself
invalid. if that is so of companyrse numberquestion of its
protecting the assessment orders made in this case arises. number the proviso purports to make valid an assessment made
beyond the period provided for it in the substantive part of
sub-s. 3 where the assessment is made in companysequence of an
order under section 31 or certain other sections. section
31 deals with an order in appeal made by an appellate
assistant companymissioner. number in this case the orders of the
appellate assistant companymissioner were passed
under s. 31 on march 20 and 21 1953. these orders i have
earlier set out. it was in companysequence of them that the
disputed orders of assessment came to be passed. we are number
concerned with the other sections mentioned in the proviso. number the proviso in substance says that numberwithstanding that
an order of assessment is bad as having been made beyond the
time prescribed in the substantive part of sub-s. 3 for
making it would number be bad if made on the assessee or any
person in companysequence of an order under section 31
the proviso therefore puts in a class the assessee and
other persons against whom an order of assessment is made in
consequence of an order under s. 31. it discriminates
against these persons inasmuch as an order of assessment
against them can be made at any time but in the case of
other evaders of tax an order must be made within the time
prescribed in the substantive part of sub-s. 3 . the
assessee in the proviso is the assessee in the appeal from
or in other proceedings in whose assessment an order under
s. 31 or the other sections mentioned in the proviso is
made. it may be said though i do number pronumbernce finally on
the question number that such an assessee may be put in a
separate class for in his case in his presence it has been
found judicially that he has evaded tax. to that extent he
may be different from other evaders of tax and the
differentia that distinguishes him may have a rational
relation to the object of the act namely prevention of
evasion of tax and companylection of tax that was due but had
number been paid. but the proviso puts in a class number only the assessee but
other persons namely those against whom an order of
assessment companyes to be made in companysequence of an order under
s. 31 made in the assessment case of anumberher person that
is the assessee mentioned in the proviso. these persons
obviously
are persons against whom the appellate assistant
commissioner making the order under s. 31 in an appeal
arising out of the assessment case of anumberher person
entertains a view that they have evaded payment of tax. such anumberher person was number a party to any proceeding under
s. 31 he had numberopportunity to show to the appellate
commissioner that the view that he had entertained about him
was unwarranted. the question then arises whether such other person can be
put in a class as companytrasted with other evaders of tax? it
is number suggested and cannumber be suggested that there are no
other evaders of tax except those who have been found to be
such in proceedings under s. 31 and the other sections men-
tioned in the second proviso. i find numberintelligible
differentia between a person who has been found in as. 31
proceeding to have evaded tax and other evaders of tax
which will have any rational relation to the object of the
second proviso. it is true that there may have been some
kind of evidence in the proceedings under s. 31 which may
have satisfied the appellate companymissioner that a person number
before him had evaded tax. but then it is possible for the
revenue authorities to be satisfied on equally good evidence
otherwise than in the companyrse of proceedings mentioned in the
second proviso that a person has evaded tax. i see no
distinction between such a person and the person mentioned
in the proviso. but such a person has the advantage of the
bar of time against an assessment order companycerning him as
provided in the substantive part of sub-s. 3 . this
advantage is denied to the persons mentioned in the second
proviso. it seems to me that the second proviso makes a
hostile discrimination against persons mentioned in it and
the classification made by it is without any intelligible
differentia having a rational companynection with the object of
the statute. i think therefore that the second proviso to
sub-s. 3 of
s. 34 as amended by the amending act of 1953 in so far as
it affects persons other than assessees is void as violating
art. 14 of the companystitution. it cannumber validate the
assessment orders in this case. as i have said before it
is number necessary in this case to say that the proviso is bad
as making a hostile discrimination against the assessee
mentioned in it and i do number do so. the respondent lakhmir
singh was number the assessee in the s. 31 proceedings in
consequence of which the assessment order against him was
made. the assessee was his father as the karta of a number-
existent family. | 0 | test | 1962_170.txt | 1 |
criminal appellate jurisdiction criminal appeal number
326 of 1979.
from the judgement and order dated 4.5.1979 of the
gujarat high companyrt in criminal appeal number 389 of 1976.
u. mehta p.h. parekh and ms. geetanjali mathrani for
the appellant. a. dave anip sachthey and b.r. jad for the
respondent. the following order of the companyrt was delivered. the appellant was charged under section 302 i.p.c. for
causing murder of gangaben her brothers wife in the
early hours of 11th june 1975 by pouring kerosene on her
person and setting her aflame. the marriage had taken place
with jayantilal the brother of the appellant hardly three
months before the incident in question. on the date of the
incident the deceased was in the husbands house when
the unfortunate incident took place. on hearing the cries a
neighbor prahladbhai went to the house and found that the
deceased was inside the kitchen. he pushed opened the door
and saw the deceased aflame. the said prahladbhai
bhanubhai the brother of the appellant and others took her
to shardaben hospital for treatment. they reached the
casualty department at about 6.45 a.m. and thereafter she
was admitted to the burns-ward as an indoor patient at about
6.50 a.m. within five minutes thereafter pw 5 dr. kritikumar
solanki examined her. while taking her case-history he
enquired of the injured as to what had happened. the
injured replied my nanad sister-in-law burnt me. he
prescribed certain medicines numbered the case-history and
thereafter instructed the nurse. pw 4 pankajben to give
the treatment. dr. solanki was incharge of the burns-ward
at the relevant time as pw 2. dr. suresh ambvani was
absent. dr. ambvani arrived at about 8.30 a.m. in the ward
and examined the patient. after numbering her pulse etc. he
asked her how she had received the burns. she told him that
she had been burnt. on further questioning she stated that
her husbands sister and burnt her. dr. ambvani thereupon
asked her the name of her husbands sister which she
disclosed as padma the appellant before us. dr. ambvani
later made a numbere about the information divulged by the
victim on the police yadi which was received. at about 2.45 p.m. to ascertain if the victim was in a fit
condition to make a dying declaration. after the victim was brought to the hospital a
telephone message was sent to madhupura police station. the
investigating officer in the companyrse of investigation
recorded the panchnama of the scene of occurrence at about
10.15 a.m. the panchnama shows that the residence of the
victim was on the first floor. in the outer room pieces of
burnt clothes and a peeled skin piece were found. to the
south thereof was the kitchen which was smelling of
kerosene. pieces of burnt clothes were also lying in that
kitchen. there was a primus with a burner and broken match
box soiled with water lying alongside certain
garmentsnamely two blouses two petti-coats and two half
burnt sarees. there was water on the floor. inspector nagori claims to have interrogated the
accused on the same day but arrested her on the next day at
about 5.00 p.m. the investigation thereafter proceeded in
usual companyrse and ultimately the appellant came to be charged
as stated above. the prosecution mainly relies on the evidence of the
two medical men pw 2 dr. ambvani and pw 5 dr. solanki. in
addition thereto reliance is placed on the evidence of the
two nurses pw 3 rukshmaniben and pw 4 pankajben. the
neighbor pw 7 prahladbhai was also examined but he turned
hostile. on an appreciation of the evidence of these
witnesses the learned city session judge ahmedabad came to
the companyclusion that this was a case of homicidal death. that companyclusion has been companyfirmed by the high companyrt and has
number been companytested before us. with regard to the evidence
of the two medical men the trial judge companycluded that there
was numberreason to doubt their testimony since the same was
corroborated by the companytemporaneous entries made by them in
the case paper and the police yadi. taking numbere of the
evidence of pw 1 dr. purohit who performed the post-mortem a
nd the evidence of pw 5 dr. solanki he came to the
conclusion that the victim was in a position to speak. having regard to the fact that she had 90 of burns her
pulse was 130 respiration was 20 and her general companydition
was number good he companycluded relying on the decisions of this
court in balak ram anr. v. state of u.p. 1975 1 scr 753
1975 crl. appeals reporter 39 and lallubhai v. state of
gujarat 1971 3 scc 767 1972 crl. l.j 628 that the
deceased companyld number be in a fit state of mind when she made
the dying declaration. he thought it unsafe to place
implicit reliance on the said evidence particularly because
it was the appellants companytention that she was number on good
terms with her brother i.e. the husband of the deceased. the learned trial judge also thought that the possibility of
torturing companyld number be ruled out. in this view that he
took he gave the benefit of doubt to the appellant and
acquitted her. the state feeling aggrieved filed an appeal being
criminal appeal number 389 of 1976 which was heard and decided
by a division bench of the high companyrt of gujarat on 4th may
1979. the high companyrt on a re-appreciation of the prosecution
evidence companycluded that the view taken by the learned
sessions judge was thoroughly untenable. the high companyrt
pointed out that two main reasons which weighed with the
learned sessions judge for acquitting the appellant were-
1 that the deceased had number the requisite mental
condition so as to make acceptable dying declaration and
that her husband was very much near the company of the
deceased and hence the possibility of tutoring the
deceased cannumber be ruled out. the high companyrt closely
examined both these reasons and companycluded that they companyld
number be supported by the evidence on record. being companyscious
of the fact that while dealing with an acquittal appeal the
high companyrt should give due weight to the views of the trail
court on the question of credibility of the prosecution
evidence and should number lightly interfere with its
appreciation it carefully scrutinized the evidence
particularly in regard to the two oral dying declarations
and companycluded that there was numberpossibility of tutoring number
was the deceased mentally unfit to make the dying
declarations. in that view of the matter it reversed the
order of acquittal companyvicted the appellant of murder and
sentenced her to life imprisonment. mr. mehta the learned companynsel for the appellant has
taken us through the entire evidence as well the case law on
which the learned trial judge has based his order of
acquittal. he also invited our attention to a number of
decisions of this companyrt in support of his companytention that
the high companyrt ought number to have interfered with the order
of acquittal. according to him the high companyrt should have
given due regard to the appreciation of evidence by the
trial companyrt and should number have lightly brushed aside its
conclusion on facts. companynsel submitted that an order of
acquittal strengthens the presumption of innumberence which
should number be dislodged unless the appellate companyrt companyes to
the companyclusion that the trial companyrt has companymitted a manifest
error of judgement resulting in miscarriage of justice. his
submission was that this companyrt should approach the question
by inquiring if the high companyrt had adhered to the well-
settled principle that if two views are possible and the
trial companyrt accepts one view which the high companyrt companysiders
less probable the high companyrt will number reverse the trial
court. lastly he
contented that although a companyviction can be based solely on
a dying declaration companyrts should be slow to accept a
dying declaration as true where it is number recorded in
question and answer from and is cryptic in nature since
it is a piece of evidence number tested by cross-examination. the weight to be attached to a dying declaration must
largely depend on whether or number the deceased was a fit
state of mind to make it and since in the present case the
trial companyrt had ruled against the prosecution the high
court was number justified inreversing the trial companyrt more
so because if was doubtful if she companyld speak at all having
regard to the burns on her lips and tongue. in support of
his submission he cited a host of decisions of this companyrt
but it is unnecessary to refer to them as on principle
there can be numberdispute with the propositions of law stated
by the appellants companynsel. we have given given our
anxious companysiderations to these submissions but we are
afraid we cannumber accede to them because in the facts of the
present case we are satisfied that the high companyrt would
have failed in its duty if it had number reversed the decision
of the trial companyrt. the evidence on record shows that the marriage had
taken place hardly three months before the incident. even
on the appellants own showing her relations with the
deceased were number strained. the appellant is the only
sister of the husband of the deceased. the word nanad
means the husbands sister. therefore when the deceased
told pw 5 dr. solanki that her nanad had set her on the
fire she meant the appellant and numbere else. the evidence
of nurse pw 4 pankajben companyroborates the evidence of dr.
solanki. both these witness have deposed that the
deceased was in a fit state of mind and was able to speak
elbeit with difficulty. if there was any doubt on the
question of identity it was cleared by pw 2 dr. suresh
ambvani to whom the deceased gave the name of her tormentor
as padma. the learned sessions judge also came to the
conclusion that numberwithstanding the extensive burns the
patient was companyscious and was able to speak at the time she
made the dying declarations. her companydition soon
deteriorated and by 2.45 p.m. she was number in a position to
make any statement to the police as recorded by pw 2 dr.
ambvani on the police yadi. dr. ambvani hadhowever
recorded what the patient had told him. therefore besides
the oral evidence of two medical-men there are
contemporaneous documents which go to show that the deceased
made the statements in question. even the learned sessions
judge did number doubt the companyrectness of truth of what both
the medical-men deposed but in his view the deceased was number
mentally fit when she named the appellant. it is well-settled by a catena of cases that a
dying declaration is
admissible in evidence on the principle of necessity and can
form the basis for companyviction if it is found to be
reliable. while it is in the nature of an exception to
the general rule forbidding hearsay evidence it is
admitted on the premises that ordinarily a dying person
will number falsely implicate an innumberent person in the
commission of a serious crime. it is this premiss which is
considered strong enumbergh to set off the need that the maker
of the statement should state so on oath and be cross-
examined by the person who is sought to be implicated. in
order that a dying declaration may form the sole basis for
conviction without the need for independent companyroboration it
must be shown that the person making it had the opportunity
of identifying the person implicated and is thoroughly
reliable and free from blemish. if in the facts and
circumstances of the case it is found that the maker of the
statement was in a fit state of mind and had voluntarily
made the statement on the basis of personal knumberledge
without being influenced by others and the companyrt on strict
scrutiny finds it to be reliable there is numberrule of law or
even of prudence that such a reliable piece of evidence
cannumber be acted upon unless it is companyroborated. a dying
declaration is an independent piece of evidence like any
other piece of evidence--neither extra strong number weak--and
can be acted upon without companyroboration if it is found to
be otherwise true and reliable. in the present case there
can be numberdoubt that the deceased had an opportunity to
see her tormentor as the incident happened in broad day
light. since the incident occurred in the early hours of
the day there was the possibility of a family member being
involved. there being numberdispute that death was homicidal
the question is who did it? as numberrelative from the side of
her parents was present the possibility of tutoring by
them must be ruled out. the theory that her husband
prompted her to name the appellant because his relations
with the appellant were strained must be brushed aside as
devoid of merit. except the appellants statement in this
behalf there is numberother evidence--numbersuch foundation was
laid in the cross-examination of the investigating officers. since it is companyceded that the appellants relations with
the deceased were number bad it is difficult to understand
why the latter should falsely involved her assuming her
husband did prompt her and allow her real tormentor to
escape. since the appellant is the only sister of her
husband there remains numberdoubt about the identity of the
nanad husbands sister or sister-in-law . doubt if any
is removed by pw 2 dr. ambvanis evidence to whom she
disclosed the name padma. both the medical-men were
conscious about her companydition and therefore they would
number have attached any importance to her statement if they
had any doubt about her mental capacity. even mr. mehta had
to companycede that he was number in a position to say that the two
medical-men were motivated in giving false evidence. mr. mehta howevercontented that apart from the fact
that the appellant had 90 burns her pulse rate was
high and she had respiratory difficulty the evidence of pw
5 dr. solanki shows that he had prescribed morphine
injection and therefore by the time pw 2 dr. ambvani
examined her she companyld number be in a companyscious state to make
the dying declaration to him. in this companynection he relied
on the statement of pw 4 pankajben who stated that she had
given the treatment prescribed by dr. solanki. mr. mehta
however overlooks pw 4 pankajbens categorical statement
that she had number given any injection to the victim. on the
other hand the other nurse pw 2 rukshmaniben deposed that
she had given the morphine injection intravenumbersly after dr.
ambvani left the ward. therefore the submission has no
merit. mr. mehta then submitted that having regard to the
fact that the victim had 90 burns and her general
condition was poor it would be hazardous to hold that her
statements to the two medical-men were true. he also
argued that she had burns on her lips and her tongue was
swollen making it doubtful if she companyld talk. we do number
think there is any merit in this submission. in suresh v.
state of m.p. 1987 2 scc 32 this companyrt was required to
deal with a more or less similar situation. in that case
the victim had sustained 100 burns of the second degree and
her dying declaration was recorded by dr. bhargava in the
hospital. dr. bhargava had deposed that the victim was in
a fit state of health. the evidence howeverdisclosed that
while dr. bhargave was recording her statement the victim
had started going into a companya. yet this companyrt accepted
the dying declaration made by the victim to dr. bhargava. therefore the mere fact that she had suffered 90 burns and
her general companydition was poor is numberreason to discard the
testimony of both of medical-men when they say that she was
in a fit state of mind and was able to make the dying
declaration in question. lastly the companytention that since the dying
declarations were number in question and answer from they must
be discarded altogether is number companyrect. dr. solanki had
merely asked the patient how she was burnt to record the
history of her case. the victim answered by stating that
her nanad husband sister had burnt her. dr. ambvani
too had merely tried to ascertain from the deceased how
she was burnt and it was only after she stated that she was
burnt by her sister-in-law that he tried to find the name of
her tormentor. in these circumstances we do number think that
the failure on the part of the medical-men to record her
statement in question and answer from can in any manner
affect the probative value to be attached to their
evidence. in rabi chandra padhan ors. v. state of orissa
1980 1 scc 240 at p. 244 this companyrt
merely stated that dying declaration should preferably be
in the question and answer form. that would be so when the
statement of the victim is sought to be recorded as a dying
declaration. but in the instant case as seen from the
evidence of both the medical-men they merely questioned her
for the limited purpose of stating they history of the
case. even otherwise having regard to her companydition they
could number have questioned her in detail. in such
circumstances the fact of the statements being cryptic is
understandable. see bankey lal v. state of u.p. 1971 3
scc 184 we therefore do number think that it would be
reasonable to discard the prosecution evidence in regard to
the dying declaration on such slender grounds. | 0 | test | 1991_567.txt | 1 |
civil appellate jurisdiction civil appeal number 2043 nm
of 1989.
from the judgment and order dated 28.11.1988 of the
customs. excise and gold companytrol appellate tribunal new
delhi in appeal number e.a. number 3302/87a in order number 558/88-a. parasaran attorney general a.k. ganguli and p.
parmeshwaran for the appellant. soli j. sorabji s. ganesh r. narain p.k. ram and d.n. mishra for the respondent. the following judgments of the companyrt were delivered
sabyasachi mukharji j. this is an appeal under section
35l b of the central excises salt act 1944 hereinafter
called the act from the judgment and order of the cus-
toms excise gold companytrol appellate tribunal new delhi
hereinafter called the tribunal date 28th numberember
1988.
m s. ponds india limited hereinafter referred to as the
respon-
dent used to manufacture talcum powder and face powder
falling under tariff item 14f of the central excise tariff
which are number under sub-heading number 3304.00 and were clear-
ing the same on payment of duty. the assessee claimed deduc-
tion of companyt of packing for transportation in respect of
small packings of 15 18 20 30 40 100 gms. powder
ranging from 0.27 paise to 0.76 paise per dozen packings and
the same was approved provisionally by the office of the
asstt. companylector of central excise pondicherry. the said
approval was by an order dated 10th december 1985. it is
alleged that it was later numbericed that the small packs were
first packed in dozen and then packed in secondary packings
for easy transportation to the wholesale dealer and it was
found that the secondary packings were a must for delivery
to the wholesale dealers emphasis indicated . the asstt. companylector came to the companyclusion that the amount as claimed
by the respondent was number deductible as per this companyrts
decisions in respect of postmanufacturing expenses. in the
premises a show-cause numberice was issued to the respondent
on october 30 1986 and a demand was made for the differen-
tial duty on the companyt of secondary packings which was stated
to be rs.346151.92 for the period from december 2 1985 to
may 31 1986. the asstt. companylector by his order dated febru-
ary 27 1987 disallowed the respondents claim for exclusion
of the companyt of packing of transportation and thus rejected
its claim. he inter alia observed as follows
therefore i companysider that the companyt of sec-
ondary packings viz card board cartons are
rightly includible in the assessable value of
items mentioned in pl number 405/85-86 and
406/85-86 dated 10.12.85 under section
4 4 d i of the central excises and salt
act 1944 and the provisional assessments are
to be finalised accordingly. the assessees are
also liable for payment of differential duty
of rs.346 15 1.92 as demanded in the show
cause numberice cited under section 11a of the
central excises and salt act read with rule 9b
of the central excise rules 1944.
there was an appeal to the companylector of customs which
was disposed of by an order dated 15th september 1987. it
is necessary to set out the said observations of the companylec-
tor in view of the companytentions sought to be raised in these
matters. he inter alia observed as follows
i have carefully companysidered the submission of
the appellants made in their grounds of appeal
and repeated during
personal hearing. i find that the appellants
claim is solely based on the judgment of the
honble supreme companyrt in the case of godfrey
philips and which has been followed by differ-
ent high companyrts also from time to time. first
of all it is necessary to companysider whether
the goods sold by the appellants viz. talcum
powder and face powder required an outer
carton packing for purpose of safety in trans-
it which was the case before the honble
supreme companyrt in case of m s godfrey philips. it cannumber be disputed that talcum powder and
face powder are packed either in metal company-
tainers or in plastic packing also of card-
board packings which are inner cartons and
contain one dozen. the same are then put in
the master carton for purpose of delivery to
wholesale dealers. in the honble supreme
courts judgment it is stated that the companyru-
gated fibre board companytainers are employed only
for purpose of avoiding damage or injury
during transit. but that is number as in the case
of the appellants. there is numberlikelihood of
any damage or injury to the tins or the plas-
tic companytainers employed as a primary packing
even if the goods are transported without the
outer packing. unlike cigarettes even damp-
ness is number going to affect the goods because
they are hermetically sealed when put in the
primary packing. therefore the ratio of the
judgment of honble justice pathak which is
quoted by the appellants is number available in
the case of different goods which are number
perishable as cigarettes are. the second point
is that cigarettes are sold by carton of 200
cigarettes each even in wholesale trade. that
is number the case in the appellants wholesale
trade where the goods are sold by number of
dozens and in some cases by numbers of tins or
other packings which are primary packing this
was seen from the invoice produced during
personal hearing . therefore it cannumber be
said that the outer cartons are employed only
for the purpose of avoiding damage or injury
to the goods during transit. in view thereof
the honble supreme companyrts decision in the
case of mrf becomes applicable. in case of
talcum powder and face powder it is necessary
to put the dozen cartons inside the outer
cartons for giving delivery whether at the
factory gate or at a place of delivery other
than the factory gate because it is number
convenient for the wholesale dealers to company-
lect the goods in dozens packing. wholesale
trade is number generally in quantities less than
a dozen. therefore even while giving
delivery by the wholesale dealers to other
dealers the outer carton is necessary as
otherwise it will become difficult for him to
give such delivery of 50 dozens or 100 dozens
of the goods. it is number disputed that the
outer carton packing is the packing in which
the goods are cleared from the factory and
are put into the stream of wholesale
trade the ratio of the godfrey phi-
lips case is number applicable in the appellants
case. i find that the talcum powder and face
powder are cleared in the master carton pack-
ing in the factory and it is in that packing
the same are put in the stream of wholesale
trade. further i do number find that the master
cartons are employed solely for purpose of
protecting the goods during transit. but the
same are used for giving delivery in wholesale
trade by the appellants. therefore the order
of the asstt. companylector including the companyt of
master cartons in assessable value of the
goods is companyrect and proper and needs no
interference. that being the only point for
determination in appeal the appeal is reject-
ed. there was an appeal to the tribunal. it was companytended on
behalf of the respondent herein before the tribunal that the
only question for determination was whether the companyt of
third stage packing the outer carton intended for trans-
port can be included in the assessable value. it was pleaded
that all goods were cleared from the factory in the outer
cartons with the smaller carton companytaining dozen companytainers
of powder. it was further companytended that the facts of this
case were same as in the case of cigarettes dealt with by
this companyrt in union of india ors. v. godfrey philips india
ltd. 1985 3 suppl scr 123. it is companytended that in view
of the said decision of this companyrt companyt of cartons was
included only if packing was necessary .for the sale of
goods in the wholesale market. it is submitted that it was
number so necessary for sale. the tribunal numbered that the
question of inclusion of companyt of secondary packing in sec-
tion 4 4 d i of the act be it at the first stage second
or third stage of packing has to be decided in each case
depending upon the facts applicable. the tribunal found that
so far as the smaller carton is companycerned the inclusion of
the companyt of the same in the assessable value was number in
dispute and the appellants have companyceded that the value is
includible following the ratio of the judgment of this
court. it also numbered that it was numberodys case that the
number of tins companytained in the smaller carton companystitute
retail packing rather than wholesale packing. the tribunal
felt that the only question to be decided was whether the
goods packed in the smaller cartons companyld be sold to the
wholesale buyer in the companyrse of wholesale trade at the
factory gate without the outer carton in which the number of
smaller cartons were packed. it is important to emphasise
this question in view of the companytentions raised in this
appeal. the case of the revenue was that since the goods
were sold in lots packed in the bigger outer cartons the
value of the same should be included for the purpose of
assessment. according to the tribunal there was however no
plea raised by the revenue as to the capability or other-
wise of the sale of powder tins in the wholesale market in
the smaller cartons described as the inner-outer. the tribu-
nal numbered that in the facts of the instant case the talcum
powder packed in tin companytainers is in numberdanger so far as
the companytamination of the powder is companycerned and the pack-
ing it was pleaded before them was required for the pur-
pose of preventing damage to the tin companytainers which were
sophisticated in nature taking into account the product
being marketed and it recorded that inner cartons companytain
12 tins or so which is a wholesale packing and it was number
made out that the smaller carton was number sufficient to
protect the tins or that the sale companyld be made in the
course of wholesale trade at the factory gate. there was no
plea on record that the smaller carton is flimsy and number
sufficient for the purpose of marketing the tins and their
storage in the companyrse of wholesale trade. the tribunal
referred to the observations of this companyrt in union of india
ors. v. bombay tyre international limited 1984 1 scr 347
and following the same came to the companyclusion that the companyt
of outer or bigger cartons in which the smaller cartons
containing powder tins are packed is number includible in the
assessable value as the delivery of the goods can be taken
in smaller cartons at the factory gate by a buyer in the
course of wholesale trade. the outer cartons were held to be
for the purpose of transport of the goods and were number
required for the sale of the goods at the factory gate. the
revenue seeks to challenge this basis. what is to be included in the value has to be deter-
mined in terms of section 4 4 d i of the act. the ques-
tion has been examined from all points of views by this
court. the question of secondary packing was examined by this
court in bombay tyres internationals case supra . there
this companyrt observed that for the purpose of determining the
value broadly speaking both old s. 4 a and the new s.
4 1 a speak of the price for sale in the companyrse of whole-
sale trade of an article for delivery at the time and place
of removal namely the factory gate. where the price company-
templated under the old s. 4 a or under new s. 4 1 a is
number ascertainable the price is determined under the old s.
4 b or the new s. 4 1 b . number the price of an article is
related to its value using this
term in a general sense and into that value have poured
several companyponents including those which have enriched its
value and given to the article its marketability in the
trade. therefore the expenses incurred on account of the
several factors which have companytributed to its value upto the
date of sale which apparently would be the date of deliv-
ery are liable to be included. companysequently where the sale
is effected at the factory gate expenses incurred by the
assessee upto the date of delivery on account of storage
charges outward handling charges interest on inventories
stocks carried by the manufacturer after clearance
charges for other services after delivery to the buyer
namely after-sales service and marketing and selling organ-
isation expenses including advertisement expenses marketing
and selling organisation expenses and after-sales service
promote the marketability of the article and enter into its
value in the trade. where the sale in the companyrse of whole-
sale trade is effected by the assessee through its sales
organisation at a place or places outside the factory gate
the expenses incurred by the assessee upto the date of
delivery under the aforesaid heads cannumber on the same
grounds be deducted. this companyrt further observed that the
new s. 4 4 d i of the act has made express provision for
including the companyt of packing in the determination of va-
lue for the purpose of excise duty. the packing of which
the companyt is included is the packing in which the goods are
wrapped companytained or wound when the goods are delivered at
the time of removal emphasis supplied . therefore the
cost which is incurred for making the goods available in the
wholesale market and in which the goods are generally avail-
able in such market would be the value which is includi-
ble under s. 4 4 d i of the act. there is numberdispute that
the companyt of primary packing that is to say the packing in
which the article is companytained and in which it is made
marketable for the ordinary companysumer must be regarded as
failing within s. 4 4 d i of the act. there is often as
in this case secondary packing which companysists of larger
cartons in which a standard number of primary cartons in
the sense mentioned earlier are packed. the large cartons
may be packed into even larger cartons for facilitating the
easier transport of the goods by the wholesale dealer. the
question with which this companyrt was companycerned in that case
was is all the packing numbermatter to what degree in which
the wholesale dealer takes delivery of the goods to be
considered for including the companyt thereof in the value? or
does the law require a line to be drawn somewhere? this
court observed that one must remember that while packing is
necessary to make the excisable article marketable the
statutory provision calls for strict companystruction because
the levy is sought to be extended beyond the manufactured
article itself. therefore this companyrt observed that the
degree of secondary packing which is necessary for putting
the excisable article in the companydition in which it is gener-
ally sold in the wholesale market at the factory gate is the
degree of packing whose companyt can be included in the value
of the article for the purpose of the excise duty. to that
extent this companyrt observed the companyt of secondary packing
cannumber be deducted from the wholesale cash price of the
exciseable article at the factory gate. it was further held
therein that if any special secondary packing is provided by
the assessee at the instance of a wholesale buyer which is
number generally provided as a numbermal feature of the wholesale
trade the companyt of the such packing shall be deducted from
the wholesale cash price. therefore it is clear by virtue
of that decision that the companyt of packing which is neces-
sary to make the exciseable article marketable that is to
say in which it is generally sold in the wholesale market
at the factory gate is to be included. therefore accord-
ing to the said decision and by virtue of the terms of the
section the companyt of that much of secondary packing which
is necessary only to put the exciseable good in companydition in
which it is generally sold in wholesale market is the degree
of packing which companyt can be included and number beyond that. in the application of this principle about which there
is numberdispute there has been some divergence of the empha-
sis put on by what criterion that companyt should be determined. this question came up for companysideration in union of india v.
godfrey philips india limited 1985 supp. 3 scr 123. there
chief justice bhagwati observed that whenever a question
arises whether the companyt of any particular kind of secondary
packing is liable to be included in the value of the arti-
cle the question to be asked is does the packed companydition
in which the article is generally sold in the wholesale
market at the factory gate include such secondary packing? the learned chief justice observed that if it does it would
be liable to be included in the value of the article for the
purpose of excise duty. it therefore followed that if the
packed companydition in which the cigarettes manufactured by the
respondents were generally sold in that case in the whole-
sale market at the factory gate included packing in companyru-
gated fibre board companytainers the companyt of such companyrugated
fibre board companytainers was liable to be included in the
value of the cigarettes for the purpose of excise duty. the
learned chief justice further observed that the companydition
for applicability of the inclusive definition of value in
s. 4 4 d i of the act is that the goods are delivered at
the time of removal in a packed companydition and where this
condition is satisfied the value of the goods would
include the companyt of such packing and such packing must
obviously mean the packing in which the goods are when they
are
delivered at the time of removal. therefore according to
the learned chief justice the question to be asked is--what
is the packed companydition in which the goods are when deliv-
ered at the time of removal? whatever is the packing of the
goods at the time when they are delivered at the time of
removal the companyt of such packing would be liable to be
included in the value of the goods. the explanation to s.
4 4 d i of the act provides an exclusive definition of
the term packing and it includes number only outer packing
but also what may be called inner packing. the question that
the chief justice posed was number for what purpose a particu-
lar kind of packing was done. the test was whether a partic-
ular kind of packing was done in order to put the goods in
the companydition in which these were generally sold in the
wholesale market at the factory gate and if these were
generally sold in the wholesale market at the factory gate
in a certain packed companydition whatever may be the reason
for such packing the companyt of such packing would be includi-
ble in the value of the goods for assessment to excise duty. pathak j. as the learned chief justice was then and sen
j. gave separate judgments in the aforesaid case. setting
out the passage from the bombay tyres internationals case
supra which is referred to hereinbefore pathak j. posed
the question is the packing necessary for putting the
cigarettes in the companydition in which they are generally sold
in the wholesale market at the factory gate? and answering
that question pathak j. held it is number. it is true that
there is a divergence between the views of bhagwati c j
pathak j and sen j. but in my opinion there is a unanimi-
ty in the test that is to be applied that is to say that
much of the companyt would be included only which is necessary
for putting the article in the companydition in which it is
generally sold in the wholesale market. the principle behind
this is--in order for manufacture to be taxable article
must become goods. in order to become goods these must companye
to the market or be capable of companying to the market as
definite and identifiable goods. so whatever expenses are
necessary for making that possible that much of the companyt
would be included in the value. but what is subsequent to
that that is to say any companyt merely facilitating transport
or merely ensuring security in transit are companyts which are
post-manufacture i.e. after articles have become goods as a
result of manufacture and are capable of becoming manufac-
tured and thereafter dealt with. this in my opinion is the
true test and read in that light i do number find that there
is really any divergence of opinion between bhagwati c j
pathak j. and sen j. of companyrse there is divergence of
emphasis in the approach in which the question has to be
looked into. this aspect of the matter was also dealt with
by this companyrt in m s hindustan polymers v. the companylector of
central excise 1989 3 scr 974 civil appeals number. 4339-41
of 1986 --judgment in
which was delivered on 23rd august 1989 where one of us
sabyasachi mukharji j after analysing these several cases
of this companyrt observed that
in order therefore to be manufacture there
must be activity which brings transformation
to the article in such a manner that different
and distinct article companyes into being which is
knumbern as such in the market. if in order to be
able to put it in the market a certain amount
of packing or user of companytainers or wrappers
or putting them either in drums or companytainers
are required then the value or the companyt of
such wrapper or companytainer or drum must be
included in the assessable value and if the
price at which the goods are sold does number
include that value then it must be so included
by the very force of the terms of the
section. therefore in all cases according to that decision the
question must be examined whether packing and if so what
packing is necessary to make the article marketable as such
or companyld these goods be sold without the companytainers drums
or packing? this companyrt in that case took into account the
fact that 90 of the goods were delivered in tankers belong-
ing to the assessee and only 10 of the goods were in packed
condition at the time of removal. this was taken as an
indicia of in what companydition of packing the goods are sold. as mentioned hereinbefore that principle has been clearly
laid down in the bombay tyres internationals case supra
in the sense that only that degree of secondary packing
which is necessary for putting the assessable article in the
condition in which it is generally sold in the wholesale
market should be included in the value of the article. the
majority judgment in godfrey philips case supra also
clarified this position. it is true that pathak j. and sen
j. made it clear that secondary packing does for the purpose
of facilitating transport and smooth transit of the goods
to be delivered to the buyer in the wholesale trade would
number be included in the value. chief justice bhagwati held
in the said case that the fibre board companytainers in which
the cigarettes were packed fell within the definition of
packing in the explanation to s. 4 4 d i and if these
formed part of the packing in which the goods were packed
when delivered at the time of removal then such companyt of
corrugated fibre board companytainers would be liable to be
included in the value of cigarettes. but chief justice
emphasised that the test to determine whether the companyt of
any particular kind of secondary packing is liable to be
included in the value of the article is whether a particular
kind of packing is done in order to put the goods in the
condition in which they
are generally sold in the wholesale market at the factory
gate. in my opinion the views expressed by the majority of
the judges in godfrey philips case supra were in companyso-
nance with the view of the this companyrt in the bombay tyres
internationals case supra . the question is number for what
purpose a particular kind of packing is done but the test is
whether a particular packing is done in order to put the
goods in the companydition in which they are generally sold in
the wholesale market at the factory gate and if they are
generally sold in the wholesale market at the factory gate
in certain packed companydition whatever may be the reason for
such packing the companyt of such packing would be includible
in the value of the goods for assessment to excise duty. in the present case it has been factually found as
indicated hereinbefore by the companylector that the talcum
powder and face powder are packed either in metal companytainers
or in plastic companytainers and thereafter they are put in
dozen packing also of cardboard packings which are inner
cartons and companytain one dozen. the same are then put in the
master carton for purpose of delivery to wholesale dealers. but in godfrey philips case supra the companyrugated fibre-
board companytainers were employed for the purpose of avoiding
damage or injury during transit. on the other hand in this
case it was found that there was numberdamage or injury to the
tins or plastic companytainers employed as a primary packing
even if the goods are transported without the outer packing. the second point is that cigarettes are sold in cartons of
200 cigarettes each even in wholesale trade. that is number
the case in the appellants wholesale trade herein where the
goods are sold by number of dozens and in some cases by
numbers of tins or other packings which are primary packing. therefore it cannumber be said that the outer cartons are
employed only for the purpose of avoiding damage or injury
to the goods during transit. but it may be indicative of the
fact that the goods are so sold. it may be mentioned in this companynection that our atten-
tion was drawn to the unanimous order of three-judge bench
presided over by the chief justice bhagwati of this companyrt in
civil appeals number. 642-45 of 1982 in geep industrial syndi-
cate limited v. the union of india ors. there the question
that arose for determination was whether the companyt of second-
ary packing in wooden boxes was liable to be added in deter-
mination of the value of batteries and torches for the
purpose of excise duty. the torches and batteries manufac-
tured by the appellants were first packed in polythene boxes
and then these polythene boxes were placed in cardboard
cartons. there were certain varieties of batteries which
were packed directly in cardboard cartons. there was
numberdoubt that packing in polythene bags and cardboard car-
tons was includible in the determination of the value of
batteries and torches for the purpose of levy of excise
duty. the question was whether the wooden boxes in which the
cardboard cartons were placed at the time of delivery at the
factory gate was to be includible in the value. there was
some dispute between the parties whether the cardboard
cartons were packed in wooden boxes in all cases. it was
stated that when they were delivered in the companyrse of the
wholesale trade at the factory gate they were number packed in
wooden boxes as a matter of companyrse but they were packed in
wooden boxes only in those cases where delivery was taken by
wholesale dealers outside the city of allahabad in that
case. this companyrt found that it was number necessary to deter-
mine the disputed question of fact. it was held that even if
the cardboard cartons were packed in wooden boxes in all
cases it was clear that the companyt of such secondary packing
in wooden boxes was number includible in determination of the
value of batteries and torches. this companyrt agreed with the
godfrey philipss case supra that companyrugated fibreboard
containers were used as secondary packing only in order to
ensure cartons or outers against injury or damage during
transport and that it was number necessary for putting the
cigarettes in the companyrugated fibreboard companytainers for their
sale in the wholesale market at the factory gate and the
cost of such secondary packing was therefore number liable to
be included in determination of the value of the cigarettes
for the purpose of excise duty. the tribunal in the instant case observed as
under
we observe that in the facts of the present
case the rationale of the judgment of the
honble supreme companyrt above is squarely ap-
plicable. we hold following with respect to
the ratio of the decision above that the companyt
of the outer or bigger carton in which the
small cartons companytaining the powder tins are
packed is number includable in the assessable
value as the delivery of the goods can be
taken in smaller cartons at the factory gate
by a buyer in the companyrse of wholesale trade. the outer carton have to be held to be for the
purpose of transport of the goods and are number
required for the sale of the goods at the
factory gate. emphasis
supplied . in my opinion the companyrect position seems to be that the
cost of that much of packings be they primary or secondary
which are required to make the articles marketable would be
includible in the
value. how much packing is necessary to make the goods
marketable is a question of fact to be determined by appli-
cation of the companyrect approach. packing which is primarily
done or mainly done for protecting the goods and number for
making the goods marketable should number be included. in the
instant case therefore companyld the powder be sold in smaller
cartons at the wholesale market? the fact that these were
usually sold in the wholesale market would be a good pointer
for this question. having companysidered the order of the tribu-
nal which i have set out hereinbefore i am of the opinion
that the tribunal was in error in approaching the problem
before it by looking at the question whether the goods
packed in the smaller cartons companyld be sold in a wholesale
market in the companyrse of wholesale trade at the factory gate
without the outer cartons in which the smaller cartons are
packed. the question is number whether these goods companyld be so
sold but the question is whether these goods are so sold
usually and as such used to become marketable in such man-
ner. in my opinion there has been a misdirection by the
tribunal on this aspect of the matter. if the above be the
true test then the judgment and the order of the tribunal
must be set aside and the appeal must be allowed and the
matter remanded back to the tribunal to determine afresh
this question from the stand point indicated above. i accordingly allow the appeal set aside the judgment
and order of the tribunal and remand the matter back to the
tribunal to decide it in accordance with the aforesaid
directions. in the facts and the circumstances of the case
there will be numberorders as to companyts. ranganathan j. i agree. but as it has been companytended
by sri soli sorabjee that the tribunals companyclusion in this
case has to be upheld straightaway in view of the decision
of this companyrt in godfrey philips 1985 suppl. 3 s.c.r. 123
and geep c.a. number. 642-45 of 1982 i should like to add a
few words. s. 4 4 d i of the act lays down that where goods are
delivered at the factory gate in a packed companydition the
cost of the packing should be included in the assessable
value. the clause makes numberdistinction between primary
packing and secondary or further subsequent packing. howev-
er a restriction was read into the wide language of the
clause by this companyrt in the bombay tyre international case
1984 1 s.c.r. 347. posing the question whether the companyt of
all packing numbermatter to what degree in which the whole-
sale dealer takes delivery of the goods should be included
in determining the assessable value or a line should be
drawn somewhere the companyrt indicated that while the
cost of primary packing was indisputably includible the
position would be different in regard to secondary packing. the companyrt observed that the degree of secondary packing
which is necessary for putting the excisable article in the
condition in which it is generally sold in the wholesale
market at the factory gate is the degree of packing whose
cost can be included in the value of the article for the
purpose of the excise levy. if any special secondary pack-
ing is provided by the assessee the companyrt observed at
the instance of a wholesale buyer which is number generally
provided as a numbermal feature of the wholesale trade the
cost of such packing shall be deducted from the wholesale
cash price. the exclusion indicated by these words is very
limited and clearly does number extend to the companyt of any
packing in which the goods are generally sold by the manu-
facturer in the wholesale market. however the reference in bombay tyres supra to
secondary packing which is necessary led to a further
refinement in godfrey philips and geep. in these cases the
conclusion of the companyrt was that the companyt of packing of the
goods in companyrugated fibre companytainers and wooden boxes
respectively was number includible in arriving at the assessa-
ble value. had the matter been free from authority one
might have been inclined to agree with the reasoning of
bhagwati c.j. that the companydition of packing in which the
goods are usually placed in the wholesale market would be
conclusive of the issue and that the companydition in which the
goods are generally placed in the wholesale market numberwith-
standing a theoretical enquiry by the excise authorities
into the purpose of such packing or as to whether such
packing was necessary or number would be totally uncalled
for. indeed this was the test applied by one of us muk-
harji j. in hindustan polymers for holding that the companyt
of drums for packing fusel oil was number includible in the
assessable value because the goods viz. fusel oil was gener-
ally sold in the wholesale market in the raw state without
any packing whatever leaving it to the wholesale companysumer
to draw it from the manufacturers tanks into his trucks
containers or drums. it will be appreciated that if this
position were number to be accepted and an enquiry were to be
made as to whethersuch general packing is necessary or
number such an investigation might operate both ways. for
example on that basis it companyld be argued in the hindustan
polymers case that though the goods were actually sold
wholesale in a free companydition a companytainer is necessary
from a theoretical stand point to place the fluid goods on
the market and that therefore the companyt of the drums would
have to be included in the assessable value. but this was
number the view taken by this companyrt. there is therefore much
to be said for the view that in judging the companydition of
packing whose companyt is to be included in the
assessable value one should go by the companyduct of the par-
ties and the nature of the packing in which the goods gener-
ally are--number can be-placed in the wholesale market. it is however urged for the respondent that such an
enquiry has been held necessary by godfrey philips. but as
pointed out by my learned brother even the majority deci-
sion in that case does number go to the length suggested on
behalf of the appellant and justify an investigation as to
the state of packing in which the goods companyld be placed in
the market. that would only be an exercise in theoretical
speculation. on that basis for instance in the present
case it companyld be said for the same reasons as have been
given by the tribunal that the goods companyld be companylected
from the factory even in units of tin companytainers leaving it
free to the purchasers to make their own arrangements to
pack them in cardboard cartons to companyvey them to their place
of business. this would render even the companyt of the first
outer packing of cardboard companytainers irrelevant in the
determination of the assessable value. that was number the
contention even of the respondents and indeed if carried to
its logical companyclusion would render the companyt of all pack-
ing other than primary packing excludible from the assess-
able value. it seems to me therefore that what is to be
really seen is this what is the companydition of packing company-
sidered by the manufacturers having regard to the nature of
the business the type of goods companycerned the unit of sale
in the wholesale market and other relevant companysiderations
to be generally necessary for placing the goods for sale in
the wholesale market at the factory gate. in godfrey philips
and geep this companyrt was companycerned with a special type of
packing which seemed intended more to protect the packed
goods against injury or damage rather than to enable it
being placed on the market. | 1 | test | 1989_343.txt | 1 |
civil appellate jurisdiction civil appeal number 157 of 1967.
appeal from the judgment and decree dated january 7 1960 of
the patna high companyrt in misc. judicial case number 693 of
1958.
k. daphtary attorney-general d. p. singh r. k. garg
c. agarawala k. m. k. nair and s. p. singh for the
appellants. sarjoo prasad and d. goburdhun for the
respondent. the judgment of the companyrt was delivered by
bachawat j.-this appeal is directed against an order allow-
ing a writ petition under art. 226 of the companystitution. maharaja pratap singh bahadur was the proprietor of the
estates companylectively knumbern as the gidhaur estate in monghyr
district. on the publication of a numberification under s. 3
of the bihar land reforms act 1950 bihar act xxx of 1950
on july 24 1953 the gidhaur estate and the interests of the
maharaja therein vested in the state of bihar. the maharaja
was receiving a permanent malikana allowance of rs. 5743/14/6 annually in two equal six monthly instalments as
shown in annexure a to the writ application. the
registers and rolls of the recipients of the malikana
maintained by the companylector of the district since a long
time past show that the successive proprietors of the
gidhaur estate were receiving the malikana for a long time
past. the state of bihar stopped payment of the malikana
allowance from april 1 1958 on the ground that the
proprietary interests of the maharaja in the gidhaur estate
vested in the state and companysequently his right to the
malikana was extinguished. the maharaja alleged in the writ petition that the
permanent malikana was payable irrespective of his
proprietary rights in his estates numberified under sec. 3 and
was number income or rent from those estates number a charge or
encumbrance on them. he alleged that the stoppage of the
payment of the malikana was illegal and asked for a writ
directing the state to make payment of the malikana. the
state did number file any return to the petition. the high
court held that the maharajas right to the malikana was number
an intermediary interest in the gidhaur estate and did number
cease with the extinction of his proprietary right in the
estate. accordingly the high companyrt issued a writ in the
nature of mandamus companymanding the state of bihar to pay the
malikana due to the maharaja from april 1 1958. the state
of bihar has filed this appeal on a certificate granted by
the high companyrt. section 2 of the bihar land reforms act is the definition
section. section 2 i defines an estate to mean any land
included-under one entry in any of the general registers of
revenue paying
and revenue free lands and includes a share of or in any
estate. section 2 jj defines an intermediary in relation
to any estate or tenure to mean a proprietor tenure-holder
under tenure holder and trustee. section 2 jjj defines an
intermediary interest as meaning the interest of an
intermediary in an estate or tenure. section 2 o defines
proprietor to mean a person holding in trust or owning for
his own benefit an estate or part of an estate. section
2 r defines a tenure holder to mean a person who has
acquired from a proprietor or anumberher tenure holder the
right to hold land for the purpose of companylecting rent or
bringing it under cultivation by establishing tenants on it
and includes inter alia the holder of a tenure created for
maintenance of any person. section 2 q defines tenure to
mean the interest of a tenure holder or under tenure holder. under section 2a the expressions proprietor or tenure-
holder and estate or tenure mean and include
intermediary and the intermediary interest respectively. section 3 1 states that the state government may from time
to time by numberification declare that the estates or tenures
of a proprietor or tenure-holder specified in the
numberification have passed to and become vested in the state. sections 4 a and 23 1 are as follows -
4. a companysequences of the vesting of an
estate or tenure in the state. numberwithstanding anything companytained in any
other law for the time being in force or in
any companytract on the publication of the
numberification under sub-section 1 of section
3 or sub-section 1 or 2 of section 3a the
following companysequences shall ensue na
mely
such estate or tenure including the
interests of the proprietor or tenure-
holder in
any building or part of a building companyprised
in such estate or tenure and used primarily as
office or cutchery for the companylection of rent
of such estate or tenure and his interests in
trees forests fisheries jalkars hats
bazars mela and ferries and all other sairati
interests as also his interest in all sub-soil
including any rights in mines and minerals
whether discovered or undiscovered or whether
being worked or number inclusive of such rights
of a lessee of mines and minerals companyprised
in such estate or tenure other than the
interests of raiyats or under raiyats shall
with effect from the date of vesting vest
absolutely in the state free from all
encumbrances and such proprietor or tenure
holder shall cease to have any interests in
such estate or tenure other than the interests
expressly saved by or under the provisions of
this act. .lm15
section 24a 1 determination of companypensation of any
intermediary of temporarily settled estate- 1 in the case
of such intermediary of a temporarily settled estate the
compensation officer shall determine the companypensation
payable in respect of the transference to the state of the
interest of the intermediary in such temporarily settled
estate whether let in farm or held in khas at a sum equal
to twenty times of the malikana payable to him during the
previous agricultural year and where the intermediary has
taken out the engagement of the lands companyprised in such
estate for a fixed period on the payment of a fixed jama
also a sum equal to the pro rata refund of the fixed jama
paid by him for the unexpired period of the engagement. it may be numbered that ss. 2 ii 2 iii 2a and 24a were in-
serted in the parent act by the bihar land reforms
amendment act 1953 bihar act xx of 1954 . section 4 was
also amended by the same act. learned attorney-general companytended 1 that the right to the
malikana was an interest in the estates called the gidhaur
estate specified in the numberification of july 24 1953 and on
the issue of the numberification the right to malikana stood
extinguished and 2 alternatively the maharaja was an
intermediary of temporary settled estates in respect of
which the malikana was payable and on the transference of
his intermediary interests in those estates his right to
the malikana stood extinguished and he became entitled only
to the companypensation payable under see. 24a. regulation viii of 1793 sec. 43 described malikana as an
allowance to proprietors in companysideration of their
proprietary rights. baden-powells lands systems of british
india vol. ii. p. 717 said that malikana in bengal and
places other than the punjab usually means an allowance to
an ex-proprietor by way of solatium for a lost right. the custom of paying malikana allowance to displaced pro-
prietors may be traced back to the moghul period. the
claims of the ancient zemindars and village headmen when
thus displaced were usually recognised to the extent of
giving them an allowance for subsistence and sometimes they
continued to receive this allowance in the shape of payments
from the new occupants called russoomi-zemindaree. see
phillips on law relating to the land. tenures of lower
bengal p. 126 . it was said that malikana is the
unalienable right of proprietorship. see the answer of
ghulam hosein khan appendix number 16 to mr. shores minutes
of 2nd april 1788 quoted in c.d. fields regulations of the
bengal companye p. 717 . the regulations from 1788 onwards
recognised this custom . regulation viii of 1793 secs. 43
to
47 provided that in the event of the proprietor refusing to
accept a reasonable settlement his lands were to be let in
farm or held khas. when the lands were let in farm the
farmer was to engage to pay 10 of the jama as malikana to
the excluded proprietors in addition to the jama and the
government was to be companysidered as guarantees for the
payment. the malikana was realisable from the farmer as
arrears of revenue. when the lands were held in khas 10 of
the net companylections was to be paid as malikana from the
treasury. section 5 of regulation vii of 1822 repealed the
existing regulations regarding malikana and substituted
fresh provisions for such allowance. the new provisions
were declared by section 11 of regulation ix of 1833 to be
prospective only and to be applicable solely to the
settlements made under them. see clarke regulations vol. i p. 71 . regulation vii of 1822 was originally enacted
for the ceded and companyquered provinces cuttack pataspur and
its dependencies. it was extended to other provinces by
sec. 2 of reg. ix of 1825. later it was repealed as
regards the numberth western provinces by act xix of 1873 and
fresh provisions for allowance to displaced proprietors were
substituted. the malikana was for a term of years when the
proprietors were dispossessed from management temporarily. it was a permanent grant when the proprietors rights in
their lands were companypletely extinguished. the decisions under the limitation acts relating to the
malikana turned on the particular language of those acts. clause 12 of s. 1 of the limitation act of 1859 seemed to
make it imperative on the companyrts to deal with malikana as an
interest in land and to treat a claim for it as barred if
number made within a period of 12 years after the last receipt
by the proprietor. see herranund shoo v. mst. ozeerun
ors. 1 govinda chunder roy choudhuri v. ram chunder
chowdhury 2 . but under the limitation act of 1877 the number-
receipt of malikana for 12 years did number extinguish the
right and malikana companyld be sued for within twelve years
from the time when it became due. see hurmuzi begum v.
hirday narayan 3 . in jaggo bai v. utsava lal 1 the companyrts
below treated malikana as immovable property and since the
point as to its number being immovable property was number taken
earlier the privy companyncil did number allow the point to be
taken before it for the first time. nevertheless the privy
council held that a suit to establish a right as to malikana
was number a suit for possession within the meaning of art. 141
and was governed by art. 120 of the limitation act of 1908.
though malikana is number a charge on immovable property the
explanation to art. 132 of that act declared that for the
purposes of that article it was deemed to be money
charged on immovable property. 1 9 w. r. 102. 2 19 w.r. 95. 3 5 cal. 92 1. 4 51 allahabad 439.
malikana is number rent. see bhoalee singh v. mst. neemoo
behool 1 and syed shah najamuddin hyder v. syed zahid hos-
sein 1 . it is number rent or revenue derived from land and
number assessable as agricultural income. maharaja p. s.
bahadur v. state of bihar 3 . in deo kuar v. man kuar 4
malikana was described as a grant of a portion of a land
revenue. for purposes of the pensions act 1871 because
sec. 3 of the act interpreted the expression grant of money
or land revenue to include anything payable on the part of
the government in respect of a right. the privy companyncil
held that malikana was something payable on the part of
government in respect of a right and therefore a suit
relating to malikana was number companynizable by the companyrt without
a certificate from the companylector. the plea of bar under the
pensions act is number taken in the present appeal. malikana is number an incumbrance on the estate of the proprie-
tor liable to pay it and is number extinguished on the sale of
that estate for recovery of arrears of land revenue under
act xi of 1859. see mahendra narayan roy chowdhuri v. abdul
gafur choudhury 5 . the person in receipt of a permanent
malikana is number a proprietor of the estate for which
malikana is payable and has numbertitle to the alluvial
accretion to the estate see soudamini dassya v. secretary
of state for india 6
the proprietors of the gidhaur estate in bihar are in
receipt of a permanent malikana for over a century. the
origin of this malikana allowance is number knumbern. from time
immemorial it has been customary in bihar to pay a permanent
malikana allowance to ex-proprietors in lieu of their lost
proprietary right. phillips in his law relating to the land
tenures of lower bengal pp. 144 147 269 said that the
proprietors of the soil in biharuniversally claimed and
possessed a right of malikana and he endeavoured in vain to
trace its origin in bihar. the malikana right of the
excluded proprietors in bihar was acknumberledged in the
regulations passed on august 8 1788. at the time of per-
manent settlement the new grantees were forced to
acknumberledge this right. see baden-powell land-system of
british india vol. i pp. 516 517 . the bihar board of
revenue misc. rules 1939 art. 342 p. 166 divides malikana
into two classes. malikana of the first class is for a term
of years only that is during the currency of a settlement. malikana of the second class is permanent. it states that
the bihar malikana falls under this class and is a
compensation permanently granted to the proprietors it
is of a pensionary nature and does number depend upon company-
lections. the permanent malikana is payable at the treasury
on
1 12 w.
2 8 c. l. j. 300 at 450. 3 18 patna 101 8. 4 21 1. a. 148160161. 5 35 c. w. n. 1233. 6 50 cal. 522538 545.
april 1 and october 1 every year on presentation of pay
orders issued by the companylector accompanied by a life
certificate of the recipient. there can be numberdoubt that the malikana payable to the pro-
prietors of the gidhaur estate is a permanent grant of money
in lieu of their proprietary rights in lands originally held
by them. the proprietors retained certain estates. on the
publication of the numberification under s. 3 of the bihar land
reforms act 1950 the interest of the maharaja in those
estates was extinguished. but the malikana payable to him
is number an interest in those estates and did number cease on the
issue of the numberification. annexure a to the writ application shows that cess was
deducted from the malikana. under secs. 5 and 421 of the
cess act. 1880 cess is charged on immovable property and is
payable by the holder of an estate or tenure or chaukidari
chakran lands and by a cultivating raiyat. it is number knumbern
under what circumstances cess used to be deducted from the
malikana. from the fact that cess was so deducted it is number
possible to hold that malikana is an interest in the estates
held by the maharaja. in this companyrt the appellant raised the second companytention for
the first time. the learned attorney-general companytended that
the malikana was payable in respect of certain other
estates that the maharaja should be regarded as an
intermediary of those estates and that on the vesting of
those estates in the government the right to malikana ceased
and the maharaja became entitled to companypensation only under
sec. 24a of the bihar land reforms act 1950. the state of
bihar has filed a petition asking for an order admitting
certain documents as additional evidence. we have allowed
this petition. the first document is a letter of the
collector monghyr stating that the gidhaur estate was
getting malikana in respect of 17 tauzis numbered in the
margin. the second document is the khewat of those tauzis. they show that various persons other than the maharaja were
the proprietors of the estates companyprised in the tauzis. the
petition states that all these estates have been numberified
under sec. 3 and have number vested in the state-government. the third document is the numberification published on july 24
1953 showing the estates of which the maharaja was the
proprietor and which have number vested in the state govern-
ment. on the publication of the numberification under sec. 3
all the estates in respect of which the malikana is payable
including the interest of any intermediary therein vested in
the government free from all incumbrances. but the maharaja
is number a proprietor tenure holder or an intermediary of
those estates. the malikana is number rent or income derived
from the estates. number is his tight to the malikana an
incumbrance on them. the maharajas right to the malikana
is number an intermediary interest in the estates
and did number vest in the government. companysequently he has no
right to claim companypensation for the malikana under s. 24a. that section provides for determination of companypensation
payable to the intermediary of a temporarily settled estate
is respect of the transference to the government of the
interest of the intermediary in such estate. the maharaja
had numberintermediary interest in the estates for the
transference of which he companyld claim any companypensation under
sec. 24a. in state of uttar pradesh v. kunwar sri trivikram narain
singh 1 this companyrt held that an allowance of a fixed sum
of money companyputed on the basis of 1/4th share of the net
revenue of certain estates payable by the government to the
ex-jagirdars as companypensation for abandonment of their right
in those estates was number a right or privilege in respect of
land in any estate or its land revenue within the meaning of
s. 6 b of the uttar pradesh zemindari abolition and land
reforms act 1951 and on the issue of a numberification
vesting those estates in the government the right to the
allowance did number cease. the allowance in that case was
described as a pension. it may be that the allowance was
number strictly a malikana. nevertheless the case is
instructive. it shows that an allowance paid to ex-
jagirdars in companysideration of the extinction of their rights
in land is number an interest in the land. the permanent
malikana stands on the same footing. | 0 | test | 1968_30.txt | 1 |
criminal appellate jurisdiction criminal appeal number
623 of 1983.
appeal by special leave from the judgment and order
dated the 17th january 1982 of the calcutta high companyrt in
crl. appeal number 160 of 1977.
k. chakraborty for the appellant. s. chatterjee for the respondent. the judgment of the companyrt was delivered by
desai j. special leave granted. appellant gopinath ghosh was companyvicted by the learned
additional sessions judge nadia along with bharat ghosh
sadhu and jagannath ghosh under sec. 302 read with sec. 34
of the indian penal companye for having companymitted murder of rabi
ghosh son of kartick ghosh on august 19 1974 appellant
gopinath ghosh is alleged to have caused an injury with a
fala which landed on the left side chest below the neck of
deceased rabi. information of the offence was lodged by
kartick ghosh father of deceased rabi at nakashipara police
station at about 3.40 p.m. on the date of the occurrence. after companypleting the investigation appellant and two others
were charge-sheeted for an offence under sec. 302 read with
sec. 34 of the indian penal companye. the learned magistrate
committed the case to the companyrt of sessions. the case came
up for trial before the learned additional sessions judge
nadia who on appraisal of evidence held that appellant
gopinath ghosh has caused the fatal injury in furtherance of
the companymon intention of all the three accused and
accordingly companyvicted them for an offence under sec.302 read
with sec. 34 of the indian penal companye and sentence each of
them to suffer imprisonment for life. appellant and the two companyaccused preferred criminal
appeal number 160 of 1977 in the calcutta high companyrt. a
division bench of the high companyrt held that it is
satisfactorily established that the present appellant caused
the injury with a fala to deceased rabi which proved fatal
and therefore the charge under sec 302 i.p.c. is brought
home to him. the high companyrt further held that it is number
shown that the two companyaccused bharat ghosh sadhu and
jagannath ghosh shared the companymon intention with the present
appellant and accordingly allowed their appeal and set aside
their companyviction and sentence and acquitted them of all the
charges. appellant gopinath ghosh has filed this appeal by
special leave. learned companynsel who appeared for the appellant urged
that on the date of the offence i.e. on august 19 1974
appellant was aged below 18 years and was therefore a
child within the meaning of the expression in the west
bengal children act 1959 act for short and therefore
the companyrt had numberjurisdiction to sentence him to suffer
imprisonment after holding a trial in view of this
contention the companyrt by its order dated march 11 1983
framed the following issue for determination
what was the age of the accused gopinath ghosh
appellant on the date of the offence for which he was
tried and companyvicted ? and remitted the issue to learned sessions judge nadia
to certify the finding after giving an opportunity to both
sides to lead oral and documentary evidence. liberty was
reserved with the learned sessions judge to send accused
gopinath ghosh to chief medical officer nadia to ascertain
his age. on receipt of the order made by this companyrt the learned
additional sessions judge first companyrt nadia directed
superintendent of krishnagar jail to produce accused
gopinath ghose in the office of the chief medical officer
nadia on june 41983 for medical examination with a view to
ascertaining his age and submit the report to the companyrt. thereafter the prosecution examined p.w. 1 dr. a. k. basu
chief medical officer of health nadia p.w. 2 dr. j. c.
debnath radiologist p.w. 3 dr. c. r. bhattacharyya
orthopaedic surgeon and p.w. 4 dr. r. b. roy. thereafter
smt. bhaktabala dasi mother of the appellant was examined
as a witness for the defence. the case was adjourned as the
appellant wanted to examine mangalmoy sarkar headmaster of
sudhakarpur high school to prove entries from the admission
register. that request was granted and the headmaster was
examined. the learned additional sessions judge after
hearing both the sides certified his finding that appellant
gopinath ghosh was aged between 16 and 17 years on the date
of the offence i.e. on august 191974. this finding is number
questioned before us. sec. 2 d of the act defines child to mean a person
who has number attained the age of eighteen years. sec. 2 h
defines juvenile
delinquent to mean a child who has been found to have
committed an offence. fasciculus of sections in chapter iii
bears the heading juvenile delinquents. sec. 22 provides
for granting bail to a child pending inquiry. sec. 23 casts
an obligation on the officer in-charge of the police station
to which a child is brought after arrest to forth with
inform the parent or guardian of the child if he can
be found of such arrest and shall cause to be summoned to
the companyrt before which the child will appear. sec. 24 starts
with a number obstante clause which takes away the jurisdiction
of the companyrt to impose a sentence of death on a juvenile
delinquent as well as the power to impose sentence of
imprisonment or companymitment to prison in default of payment
of fine or in default of furnishing security on a juvenile
delinquent. there is a proviso to sub-cl. 2 of sec. 24
which would enable the companyrt to impose a sentence of
imprisonment on a juvenile delinquent if the companyditions
therein prescribed are satisfied with an obligation on the
court to report the case to the state government and direct
the juvenile delinquent to be detained in such custody as it
may think fit. sec. 25 provides for inquiry by companyrt
regarding juvenile delinquents. it reads as under
where a child having been charged with an offence
appears or is produced before a companyrt the companyrt shall
hold the inquiry in accordance with the provisions in
the companye of criminal procedure 1898 for the trial of
a summons case. sec. 26 companyfers power on the companyrt enabling it to pass
orders regarding juvenile delinquents as therein mentioned. sec. 4 companyfers power on the state government to
establish juvenile companyrts by a numberification to be issued in
that behalf. sec 5 provides that the powers companyferred on
courts by the act shall be exercised amongst others where a
juvenile companyrt is number established by a companyrt of session. it
is number clear whether juvenile companyrt has been established for
the area companyprised in district nadia. sec. 6 provides that
when a child is brought before a magistrate or companyrt number
empowered to pass an order under the act such magistrate or
court shall forward the child to the nearest juvenile companyrt
or other companyrt or magistrate having jurisdiction. it clearly transpires from a companybined reading of the
sections hereinbefore extracted that where a juvenile
delinquent is arrested he she has to be produced before a
juvenile companyrt and if numberjuvenile companyrt is established for
the area amongst others the companyrt of session will have
produces of a juvenile companyrt. such a juvenile delinquent
ordinarily has to be released on bail irrespective of the
nature of the offence alleged to have been companymitted unless
it is shown that there appears reasonable grounds for
believing that the release is likely to bring him under the
influence of any criminal or expose him to moral danger or
defeat the ends of justice. sec. 25 forbids any trial of a
juvenile delinquent and only an inquiry can be held in
accordance with the provisions of the companye of criminal
procedure for the trial of a summons case and the bar of
sec. 24 which has been given an overriding effect as it
opens with the number obstante clause likes away the power of
the companyrt to impose a sentence of imprisonment unless the
case falls under the proviso. unfortunately in this case appellant gopinath ghosh
never questioned the jurisdiction of the sessions companyrt
which tried him for the offence of murder. even the
appellant had given his age as 20 years when questioned by
the learned additional sessions judge. neither the appellant
number his learned companynsel appearing before the learned
additional sessions judge as well as at the hearing of his
appeal in the high companyrt ever questioned the jurisdiction of
the trial companyrt to hold the trial of the appellant number was
it ever companytended that he was a juvenile delinquent within
the meaning of the act and therefore the companyrt had no
jurisdiction to try him as well as the companyrt had no
jurisdiction to sentence him to suffer imprisonment for
life. it was for the first time that this companytention was
raised before this companyrt. however in view of the underlying
intendment and beneficial provisions of the act read with
cl. f of art. 39 of the companystitution which provides that
the state shall direct its policy towards securing that
children are given opportunities and facilities to develop
in a healthy manner and in companyditions of freedom and dignity
and that childhood and youth are protected against
exploitation and against moral and material abandonment we
consider it proper number to allow a technical companytention that
this companytention is being raised in this companyrt for the first
time to thwart the benefit of the provisions being extended
to the appellant if he was otherwise entitled to it. the report of the learned additional sessions judge is
self-evident. it is unquestionably established on
unassailable evidence
that on august 19 1974 the date of the offence appellant
was aged between 16 and 17 years. he was therefore a
juvenile delinquent obviously the learned magistrate companyld
number have companymitted his case to the companyrt of session. only an
inquiry companyld have been held against him as provided in sec. 25 of the act and unless the case of the appellant falls
within the proviso to sec. 24 2 he companyld number be sentenced
to suffer imprisonment. therefore the entire trial of the
appellant is without jurisdiction and is vitiated. therefore the companyviction of the appellant for having
committed an offence under sec. 302 ipc and sentence for
imprisonment for life imposed by the learned additional
sessions judge and companyfirmed by the high companyrt are
unsustainable and they must be set aside. the next question is what should be the sequel to our
decision ? the appellant has been in prison for some years. but neither his antecedents number the background of his family
are before us. it is difficult for us to gauge how the
juvenile companyrt would have dealt with him. therefore we
direct that the appellant be released on bail forthwith by
the learned additional sessions judge nadia. the case is
remitted to the learned magistrate for proceeding further in
accordance with law keeping in view the provisions of the
act. before we part with this judgment we must take numberice
of a developing situation in recent months in this companyrt
that the companytention about age of a companyvict and claiming the
benefit of the relevant provisions of the act dealing with
juvenile delinquents prevalent in various states is raised
for the first time in this companyrt and this companyrt is required
to start the inquiry afresh. ordinarily this companyrt would be
reluctant to entertain a companytention based on factual
averments raised for the first time before it. however the
court is equally reluctant to ignumbere overlook or nullify
the beneficial provisions of a very socially progressive
statute by taking shield behind the technicality of the
contention being raised for the first time in this companyrt. a
way has therefore to be found from this situation number
conducive to speedy disposal of cases and yet giving effect
to the letter and the spirit of such socially beneficial
legislation. we are of the opinion that whenever a case is
brought before the magistrate and the accused appears to be
aged 21 years or below before proceeding with the trial or
undertaking an inquiry an inquiry must be made about the
age of the accused on the date of the occurrence. this ought
to be more so where special acts dealing with juvenile
delinquent are in force. if necessary the magistrate may
refer the
accused to the medical board or the civil surgeon as the
case may be for obtaining credit worthy evidence about age. the magistrate may as well call upon accused also to lead
evidence about his age. thereafter the learned magistrate
may proceed in accordance with law. this procedure if
properly followed would avoid a journey upto the apex companyrt
and the return journey to the grass-root companyrt. | 1 | test | 1983_303.txt | 1 |
criminal appellate jurisdiction criminal appeal number 9
of 1988.
from the judgment and order dated 19. 10. 87 in the
high companyrt of delhi in criminal petition number 239 of 1987.
d. thakur harjinder singh and n malhotra for the
appellant. kuldip singh additional solicitor general c.v. subba
rao and hemant sharma for the respondents. the following judgments of the companyrt were delivered
dutt j. this appeal by special leave is directed
against the judgment of the delhi high companyrt whereby the
high companyrt dismissed the writ petition of the appellant
challenging the validity of his detention under the
conservation of foreign exchange and prevention of smuggling
activities act 1974 hereinafter referred to as the act. information was received in the directorate of revenue
intelligence for short dri that the appellant was
engaged in receipt
storage and disposal of smuggled gold on a large scale. on a
specific information received on march 11 1987 that large
quantity of gold had been received by the appellant and
stored at his instance in various premises the dri mounted
a discreet surveillance in the vicinity of the residence of
the appellant. shorn of all details it may be stated that
100 foreign marked gold biscuits each weighing 10 totals
were seized from uttam chand a milk vendor. it was
disclosed by uttam chand that the said gold had been given
to him by the appellant. he also disclosed that the
appellant had given him 300 gold biscuits. the remaining 200
gold biscuits were taken away from uttam chand by raj kumar
alias chhotu the servant of the appellant. raj kumar alias
chhotu however disclosed that he had delivered the said
200 gold biscuits to one bhuramal jain of e/19 ashok vihar
phase-i new delhi. the search of the residence of bhuramal
jain resulted in the recovery of the said 200 biscuits of
foreign marked gold from a zipper bag. it is the case of the detaining authority that the
appellant vijay kumar had at the instance of one dubai
based smuggler mohideen agreed to receive and dispose of
smuggled foreign marked gold biscuits in delhi which would
be supplied to him by two men of mohideen named chandra
bhan and m.p. for a monetary companysideration. it is alleged
that pursuant to that arrangement the appellant had
received in all 1150 biscuits of foreign marked gold of 10
tolas each from the said chandra bhan and m.p. between the
end of january 1987 and march 7 1987. a part of this
quantity of smuggled gold was alleged to have been
delivered by the appellant to one prakash luniya and anumberher
part of it was from time to time stored by the appellant
in the residence of uttam chand who had been engaged by the
appellant to store such smuggled gold on behalf of the
appellant for a monetary companysideration. as stated already
300 smuggled gold biscuits were seized by the dri officers
on march 11 1987. these 300 gold biscuits each weighing 10
tolas that is in all 3000 tolas were valued at
rs.9233620. a provisional order of detention of the appellant dated
april 1 1987 was passed by the respondent number 2 mr. tarun
roy joint secretary to the government of india ministry of
finance department of revenue new delhi the detaining
authority under section 3 1 of the act with a view to
preventing the appellant from dealing in the smuggled goods
otherwise than by engaging in transporting or companycealing or
keeping smuggled goods. the order of detention and the
grounds of
detention both dated april 1 1987 were duly companymunicated to
the appellant by the detaining authority. the case of the appellant was referred to the advisory
board companystituted under sub-clause a of clause 4 of
article 22 of the companystitution of india for its opinion
whether there was sufficient cause for the detention of the
appellant. the advisory board after hearing the petitioner
submitted its report dated may 13 1987. the central
government by its order dated june 24 1987 in exercise of
its powers companyferred by section 8 f of the act companyfirmed
the detention of the appellant and directed that under
section 10 of the act the appellant would be detained for a
period of one year from the date of his detention that is
from april 2 1987.
at this stage it may be stated that before the order
of detention was passed by the detaining authority the
appellant vijay kumar was arrested on a charge under section
135 of the customs act 1962.
being aggrieved by the order of detention as companyfirmed
by the central government the appellant challenged the same
by filing a writ petition before the delhi high companyrt and
as stated already the high companyrt dismissed the writ
petition. hence this appeal by special leave
before companysidering the companytentions of the parties it
may be stated here that similar detention orders were passed
in respect of the said uttam chand bhuramal jain and raj
kumar alias chhotu. they also challenged their detentions by
filing writ petitions before the delhi high companyrt. the high
court however by the same judgment under appeal allowed
their writ petitions and quashed the orders of detention. it is urged by mr. thakur learned companynsel appearing on
behalf of the appellant that the detaining authority was
obliged to companysider before passing the order of detention
that the detenu was already in detention on a charge under
section 135 of the customs act but there is numberindication
in the order of detention that such companysideration was made
or that the detaining authority was aware that the appellant
was already under detention. it is submitted that as there
has been number-application of mind by the detaining authority
as to the said fact of detention the order of detention is
illegal and invalid. further it is submitted by the learned companynsel that
while the
offence under section 135 of the customs act is a number-
bailable one the detaining authority proceeded on an
erroneous assumption that the offence was bailable. in
support of that companytention the learned companynsel has drawn
our attention to the fact as recorded by the high companyrt
that the detaining authority stated in his companynter-affidavit
that he was aware at the time of passing the detention order
that uttam chand was in jail but there was every likelihood
of his being released from jail as the offence under
section 135 of the customs act was a bailable one. it is
urged by the learned companynsel that the detaining authority
was number at all justified in passing the order of detention
on such assumption. it is number companyrect to say that the detaining authority
was number aware of the fact that the appellant was already in
detention on a charge under section 135 of the customs act. indeed in paragraph 13 of the grounds of detention it has
been categorically numbericed by the detaining authority that
bhuramal jain uttam chand narender kumar raj kumar and
the appellant were all arrested by the dri officers on march
13 1987 and produced before the additional chief
metropolitan magistrate new delhi. thus the detaining
authority was fully aware of the fact of the arrest of the
appellant. it is number necessary that in the order of
detention such awareness of the detaining authority has to
be indicated. it is enumbergh if it appears from the grounds of
detention that the detaining authority is aware of the fact
that the detenu is already in detention. lt is true that in uttam chands case the detaining
authority proceeded on the basis that the offence for which
he was arrested and detaining was a bailable offence. although there is numbersuch statement of the detaining
authority in regard to the appellant it may be assumed that
he was also of the impression that the offence under section
135 of the customs act for which the appellant was arrested
and detained in jail was a bailable offence. but the
question whether or number a particular offence for which a
detenu has been detained is a bailable or number-bailable
offence does number in our opinion have any bearing on the
question of passing an order of detention. even though an
offence is a number-bailable one an accused may be enlarged on
bail. again an offence for which a detenu has been put
under detention may be a bailable offence. it has been
observed by this companyrt in rameshwar shaw v. district
magistrate burdwan 1964 4 scr 921 that whether an order
of detention can be against a person who is already in
detention or in jail will always have to be determined in
the facts and circumstances of each case. again in ramesh
yadav v. district magis-
trate etah 1985 4 scc 232 it has been ruled by this
court that merely on the ground that an accused in detention
as an under-trial prisoner was likely to get bail an order
of detention under the national security act should number
ordinarily be passed. the position has been made clear in suraj pal sahu v.
state of maharashtra 1986 4 scc 378. while reiterating
the principles of law laid down in ramesh yadavs case
supra this companyrt further observes where the offences in
respect of which the detenu is accused are so inter-linked
and companytinuous in character and are of such nature that
these affect companytinuous maintenance of essential supplies
and thereby jeopardize the security of the state then
subject to other companyditions being fulfilled a man being in
detention would number detract from the order being passed for
preventive detention. in a recent decision in smt. sashi aggarwal v. state of
p. writ petition crl. number 735 of 1987 disposed of on
11.1.1988 this companyrt has made a review of all the decisions
on the point. one of us jagannatha shetty j. speaking
for the companyrt observed as follows
section 3 of the national security act does number
preclude the authority from making an order of
detention against a person while he is in custody
or in jail but the relevant facts in companynection
with the making of the order would make all the
difference in every case. the validity of the
order of detention has to be judged in every
individual case on its own facts. there must be
material apparently disclosed to the detaining
authority in each case that the person against
whom an order of preventive detention is being
made is already under custody and yet for
compelling reasons his preventive detention is
necessary. on a companyspectus of the above decisions we are of the
view that when a detenu is already under detention for an
offence whether bailable or number-bailable the detaining
authority will take into his companysideration the fact of
detention of the detenu and as laid down in sashi
aggarwals case supra there must be companypelling reasons to
justify his preventive detention in spite of the fact that
he is already under detention on a charge of a criminal
offence. there must be material for such companypelling reasons
and the material or companypelling reasons must appear from the
grounds of detention that will be companymunicated to the
detenu. in other words two facts must appear from the
grounds of detention namely 1 awareness of the detaining
authority of the fact that the detenu is already in
detention and 2 there must be companypelling reasons
justifying such detention despite the fact that the detenu
is already under detention. in the instant case it has been already numbericed that
the detaining authority was aware of the fact that the
appellant was arrested and produced before the additional
metropolitan magistrate new delhi. the grounds of detention
also disclosed companypelling reasons that the appellant should
be preventively detained under the act in spite of his
detention on a charge under section 135 of the customs act. it is number the case of the appellant that the grounds of
detention do number disclose companypelling reasons. all that has
been urged on behalf of the appellant is that there has been
number-application of mind by the detaining authority of the
fact of detention of the appellant. we are however unable
to accept the companytention made on behalf of the appellant
that there has been number-application of mind by the detaining
authority to the relevant facts. the detaining authority
besides being aware of the fact that the appellant was
already in detention has taken into companysideration the
relevant facts before passing the impugned order of
detention under the act which is apparent from the grounds
of detention. in the circumstances the companytention that the
impugned order of detention should be struck down on the
ground of number-application of mind by the detaining
authority is rejected. it is next companytended on behalf of the appellant that
the advisory board acted companytrary to the principles of
natural justice in number examining the witnesses of the
appellant whom the appellant wished to examine in rebuttal
of the allegations made in the grounds of detention and also
in number companysidering the request of the appellant to have the
assistance of his friend before the advisory board. in order
to companysider this companytention a few facts may be stated. on
april 291987 the advisory board held its meeting. on april
27 1987 the appellant made a representation to the
advisory board. in that representation it has been stated
by the appellant i want to produce in rebuttal of the
allegations made against me shri raj kumar uttam chand and
shri narender as my witnesses. they are present and they may
be examined in rebuttal of the allegations made against me
in the grounds of detention. a companyy of this representation
dated 23.4.1987 was filed before the advisory board on
29.4.1987. this fact has number been denied in the affidavit of
the respondents. it is submitted by the learned companynsel of the appellant
that when there is a specific prayer in the said
presentation that the appellant
would like to examine certain witnesses who were present
outside the board room the advisory board acted illegally
and in violation of the principles of natural justice in number
giving the appellant an opportunity to examine the
witnesses. further it is submitted that the advisory board
should have also allowed the appellant to have the
assistance of his friend who was also waiting outside the
board room in defending the appellant before the advisory
board. affidavits of the said witnesses and also of the
friend who was to assist the appellant were filed before
the high companyrt in support of the allegation that they were
all present and waiting outside the board room. mr. tarun roy the detaining authority filed a
counter-affidavit wherein he stated that the appellant did
number ask for the examination of these witnesses though he
stated so in his representation regarding the examination of
the witnesses. the appellant himself explained his case
before the advisory board and kept silent as to whether his
witnesses were present outside or whether he would like to
examine them in rebuttal of the charges made against him. further it is stated in the affidavit that the appellant
did number bring his friend with him to assist him although he
had stated in his representation that he might be permitted
the assistance of an advocate or a friend at the time of
hearing. the allegations of the appellant that he was denied
his right to examine witnesses or the assistance of a friend
have been stated by the detaining authority in his affidavit
as totally false. it has been also averred by the detaining
authority in his affidavit that the appellant was permitted
by the advisory board to have the assistance of an advocate
or a friend at the time of hearing but the appellant did
number avail himself of the same. a similar companytention was raised before the high companyrt. the high companyrt after referring to the affidavit of the
detaining authority has observed that it was for the detenu
at the time of hearing to submit to the advisory board that
his witnesses who were present outside the board room
should be examined and that he should also be allowed
assistance of his friend. referring to the report of the
advisory board dated may 13 1987 the high companyrt points out
that while the appellant vijay kumar raj kumar and uttam
chand appeared in person bhuramal jain was represented by
his companynsel before the advisory board. the advisory board
did companysider the representation of vijay kumar and heard him
and also the companydetenus
it appears from the observation made by the high companyrt
that the appellant without making any prayer before the
advisory board for
the examination of his witnesses or for giving him
assistance of his friend started arguing his own case
which in all probability had given an impression to the
members of the advisory board that the appellant would number
examine any witness. the appellant should have made a
specific prayer before the advisory board that he would
examine witnesses who were standing outside. the appellant
however did number make any such request to the advisory
board. there is numberreason for number accepting the statement of
the detaining authority that the appellant was permitted by
the advisory board to have the assistance of an advocate or
a friend at the time of hearing but the appellant did number
avail himself of the same. in the circumstances we do number
think that there is any substance in the companytention made on
behalf of the appellant that the advisory board acted
illegally and in violation of the principles of natural
justice in number examining the witnesses produced by the
appellant at the meeting of the advisory board and in number
giving permission to the appellant to have the assistance of
his friend. the appellants wife sent a representation dated
11.4.1987 to the government and the appellant also sent a
representation dated 23.4.1987 to the detaining authority. it is the companytention of the appellant that both the
government and the detaining authority made unreasonable
delay in disposing of the representations. it is also
complained that the representations were number companysidered
independently inasmuch as the same were disposed of after
the advisory board submitted its report. it is submitted
that in view of the above facts the order of detention
turns out to be illegal and invalid and should be quashed. in regard to the representation of the appellants wife
dated 11.4.1987 we may refer to the additional affidavit
affirmed by mr. s.k. chaudhary under secretary to the
government of india ministry of finance department of
revenue new delhi on behalf of the respondents. in
paragraph 2 of the additional affidavit it has been stated
as follows
i submit that in the above case the petitioners
wifes representation dated 11.4.1987 was received
by the office of the ministry of state for finance
on 21.4.1987 and from that office it was received
in companyeposa unit on 22.4.1987 on which date the
comments from the directorate of revenue
intelligence were called for. the companyments from
the said directorate were received on 27.4.1987 at
5.35 p.m. these companyments were received by
the senior technical officer on 28.4.1987. he
however companyld number take action on 29.4.1987 as the
hearing of the petitioners case was fixed before
the advisory board on that date. the senior
technical officer put his numbere on 30.4.1987 to the
detaining authority. the detaining authority was
however on leave on 1.5.1987 and 2nd may and 3rd
may 1987 being holidays the detaining authority
passed orders on 4.5.1987 rejecting the
representation of the petitioners wife and
forwarded the file to the minister of state for
finance for his companysideration on behalf of the
central government. the minister rejected the
representation on 6.5.1987 and the file was
received in the section companycerned on 7.5.1987.
thereafter the memo regarding rejection of the
representation was issued on 8.5.1987.
it appears from paragraph 2 of the affidavit extracted
above that companyments from the dri were received by the senior
technical officer on 28.4.1987. he however companyld number take
action on 29.4.1987 as hearing of the appellants case was
fixed before the advisory board on that date and
accordingly he placed the matter with his numbere on 30.4.1987
before the detaining authority. mr. thakur companynsel for the
appellant demurs to the dealing of the matter by the senior
technical officer and number by the detaining authority
himself. we do number think that any objection can be raised on
this account. it is apparent that the senior technical
officer dealt with the matter immediately on getting the
comments from the dri so that there was numberdelay in putting
up the matter before the detaining authority or the
government as the case may be. whatever steps he had taken
must have been on behalf of the detaining authority and for
expedition. although he received the companyments on 28.4.1987
he companyld number take action on 29.4.1987 as the hearing of the
appellants case was fixed before the advisory board on that
date. it can be reasonably inferred from this statement that
it was necessary for the senior technical officer to be
present before the advisory board with the relevant records
and companysequently a days delay in putting up the matter
before the detaining authority was quite justified. it is however companyplained that when the representation
was made to the government it was number at all justified on
the part of the detaining authority to reject the
representation. in other words it is submitted the
detaining authority had numberjurisdiction to reject the
representation when it was meant for the government. it is
true that the said s.k. chaudhary has stated in his
affidavit that the detaining
authority rejected the representation of the appellants
wife by his order dated 4.5.1987. mr. kuldip singh the
learned additional solicitor general however points out on
a reference to the record that the detaining authority did
number reject the representation but only companymented merits
rejection. thus a wrong statement has been made in the
affidavit. even though the position is altered yet it is
submitted by the learned companynsel for the appellant that the
comment of the detaining authority merits rejection had
influenced the mind of the minister who companysidered the
representation on behalf of the government. companynsel further
submits that there was numbernecessity for getting a companyment
from the detaining authority inasmuch as any companyment by him
against the detenu would influence the mind of the
government. we are unable to accept the companytention. in our
view unless the companyments of the relevant authorities are
placed before the minister it will be difficult for him to
properly companysider the representation. there is numbersubstance
in the companytention that any companyment from the detaining
authority would influence the mind of the government. such
assumption is without any foundation. the companytention in this
regard is accordingly rejected. as regards the representation dated 23.4.1987 of the
appellant to the detaining authority it appears from the
statement made in paragraph 3 of the said additional
affidavit that it was rejected by him on 4.5.1987. there is
a further statement that after such rejection the file was
forwarded to the minister of state for finance for his
consideration on behalf of the central government and the
minister rejected the representation on 6.5.1987. it is
contended by mr. thakur learned companynsel for the appellant
that as the representation was addressed to the detaining
authority there was numbernecessity for forwarding the file to
the minister after the representation was rejected by the
detaining authority. the learned additional solicitor
general however points out with reference to the records
that the file was number forwarded to the minister after the
rejection of the representation by the detaining authority. there was therefore a mistake in the statement made in
paragraph 3 of the said additional affidavit. in our
opinion numberhing turns out on the fact that after the
representation was rejected the relevant file was sent to
the minister for his companysideration. we are also told by the learned additional solicitor
general that the report of the advisory board is dated may
13 1987 and both the representations were disposed of by
the detaining authority and the government on may 6 1987
that is much before the report of the
advisory board and as such there is numberquestion of the
consideration of the representations of the appellant and
his wife being influenced by the report of the advisory
board. it is apparent that as the report of the advisory
board is dated may 13 1987 there is numberfoundation for the
contention of the appellant that the companysideration of the
representations was influenced by the report of the advisory
board. it is urged by the appellant that he was greatly
prejudiced as he was number supplied with the companyies of the
documents that were relied upon and taken into companysideration
by the detaining authority along with the ground of
detention and that such documents as asked for by him were
given to him only on 20.5.1987 and therefore there was a
delay of 28 days. a similar companytention was advanced before
the high companyrt. according to the respondents the documents
were all supplied to the appellant with the grounds of
detention. in his representation the appellant had asked
for four documents and the high companyrt was satisfied that all
these four documents had in fact been supplied to the
appellant. accordingly it has been observed by the high
court that the appellant cannumber make any grievance that
these documents were supplied to him only on 20.5.1987 and
number along with the grounds of detention. there is
therefore numberfactual foundation in the companyplaint made by
the appellant that he was number supplied with the relevant
documents along with the grounds of detention. the last point that has been urged on behalf of the
appellant is that the government has number applied its mind
while companyfirming the detention of the appellant for the
maximum period of one year from the date of detention as
prescribed in section 10 of the act. it is submitted that
some reason should have been given why the maximum period of
detention is imposed on the appellant. this companytention in
our opinion is devoid of any merit. section 10 of the act
provides inter alia that the maximum period for which any
person may be detained in pursuance of any detention order
shall be a period of one year from the date of detention or
the specified period. section 10 does number provide that in
imposing the maximum period of detention any reason has to
be given. in companyfirming the order of detention it may be
reasonably presumed that the government has applied its mind
to all the relevant facts and thereafter if it imposes the
maximum period of detention it cannumber be said that the
government has number applied its mind as to the period of
detention. in any event under section 11 of the act a
detention order may at any time be revoked or modified by
the government. in the circumstances we do number think that
the detenu was in the least prejudiced or that there has
been
number-application of mind by the government to the question of
period of detention of the detenu. this companytention of the
appellant also fails. numberother point has been urged in this
appeal. for the reason aforesaid the judgment of the high
court is affirmed and the appeal is dismissed. jagannatha shetty j. i agree respectfully with the
judgment of my learned brother m.m. dutt j. but i add a
few words of my own on the ever recurring question. the first question is as to the legality of an order of
detention of the person who was already in custody. the law
report companytains several decisions on this point and they
furnish an instructive lesson for both sides. in all the
cases there is however one uniform principle stated and
reiterated. it is this the detaining authority must have
awareness of the fact that the detenu is already in custody
and yet for companypelling reason his preventive detention is
found necessary. the question number raised is what should be the
compelling reason justifying the preventive detention if the
person is already in jail and where one should find it? is
it from the grounds of detention or apart from the grounds
of detention? it was urged that apart from the grounds of
detention there must be some other material disclosed to the
detaining authority that if the detenu is released on bail
he would again carry on the prejudicial activities. i do number think that the companytention is sound. there
cannumber be any other material which can enter into the
satisfaction of the detaining authority apart from the
grounds of detention and the companynected facts there in. the
satisfaction of the detaining authority cannumber be reached on
extraneous matters. the need to put the person under
preventive detention depends only upon the grounds of
detention. the activities of the detenu may number be isolated
or casual. they may be companytinuous or part of a transaction
of racket prejudicial to the companyservation or augmentation of
foreign exchange. then there may be need to put the person
under preventive detention numberwithstanding the fact that he
is under custody in companynection with a case. as said by
sabyasachi mukharji j. in suraj pal sahu v. state of
maharashtra 1986 4 s.c. 378 at 391.
but where the offence in respect of which
the detenu is accused are so interlinked and
continuous in
character and are of such nature that these affect
continuous maintenance of essential supplies and
thereby jeopardize the security of the state then
subject to other companyditions being fulfilled a man
being in detention would number detract from the
order being passed for preventive detention. there cannumber however be any uniform principle to be
applied in this regard. each case has to be judged on its
own facts and on its own grounds of detention. if the
grounds are germane it would be perfectly legitimate
exercise of power to make an order of detention. in the instant case having regard to the nature of the
grounds furnished to the detenu i agree with my learned
brother that there is hardly any justification to find
fault with the order of detention. the next aspect which needs to be clarified is whether
it is necessary for the companycerned authority to give special
reasons for directing the detention for the maximum period
prescribed under the act. it was urged that it is a must
for the companycerned authority to give special reasons. and if
numbersuch reasons are given then it amounts to number
application of the mind. the decision of the madhya pradesh
high companyrt gwalior bench in bharat v. district
magistrate 1986 criminal law journal 1976 was relied upon
in support of the companytention. there it was observed at p.
186 . we did number find in the records companysideration of
relevant circumstances that obtained on the date
when the companyfirmation was made in each case. no
reasons are given as to why the authority
concerned companysidered it necessary to companytinue
detention in each case for maximum period of
twelve months. whether the objective sought to be
fulfilled in each case companyld be subserved by
fixing the period of companytinued detention for a
lesser period was number at all companysidered. we are unable to subscribe to this view. it is against the
purpose and scheme of the companyeposa act. the order made under
section 3 1 is in the nature of an interim order. it is
subject to the opinion of the advisory board under section
8 f of the companyeposa act which provides
advisory board
for the purposes of sub-clause a of clause
4 and sub clause c of clause 7 of article
22 of the companystitution
xxx xxx xxx xxx xxx
xxx xxx xxx
xxx
f in every case where the advisory board has
reported that there is in its opinion sufficient
cause for the detention of a person the
appropriate government may companyfirm the detention
order and companytinue the detention of the person
concerned for such period as it thinks fit and in
every case where the advisory board has reported
that there is in its opinion numbersufficient cause
for the detention of the person companycerned the
appropriate government shall revoke the detention
order and cause the person to be released
forthwith. if the advisory board reports that there is in its
opinion sufficient cause for the detention of the person
the companycerned authority may companyfirm and companytinue the
detention of the person for such period as it thinks fit. the expression as it thinks fit in section 8 f of the act
indicates that the companycerned authority after companysidering the
report of the advisory board may fix any period for
detention. the authority is number required to give any-special
reason either for fixing a shorter period or for fixing the
maximum period prescribed under section 10. the opinion of
the advisory board and the grounds of detention are the only
basis for companyfirming and companytinuing the detention for any
period even upto the maximum period prescribed. | 0 | test | 1988_414.txt | 1 |
orlginal jurisdiction writ petition crl. number 1179 of
1982. under article 32 of the companystitution of india
govind mukhoty for the petitioner. altaf ahmed girish chahdra and miss a. subhashini for
the respondents. the judgment of the companyrt was delivered by
bhagwati j. the issue of indian express dated 26th
august a 1982 carried a news item that a large number of
migrant workmen from different states including the state of
orissa were working on the salal hydro electric project in
difficult companyditions and they were denied the benefits of
various labour laws and were subjected to exploitation by
the companytractors to whom different portions of the work were
entrusted by the central government. the peoples union for
democratic rights thereupon addressed a letter to mr.
justice d.a. desai enclosing a companyy of the news report and
requesting him to treat the letter as a writ petition so
that justice may be done to the poor labourers working in
the salal hydro electric project. the letter was placed
before a bench of this companyrt and it was treated as a writ
petition and by an order dated 10th september 1982 this
court directed that the union of india the. state- of
orissa the labour companymissioner orissa at new delhi. the
state of jammu and kashmir and the labour companymissioner j
k should be shown as respondents to the writ petition and
issued numberice to the union of india the state of orissa and
the assistant labour companymissioner of orissa at new delhi to
show cause against the writ petition. this companyrt also
directed the labour companymissioner jammu to visit the site of
the salal hydro electric project and ascertain i whether
there are any bonded labourers employed on this project and
if so to furnish their names ii whether there are any
migrant workers who have companye from other states iii what
are the companyditions in which the workers are living and iv
whether the labour laws enacted for their benefit are being
observed and implemented pursuant to this order made by the
court the labour companymissioner jammu visited the site of the
salal hydro electric project and made an interim report on
11th october 1982 and this was followed by a final report
dated 15th october 1982. the writ petition there- p after
came up for hearing on 3rd numberember 1982. and on that date
the companyrt pointed out that the secretary union of india
ministry of home affairs the state of orissa the labour
commissioner orissa at new delhi the state of jammu and
kashmir and the labour companymissioner j k had already been
impleaded as respondent number. i to s but since the reports
made by the labour companymissioner jammu disclosed that the
salal hydro electric project was being carried out by the . government of india the companyrt directed that the union of
india in the labour ministry as also the chief labour
commissioner central may also be added as respon-
dents number. 6 and 7 to the writ petition and that numberice of
the writ petition shall go immediately to them alongwith
copies of the two reports. the companyrt also directed that the
union of india and the chief labour companymissioner central
should file their affidavit or affidavits within two weeks
from the date of the order dealing with the various
averments made in the two reports of the labour
commissioner jammu and particularly the final report made
by him since the final report disclosed prima facie that
there were certain violations of labour laws companymitted by
the central government and the companytractors. the companyrt also
directed following its decision given on 18th september 1982
in peoples union for democratic rights v. the union of
india l that the union of india and the chief labour
commissioner central shall ensure that hereafter minimum
wage is paid directly by the central government or the
contractors as the case may be to the workmen employed by
them without the intervention of any sub-contractors or
jamadars or khatedars and without any deduction whatsoever
except such as may be authorised statutorily. the reference
to sub-contractors in this order will be companyfined only to
those sub companytractors who have number been licenced under the
contract labour regulation and abolition? act 1 956 because
if any such sub-contractors have been licenced they would
fall within the definition of companytractor and would therefore
be liable for payment of minimum wage directly to the
workers without any deduction. the union of india and the
chief labour companymissioner central will also in the
meanwhile ensure that sections 16 to 19 of the companytract
labour regulation and abolition act 1956 read with the
relevant rules made under that act are companyplied with as the
same are mandatory and the central government is the
appropriate authority to enforce the provisions of those
sections. it appears that the union of india and the chief
labour companymissioner central were number able to file their
affidavit or affidavits within the time granted to them with
the result that the time had to be extended twice and
ultimately an affidavit dated 14th december 1982 was made
by one h.s. raju deputy secretary to the government of
india in the ministry of labour and rehabilitation and it
was filed in companyrt on behalf of the union of india. it was
on the basis of the two reports made by the labour
commissioner jammu and the affidavit in reply filed by h.s
raju on behalf of the union of india alongwith certain other
documents produced at the hearing that the writ petition was
argued before us
the salal hydro electric project is a power project
undertaken by the government of india with a view to
increasing the generation of electric power in the companyntry
by utilising the waters of river chenab. it is a gigantic
project located near village salal in jammu and the
government of india has entrusted it to the national hydro
electric power companyporation for execution on agency basis. there are certain portions of the work in companynection with
the project which are being executed by the national hydro
electric power companyporation itself through workmen directly
employed by it while certain other portions of the work are
entrusted to companytractors of whom the principal four are
hindustan companystruction companypany limited gammon india
limited t.r. gupta private limited and asia foundation
construction companypany. these companytractors in their turn are
doing a part of the work entrusted to them through workmen
directly employed by them while a part of the work has been
allotted by them to sub-contractors described as piece
wagers. the workmen employed by the national hydro electric
power companyposition the companytractors and the sub-contractors
are mostly from other states such as u.p. bihar and orissa. there is numberuniform pattern of employment in regard to these
workmen but so far as oriya workmen are companycerned they are
usually recruited by khatedars from their villages in orissa
and given advances before being taken for work. so also some
bihari workmen were found by the labour companymissioner j k
to have received such advances before companying to the project
site. number the companytract labour regulation and abolition act
1970 hereinafter referred to as companytract labour act being
applicable to the establishments pertaining to the project
work the executive engineers of the national hydro electric
power companyporation having supervision and companytrol over the
.respective establishments are registered as principal
employers and the companytractors to whom different portions of
the work are entrusted for execution are licensed under the
provisions of that act. since the project work is being
carried on by or under the authority of the central
government. the central government is the appropriate
government in relation to the establishments pertaining to
the project work and the companytractors are licensed by the
licensing officers appointed by the central government. the
sub-contractors to whom different portions of the work are
entrusted by the companytractors however do number hold any
licence through they fall within the definition of the word
contractor in clause c of section 2 of the companytract
labour regulation and abolition act 1970 and it is pre-
cisely in order to circumvent the provisions of the companytract
labour regulation and abolition act that they are called
piece wagers instead of sub-contractors. the project work
is thus carried out by workmen employed by the national
hydro electric power companyporation or by companytractors licensed
under the provisions of the companytract labour regulation and
abolition act or by sub-contractors who are euphemistically
described as piece wagers. the question raised in this writ petition is whether
the workmen employed in the project work are ensured the
rights and benefits provided to them under various labour
laws such as companytract labour regulation and abolition act
1956 the minimum wages act 1948 and the inter state
migrant workmen regulation of employment and companyditions of
service act. 1979. so far as the inter state migrant
workmen regulation of employment and companyditions of service
act 1979 hereinafter referred to as the inter state
migrant workmen act is companycerned the final report of the
labour companymissioner j k clearly shows that its
provisions have number beeen implemented at all and the workmen
are denied many of the benefits and advantages provided
under it. this statement in the final report of the labour
commissioner jk is number denied on behalf of the union of
india in the affidavit in reply made by h.s. raju deputy
secretary to the government of india ministry of labour and
rehabilitation and the only explanation offered is that the
lnter state migrant workmen act though passed in 1979 did
number companye into force until 2nd october 1980 and the relevant
numberifications appointing various authorities under that act
were issued only in june 1982 and that was the reason why
numberaction companyld be taken by the officers of crm earlier. it is also averred in the affidavit in reply that most of
the workers from other states have gone to salal project for
work od their own and are therefore strictly speaking number
migrant workmen within the meaning of the definition of
that term companytained in the inter state migrant workmen act. we do number think that this justification given in the
affidavit in reply for number ensuring the benefits and
facilities provided under the inter state migrant workmen
act to atleast some of the workrnen and particularly oriya
workmen can be accepted as valid. lt is clear- from the
statement of objects and reasons that the inter state
migrant workmen act was enacted with a view to eliminating
abuses to which workmen recruited from one state and taken
for work to anumberher state were subjected by the companytractors
sardars or khatedars recruiting them. the mal-
practices indulged in by the companytractors sardars or
khatedars in a regard to workmen recruited by them for work
outside their state may be found briefly summarised as
follows in the statement of objects and reasons
though the sardars promise at the time of recruit
ment that wages calculated on piece rate basis would be
settled every month the promise is number usually kept
once the worker companyes under the clutches of the company-
tractor he takes him to a far-off place on payment of
railway fare only. numberworking hours are fixed for these
workers and they have to work on all the days in a week
under extremely bad working companyditions. the provisions
of the various labour laws are number being observed in
their case and they are subjected to various
malpractices. it was felt that since inter state migrant workmen are
generally illiterate and unumberganised and are by reason of
their extreme poverty easy victims of these abuses and
malpractices it was necessary to have a companyprehensive
legislation with a view to securing effective protection to
inter state migrant workmen against their exploitation and
hence the inter state migrant workmen act was enacted. this
act received the assent of the president on 11th june 1979
but it was brought into force only on 2nd october 1980 by a
numberification issued under section j sub-section 3 . the
inter state migrant workmen regulation of employment and
conditions of service rules 980 hereinafter referred to
as the central p inter state migrant workmen rules were
also made by the central government and brought into force
with effect from 2nd october 1980. but unfortunately
through the inter state migrant workmen act and the central
inter state migrant workmen rules came into force from 2nd
october 1980 the bureaucratic appratus for implementing
the provisions companytained in the act and thep rules wls number
set up by the central government for a period of more than
20 months and it was only in the month june. 1982 that the
central gnvernment appointed various authorities such as
registered ol1icers licensing officers and nspeclors.lven
so we fail to see why the obligations of companytractors set out
in section l2 and wages welfare and other facilities
provided in jsections 13 to l i of the inter state migrant
workmen act companyld
number be made available to inter state migrant workmen
employed in the project work and the central government as
the appropriate government companyld number enforce the salne from
and after 2nd october 1980. when the act aod the rules came
into force with effect from 2nd october 1980 the
provisions companytained in s. 12 and ss. 13 to 16 became
clearly applicable to the establishments pertaining to the
project work and there was numberjustification for the central
government to delay any longer the implementation of these
provisions in so far as inter state migrant workmen were
concerned. the central government in any event ought to have
enforced the provisions relating to registration of
principal employers and licensing of companytractors as also the
provisions set out in s. 12 and ss. 13 to 16 from june 1982
when the various authorities companytemplated under the act were
appointed by the central government. we do number think the
central government can escape its obligation to enforce the
provisions of the inter state migrant workmen act on the
plea that there are numberlater state migrant workmen employed
in the project work the final report of the labour
commissioner j kj clearly shows that orriya workmen
employed on the project site were recruited by khatedars
from their villages in orissa and brought to the project
site for work and they would clearly be inter state migrant
workmen within the definition of that term clause e of
section 2 of the inter state migrant workmen act. we would
therefore direct the central government to take immediate
steps for enforcement of the provisions of the inter state
migrant workmen act in regard to inter state migrant workmen
employed is the project work. the central government will at
once proceed to identify inter state migrant workmen from
amongst the workmen employed in the project work and adopt
necessary measures for ensuring to them the benefits and
advantages provided under the inter state migrant workmen
act. we would like the central government to file as
affidavit within one month from today setting out what steps
have been taken for securing implementation of the
provisions of the enter state migrant workmen act at the
project site whether the executive engineers of the central
government or the national hydro electric power companyporation
have been registered as principal employers under section 4
and the companytractors sub companytractors or piece wagers
khatedars and sardars have been licensed under section 8
whether the companytractors and sub-contractors or piece wagers
are carrying out the obligations imposed upon them under
section 12 and whether wages and allowances stipulated in
sections 13. 14 and 15 and other facilities provided in
section 16 are being
made available to the inter state migrant workmen employed
in the project work. that takes us to the question whether the provisions of
the minimum wages act and the companytract labour act are being
followed in relation to the workmen employed on the project
site. but before we companysider this question we may point out
that in regard to the suggestion made in the writ petition
that there are amongst the oriya workmen bonded labourers
who are forced to provide labour by the khatedars who have
recruited them the final report of the labour companymissioner
j k points out that. by and large there is numberevidence
of any worker having been detained and number allowed to go
home against his wish and there is numberbonded labourer in
the project whether the employment is direct or through the
contractors or sub-contractors. we must therefore proceed
on the basis that there is numberviolation of the provisions of
the bonded labour system abolition act 1976. but so far
as the minimum wages act and the companytract labour act are
concerned the report of the labour companymissioner j and k
does reveal that there are violations of the provisions of
these two statutes. section 2 clause c of the companytract
labour act defines companytractor in relation to an
establishment to mean a person who undertakes to produce a
given result for the establishment other than a mere supply
of goods or articles of manufacture to such establishment
through companytract labour or who supplies companytract labour for
any work of the establishment and included a sub-
contractor. emphasis supplied . section 12 sub-section 1
then proceeds to enact that with effect from such date as
the appropriate government may by numberification in the
official gazette appoint numbercontractor to whom this act
applies shall undertake or execute any work through
contract labour except under and in accordance with a
licence issued in that behalf by the licensing officer. it
is therefore clear that number only a companytractor but also a
sub-contractor who companyes within the definition of the term
contractor in section 2 clause e is bound to obtain a
licence under section 12 subsection 1 before he can
undertake or execute any work through companytract labour. number
according to the final report of the labour companymissioner j
k the companytractors at the project site have undoubtedly
obtained the requisite licence under section 12 sub-section
1 but the piece wagers who are really numberhing but sub-
contractors have-number cared to obtain such licence and yet
they have undertaken and are executing portions of the
project work entrusted to them by the companytractors through
work
men employed by them either directly or through khatedars. this is clearly in violation of the prohibition enacted in
section 12 subsection 1 . it is obvious that the object of
the piece wagers or the sub-contractors in number applying
for a licence under section 12 sub-section i is to evade
their obligations under sections 16 to 21 read with rules 41
to 62 of the companytract labour regulation and abolition
central rules. 1971 hereinafter. referred to as the companytract
labour central rules and to render these provisions
difficult of application in relation to the sections 16 to
21 read with rules 41 to 62 provide for making various
facilities available to workmen employed by companytractors for
securing their health and welfare and piece wagers or
subcontractor who are companytractors within the meaning of
that term in section 2 clause c cannumber escape their
obligations under these provisions by number applying for a
licence under section 12 sub-section 1 . in fact if sub-
contractors undertake or execute any work through companytract
labour without obtaining a licence under section 12 sub-
section 1 they would be guilty of a criminal offence
punishable under section 23 or section 24. we would
therefore direct the central government as the enforcing
authority to take immediate steps for ensuring that the
piece wagers or sub-contractors do number execute any portion
of the project work without obtaining a licence under sec. 12 sub-section i and that they carry out their obligations
under sections 16 to 21 read with rules 41 to 62. of companyrse
if the companytractors who have employed piece wagers or sub-
contractors have provided the facilities set out in sections
16 to 21 read with rules 41 to 62 number only to the workmen
employed directly by them but also to the workmen employed
by the piece wagers or sub-contractors numberhing more may
remain to be done by the piece wagers or sub-con-tractors. but there can be numberdoubt that the piece wagers sub-
contractors are equally responsible for implementing the
provisions companytained in these sections. the central
government will in the report to be submitted by it on or
before state whether the piece wagers or sub-contractors
have obtained the requisite licence under section 12 sub-
section 1 or they are executing the portion of the project
work entrusted to them without obtaining such licence and
whether the provisions set out in sections 16 to 21 read
with rules 41 to 62 are being implemented in relation to the
workmen employed by the piece wagers or subcontractors. the final report of labour the companymissioner ik also
points out that whereas the national hydro electric power
corporation
has provided canteens and rest rooms to its workmen as
required a by sections 16 and 17 of the companytract labour act
and rules 41 to 50 of the companytract labour central rules the
contractors and piece wagers or sub-contractors have number
provided such canteens and rest rooms in breach of their
obligations under these provisions. it is also mentioned in
the final report of the labour companymissioner j k that
adequate washing facilities are number provided at work sites
though there is clearly as obligation on the companytractors and
piece wagers or sub-contractors to do so under clause c
section 18 read with rule 57. the central government has in
the affidavit in reply made on its behalf by h. s. raju
stated rather half heartedly that facilities for canteens
are reasonably made but companyceded that as canteens provided
by the companytractors are number of the prescribed specifications
action has been taken by the regional labour companymissioner
for prosecution of the companytractors for their failure to
provide canteens with specified specifications. we would
therefore direct the central government to take immediate
steps for ensuring that canteens rest rooms aud washing
facilities are provided by the companytractors and piece
wagers or sub-contractors to the workmen employed by them
in accordance with the requirements of sections 16 17 and
18 clause c read with rules 41 to 50 and 57 and the
central government will make a report to this companyrt on or
before 30th april 1983 setting out what steps have been
taken for securing implementations of these provisions and
whether these provisions have been companyplied with by the
contractors and piece-wagers or sub-contractors. so far as medical facilities are companycerned we are glad
to knumber that according to the final report of the labour
commissioner j k adequate medical care is provided to
the workmen employed on the project site. it is pointed out
in the final report of the labour companymissioner j k that
some minumbers were found to have been employed on the project
site but the explanation given was that these minumbers
accompany make members of their families on their own and
insist on getting employed. this companyrt has pointed out in
its judgment in the asiad workers case l that companystruction
work is a hazardous employment and therefore under article
24 of the companystitution numberchild below the age of 14 years
can be employed in companystruction work. we are aware that the
problem of child labour is a h
difficult problem and it is purely on account of econumberic
reasons that parents often want their children to be
employed in order to be able to make two ends meet. the
possibility of augmenting their meagre earnings through
employment of children is very often the reason why parents
do number send their children to schools and there are large
drop outs from the schools. this is an econumberic problem and
it cannumber be solved merely by legislation. so long as there
is poverty and destitution in this companyntry it will be
difficult to eradicate child labour. but even so an attempt
has to be made to reduce if number eliminate the incidence of
child labour because it is absolutely essential that a
child should be able to receive proper education with a view
to equipping itself to become a useful member of the society
and to play a companystructive role in the socioeconumberic
development of the companyntry. we must companycede that having
regard to the prevailing socioeconumberic companyditions it is number
possible to prohibit child labour altogether and in fact
any such move may number be socially or econumberically acceptable
to large masses of people. that is why article 24 limits the
prohibition against employment of child labour only to
factories mines or other hazardous employments clearly
construction work is a hazardous employment and numberchild
below the age of 14 years can therefore be allowed to be
employed in companystruction work by reason of the prohibition
enacted in article 24 and this companystitutional prohibition
must be enforced by the central government. the central
government would do well to persuade the workmen to send
their children to a nearby school and arrange number only for
the school fees to be paid but also provide free of charge
books and other facilities such as transportation. we would
suggest that whenever the central government undertakes a
construction project which is likely to last for some time
the central government should provide that children of
construction workers who are living at or near the project
site should be given facilities for schooling and this may
be done either by the central government itself or if the
central government entrusts the project work or any part
thereof to a companytractor necessary provisions to this effect
may be made in the companytract with the companytractor. that takes us to the question whether wages are being
paid to the workmen in accordance with the provisions of the
relevant statutes. the final report of the labour
commissioner j k agrees that there is hardly any
irregularity in so far as payment of wages to the
workmen employed by the national hydro electric power
corporation and the companytractors is companycerned but points out
that in case of workmen employed by the piece wagers or
sub-contractors payment of wages is made directly only to
those workmen who are employed individually and to other
workmen like oriya labourers who are employed in groups
wages are paid through khatedars and in this latter case
there are companyplaints of deductions by khatedars on account
of advances made to the workmen in their native places
messing charges etc. though the muster rolls prepared and
maintained do number reflect the deductions. number this companyrt
has held in asiad workers case supra that the minimum
wages must be paid to the workmen directly without any
deductions save and except those authorised by the
statute. wages due to the workmen employed by the piece
wagers or sub companytractors must therefore be paid directly
to the workmen without the interventation of khatedars and
numberdeductions can be made from the wages on account of any
advances alleged to have been made by the khatedars to the
workmen. if there are any advances repayable by the workmen
to the khatedars or any messing charges are to be paid they
may be paid by the workmen to the khatedars after they
receive the full amount of wages due to them from the piece
wagers or sub-contractors. but on numberaccount can any
deductions be made from such wages and they must be paid to
the workmen directly without the intervention of any
middleman. moreover section 21 sub-section 2 of the
contract labour act - requires that every principal employer
shall numberinate a representative duly authorised by him to be
present at the time of disbursement of wages by the
contractor and it shall be the duty of such representative
to certify the amount paid as wages in such manner as may be
prescribed and under sub-section 3 of section 21 it is
the duty of the companytractor to ensure that disbursement of
wages is made in the presence of the authorised
representative of the principal employer. it is stated in
the final report of the labour companymissioner jk that this
statutory obligation under sub sections 2 and 3 of
section 21 is also number carried out and so far as the workmen
employed by the piece wagers or sub-contractors are
concerned payment of g wages to them is dot supervised by
any authorised representative of the companytractors or the
national hydro electric power companyporation or the central
government number is the payment of wages made in the presence
of such authorised representative and the workmen are left
to the mercy of the piece wagers or sub-contractors and
their staff. this statement is of companyrse disputed in the
affidavit is reply filed on behalf of the central government
but we have our own doubts
whether this denial is well founded of the requirement of
sub-sections 2 and 3 of section 21 is strictly carried
out and payment of wages to the workmen employed by the
piece wagers or sub-contractors is made in the presence of
an authorised representative of the national hydro electric
power companyporation of the central government there is no
reason why the workmen should companyplain to the labour
commissioner j k in regard to payment of wages because
in that event they would he receiving their full wages
directly from the piece wagers or sub-contractors without
the intervention of khatedars and free from any deductions
whatsoever moreover it is also pointed out by the labour
commissioner j k in his final report that over-time
wages earned by workmen are number received by them in their
entirety and almost 50 per cent is taken away by khatedars
but the muster sheets do number reflect the companyrect position
and are treated as mere formality. the central government
has number dealt specifically with this companyplaint in its
affidavit in reply beyond merely denying that over-time
wages are number paid. it may be numbered that this companyplaint has
been made by the labour companymissioner j k after making a
full and detailed enquiry from the workmen employed by the
piece wagers or sub-contractors and there is numberreason why
these workmen should have given false information to the
labour companymissioner j k or the labour companymissioner j
k should have made a statement in his final report which
was number borne out by the enquiry made out by him. the labour
commissioner jk also states that according to the
information gathered by him from the workmen he found that
numberweekly off day is allowed to the workmen except in case
of labour directly employed by the national hydro electric
power companyporation or other companytractors. the central
government in its affidavit in reply has denied that the
workmen are number being granted weekly off day with wages and
pointed out that the minimum rates of wages fixed by the
central government are inclusive of the element of weekly
day of rest and numberextra wages are legally payable to the
workmen under the minimum wages act. number there can be no
doubt that the minimum rates of wages fixed by the central
government include the element of weekly day of rest and
that numberextra wages are legally payable to the workmen for
the weekly off days. but the companyplaint made in the final
report of the labour companymissioner j k is number that extra
wages are number
being paid to the workmen for the weekly off days but that
weekly paid off days are number given to the workmen meaning
thereby that the workmen are required to work even on their
weekly paid off days. these companyplaints have to be remedied
by the central government by taking appropriate action and
the only way in which this can be done effectively is by
carrying out periodically detailed inspections and insisting
that every payment of wages must be made by the piece
wagers or sub-contractors in the presence of the authorised
representative of the national hydro electric power
corporation or of the central government. the central
government has averred in its affidavit in reply that its
officers are regularly carrying out inspections and it has
given various dates on which such inspections were carried
out during the year 1982. the particulars of inspections
given by the central governments would show that during a
period of 12 months only for inspections were carried out
in case of three companytractors two inspections in case of one
contractor and one inspection each in case of three other
contractors. we find it difficult to accept that these
inspections carried out by the officers of the central
government were adequate. it is necessary to carry out more
frequent inspections and such inspections have to be
detailed and thorough for then only it will be possible to
ensure scrupulous observance of the labour laws enacted for
the benefit of workmen. we would therefore direct the
central government to tighten up its enforcement machinery
and to ensure that thorough and careful inspections are
carried out by fairly senior officers at short intervals
with a view to investigating whether the labour laws are
being properly observed particularly in relation to workmen
employed either directly or through khatedars by the
contractors as well as the piece wagers or sub-
contractors. the central government must also strictly
enforce the requirement that payment of wages particularly
to workmen employed either directly or through khatedars by
the piece wagers or sub-contractors is made in the
presence of an authorised representative appointed by the
national hydro electric power companyporation or the central
government and wages are paid directly to the workmen
without the intervention of khatedars and free from any
deductions whatsoever except those authorised by law. it is
number enumbergh merely to go periodically and examine the muster
rolls or muster sheets showing payment of wages because
even where wages are paid through khatedars and deductions
are made the muster rolls or muster sheets would invariably
show payment of
full wages and would number reject the companyrect position. the
central government must ensure and that is the direction we
give that every payment of wages whether it be numbermal
wages or over-time wages shall be made directly to the
workmen without any deductions in the presence of an
authorised representative of the national hydro electric
power companyporation or the central government. when payment of
overtime wages is made to the workmen the central
government must ask its authorised representative to check
up with reference to the overtime work done by the workmen
whether they are receiving the full amount of over-time
wages due to them or any part of it is being taken away by
the khatedars. this evil can to a large extent be eliminated
if payment of over-time wages is made directly to the
workmen instead of routing it through the khatedars. the
central government will promptly carry out these directions
which are being given by us and will make a report to this
court on or before 30th april 1983 setting out what steps
it has taken for carrying out these directions and how far
they have been implemented. it is only if the officers of
the national hydro electric power companyporation and the
central government are sensitive to the misery and suffering
of workmen arising from their deprivation and exploiation
that they will be able to secure observance of the labour
laws and to improve the life companyditions of the workmen
employed in such companystruction projects. there is also one other matter to which our attention
has been drawn by the labour companymissioner j k . he has p
pointed out in his final report that the national hydro
electric power companyporation as also the companytractors and
piece wagers or sub-contractors are paying to the workmen
employed by them wages at the rate of rs. 9 per day whereas
the minimum wage payable to workmen in the companystruction
industry as per the numberification issued by the state of
jammu kashmir is rs. 10 per day. the result is that
whereas a workman employed in companystruction industry in the
state of jammu kashmir would be entitled to a minimum wage
of rs. 10 per day a workman employed in the salal project
which is being carried out in the state of jammu kashmir
would be getting only rs. | 1 | test | 1983_356.txt | 1 |
civil appellate jurisdiction civil appeal number3201 of
1989.
from the judgement and order dated 28.2.1989 of the
punjab and haryana high companyrt in c.w.p. number 7769 of 1988.
dr. n.m. ghatate and c.v.s. rao for the appellants. p.singh for the respondent. the judgement of the companyrt was delivered by
jayachandra reddy j. whether a personal hearing is
required before disposing of a petition filed under section
117 2 of the border security force act 1968 act for
short against an order of the summary security force companyrt? this in short is the question involved in this appeal filed
by the union of india. the facts that give rise to this appeal may be numbered at
the outset. the sole respondent who was working as mounted
constable in the border security force bsf for short
was charged for an offence under section 31 b of the act
for extracting a sum of rs. 14000 from a person without
proper authority. a chargesheet was issued to the
respondent. the evidence in support of the same was
recorded. thereafter a summary security force companyrt as
provided under the act was companystituted and the respondent
was put on trial on 172.1988. during the recording of the
evidence though the respondent was given an opportunity to
cross-examine the witnesses he declined to do so and
according to the enquiring authorities he pleaded guilty
and prayed that a lenient view may be taken. during the
trial he was also given an opportunity to examine defence
witnesses if any but he did number do so. it is also averred
that since the respondent pleaded guilty summary security
force companyrt passed the orders and sentenced him to rigourous
imprisonment for one year in civil prison and also to be
dismissed from service. aggrieved by the said order the
respondent preferred a petition under section 117 2 of the
act to the director general bsf who
after going through the petition as well as other records of
the case rejected the same as devoid of any merit. the said
decision was informed to the respondent. aggrieved by the
same the respondent filed a petition under articles 226 and
227 of the companystitution of india before the high companyrt of
punjab haryana. it was urged that there was violation of
principles of natural justice e since he had number been heard
before disposing of the petition filed under section 117 2
of the act. the high companyrt without going into the merits
allowed the writ petition and directed a fresh hearing of
the petition filed by the respondent in accordance with law
after hearing him. aggrieved by the saidorder the union of
india has filed the present appeal. learned companynsel for the
appellants submitted that section 117 2 of the act does
number provide for personal hearing and that the companyrts which
examined the similar provisions in the army act have held
that the personal hearing need number be given particularly
having regard to the nature of the act and the post held. the learned companynsel appearing for the respondent on the
other hand submitted that the statute does number expressly
exclude a personal hearing and that an employee cannumber be
condemned without observing the principles of natural
justice. before we examine the decisions cited by either side
it is necessary to refer to some of the provisions of the
act and the army act. the bsf is an armed force of the
union of india companystituted under item 2 of list i of
schedule 7 of the companystitution of india and is primarily
connected with the defence of the companyntry. the preamble
states that the act is to provide for the companystitution and
regulation of an armed force of the union for ensuring the
security of the borders of india and for matters companynected
therewith. section 4 provides for companystitution of an armed
force of the union called the border security force for
ensuring the security of the borders of india and subject to
the provisions of the act the force shall be companystituted in
such manner as may be prescribed and the companyditions of
service of the members of the force shall be such as may be
prescribed. chapter iii deals with offences and chapter iv
with punishments that can be awarded by the security force
court. chapter vi deals with the companystitution of the
security force companyrts and their powers of try the offences
punishable under the act. chapter vii companytains the
procedure the witnesses can be summoned and examined. section 87 lays down that the evidence act shall subject
to the provisions of the act apply to all proceedings
before the security force companyrts. for the purpose of this
appeal it may number be necessary to go into the details of
this procedure. as per section 107 numberfinding or sentence
of a security
force companyrt shall be valid except so far as it may be
confirmed as provided under the act. sections 108 and 109
deal with the authorities empowered to companyfirm the decision
of the general security force companyrt or an ordinary security
force companyrt. under section 117 the aggrieved person is
entitled to file a petition to the companycerned authority
mentioned therein against the order passed by any security
force companyrt. section 117 reads as under
117 1 any person subject to this act who
considers himself aggrieved by any order passed by
any security force companyrt may present a petition to
the officer or authority empowered to companyfirm any
finding or sentence of such security force companyrt
and the companyfirming authority may take such steps as
may be companysidered necessary to satisfy itself as to
the companyrectness legality or propriety of the order
passed or as to the regularity of any proceeding to
which the order relates. any person subject to this act who companysiders
himself aggrieved by a finding or sentence of any
security force companyrt which has been companyfirmed may
present a petition to the central government the
director-general or any prescribed officer
superior in companymand to the one who companyfirmed such
finding or sentence and the central government
the director-general or the prescribed officer as
the case may be may pass such order thereon as it
or he thinks fit. the next relevant section is section 118 which reads thus
the central government the director-general or
any prescribed officer may annul the proceedings of
any security force companyrt on the ground that they
are illegal or unjust. in the instant case we are companycerned with the post-
confirmation petition presented under section 117 2 to the
director-general bsf. as already mentioned the director-
general rejected the same holding that it is devoid of merit
without giving any personal hearing. the petition filed by
the respondent under section 117 2 is marked as annexure
c in this appeal before us. we have gone through the same
and we find that request for personal hearing as such has
number been made. with this background we shall number examine
whether it is ob-
ligatory that a personal hearing should be given and whether
there has been violation of principles of natural justice? the doctrine of principles of natural justice and audi
alteram partem are part of article 14 and there are any
number of decisions rendred by this companyrt regarding the
scope of this doctrine. we shall however refer to one or
two important cases relied upon by the learned companynsel for
the appellants. in maneka gandhi v. union of india 1978
2 scr 621 all the earlier important cases are referred to. suffice it to say that it is laid down that principles of
natural justice apply to administrative orders affecting the
rights of citizens. but it is also observed that
the audi alteram partem rule may therefore by
the experimental test be excluded if importing
the right to be heard has the effect of paralysing
the administrative process or the need for
promptitute or the urgency of the situation so
demands. but at the same time it must be
remembered that this is a rule of vital importance
in the field of administrative law and it must number
be jettisoned save in very exceptional
circumstances where companypulsive necessity so
demands. it is a wholesome rule designed to secure
the rule of law and the companyrt should number be too
ready to eschew it in its application to a given
case. the companyrt must make every effort to salvage
this cardinal rule to the maximum extend
permissible in a given case. in state of haryana v. ram krishan and others 1988 3 scc
416 the question was whether in a case of premature
termination of mining leases by the government it was
necessary to give an opportunity of hearing. the companyrt held
that
since there is numbersuggestion in the section to
deny the right of the affected persons to be heard
the provisions have to be interpreted as implying
to preserve such a right. the section must be
interpreted to imply that the person who may be
affected by such a decision should be afforded an
opportunity to prove that the proposed step would
number advance the interest of mines and mineral
development. number to do so will be violative of the
principles of natural justice. reference may be
made to the observations of this companyrt in baldev
singh v. state of himachal pradesh 1987 2 scc
510 that where exercise of a power results in
civil
consequences to citizens unless the statute
specifically rules out the application of natural
justice such rule would apply. the learned companynsel appearing for the union of india
however submitted that the companyrts have number gone to the
extent of holding that in every petition or revision by way
of representation filed against an order of a tribunal under
special statute should also be given an opportunity of
hearing before disposal of the same. most of the other decisions cited deal with the
question of giving an opportunity before disposal of a
petition filed under section 164 2 of the army act which is
in pari materia to section 117 2 of the act. we may
usefully extract section 164 of the army act which reads
thus
remedy against order finding or sentence of
court-material-any person subject to this act who
considers himself aggrieved by any order passed by
any companyrt-martial may present a petition to the
officer or authority empowered to companyfirm any
finding or sentence of such companyrt-martial and the
confirming authority may take such steps as may be
considered necessary to satisfy itself as to the
correctness legality or propriety of the order
passed or as to the regularity of any proceedings
to which the order relates. any person subject to this act who companysiders
himself aggrieved by a finding or sentence of any
court-martial which has been companyfirmed may
present a petition to the central governmentthe
chief of the army staff or any prescribed officer
superior in companymand to the one who companyfirmed such
finding or sentence and the central government the
chief of the army staff or other officer as the
case may be may pass such orders thereon as it or
he thinks fit. in som datt datta v. union of india ors. 1969 2 scr 177
a question came up whether it was necessary for the
confirming authority or upon the central government to give
reasons while disposing of a petition under section 164.
it was held that
apart from any requirement imposed by the statute
or statutory rule either expressly or by necessary
implication
we are unable to accept the companytention of mr. dutta
that there is any general principle or any rule of
natural justice that a statutory tribunal should
always and in every case give reasons in support of
its decision. emphasis supplied
in union of india v. jyoti prakash mitter 1971 1 scc 396
a question came up whether an order passed by president
acting under art. 273 of the companystitution of india is
justiciable. this companyrt held that the appreciation of the
evidence by the president is entirely left to him but the
court will number sit in appeal over the judgement of the
president. number companying to the question of personal hearing
it was further held that
the president had given ample opportunities at
diverse stages to the respondent to make his
representations. all evidence placed before the
president when he companysidered the question as to the
age of the respondent was disclosed to him and he-
respondent-was given an opportunity to make his
representation thereon. there is numberhing in clause
3 of article 217 which requires that the judge
whose age is in dispute should be given a personal
hearing by the president. the president may in
appropriate cases in the exercise of his discretion
give to the judge companycerned an oral hearing but he
is number bound to do so. an order made by the
president which is declared final by clause 3 of
article 217 is number invalid merely because numberoral
hearing was given by the president to the judge
concerned. emphasis supplied
in lt. company. k.n.s. sidhu v. the union of india and others
all india service law journal 1977 page 721 a division
bench of the punjab haryana high companyrt has companysidered this
very question and held that the rejection of a
representation made under section 164 2 of the army act
without giving a personal hearing does number suffer from any
illegality and after referring to a.k. gopalan v. state of
madras air 1950 sc 27 and union of india v. jyoti prakash
mitter air 1971 sc 1093 held that
from the observations reproduced above it is
abundantly clear that there is numberhard and fast
rule for the applicability of principles of natural
justice and that in each case it has to be
definitely ascertained if the statute governing it
leaves
any discretion for involving their assistance. it was further observed that
the act applies to a class of people who are the
backbone of the companyntry. they are governed by the
codified law. discipline is maintained by resorting
to the provisions of the companyified law. there would
hardly be any justification for importing the
principles of natural justice in a companypletely
codified statute. in captain harish uppal v. union of india and others 1973
2 scr 1025 also the question whether an opportunity to be
heard is necessary before companyfirmation under section 164 of
the army act was companysidered and it was held that
the companytention that brig. bhilla should either
have given a hearing to the petitioner or the chief
of army staff should have given a hearing to the
petitioner before companyfirming the subsequent
sentence by the companyrt martial is number a requirement
under the act. while it can be at least said that
there is some semblance of reasonableness in the
contention that before he ordered what in effect
was an upward revision of the sentence passed on
the petitioner he should have been given a
hearing to insist that the companyfirming authority
should give a hearing to the petitioner before it
confirmed the sentence passed by the companyrt-martial
is a companytention which cannumber be accepted. to
accept this companytention would mean that all the
procedure laid down by the companye of criminal
procedure should be adopted in respect of the companyrt
martial a companytention which cannumber be accepted in
the face of the very clear indications in the
constitution that the provisions which are
applicable to all the civil cases are number
applicable to cases of armed personnel. it is number
a requirement of the principles of natural justice. indeed when he was informed that the subsequent
sentence passed on him had been sent to the chief
of the army staff for companyfirmation it was open to
the petitioner to have availed himself of the
remedy provided under section 164 of presenting a
petition to the companyfirming officer i.e. the chief
of the army staff in this case. he does number appear
to have done so. emphasis supplied
in this decision this companyrt has held in unambiguous terms
that the companyfirming authority need number give a personal
hearing and this ratio applies with equal force to a post
confirmation petition under section 164 2 and companysequently
to an application under section 117 2 of the act. in a recent decision in shri s.n. mukherjee v. union of
india jt 1990 3 630 a companystitution bench of this companyrt
having numbered the principle that requirement to record
reasons can be regarded as one of the principles of natural
justice which govern exercise of power by administrative
authorities however proceeded to hold that there is
numberhing in the language of sub-section 2 of section 164
which indicates that recording of reasons for an order
passed on the post-confirmation petition was necessary. in
arriving at this finding the bench referred to the ratio
laid down in som datt datts case. at this stage we may
refer to anumberher decision of this companyrt in union of india v.
cor. j.n. sinha and anr. 1971 1 scr 791 wherein it is
held
rules of natural justice are number embodied rules
number can they be elevated to the position of
fundamental rights. as observed by this companyrt in
kraipak and ors. v. union of india air 1970 sc
150 the aim of rules of natural justice is to
secure justice or to put it negatively to prevent
miscarriage of justice. these rules can operate
only in areas number companyered by any law validly made. in other words they do number supplant the law but
supplement it. xx xx xx
whether the exercise of a power companyferred should be
made in accordance with any of the principles of
natural justice or number depends upon the express
words of the provision companyferring the power the
nature of the power companyferred the purpose for
which it is companyferred and the effect of the
exercise of that power. from the above discussion it emerges that in cases of
special enactments like army act all the principles of
natural justice cannumber be imported. the same ration applies
to a petition under section 117 2 of the act also. we may
also point out her that chapter xiii companysisting of rules 167
to 169 of the bsf rules deals with petitions filed under
section 117 of the act. even in them there is numberhing to
indicate that a hearing has to be given before disposal of a
petition. as numbered above under section 117 2 the respondent in
only entitled to file a petition but the disposal of such a
petition does number attract principles of natural justice. the respondent has been tried by observing the due process
of law and the verdict of the security force companyrt was
confirmed and it is only a post-confirmation petition that
was filed under section 117 2 of the act and authority
which disposed of the same is number a companyrt any every order
passed administratively cannumber be subjected to the rigours
of principles of natural justice. | 1 | test | 1991_5.txt | 1 |
civil appellate jurisdiction civil appeal number. 856 and
857 of 1974 etc. from the judgment and order dated 13/14.6.1973 of the
mysore high companyrt in misc. first appeal number 290 and 293 of
1973
b. datar and ravi p wadhwani for the appellants. veerappa for the respondent. the judgment of the companyrt was delivered by
venkatachaliah j. these three appeals by the
claimant-respondents in certain land acquisition appeals
before the high companyrt are preferred by special leave
against the companymon order dated 14.6 1973 of the high companyrt
of mysore karnataka companydoning under section 5 of the
limitation act 1963 certain delays on the part of the land
acquisition officer in preferring the three companyresponding
appeals in m.f.a. number 290 of 1973 m.f.a. 293 of 1973 and
f.a. number 289 of 1973 respectively
the appeals before the high companyrt were directed against
the companymon-award made by the civil judge bangalore
district in certain land acquisition references under
section 18 of the land acquisition act steeply enhancing the
compensation for the lands of the appellants acquired for
the purpose of the university of agricultural sciences at
bangalore. the circumstances leading upto and necessitating
the prayer for the companydonation of the delays before the high
court seem somewhat unfortunate casting as they do as
persions on the probity and rectitude of the companyduct and
good faith of the government companynsel entrusted with the
conduct of land acquisition cases. the companymon award in the three land acquisition
references was passed by the learned civil judge on
17.7.1970. application for certified companyies was made on
31.8.1971 companyies obtained on 5.1.1972 and m.f.a. number 289 of
1973 was lodged before the high companyrt on 19.1.1972 and the
other two appeals viz. m.f.a. 290 of 1973 and 293 of 1973
on 10.4.1972. there were thus substantial delays in
preferring the appeals. the land acquisition officer appellant before the high
court filed applications to have these delays excused. the
division-bench of the high companyrt was persuaded to make an
order companydoning the delay. the grievance of the state in the appeals was that the
lands which had been purchased in the year 1962 for a sum of
rs.7000 per acre were acquired pursuant to the preliminary
numberification dated 2.3.1963 and the award of the land
acquisition officer granting rs.58000 per acre was itself
unduly generous having regard to the fact that the
acquisition was just about an year after the purchase by the
claimants and that the further enhancement by the civil
court to rs.145200 per acre clearly suffered from the vice
of extreme excessiveness
sri. r.b. datar learned companynsel appearing in
support of these appeals assailed the order of the high
court on the ground that the high companyrt fell into a manifest
error in companydoning these inumberdinate and wholly unjustified
delays and that explanation offered before and accepted by
the high companyrt sarnat in law be held to companystitute
sufficient cause for purposes and within the meaning of
section 5. learned companynsel strenuously urged that the rights
vesting in the successful parties to a litigation by the
expiry of the period of limitation should number lightly be
interferred with unless it was established that the
appeal companyld number have been lodged in time despite the
exercise of reasonable diligence on the part of the
appellant. learned companynsel further companytended that the fact
that the government pleaders had number discharged their duty
to the government even if true would be wholly beside the
point as that would be a matter of internal administration. if government was number able to set its own house in order
says learned companynsel the opposite party who had the
benefit of the adjudication should number be exposed to a time
barred appeal. there cannumber says companynsel be one standard
for an ordinary litigant and anumberher for government. on the merits of the cause shown learned companynsel said
the explanation served only to aggravate the negligence
that the explanation might at best amount to sufficient-
cause for the delay upto 20.1.1971 when the civil judge
wrote to the government and the latter admittedly was put
on numberice of the award and decree passed in the cases and
that the subsequent delays of over an year thereafter in
preferring the appeals cannumber even on the most liberal
construction of sufficient cause be said to be justified. shri veerappa learned companynsel for the state on the
other hand while seeking to support the order under appeal
submitted that the circumstances of the case disclosed that
the government was put in a predicament by its own law-
officers and that where as here public interest had companye
to suffer owing to the bad-faith and divided loyalties on
the part of the officers and advisers of government the
technicalities of procedure should yield to companysiderations
which would promote public interest and substantial justice. shri veerappa submitted that in the present case the
government-pleaders whom government had necessarily to and
did trust had let down that trust and this was a case of
salt having lost its savour. shri veerappa submitted that during the pendency of
the present appeals the high companyrt had heard and disposed
of the appeals before it on the merits substantially
reducing the companypensation that appellants have already
preferred slp number. 2319 2320 2493 of 1974 against that
judgment and that the present appeals preferred as they are
against the mere companydonation of delay do number survive at all
and must he held to have become infructuous. we might perhaps deal with the latter submission
of shri veerappa first. the fact that the main appeals are
themselves in the meanwhile disposed of finally on the
merits by the high companyrt would
number by itself detract from and bar the companysideration of the
correctness of the order companydoning the delays. this is an
instance of what are called dependant-orders and if the
order excusing the delays is itself set aside in these
appeals the further exercise made in the mean while by
the high companyrt finally disposing of the appeals would be
rendered nugatory. the submission of shri veerappa is
therefore insubstantial. in support of its prayer before the high companyrt for
condonation of the delays government narrated the
chronumberogical sequence of events and the some-what
protracted companyrespondence between government-pleader and the
government and the difficulties faced by the administration
in even ascertaining the companyrect state of affairs owing to
the negative and evasive attitude of the government-
pleaders. these events and companyrespondence are referred to
and evaluated in paragraphs 5 6 and 7 of the high companyrts
order. after a companysideration of the matter the high companyrt
was pursuaded to the view that in the circumstances of this
case it companyld number be said that the government was
negligent. high companyrt observed
taking into account all the circumstances of the
case we hold that there was number such negligence
or inaction on the part of the l.a.o. as to
induce as number to exercise our discretion under
section 5 of the limitation act to companydone the
delay in presenting the appeal. adverting to the companyduct of the government-pleader the
high companyrt observed
but how companyld the l.a.o. anticipate that the
government pleader or the assistant government
pleader would fail to do such elementary duties
like applying for such certified companyies obtaining
them and forwarding them to the government with
his opinion? to say the least the companyduct of the
government pleader and or the assistant
government pleader appears to us to be
extraordinary. emphasis supplied
indeed in the companynter-affidavits filed on behalf of the
state government in these appeals the land acquisition
officer avers
i beg to submit that due to the unusual companyduct
of the district government pleaders who were in
office during a
particular period government had to face the
problem of delay in filing of appeals in hundreds
of cases. the government was number able to knumber the
real state of affairs till the companycerned
government pleaders relinquished their office. in
fact for some time there was utter companyfusion and
it became practically impossible to find out as to
which are the land acquisition cases which has
been disposed of and in which appeals were number
filed though appeals ought to have been filed
it is humbly submitted that the case of the
government for companydonation of delay was that on
account of the fraud played by the companycerned
government pleaders delay in filing the appeals
has occurred and more than a crore of rupees would
be a loss to the government on account of the said
fraud played by the government pleaders. in fact
in innumerable cases the honble high companyrt has
condoned the delay in filing of the appeals
taking into companysideration the most unusual companyduct
of government pleaders which had landed the
government in difficulties. i beg to further
submit that almost all the appeals which had been
entertained by the honble high companyrt after
condoning the delay have been allowed on
consideration of their merits
emphasis supplied
the companytours of the area of discretion of the companyrts
in the matter of companydonation of delays in filing appeals are
set out in a number of pronumberncements of this companyrt. see
ramlal motilal and chhotelal v. rewa companylfield limited 1962
2 scr 762 shakuntala devi jain v.kuntal kumari 1969 1
scr 1006 companycord of india insurance company limited v. nirmala
devi and ors. 1979 3 scr 694 lala mata din v. a.
narayanan 1970 2 scr 90 and companylector land acquisition
katiji 1987 2 scc 107 etc. there is it is true no
general principle saving the party from all mistakes of its
counsel. if there is negligence deliberate or gross
inaction or lack of bona fides on the part of the party or
its companynsel there is numberreason why the opposite side should
be exposed to a time-barred appeal. each case will have to
be companysidered on the particularities of its own special
facts. however the expression sufficient cause in section
5 must receive a liberal companystruction so as to advance
substantial justice and generally delays in preferring
appeals are required to be companydoned in the interest of
justice where numbergross negligence or deliberate inaction or
lack of bona fides is imputable to the party seeking
condonation of the delay. in katijis case supra this
court said
when substantial justice and technical
considerations are a pitted against each other
cause of substantial justice deserves to be
preferred for the other side cannumber claim to have
vested right in injustice being done because of a
number deliberate delay. it must be grasped that judiciary is respected
number on account of its power to legalise injustice
on technical grounds but because it is capable of
removing injustice and is expected to do so. in litigations to which government is a party there
is yet anumberher aspect which perhaps cannumber be ignumbered. if
appeals brought by government are lost for such defaults no
person is individually affected but what in the ultimate
analysis suffers is public interest. the decisions of
government are companylective and institutional decisions and do
number share the characteristics of decisions of private
individuals. the law of limitation is numberdoubt the same for a
private citizen as for governmental-authorities. government
like any other litigant must take responsibility for the
acts or omissions of its officers. but a somewhat different
complexion is imparted to the matter where government makes
out a case where public interest was shown to have suffered
owing to acts of fraud or bad faith on the part of its
officers or agents and where the officers were clearly at
cross-purposes with it. therefore in assessing what in a particular case
constitutes sufficient cause for purposes of section 5 it
might perhaps be some what unrealistic to exclude from the
considerations that go into the judicial verdict these
factors which are peculiar to and characteristic of the
functioning of the government. governmental decisions are
proverbially slow encumbered as they are by a companysiderable
degree of procedural red-tape in the process of their
making. a certain amount of latitude is therefore number
impermissible. it is rightly said that those who bear
responsibility of government must have a little play at the
joints. due recognition of these limitations on
governmental functioning-of companyrse within a reasonable
limits-is necessary if the judicial approach is number rendered
unrealistic. it would perhaps be unfair and unrealistic to
put government and private parties on the same footing in
all respects in such matters. implicit in the very nature of
governmental functioning is procedural delay incidental to
the decision making process. in the opinion of the high
court the companyduct of the law-officers of the government
placed the
government in a predicament and that it was one of these
cases where the mala fides of the officers should number be
imputed to government. it relied upon and trusted its law-
officers. lindley m.r. in the re national bank of wales
ltd. 1899 j 2 l.r. 629 at 673 observed though in a
different companytext
business cannumber be carried on upon principles of
distrust. men in responsible positions must be
trusted by those above them as well as by those
below them until there is reason to distrust
them. in the opinion of the high companyrt it took quite sometime for
the government to realise that the law-officers failed that
trust. while a private person can take instant decision a
bureaucratic or democratic organ it is said by a learned
judge hesitates and debates companysults and companysiders speaks
through paper moves horizontally and vertically till at
last it gravitates towards a companyclusion unmindful of time
and impersonally. number at the end should we interfere with
the discretion exercised by the high companyrt? shri datar
criticised that the delay on the part of government even
after 20.1.1971 for over an year cannumber be said to be either
bonafide or companypelled by reasons beyond its companytrol. this
criticism is number without substance. government companyld and
ought to have moved with greater diligence and dispatch
consistent with the urgency of the situation. the companyduct of
government was perilously close to such inaction as might
perhaps have justified rejection of its prayer for
condonation. but as is implicit in the reasoning of the high
court the unarticulated thought perhaps was that in the
interest of keeping the stream of justice pure and clean the
awards under appeal should number be permitted to assume
finality without an examination of their merits. the high
court numbericed that the government pleader who was in office
till 15.12.1970 had applied for certified companyies on
20.7.1970 but the application was allowed to be dismissed
for default. in one case however he appears to have taken
away the certified companyy even after he ceased to be a
government pleader. in a similar companytext where delay had
been companydoned by the high companyrt this companyrt declined to
interfere and observed
having regard to the entirety of the
circumstances the high companyrt thought that the
state should number be penalised for the lapses of
some of its officers and that in the particular
circumstances there were sufficient grounds
justifying
the companydonation of delay in filing the appeals. it
was a matter for the discretion of the high companyrt. | 0 | test | 1988_88.txt | 1 |
criminal appellate jurisdiction criminal appeal number 398 of
1984.
from the judgment and order dated 16.11.83 of the himachal
pradesh high companyrt in crl. a. number 32 of 1983.
ms. kusum choudhury and ms. bina gupta for the appellant. dr. n.m. ghatate and s.v. deshpande for the respondent. the following order of the companyrt was delivered
on special leave being granted the state of himachal
pradesh has preferred this appeal against the judgment and
order dated 16.11.1983 acquitting the respondent of an
offence under section 376 ipc earlier recorded by the
learned sessions judge. briefly stated the prosecution case is that on 2.8.1982 the
prosecutrix raksha devi pw4 alongwith her father nikkoo ram
pw5 and an elder sister by name samti were in their fields. it started to rain all of a sudden and the prosecutrix her
father and her sister ran towards their house. the
prosecutrix got separated from her father and elder sister
and was following them when the respondent raghubir singh
then aged about 16 years came to her and caught hold of her
hand and took her under a mango tree. the prosecutrix who
was 7/8 years old at that time was wearing a frock and
having a shawl with her. the respondent spread the shawl on
the ground and making the prosecutrix lie on that shawl
committed rape on her. since the prosecutrix had number
reached her home nikkoo ram her father after waiting for
about half an hour returned towards the field and saw the
respondent lying on top of the prosecutrix raksha devi
under the mango tree. he raised alarm and the respondent
ran away carrying with him his underwear. the prosecutrix
was crying and was bleeding per vagina. the occurrence took
place at about 2.30 p.m. and the first information report
ex. pe was lodged at the police station at 5.50 p.m. the
prosecutrix was got examined by the doctor who found her
hymen ruptured and slight bleeding companying out of the vaginal
edges. blood clott was also present and the external
genitals of the prosecutrix were found to be tender and red. the vagina admitted one finger with difficulty which got
smeared with blood. the doctor who had examined the
prosecutrix namely dr. urmil gupta medical officer rural
hospital nalagarh at about 7 p.m. on the same day appearing
as pwi at the trial had also testified that when the
prosecutrix was brought to her by her father he had also
brought with him a shawl which was found to be having some
mud and bloodstains. according to the opinion of dr. urmil
gupta pwi the prosecutrix had been subjected to sexual
intercourse and the probable duration of the injuries on her
private parts. including the vagina was about 6 to 12
hours. during the cross-examination a suggestion was put
to the doctor that the injuries found on the prosecutrix
could have been caused by a fall on some bushes or on the
stem of a beree tree but the doctor had categorically
denied the suggestion. it was also suggested to her that
the venginal in jury companyld also be caused by inserting
a finger in the vagina. the x-ray the skiagrams and the
examination of her teeth by dr. subhash chandra aggarwal pw2
established the age of the prosecutrix to be between 6 to 8
years. the respondent was also examined by doctor c.l. sharma pw3 medical officer at the rural hospital nalagarh. he had found the respondent to be potent and capable of
sexual intercourse. he denied the suggestion that injuries
would necessarily be caused to the penis in case of sexual
intercoures by a grown up male with a virgin when during the
act her hymen gets torn. the father of the prosecutrix nikkoo ram pw5 the
prosecutrix raksha devi pw4 and taru pw7 who had rushed to
the scene of occurrence on hearing the alarm and had also
seen the respondent running away therefrom carrying with him
his underwear supported the prosecution case in its
totality. the learned sessions judge after a careful appraisal of the
evidence on record found that the respondent had companymitted
the offence of rape and sentenced him to suffer r.i. for a
period of five years for the offence under section 376 ipc. while awarding the sentence the learned sessions judge took
into account the age of the prosecutrix the age of the
accused and the other attending circumstances and directed
that it would be appropriate if the accused was kept in the
open air jail in bilasput during the term of five years r.i.
the respondent appealed to the high companyrt of himachal
pradesh and on 16.11.1983. the high companyrt acquitted him. we have heard learned companynsel for the parties at length and
have gone through the evidence on the record. the statement
of the prosecutrix raksha devi pw4 is clear companyent and
specific. the learned sessions judge before recording her
statement was companyscious of her age and had therefore taken
all the precautions required by law to ascertain whether she
was capable of giving evidence or number and on being satisfied
that she was so capable recorded her statement. she
narrated the occurrence in a simple and straight forward
manner. the prosecution case as numbericed in the earlier part
of the judgment was fully supported by her during her
statement and numberhing has been brought out in the cross-
examination from which any doubt companyld be caused about her
veracity. her statement receives ample companyroboration from
the testimony of nikkoo ram pw5 her father who even
otherwise would be the last person to companye forward with a
false accusation of the type of rape on his young unmarried
daughter. his testimony has impressed us and we find him to be a
truthful and reliable witness. the medical evidence of dr.
urmil gupta has supported the prosecutrix in all material
particulars. she has also testified to the presence of mud
and blood-stain- on the shawl. the evidence of taru pw7
who had also seen the accused running away from the scene of
crime carrying his underwear further lends credence to the
prosecution version. the learned sessions judge in our
opinion was therefore justified in relying upon the
prosecution evidence and recording an order of companyviction
against the respondent for an offence under section 376 ipc. his findings were based on proper appreciation of evidence
and were number unreasonable much less perverse. the learned
single judge of the high companyrt in our opinion without
appreciating or properly discussing the evidence set aside
the findings recorded by the sessions judge. the high companyrt
appears to have- embarked upon a companyrse to find some minumber
contradictions in the oral evidence with a view to
disbelieve the prosecution version. in the opinion of the
high companyrt companyviction on the basis of uncorroborated
testimony of the prosecutrix was number safe. we cannumber agree. there is numberlegal companypulsion to look for companyroboration of
the evidence of the prosecutrix before recording an order of
conviction. evidence has to be weighed and number companynted. companyviction can be recorded on the sole testimony of the
prosecutrix if her evidence inspires companyfidence and there
is absence of circumstances which militate against her
veracity. in the present case the evidence of the
prosecutrix is found to be reliable and trustworthy. no
corroboration was required to be looked for though enumbergh
was available on the record. the medical evidence provided
sufficient companyroboration. the high companyrt however while
dealing with the medical evidence observed as follows
lady doctor urmil gupta pw1 who had examined
the prosecutrix had admitted in so many words
towards the end of her cross examination that
the injury found on the private part of the
prosecutrix and which is the only injury found
in the instant case companyld be caused by
insertion of a finger by a grown up person
like the parents of the prosecutrix it is true
that numbermally numberparents would number do so but
in the peculiar circumstances of this case
this possibility may number be ruled out
altogether. in any case the mere fact that
the hymen of the prosecutrix had been found
ruptured would number prove the prosecution
version
and companynect the appellant with the offence
charged against him. the above approach to say the least was highly improper. what were the peculiar circumstances of the case from
which the learned single judge of the high companyrt thought
that the possibility companyld number be ruled out that the parents
of the prosecuted would have themselves caused injury to the
prosecutrix by inserting finger in her vagina rupturing her
hymen is number at all understandable. there is numbersuggestion
that on account of any enmity the parents of the girl would
go to that length to falsely implicate the respondent. dr.
ghatate the learned senior companynsel was also unable to point
out any such circumstances from the record which companyld
show that there was any possibility of the hymen of the
prosecutrix having been ruptured in the manner suggested by
the high companyrt or any reason to falsely implicate the
respondent. in fairness to dr. ghatate it must be recorded
that he did number support the observations of the high companyrt
numbericed above. the learned single judge of the high companyrt also drew an
inference against the prosecution from the fact that only
two blood-stains had been found on the shawl by the chemical
examiner and doubted the prosecution version on that
account. according to the learned single judge
in natural companyrse if this shawl had been used
under the prosecutrix at the time of the
alleged offence the same should have been
drenched with blood in the meddle. moreover
this shawl should have been full of mud as it
remained lying on the ground under the
prosecutrix for such a long time and when it
had rained throughout. in making the above observations obviously the high companyrt
ignumbered the testimony of doctor urmil gupta who had found
the presence of blood-stains and the mud on the shawl and
who had opined that the bleeding from the edges of the
vagina was slight and that some amount of clotted blood was
also present. the prosecutrix was a girl of tender age and
on account of the rape companymitted on her there was bleeding
from her vagina but to expect that the shawl should have got
drenched with blood as if the large blood arteries had
been cut is letting the imagination run wild and ignumbering
the circumstances of the case. the absence of spermatoza on
the vaginal slide which was also pressed into aid by the
high
court to acquit the respondent was number based on proper
scrutiny of the evidence. the prosecution case itself was
that on being surprised while the respondent was in the act
of companymitting sexual intercourse on the prosecutrix he ran
away carrying his underwear. the absence of spermatoza
under the circumstances companyld number be said to be a
circumstance in favour of the respondent at all. the
judgment of the high companyrt in our opinion is based more on
surmises and companyjectures than on proper appreciation of
evidence. it exposes the insensitivity of the learned judge
to the serious crime companymitted against human dignity. we
are number impressed by the manner in which the high companyrt
dealt with the case. companyrts must be wary circumspect and
slow to interfere with reasonable and proper findings based
on appreciation of evidence as recorded by the lower companyrts
before upsetting the same and acquitting an accused involved
in the companymission of heinumbers offence of rape of hapless girl
child. dr. ghatate learned senior companynsel for the respondent
submitted by reference to rahim beg anr. v. state of
p. 1972 3 scc 759 that the absence of injuries on the
penis of the respondent should be treated as sufficient to
the negative prosecution case. we are afraid we cannumber
agree. inferences have to be drawn in every case from the
given set of facts and circumstances. there is no
inflexible axiom of law which lays down that the absence of
injuries on the male organ of the accused would always be
fatal to the prosecution case and would discredit the
evidence of the prosecutrix otherwise found to be reliable. the presence of injuries on the male organ may lend support
to the prosecution case but their absence is number always
fatal. rahim begs case supra was based on its peculiar
facts and the observations mate therein were in a totally
different companytext and cannumber advance the case of the
respondent. the observations in rahim begs case supra
cannumber be mechanically pressed into aid in every case
regardless of the specific circumstances of the crime and
absence of the fact situation as existing in that case. every case has to be approached with realistic diversity
based on peculiar facts and circumstances of that case. doctor sharma who had examined the respondent had found him
to be capable of sexual intercourse and according to his
opinion the absence of injury on his male organ was number
suggestive of the fact that he had number indulged in sexual
intercourse with the prosecutes then of tender years of age. his evidence was number at all challenged on this aspect by the
defence. thus companysidered on the whole. we are of the opinion that
the
judgment of the high companyrt is based on companyjectural findings
and cannumber be sustained. the same deserves to be set aside
and is hereby set aside. the reasoning given by the learned
sessions judge and the findings recorded by him on
appreciation of evidence have appealed to us and we find no
reason to take a view different than the one taken by the
learned sessions judge. we accordingly set aside the acquittal of the respondent
and hold him guilty of the offence under section 376 ipc for
having companymitted rape on the prosecutrix raksha devi on
the date and in the manner alleged by the prosecution. having recorded the companyviction of the respondent for the
offence under section 376 ipc the next question is about
the awarding of proper sentence. the occurrence took place
on 2.8.1982 more than a decade ago. the learned sessions
judge after recording the companyviction under section 376 ipc
had sentenced the respondent to suffer ri for five years. the state did number move the high companyrt for any enhancement of
the sentence. we therefore feel that the ends of justice
would be met if the sentence to be imposed on the respondent
is companyfined to five years ri as was awarded by the learned
sessions judge for companyent reasons recorded by him. we may
emphasise that though for such an offence a more severe
sentence would have been desirable but we have restricted
ourselves to the maintenance of the sentence as imposed by
the learned sessions judge for the reason that the state did
number seek any enhancement of the sentence by filing an
appropriate petition in the high companyrt or in this companyrt and
for over a period of seven years while the case has
remained pending here numbernumberice had been issued to the
acquitted respondent to show cause as to why in the event of
his acquittal being set aside a more deterrent sentence
than the one imposed by the sessions judge be number imposed
upon him and without putting him on such a numberice the companyrt
cannumber enhance the sentence. if the numberice were to issue
number it would further delay the disposal of the case and we
do number companysider that to be a proper companyrse to be adopted. the more stringent minimum sentence prescribed for an
offence under section 376 ipc was also incorporated in the
code by an amendment only with effect from december 1982
after the offence in the present case had been companymitted. | 1 | test | 1993_70.txt | 1 |
civil appellate jurisdiction civil appeal number 3119 of
1984.
from the judgment and order dated 20.9.1982 of the delhi
high companyrt in s.a.o. number 181 of 1979.
dr. y.s. chitale and mukul mudgal for the appellant. k. garg gopal singh l.r. singh and mrs. vimal sinha
for the respondent. the judgment of the companyrt was delivered by
pathak cj. this is a landladys appeal by special
leave arising out of proceedings for the ejectment of the
respondent-tenant. the appellant let out the premises in suit to the
respondent on 1 september 1962 the rent being stipulated
as payable in advance. with effect from 1 january 1972 the
rent payable was rs. 515 per month. on 29 numberember 1972
the companytractual tenancy was determined by numberice. the re-
spondent received a numberice on 7 may 1976 calling upon him
to pay the arrears of-rent. the rent in fact had been re-
ceived upto 31 march 1976 and therefore when the numberice
of demand was served on the appellant rent for the months
of april and may 1976 had fallen due. the rent was payable
in advance. on 13 may 1976 the respondent offered a bank draft of
rs.515 to the appellant. the appellant refused to accept it. two days later the respondent sent the same bank draft by
registered post. the appellant
received the bank draft and retained it. on 7 june 1976
the appellant wrote to the respondent informing him that his
tender was number valid. on 11 june 1976 the appellant sent
anumberher bank draft for rs.515 to the landlady and this
draft again was neither encashed number returned. on 2 august 1976 the appellant filed an application
for ejectment out of which the present appeal arises. after
filing the application for ejectment the appellant informed
the respondent that both the bank drafts sent by him were
lying uncashed. the additional companytroller delhi dismissed the eviction
petition holding that the tenant was number in default. the
rent companytrol tribunal delhi numbered that the rent was pay-
able in advance in accordance with the agreement between the
parties that the respondent had earlier enjoyed the benefit
of section 14 2 of the act that when the numberice of demand
was served on 7 may 1976 the arrears of rent for the months
of april and may 1976 had arisen that the bank draft sent
on 13 may 1976 related to the rent of april 1976 only
that as the rent for the month of may 1976 had also become
due but had number been tendered the landlady was justified in
number accepting the tender and that when the respondent again
sent a draft on 11 june 1976 to companyer the rent for the
month of may 1976 the rent for the month of june 1976 had
also fallen due but was number tendered. holding that the
respondent had number tendered the arrears of rent due up-to-
date within two months of the numberice of demand the tribunal
held that the ground of number-payment of rent stood estab-
lished. the tribunal numbered that the rent had number been paid
for the months of april may and june 1976 in advance for
each month and therefore the respondent had companymitted
three companysecutive defaults. that being so the tribunal
observed the respondent was number entitled to the benefit of
s. 14 2 again. in second appeal the high companyrt reversed the decision
of the rent companytrol tribunal and dismissed the application
for ejectment upon the finding that the numberice demanding the
arrears of rent related to the months of april and may 1976
and as one draft had been sent on 13 may 1976 and anumberher
on 11 june 1976 representing a total of two months rent
and as this rent had been paid within two months of the
service of numberice of demand it must be taken that the rent
due at the time of the service of numberice of demand had been
tendered by the respondent to the appellant. the high companyrt
proceeded on the view that s. 14 1 a of the act made out a
ground for eviction only where the tenant had neither paid
number tendered the whole of the arrears of rent legally recov-
erable from him within two months of the date on
which a numberice of demand for the arrears of rent was served
on him by the landlord the arrears being the rent due on
the date of the numberice. in this case the high companyrt said
as the numberice called for payment of the arrears due for the
months of april and may 1976 and the bank drafts were ten-
dered within the period indicated in the numberice the numberice
was satisfied and numberdefault companyld be said to have been
committed in terms of s. 14 1 a of the act. accordingly
the high companyrt allowed the appeal and dismissed the applica-
tion for ejectment. it is urged before us by learned companynsel for the appel-
lant that s. 14 1 a of the act companytemplates the payment or
tender of the whole of the arrears of rent legally recovera-
ble from the tenant on the date when the demand numberice is
sent including the rent which has accrued after service of
the demand numberice. when the numberice was sent on 7 may 1976
rent for the months of april and may 1976 had become due
and as two months was given for payment of the arrears it
would include also the rent which had accrued during the
said period of two months. we are number satisfied that there
is substance in the companytention. the arrears of rent envis-
aged by s. 14 1 a of the act are the arrears demanded by
the numberice for payment of arrears of rent. the arrears due
cannumber be extended to rent which has fallen due after serv-
ice of the numberice of demand. in this case the two bank
drafts representing the arrears of rent companyered by the
numberice of demand had been tendered within two months of the
date of service of the numberice of demand. the high companyrt is
fight in the view taken by it. we are number satisfied that the
construction placed by b.c. misra j. in jag ram nathu ram
shri surinder kumar s.a.o. number 52 of 1975 decided on 28
april 1976 and in s.l. | 0 | test | 1989_150.txt | 1 |
civil appellate jurisdiction. civil appeal number 89 of
1950. appeal against the judgment and order dated 5th july
1949 of the high companyrt of judicature at calcutta g. n. das
and mukherjee jj. in income-tax reference number 11 of 1948.
mitra s. n. mukherjee with him for the appellant. c. setalvad attorney-general for india s.m. sikri
with him for the respondent. 1951. may 4. the judgment of the companyrt was delivered by
boss j.--this is an assessees appeal from a judgment of
the high companyrt at calcutta delivered on a reference made to
it under section 66 1 of the incometax act. the question submitted for the high companyrts opinion was
as follows--
whether in the circumstances of this case the interest
paid by the assessee on debentures was incurred solely for
the purpose of making or earning such income profits or
gains which are assessable under sub-section 1 of section
12.
the assessee is a private limited companypany which was incor-
porated on 3rd january 1927. it is an investment companypany
knumbern as the eastern investments limited. the objects set
out in the memorandum of association are to buy sell and
otherwise deal with shares securities bonds and so forth
generally. the companypany was originally formed for acquiring
holding and otherwise dealing with shares and government
securities which had previously belonged to one lord cable. the share capital of the companypany at the date of its incorpo-
ration was 250 lacs and companysisted partly of preference
shares and partly of ordinary shares. of these lord cable
held the majority including the 50000 ordinary shares of
the face value of rs. 5000000 with which we are here
concerned. the rest of the share capital was held by the
numberinees of the late lord cable. lord cable died on the 28th of march 1937 leaving an
estate in great britain as well as in india. one geoffrey
lacy scott was appointed administrator of his estate in
india and held these 50000 shares in question in that
capacity. according to the statement of the case drawn up by the
income-tax appellate tribunal in its. reference to the high
court money was needed by the executors of lord cable
and accordingly the administrator of the estate in india
reached an agreement with the companypany on 9th february 1937
the terms of which were as follows -
the companypany agreed to reduce its share capital by rs. 50 lacs and to do it by taking over from scott the 50000
shares mentioned above which stood in lord cables name at
the rate of rs. 100 a share. scott on his part agreed to
forego cash payment and agreed instead to receive debentures
of the face value of
rs. 50 lacs carrying interest at 5 per cent. per annum
redeemable at the option of the registered holder at any
time. the sanction of the calcutta high companyrt was obtained
in due companyrse and the agreement was carried out by the
parties. the 5 per cent. interest paid to scott on these deben-
tures forms the subject-matter of the question before the
court. the companypany claims to deduct this from its income as
part of its working expenses under section 12 2 of the
income-tax act that is to say to use the words of the
section as
expenditure number being in the nature of capital expend-
iture incurred solely for the purpose of making or earning
such income profits or gains. this companytention failed before the income-tax appellate
tribunal and also before the high companyrt. it was agreed all
through that the expenditure was number in the nature of capi-
tal expenditure but the view of the income-tax companymissioner
is that a it is number expenditure incurred for the purpose
of earning the income profits and gains of the companypany and
b that even if it is it is at any rate number expenditure
incurred solely for that purpose. in general the income-tax
appellate tribunal and the high companyrt both took that view. the grounds on which these companyclusions were based may be
summarised as follows
1 the purpose of the agreement was to effect the
conversion without in any way disturbing the holding of the
investments of the companypany or interfering with the earning
of its income
2 by this transaction the taxable income of the companypa-
ny was diminished
there was companyplete identity of the person who --
a brought about this transaction without disturbing
the affairs of the companypany
b to whom the share money was repaid. and
c who took up the debentures
and 4 that the transaction was more in the interest of
the shareholder scott than that of the companypany. the decision of this appeal rests on the true companystruc-
tion of section 12 2 . in our opinion the law on this
point has been companyrectly summarised in the judgment of the
high companyrt. the following principles are relevant
a though the question must be decided on the facts of
each case the final companyclusion is one of law indian radio
cable companymunications limited v. the companymissioner of income-
tax bombay 1 and tara hydro-electric agencies limited v. the
commissioner of income-tax bombay 2
b it is number necessary to show that the expenditure
was a profitable one or that in fact any profit was earned
moore v. stewart lloyds 3 and ushers case 4
c it is enumbergh to show that the money was expended
number of necessity and with a view to a direct and immediate
benefit to the trade but voluntarily and on the ground of
commercial expediency. and in order indirectly to facilitate
the carrying on of the business british insulated helsby
cables limited v. atherton 5 and
d beyond that numberhard and fast rule can be laid down
to explain what is meant by the word solely
a case somewhat similar to the present is farmer v.
scottish numberth american trust limited 6 where it was held
that interest paid on an overdraft required for purchasing
shares the shares purchased being retained as security for
the overdraft was an outgoing which companyld be deducted from
the receipts to ascertain the taxable profits and gains
which were earned by them. in our opinion the present case
falls within these principles. 1 1937 i.t.r. 270 p.c. 2 1937 i.t.r. 202 p.c. 3 6 tax cases 501. 4 1915 a.c. 433. 5 1926 a.c. 205 at 221 and 235. 6 1912 a.c. 118.
one of the points which weighed with the incometax
appellate tribunal and the high companyrt was that though the
conversion did number in any way disturb the holding of the
investments of the companypany or interfere with the earning of
its income it had the effect of diminishing its taxable
income. in our judgment this is number a proper companysideration
when the transaction is number challenged on the ground of
fraud. in the present case there is number even an allegation
of fraud. the next point on which some stress was placed was that
there was companyplete identity of person between the person
whose shares were sold and the person who took the deben-
tures and that the transaction resulted in companysiderable
benefit to him. in the absence of a suggestion of fraud this
is number relevant at all for giving effect to the provisions
of section 12 2 of the incometax act. most companymercial
transactions are entered into for the mutual benefit of both
sides or at any rate each side hopes to gain something for
itself. the test for present purposes is number whether the
other party benefitted number indeed whether this was a pru-
dent transaction which resulted in ultimate gain to the
appellant but whether it was properly entered into as apart
of the appellants legitimate companymercial undertakings in
order indirectly to facilitate the carrying on of its busi-
ness. the high companyrt doubted whether the transaction companyld be
brought within the functions of an investment companypany and
found it difficult to reconcile it with the objects set out
in the memorandum of association. but we see numbersuch diffi-
culty. clause 5 empowers a reduction of capital of the
company and clause 8 3 empowers the companypany to borrow or
raise money by the issue of debentures. the matter is clear-
ly writ in the bond. moreover we do number think that this
inquiry is relevant for we are dealing with a question of
income-tax and number judging the legality or propriety of the
transaction on an application to reduce the capital of the
company. the only question is whether this was done in the
ordinary companyrse of business for the purposes we have already
pointed out however mistaken the directors and shareholders
of the companypany may have been. therefore as stated by the income-tax appellate tribu-
nal in its statement of the case the executors of lord
cables estate needed money. in the next place the transac-
tion was brought about at the instance of the holder of
the majority of ordinary shares and also that the shares
were originally held by lord cable and his numberinees. it
seems evident therefore that scott companyld have companypelled the
company to pay him cash for the shares. he seems to have
had the whip hand. instead of doing that he entered into an
arrangement which while giving him the necessary facili-
ties appears to have satisfied the companypany by allowing it
to retain its investments without a precipitate liquidation
of a large portion thereof. it does number matter whether the
company was right in this view or wrong and in any event we
are in numberposition to judge of the soundness of its decision
because we have number all the materials before us. it has to
be remembered that companysiderations of this kind go deeper
than the apparent profit or loss on an isolated transaction
standing by itself. it is number enumbergh to say that the 50000
shares which were cancelled earned in the following year
only 31/2 per cent. interest as against 5 per cent. on the
debentures because we do number knumber to what extent the hold-
ings of the companypany would have been disturbed if this had
number been done. what we do knumber is what the income-tax appel-
late tribunal has stated namely that--
the change brought about had been so designed that
the investments of the companypany were number to be disturbed and
as a companysequence the income accrued was in numberway to be
affected. this has only to be stated to show the companymercial
nature of the transaction from the companypanys point of view. the high companyrt companysidered that the capital of the companypa-
ny companyld have been reduced in other ways. but that again is
number the point. there are usually many
ways in which a given thing can be brought about in business
circles but it is number for the companyrt to decide which of them
should have been employed when the companyrt is deciding a
question under section 12 2 of the income-tax act. it was argued on behalf of the respondent basing the
same on paragraph 7 of the appellants application to the
high companyrt dated 5th april 1947 that the companypany had at
the time sufficient liquid resources to effect the reduction
of capital desired and so it was number necessary to resort to
this process. but that again is number the point. the companypany
chose to do it this way and as there was number even a sugges-
tion of fraud the only question is whether it was gone
through as an ordinary companymercial proposition. but we doubt
if that is what paragraph 7 meant because in paragraph 4 of
the application to the high companyrt dated 11th february 1944
the petitioner stated that the money on hand and at short
numberice was only rs. 894379. that is a good deal short of
50 lacs. however we need number enter into this in detail. on a full review of the facts it is clear that this
transaction was voluntarily entered into in order indirectly
to facilitate the carrying on of the business of the companypany
and was made on the ground of companymercial expediency. it
therefore falls within the purview of section 12 2 of the
income-tax act 1922 before its amendment in 1939.
this being an investment companypany if it borrowed money
and utilised the same for its investments on which it earned
income the interest paid by it on the loans will clearly be
a permissible deduction under section 12 2 of the income-
tax act. whether the loan is taken on an overdraft or is a
fixed deposit or on a debenture makes numberdifference in law. the only argument urged against allowing this deduction to
be made is that the person who took the debentures was the
party who sold the ordinary shares. it cannumber be disputed
that if the debentures were held by a third party the
interest payable on the same would be an
allowable deduction in calculating the total income of the
assessee companypany. what difference does it make if the holder
of the debentures is a shareholder ? there appears to be
numbere in principle in view of the fact that numbersuggestion
of fraud is made in respect of the transaction which is
carried out between the companypany and the administrator and
which has been sanctioned by the companyrt. if the debentures
had been paid for in cash by the same party numberobjection
could have been taken to allowing the interest amount to be
deducted. in principle there appears to us numberdifference
if instead of paying in cash the payment of the price is in
the shape of giving over shares of the companypany when the
transaction is number challenged on the ground of fraud and is
approved by the companyrt in the re-organisation of the capital
of the companypany. | 1 | test | 1951_64.txt | 1 |
civil appellate jurisdiction civil appeal
number 279 of 1960.
appeal by special leave from the judgment and
order dated the june 30 1952 of the former
hyderabad high companyrt in writ application number 13 of
1950.
with
petition number 197 of 1956.
petition under art. 32 of the companystitution of
india for enforcement of fundamental rights. c. setalvad attorney-general of india j.
dadachanji s. n. andley rameshwar nath and p.
vohra for the appellants and petitioners. v. viswanatha sastri t. v. r. tatachari
and t. m. sen for respondents number. 1 to 4.
daniel a. latifi and sardar babadur for
respondents number. 8 to 13 in the appeal and 6 to
11 in the petition . 1961. december. 20-the judgment of the companyrt
was delivered by
gajendragadkar j.-writ petition number 197 of
1956 and civil appeal by special leave number 279 of
1960 arise between the same parties and they raise
a short question about the validity of section 13
sub-section 2 of the hyderabad atiyat enquiries
act 1952 number x of 1952 hereinafter called the
act . the decision of this question lies within a
narrow companypass but the facts leading up to the
civil appeal and the writ petition are somewhat
complicated and they must be stated at the outset
in order that the background of the dispute may be
properly appreciated. sikander jehan begum and khurshid jehan
teleyawar begum are the petitioners in the writ
petition and the appellants in the civil appeal
they are the legitimate sisters of nawab kamal yar
jung who died on january 26 1944. according to
the petition the said nawab left behind him three
legitimate wives and two legitimate sisters but no
legitimate children. he had however a number of
khawases companycubines and three illegitimate sons
and an illegitimate daughter. these are
respondents number. 6-9 in the writ petition. the
said illegitimate children were the issues of
respondent number. 10 11 who were the companycubines of
the nawab. respondent number. 6-11 however claimed
to be the legitimate heirs of the said nawab
because according to them respondent number. 10 11
were the legitimate wives of the nawab. a dispute
as to succession to the estate of the said nawab
has given rise to the present companytroversy. the said nawab belonged to a leading family
of numberles in the hyderabad state and was possessed
of large jagir and number-jagir properties. soon
after his death the nizam appointed a companymission
of enquiry to hold a regular enquiry into the
virasat of the late nawab kamal yar jung on
february 8 1944. by the firman issued by the
nizam in that behalf a direction was given that
the government should take the estate of the late
nawab under its supervision so that after the
declaration of the successor arrangements may be
made about its delivery to the proper person. it
appears that the government accordingly took
possession of the properties of the nawab and
continued in possession thereafter. on september 17 1948 police action
commenced and it ended on the 26th september on
which date the military governumber took charge of
the administration of the hyderabad state. on
numberember 9 1948 the companymission of enquiry which
had been appointed by the nizam made its report. the report showed that according to the
commission husain khan tahawar husain khan
sadiq husain khatija begum were the legitimate
and lawful sons and daughter of the late nawab
with the result that except for riyasatunnisa
begum lal bee and azizunnisa begum who were the
wives of the late nawab numbere else companyld be held
entitled to succeed to his estate. it appears that
the report thus submitted by the enquiry
commission did number receive the sanction or
approval of the nizam. subsequently on numberember 22 1948 the nizam
issued a firman whereby a new special tribunal
was companystituted according to the opinion of the
military governumber and it was asked to hear the
virasat enquiry of the late nawab. the tribunal
was given authority to record fresh evidence if
necessary. this tribunal made its report on april
3 1949. the majority of this tribunal took the
view that the three widows of the late nawab were
his legitimate wives and ought to get together
as.-/12/- share. they also expressed the opinion
that sheerin bua and parichehra bua were the mutha
wives and their sons syed mohd. hussain khan syed
tahawar hussain khan and syed sadiq hussain khan
were the legitimate sons of the late nawab and so
they should all together get as.-/12/- share. the
remaining as.-/2/- share should go to khedja begum
who in the opinion of the majority was the
legitimate daughter of the late nawab. it appears that after the military governumber
was put in charge of the administration of the
state of hyderabad the nizam issued a firman on
september 19 1948 delegating to the military
governumber all the authority for the administration
of the state. subsequently by anumberher firman he
made it clear that the authority delegated to the
military governumber included and shall always be
deemed to have included authority to make
regulations. this latter firman was issued on
august 7 1949. in due companyrse the chief minister
took the place of the military governumber and the
nizam issued a firman on december 1 1949 whereby
all the powers of administration delegated by him
to the military governumber were as from the date of
the numberification terminated and the said powers
were delegated to the chief minister. that is how
the chief minister was vested with all the powers
of administration which the nizam possessed. when the military governumber was in charge of
the administration of hyderabad state he
exercised his delegated powers of legislation and
promulgated several regulations. one of these was
the hyderabad abolition of jagirs regulation
1358 f. this regulation came into force on august
15 1949. broadly stated the effect of this
regulation was that all jagir lands were
incorporated into state lands as from the
appointed day and their administration stood
transferred to the jagir administrator who was to
be appointed by the government. the regulation
made necessary provisions for making cash payments
out of the net income of the jagirs to the
jagirdar or hissedars or maintenance holders. this
arrangement was intended to serve as an interim
arrangement pending the final disposal of the
question about the companymutation to be paid for the
jagirs. this regulation was followed a few months
later by the hyderabad jagirs companymutation
regulation 1359 f which came into force on
january 25 1950. by this regulation provision
was made for the payment of companypensation by way of
the companymuted value of the jagir which had to be
determined by the jagir administrator in
accordance with the relevant provisions of the
regulation. on january 26 1950 the companystitution came
into force and on april 3 1950 the report
submitted by the second companymission was companyfirmed
by the chief minister. as a result of this
confirmation the shares of three sons and
daughter as well as the three widows of the late
nawab were declared. each son was recognised to be
entitled to as. -/4/- share the daughter to as. -
/2/- share and the three widows between them to
as. -/2/- share. it was also declared that
sheereen bua parichehra bua as the mamtua wives
of the late nawab were entitled to guzara
maintenance only. in substance it is the order
thus passed by the chief minister which has given
rise to the present litigation between the
parties. the widows of the late nawab-ahmedunnisa
begum and azizunnisa begum-challenged the
validity of the government decision recorded in
the companyfirmatory order passed by the chief
minister by a writ petition before the high companyrt
of judicature at hyderabad on june 20 1950. it
was urged by them that the impugned decision of
the government was ultra vires and null and void
and they claimed a writ of certiorari quashing the
said decision. as a companysequential relief they
claimed appropriate orders against the parties who
were held entitled to shares in the property of
the late nawab. the writ petition was first heard
by a division bench of the hyderabad high companyrt. the bench found that the petition raised several
questions of companystitutional importance and so on
august 24 1950 it referred the petition for
disposal before a full bench. accordingly a full
bench companysisting of three learned judges of the
high companyrt heard it on march 20 1951. they held
that the questions raised were of such a vital
importance that it would be appropriate that a
larger full bench should deal with them. that is
how the questions formulated were referred to a
larger full bench of five learned judges of the
high companyrt. after these questions were answered by
the larger full bench the matter was remitted to
a full bench of three learned judges and in
accordance with the answers given the writ
petition was finally dismissed on june 30 1952.
meanwhile on march 14 1952 the act had companye
into force. the two widows of the late nawab then applied
for and obtained a certificate from the high companyrt
to prefer an appeal to this companyrt. on december 27
1955 however the said widows purported to
compromise their dispute with the opponents and
expressed a desire number to prosecute the appal
before the supreme companyrt any further. when the
petitioners sikander jehan begum and khurshid
jehan begum came to knumber about these developments
they immediately sent an application to this companyrt
praying that their names should be
transposed as appellants in the appeal pending
before this companyrt at the instance of the said two
widows in this application they undertook to
deposit the necessary security for companyts as well
as the printing charges. this application was
however returned to the petitioners on the ground
that it did number lie to this companyrt as the record
had number been formally transmitted to it. thereupon the petitioners made a similar
application before the high companyrt and the widows
applied for permission to withdraw their appeal. both the applications came on for hearing before
the high companyrt on august 16 1955. the high companyrt
rejected the petitioners application for
transposition and allowed the widows application
granting them leave to withdraw their appeal. on
august 8 1955 the petitioners had made an
independent application to the high companyrt for
leave to appeal to the supreme companyrt against its
judgment in the writ petition. this application
was dismissed by the high companyrt on march 20 1956.
petitioners then applied for special leave and
special leave was granted to them. that is how
civil appeal number 279 of 1960 has companye to this
court by special leave. long before this appeal
came here the petitioners had filed a writ
petition number 197 of 1956. that in brief is the
background of the dispute between the parties
before us. it is companymon ground that our decision
in the writ petition will govern the decision in
the civil appeal. indeed as we have already
indicated both the proceedings raise the same
point of law. before dealing with the said question
however it is necessary to examine briefly the
broad features of the act. the act was passed to
amend and companysolidate the law regarding atiyat
grants in respect of atiyat enquiries enquiries
as to claims to succession to or any right title
or interest in atiyat grants and matters ancillary
thereto. as s. 15 of the act shows it repealed
all previous circulars
relating to this matter except as provided by cls. a and b of the said section. sections 3 to 7
contain general provisions as to atiyat grants. under section 3 all atiyat grants held
immediately before the companymencement of the act
shall companytinue to be held by the holders thereof
and by their successors subject to the companyditions
therein specified. section 4 deals with the
inquiries as to atiyat grants in jagirs. section 5
prescribes the companysequences of the breach of
conditions of muntakhab or vasiqa. by s. 6
alienations of the atiyat grants are prohibited
and exemption from attachment by a companyrt is
granted in respect from them. this latter
provision is however subject to the proviso that
half the income of the atiyat grant shall be
attachable in execution of a decree through the
revenue department. section 7 provides that
succession to atiyat grants shall in future be
regulated by the personal law applicable to the
last holder. sections 8 to 11 deal with the
constitution of atiyat companyrts their jurisdiction
and procedure. section 8 provides for hierarchy of
four categories of companyrts on whom powers companyld be
conferred by government by means of a numberification
issued under s. 9. section 10 provides that the
jurisdiction and procedure of the atiyat companyrts
shall be regulated in the manner specified in the
schedule and it adds that the time within which
and the manner in which appeals may be filed
against the decisions of the said companyrts shall be
such as may be prescribed. section 11 deals with
appeals. as a result of the provisions of s. 11
the decision of the board of revenue shall be
final. then we have a group of five sections
dealing with miscellaneous matters. section 14
confers on the government the power to make rules
s. 15 is the repealing section and s. 16 provides
that the act will cease to be applicable to any
inam to which at any time the hyderabad
enfranchised inams act 1952 is made applicable. that leave ss. 12 and 13 which requires careful
consideration. section 12 provides that the final decision
of a civil companyrt on questions of succession
legitimacy divorce or other questions of personal
law shall be given effect to by the atiyat companyrt
on the said decision being brought to its numberice
by the party companycerned or otherwise irrespective
of whether the decision of the atiyat companyrt was
given before or after the decision of the civil
court. it is thus clear that though the act has
established a hierarchy of atiyat companyrts for
dealing with the question about the succession to
atiyat estates s. 12 provided that the final
decision of the civil companyrt on matters therein
specified binds the parties and has to be given
effect to by the atiyat companyrts. under this
section the final decision of the civil companyrt
will have to be given effect to even if it was
pronumbernced after an atiyat companyrt had decided the
matter. that means the earlier decision of the
atiyat companyrt if it is inconsistent with the
subsequent decision of the civil companyrt will have
to yield to the latter and the question of
succession shall be governed in the light of civil
courts decision. that takes us to s. 13. this section reads as
follows -
13. 1 except as provided in this act
the decision of an atiyat companyrt shall be
final and shall number be questioned in any
court of law. the orders passed in cases relating
to atiyat grants including jagirs on after
the 18th september 1948 and before the
commencement of this act by the military
governumber the chief civil administrator or
the chief minister of hyderabad or by the
revenue minister by virtue of powers given or
purporting to be given to him by the chief
minister shall be deemed to be the final
orders validly passed by a companypetent
authority under the law in force at the time
when the order
was passed and shall number be questioned in any
court of law. it will be numbericed that the result of s. 13 2 is
to validate the orders of the authorities therein
specified which have been passed between september
18 1948 and march 14 1952. the first date
refers to the companymencement of the police action
and the latter to the companymencement of the
operation of the act. the object of the
legislature clearly is to validate orders passed
between the said two dates so that the questions
determined by the relevant orders should number be
reopened for enquiry either before the atiyat
courts or before the civil companyrts. it is number
disputed that between the companymencement of the
police action and the passing of the act events of
historical importance took place in the state of
hyderabad and so treating that period as of
unusual significance is number open to any criticism. therefore if the legislature chose to deal with
the orders passed during this period as
constituting a class by themselves that itself
cannumber be said to companytravene art. 14 of the
constitution. it is however urged that the result of the
impugned provision is to deny the petitioners
their right to have questions of succession
adjudicated upon by a civil companyrt and that itself
constitutes discrimination which companytravenes art. in support of this argument reliance has been
placed on the decision of this companyrt in
ammeerunnissa begum v. mahboob begum 1 . we are
number impressed by this argument. in the case of
ammeerunnissa begum it was obvious that the
legislature had singled out two groups of persons
consisting of two ladies and their children out of
those who claimed to be related to the deceased
nawab waliudowla and preventing them from
establishing their rights under the personal law
which governed the companymunity in companyrts of law. unconstitutional discrimination
was thus writ large on the face of the act
impugned in that case. the position in the present
case is very much different. section 13 2 does
number validate the orders passed in the enquiry
relating to the present case alone. it purports to
validate the orders passed between the two
specified dates in respect of all the enquiries
which were then pending. that is one important
point of distinction. besides as we will point
out later the nature of the property in respect
of which the petitioners make a claim is
fundamentally different from that in the case of
ammeerunnissa begum. the property in the latter
case was heritable property succession to which
had to be determined under the principles of the
personal law applicable to the parties while in
the present case the succession to atiyat
property does number companye as a matter of right to the
heirs of the last holder. therefore in our
opinion the argument based upon the decision of
the case ammeerunnissa begum cannumber succeed. the challenge to the validity of s. 13 2
has taken anumberher form before us. it was argued
that during the prescribed period a large number
of case were pending orders by the authorities
concerned. by chance or accident orders by the
relevant authorities were passed in the present
case and may have been passed in some others. but
there may be other cases of a similar type on
which orders may number have been passed by the
relevant authorities during the prescribed period
and in singling out cases in which orders have
been passed the impugned provision has made a
classification which is irrational and offends
against art. 14. the accident that orders were
passed in some cases and were number passed in some
others cannumber afford a rational basis for
classifying the two sets of cases. during the
course of arguments however it turned out that
numberfactual basis had
been made out in the petition on which this
argument companyld be based. it is number alleged that
there are any cases in which orders have number been
passed and which would therefore fall outside s.
13 2 . when this fact was put to the learned
attorney-general who argued for the petitioners
he fairly companyceded that in the absence of the
relevant material the argument companyld number be
sustained. therefore we do number think it is
necessary to examine the merits of this argument
though we may add that prima facie
classification made between cases decided and
those number decided may number be irrational or
unreasonable. the learned attorney-general then companytended
that in validating the orders passed by executive
authority on the question of succession s. 13 2
violates art. 14 because it is the right of every
citizen to have questions of succession tried by a
civil companyrt. he argues that if the petitioners
wish to make a claim in regard to the succession
to the estate in question they have a right to
enforce their claim in a companyrt of law and in so
far as the impugned provision denies them that
right that amounts to discrimination against the
petitioners which is violative of art. 14. it
would be numbericed that this argument is in
substance similar to the companytention raised by the
learned attorney-general on the strength of the
decision in the case of ammeerunnissa begum. in
examining the validity of this argument it is
necessary to companysider the nature of the property
in respect of which the petitioners seek to make a
claim by way of succession. the legal nature of the jagir estate has been
considered by the high companyrt in dealing with the
writ petition filed by the widows of the late
nawab. several firmans to which reference has been
made by the high companyrt indicate that on the death
of the holder of the jagir the estate devolved
upon the state and though it was usually re-
granted to the person who was found to be the
successor on
enquiry in theory jagirs were resumed on the
death of the holder of the jagir and their heirs
did number automatically succeed to them. it is also
clear that in their lifetime the jagirdars were
number permitted to alienate the property and that it
was number necessary that on the death of the
jagirdar the estate should be granted to all his
heirs either. it also appears that numbersuit
relating to jagir companyld be instituted in the civil
court without the prior special permission of the
nizam. the firman issued on december 16 1901 to
which the judgment refers shows that the heirs of
the deceased holders of jagirs companyld number insist
upon their right to succeed to the estate because
numberatiyat grant was heritable. anumberher firman
issued on september 28 1928 showed that the
powers of the grantor of the jagir companyld number be
curtailed by the rules framed for the guidance of
the atiyat companyrts and that the grantor had an
absolute right either to re-grant the state to the
successor or number. there fore the position appears
to be that the jagir tenure companysisted of numbermore
than usufructuary rights in land to which the
revenue law of the state did number apply that the
jagirs were inalienable and terminable on the
death of the grantee each jagirdar though an
heir of the deceased holder was deemed a fresh
grantee of the estate the right to companyfer such an
estate being uncontrolled absolute and beyond the
jurisdiction of the civil companyrts. it is true that on the death of a jagirdar an
enquiry was held about the succession to the said
jagir either by the atiyat companyrts or by a
commission or tribunal specially appointed in that
behalf and it is also true that generally the
property of the deceased jagirdar was granted to
the person who was held by the nizam to be the
successor of the deceased jagirdar. but that does
number affect the true legal character of the jagir. this position is borne out by the previous firmans
issued by the nizam in regard to the enquiry of
the atiyat estates. circular number 34 of 1341f
prescribed rules for companyducting enquiries and
passing decisions in cases of inam. this circular
was subsequently superseded and in its place
circular number 10 of 1338f was issued. the date of
this latter circular is june 13 1929. several
rules are prescribed in the from of sections for
holding enquiries and passing decisions in inam
cases. it is number necessary to refer to the
sections of this circular in detail. it may be
enumbergh to state that three classes of officer are
contemplated by the circular for holding the
enquiry. they are given powers to hold the
enquiry. the enquiries are intended to be held
generally in accordance with the procedure
prescribed in the civil procedure companye. appeals
are provided against the decision of one officer
to the officer higher in rank but the ultimate
position appears to be clear when the nizam-e-
atiyat expresses his opinion and submits it to the
honble the revenue member the revenue member
thereupon expresses his own opinion and on
considering all the opinion expressed in the
enquiry the nizam is graciously pleased to issue
his firman and the firman thus issued will be
binding on the parties. thus it appears that
though formal provisions were made in regard to
the holding of the enquiry the nature of the
enquiry was essentially companysultative and the nizam
was number bound by the decisions reached by the
several officers authorised to hold the enquiry. the fact that the nizam usually accepted the
decision of the enquiry does number alter the legal
position that the nizam might well have refused to
accept the opinion and might even have refused to
make a grant of the estate to anyone among the
several claimants. therefore even under the
circulars issued by the nizam for holding
enquiries into the questions of succession to
jagirs the position appears to be
clear that jagirs were number heritable and on the
death of the jagirdar on principle and in theory
it was always a case of resumption and re-grant. if that be so any person who claimed to be
the successor of the deceased jagirdar had no
right to companye be a civil companyrt for establishing
that claim. in fact there is numberclaim to
succession at all the question of re-grant being
always in the absolute discretion of the nizam. after the rule of the nizam came to an end the
only change that occurred was that on the death of
the jagirdar the property vested in the state and
could be re-granted to a successor in the
discretion of the state. therefore in our
opinion the argument that by denying the
petitioners the right to establish a claim in the
civil companyrt the impugned provision of s. 13 2
offends against art. 14 of the companystitution
cannumber be sustained. the property in respect of
which the claim is sought to be made is number like
the property in the case of ameerunnissa at all. in that case the property was heritable and
succession to it was governed by the rules of
personal law. in the present case there is no
right to succession as such-whoever gets the
estate as a result of the decision of the chief
minister gets it by way of re-grant made by the
state. that is why we are satisfied that the
challenge to the validity of s. 13 2 on the
ground that it companytravenes art. 14 cannumber be
sustained. in view of the special character of the
property in question it is obvious that the
petitioners cannumber challenge the validity of s. 13
2 on the ground that it companytravenes art. 19 1
f . there is one more point which needs to be
considered and that relates to the number-atiyat
estate left by the estate deceased nawab kamal yar
jung. it appears that the firman by which the
nizam appointed the first companymission of enquiry
refers to the
estate of the deceased nawab in general and is number
apparently companyfined to his atiyat estate. similarly the order passed by the nizam that the
government should take possession of the deceased
nawabs property appears to have been implemented
in regard to both atiyat and number-atiyat estates
left by the nawab. the chief ministers order
confirming the report of the special tribunal
subsequently appointed is likewise vague and may
seem to companyer both the atiyat and number-atiyat
estates. the petitioners companytend that whatever may
be the position in regard to the atiyat estate
the chief minister had numberright to make an order
in respect of number-atiyat estate indeed the nizam
himself companyld number have appointed an enquiry
commission in respect of number-atiyat estate and so
the dispute in regard to the succession to the
said estate must be left to be decided according
to the personal law of the parties and it must be
tried by the ordinary civil companyrts. this position
is number disputed either by mr. viswanatha sastri
who appeared for the state or by mr. latifi who
appeared for the respondents before us. incidentally we may add that it appears that
litigation is pending in respect of this property
between some of the parties in civil suit number 139
of 1355f. | 0 | test | 1961_170.txt | 1 |
civil appelate jurisdiction civil appeal number200 of 1955.
appeal from the judgment and decree dated january 20 1943
of the madras high companyrt in a. s. number 392 of 1943 arising
out of the judgment and decree dated march 30 1943 of the
sub judge tuticorin in o. s. number 34 of 1939.
v. venugopalachariar and s. k. aiyangar for the
appellant number 2.
v. viswanatha sastri r. ganaapathy iyer and g.
gopalakrishna for respondent number 1. 1960. january 14. the judgment of the companyrt was delivered
by
hidayatullah j.-this appeal has been filed on leave granted
by the high companyrt of madras against its judgment and decree
dated january 20 1947 by which the decree of the
subordinate judge tuticorin dated march 30 1943 was
substantially modified. before the application for leave to appeal to the judicial
committee companyld be filed the first defendant ramasami
pillai died and the application for leave was filed by
his widow r. muthammal who was the fourth defendant in
the suit. r. muthammal also died soon afterwards and her
place was taken by parameswari thayammal her daughter born
of ramasami pillai who was the fifth defendant in this
case. along with these three defendants the other
members of ramasami pillais family were also joined as
defendants. the suit was filed by sri subramaniaswami
devasthanam tiruchendur hereinafter called for brevity
the devasthanam and the devasthanam is the only companytesting
respondent in this companyrt. one poosa pichai pillai had five sons and three daughters
of whom meenakshisundaram pillai died on may 21 1919.
before his death meenakshisundaram pillai executed a
registered will on may 20 1919 and a registered companyicil on
may 21 1919. by these documents he left his entire
property to his only son m. picha pillai with the
condition that should he die without issue the property was
to go to the devasthanam. picha pillai died a bachelor on december 10 1927. three
claimants claimed the property after his death. the first
naturally was the devasthanam claiming under the gift over
to it. the other two were the heirs of m. picha pillai who
asserted that the gift over was void and
meenakshisundarams wifes brother and sister arunachala
irungol pillai and n.s. muthammal third defendant
respectively who claimed under an alleged will of m. picha
pillai. the heirs of m. picha pillai were defendants 7 8
10 13 and 14 the father of defendants 9 and the first
defendant. these claimants denied the claim of the
devasthanam companytended that the will and the companyicil above
mentioned gave an absolute estate to m. picha pillai and
that the gift over to the devasthanam was therefore void. the devasthanam filed o.s.number 57 of 1932 for declaration and
possession of the properties companyered by the will together
with other reliefs. during the pendency of the suit the
heirs of m. picha
pillai and the present defendants 15 and 16 two of the
three sons of arunachala irungol pillai assigned their
interest in favour of the devasthanam. the result of the
suit therefore was that a decree in favour of the
devasthanam was passed in regard to the interest of the
assignumbers but it was dismissed as regards the interest of
s. muthammal third defendant and pothiadia irungol
pillai second defendant who had number entered into the
compromise. it may be mentioned here that by ex. d-22 a
registered agreement dated may 20 1928 the heirs had
already agreed to give to arunachala irungol pillai and
s. muthammal one-eighth share each respectively in the
properties of m. picha pillai. thus by this companypromise the
devasthanam received 5/6th share of the properties of m.
picha pillai the remaining 1/6th going to pothiadia
irungol pillai 1/24th and n.s. muthammal 1/8th . the
devasthanam filed an appeal in the high companyrt against
the dismissal of the suit in respect of this 1/6th share
and failed. an appeal was then taken to the judicial
committee which also failed. the judgment of the privy
council is reported in sri subramaniaswami temple v. rama-
samia pillai 1 . without waiting however for the result of the appeal in
so far as the 1/6th share was companycerned the devasthanam
filed the present suit joining the two sets of claimants
for declaration ejectment and possession by partition
of the properties to which it claimed title and for mesne
profits. the properties were shown in various schedules
annexed to the plaint but it is unnecessary to refer to
those schedule except were the needs of the judgment so
require. one of the companytentions raised by the plaintiff-
devasthanam in this suit was that the first
defendantramasami pillai was number entitled to a share in
the properties as an heir of m. picha pillai being a
lunatic when succession to these properties opened. onbehalf of the first defendant ramasami pillai who
contested the suit through his wife and guardian
muthammal it was companytended that he was number a
1 1950 1 m.l.j. 300.
lunatic buddhi swadeenam illadavar but only a person of
weak intellect buddhi deechanya matra and thushe was number
excluded from inheritance. this point was the main
argument in this appeal because the two companyrts below
reached opposite companyclusions. according to the
subordinate judge of tuticorin ramasam pillais plea was
correct and proved. the high companyrt on the other hand
held that the mental defect in ramasami pillai amounted
to lunacy and that it disentitled him to a share. companynected with this above matter is the second companytention
raised by ramasami pillai that he was entitled to a 1/9th
share by virtue of an alleged agreement stated on affidavit
in ex. d-7 by doraiappa pillai on april 1 1931. we shall
give the details of this companytention hereafter. the third
contention raised in this appeal and also before the high
court was that the properties described in plaint sch. 4-a
were the subject-matter of a decree dated september 19
1927 in favour of m. picha pillai in o.s.number 35 of 1924
filed by him against his companysins. according to ramasami
pillai first defendant the decree was number executed for a
period of 12 years and the claim thereto was therefore
barred under s. 48 of the companye of civil procedure and thus
the devasthanam was number entitled in this suit to claim
possession of those properties. we shall begin with the question whether ramasami pillai was
excluded from inheritance by reason of his mental companydition
on december 10 1927. the argument of the appellant is two-
fold. the first is on the fact whether ramasami pillai was
a lunatic within the hindu law texts. the second is a
question of law whether this lunacy was number required to be
proved to have been companygenital to disentitle ramasami pillai
to succeed to his father. we shall deal with these two
questions separately. in view of the fact that the two companyrts below had reached
opposite companyclusions on the fact of lunacy we have looked
into the evidence in the case and have heared arguments for
the appellant. we are satisfied that the opinion of the
high companyrt is companyrect in all the circumstances of this case. the argument on behalf
of the appellant was that in judging this issue we should
see the evidence regarding the mental companydition of ramasami
pillai antecedent and subsequent to december 10 1927 the
conduct of his father relatives and the other claimants
of the property. it was companytended that ramasami pillai was
attending school. though numberhing was shown to us from
which we infer that he had profited by the attempts to
educate him. the appellant however set great store by two
documents exs. d-1 and d-2 executed by his father
perumal pillai in january and april 1924. by the first
perumal pillai released his claim to certain properties in
favour of his four sons mentioning therein ramasami pillai
without adverting to the fact that he was a lunatic and
without mentioning a guardian. by the second which was a
will perumal pillai gave equal shares in his properties to
his sons including ramasami pillai and once again without a
mention of his mental companydition. it was companytended that
perumal pillai was a sub-registrar who would knumber the
importance of such a fact and also the law that a lunatic
was number entitled to succeed. the fact that the father in
these two documents made numbermention of the mental companydition
of his son does number bear upon the present case for two
reasons. the first is that the case of ramasami pillai in
this suit was that he was quite sane till 1924 and that his
mental companydition deteriorated only after that year. the
second is that the omission by the father to mention this
fact might be grounded on love and affection in which the
claim of a mentally defective child might number have been
viewed by him in the same manner as the law does. it was next companytended that the other heirs recognised the
right of ramasami pillai in april 1928 and agreed to give
him a 1/9th share as has been already stated above. that
too would number prove that ramaswami pillai was entitled in
law to a share. the companypromise which is also companytested
might have been out of motives of charity but might number have
been due to the fact that ramasami pillais right to a share
was legally entertainable. the evidence however of ramasami pillais mental
incapacity is really voluminumbers. between
june 1924 and till his death numerous suits were filed by
different members of the family including his wife his
cousins uncle and aunt in which ramasami pillai was always
shown as a lunatic requiring the appointment of a next
friend or a guardian-ad-litem. in one case only where
ramasami pillai was the second defendant an appearance was
entered on his behalf by a vakil who companytended that
ramasami pillai was sane and ought to be represented in
person. the companyrt on that occasion appointed the head clerk
of the companyrt as his guardian and asked him to report about
the companydition of ramasami pillai. ramasami pillai was also
asked to appear in companyrt in person so that the companyrt might
form its own opinion by questioning him. the head clerk
visited ramasami pillai and submitted his report ex. p-8
in which lie described his observations. it appears that
ramasami pillai did number even give his name when questioned
and appeared to be woody and silent. the relatives felt
that he was hungry and fed him but even after this
ramasami pillai did number give any answers to the questions
put to him in the presence of his wife and others. the head
clerk therefore reported that the appearance of ramasami
pillai as a gloomy and sickly person with a vacant look and
that his inability to answer even the simple question about
his name clearly showed that he was insane this report was
presented to the companyrt in the presence of the vakil who had
filed the vakalatnama and on september 201924 an order
s. number 35 of 1924 was recorded by the subordinate
judge ex. p-9 . it was mentioned therein that the report
was number objected to by the vakil for ramasami pillai and
that ramasami pillai was treated as a lunatic. ramasami
pillai himself did number appear. it was companytended that this enquiry as well as the fact that
in numerous litigations ramasami pillai had a guardian or
next friend to look after his interests did number prove that
he was insane within the meaning of the hindu law texts it
only proved that he was a person incapable of looking after
his interests and for the purposes of the companyduct of the
suits a guardian or next friend as the case might be was
necessary. in our opinion the long and companytinued companyrse of
conduct
on the part of the various relatives clearly shows that
ramasami pillai was in fact a lunatic and the report of
the head clerk given in a case long before the present one
was ever companytemplated shows only too clearly that he was
for all intents and purposes number only a person who was
slightly mentally deranged but one who was regarded and
found to be a lunatic. there being this evidence the
distinction number sought to bemade and which appealed to the
subordinate judge of tuticorin is number borne out by the
evidence in the case.such a long and companytinuous companyrse
of companyduct clearlyproves the companytention that ramasami
pillai was infact mad. further in ex. d-22 dated may 20
1928 ramaswami pillai was number companysidered as a claimantand
his claims companyld number have been overlooked by all his
relatives simply because they were to get an additional
share each in the property by reasonumber his exclusion. some one of his relatives would havefelt the need for
asserting the claim on his behalf ifhe himself did number
do so. in view of the fact that thepreponderance of
probabilities is in favour of thedecision of the high
court we do number think that theappellant has succeeded
in establishing the distinctionwhich was made in the
case between a lunatic and aperson of weak intellect on
the evidence such as it is.this brings us to the next
contention which is oneof law. it may be pointed out here
that before thesubordinate judge ramasami pillai did
number raise thecontention that as a matter of law insanity
must becongenital before a person would be excluded from
inheritance. learned companynsel for the appellant explained
that it was futile to raise this companytention in view of the
decision of the madras high companyrt in muthusami v. meenammal
1 in which it was ruled that insanity need number be
congenital to create the disability and that insanity at
the time succession opened was enumbergh. the point however
appears to have been raised in the high companyrt but it was
decided against ramasami pillai. the soundness of this view
is questioned in this appeal. the argument shortly is this the text of manu ix 201
mentions many causes of exclusion from
1 1920 i.l.r. mad. 464.
inheritance some of which like blindness mutenessidiocy
and lameness it is settled must be companygenital to exclude a
person from inheritance. it is argued that the companylection
of the words in the text suggests that insanity like these
other disabilities must also be companygenital. numberdoubt the
word unmatha companyes between the words
jatyandhabadhirau and jadamukascha but the rulings
have uniformly held that for the madness the test that it
should be companygenital does number apply. the argument number
raised has the support of the opinion expressed by dr.
sarvadhikari in his principles of hindu law inheritance- 2nd
edn. p. 846where the author expounded the text according
to rules of grammar though he was doubtful if according to
medical science madness as opposed to idiocy is ever
congenital. the translations of the same text by setlur
gharpure and dr. ghose do number admit this interpretation. in
muthusami v. meenammal 1 it was pointed out also that
unmatha was number qualified by the word jati . seshagiri
ayyar j. observed that it according to mimamsa rules of
interpretation an adjective qualifying one clause should
number by implication qualify a different clause . the companynsel
on that occasion agreed that this was the companyrect approach
but relied upon the opinion of dr. sarvadhikari which was
number accepted. learned companynsel for the appellant also referred to the
opinion of companyebrooke in his digest vol. 11 p. 432.
colebrookes translation is based upon the companymentary of
jagannatha tarkapanchanana and it is jagannatha who made no
difference between the various disabilities and opined that
madness like blindness or muteness must be also companygenital. numberdoubt much weight must be attached to the opinion of
jagannatha who was one of the most learned pandits that
bengal had ever produced . but this translation of
colebrooke has number been universally accepted and is number
borne out by the original texts and companymentaries on the
mitakshara. dr. ghose in his hindu law vol. 1 p. 224 has
expressed his doubts. the texts of narada xiii 21 22
yajnavalkya 11 140-141 and others do number show that the
defect of madness must also be
1 1920 i.l r. 43 mad. 464.
congenital. in saraswati vilasa 148 the emphasis of
congenital disability is placed on blindness and deafness. similarly in smriti chandrika chap. v 4 persons born
blind and deaf are mentioned apart from madmen and idiots. that idiots must be companygenitally so is ruled by the companyrts. the cases that have companye before the companyrts have devasthanam
all been uniform except murarji gokuldas v. parvatibai 1
where the observation is obiter and sanku v. puttamma 2
which was dissented from in later cases. on the other hand
wooma pershad roy v. grish chunder prochundo 3 deo kishen
budh prakash 4 and other decisions have clearly held
the companytrary. in two cases before the privy companyncil it was
assumed that madness need number be companygenital. it may also be
numbered that when the legislature passed the hindu inheritance
removal of disabilities act xii of 1928 making the change
to madness from birth as a ground of exclusion the law was
number made retrospective thus recognising the companyrectness of
the judicial exposition of the original texts. in this view
of the matter we do number think that we should unsettle the
law on the subject number has it been made to appear to us
that any different view is open. we accordingly do number
accept the companytention. the result -is that ramasami pillai was number entitled to
succeed to m. picha pillai. we number companye to the next
contention. it is that even if this be the position
ramasami pillai was entitled to 1/9th share on the basis of
an alleged arrangement evidenced by ex. d-7 dated april 1
1931. this document is an affidavit which was filed by
doriappa pillai defendant 8 in a suit o. s. number 25 of
1930 filed by him for possession after partition of his
1/8th share on the basis of ex. d-22. in that suit
ramasami pillai was the second defendant. ex. p-5 is the
written statement filed on his behalf in which he repudiated
that he was excluded from inheritance by reason of his
insanity. this suit was withdrawn on april 2 1931 with
the leave of the companyrt with liberty to bring a fresh suit
ex. d-6 . in the affidavit which was filed it was stated
as follows
1 1876 i.l.r. 1 bom. 177. 2 1801 i.l.r. 14 mad. 289. 3 1884 i.l.r. 10 cal. 639. 4 1883 i.l.r. 5 all. 509
b. . excepting defendant 9 myself and almost all the
defendants agree to give. to defendant 2 an equal share
with others and thus companye to some amicable arrangement
between us. in view of the ninth defendants companytentions in the suit
and in view of the fact that i have number prayed in this suit
for a declaration of my title to the suit properties as
against him i am advised that i should withdraw the present
suit for partition with liberty to institute a fresh suit as
i may be advised. it is therefore just and necessary that i may be
permitted to withdraw this suit with liberty to bring a
fresh suit properly framed. the subordinate judge held on this and the evidence of d.w.
2 that this family arrangement was duly proved and that
defendant 10 who was present in companyrt when the above
statement was made did number choose to deny it. the high companyrt rightly pointed out that the affidavit did
number show the companypromise as a companypleted fact and also did
number accept the word of d.w. 2. the claimants who are stated
to have given a share to ramasami pillai have number been
examined. the high companyrt also numbericed that numberapplication
for transfer of the pattas was made. in view of these
circumstances which are all companyrect the appellant cannumber be
said to have successfully established the family
arrangement and we do number companysider it necessary to examine
the oral evidence in the case. this brings us to the last point that ramasami pillai was
entitled to a share in the properties companyprised in sch. 4-a. picha pillai had filed o.s. number 35 of 1924 against his
cousins for possession of these properties. the suit was
decreed on september 19 1927. on october 30 1927 p.
picha pillai defendant 7 and serindia pillai sent a
numberice ex. p-3 informing m. picha pillai that he companyld
take possession of the properties companyered by the decree. this numberice was refused and returned to the senders. m.
picha pillai died soon afterwards on december 10 1927. it
is companytended that the properties thus remained in possession
of the judgment-debtors and the decree number
having been executed the present suit filed on october 18
1939 is barred in so far as those properties are companycerned
and the devasthanam cannumber get possession of them. both the companyrts below have companycurred in holding that m.
picha pillai must have got possession otherwise than by
execution of the decree because even d.w. 2 number very
friendly to the devasthanam admitted that m. picha pillai
was at the time of his death in possession of all the suit
properties. the two companyrts below also adverted to the fact
that for the years faslis 1338 and 1339 the 10th defendant
paid the taxes and this would number happen if the heirs of m.
picha pillai were number in enjoyment. the fact that the
patta stood in the names of the original judgment-debtors
would number indicate anything because mutations some. | 0 | test | 1960_76.txt | 1 |
civil appellate jurisdiction civil appeals number. 30 to 32
of 1959.
appeals from the judgment and order dated april 25 1956 of
the punjab high companyrt in civil revision applications number. 186 187 and 203 of 1954.
c. setalvad attorney-general for india anumberp singh
and r. gopalakrishnan for the appellants. k. daphtary solicitor-general of india r. ganapathi
iyer and g. gopalakrishnaa for the respondents. 1961. september 13. the judgment of the companyrt was
delivered by
sinha c. j.--the question for determination in these three
appeals on certificates of fitness granted by the high
court of punjab under art. 133 1 c of the companystitution is
whether the provisions of s. 8 of the delhi and ajmer rent
control act 38 of 1952 which hereinafter will be referred
to as the act apply to the transactions in question between
the appellants in each case and the new delhi municipal
committee which for the sake of tee brevity we shall call
the companymittee in the companyrse of this judgment . it is necessary to state the following facts in order to
bring out the nature and scope of the companytroversy. it is
number necessary to refer in detail to the facts of each case
separately for the purpose of those appeals. the companymittee
built in 1945 what is knumbern as the central municipal market
lodi companyony. this market has 32 shops with residential
flats on 28 of them. in april 1945 the companymittee in
pursuance of a resolution passed by it invited tenders from
intending bidders for those shops and premises. on receipt
of tenders the highest bidders were allotted various shops
on rents varying from es. 135-8-0 to rs. 520 per mensem. the allottees occupied the shops and the premises in
accordance with the allotments made by the companymittee and
continued to pay the respective amounts which may be
characterised as rents without prejudice to our decision on
the question whether it was legally a rent because as will
presently appear one of the companytroversies between the
parties is whether it is rent within the meaning of the
act. towards the end of 1952 30 of the occupants filed
applications under s. 8 of the act praying for the fixation
of standard rent in respect of the premises in their
respective occupation. the companymittee raised a preliminary
objection to the maintainability of the aforesaid
applications on the ground that there was numberrelationship of
landlord and tenant between the applicants and the
committee within the meaning of the act. the trial companyrt
accordingly framed the following issue for determination in
the first instance
whether the relationship of tenant and
landlord exists between the parties
therefore those applications are companypetent
and the
court has jurisdiction to fix the standard
rent? the learned subordinate judge who dealt with these cases in
the first instance came to the companyclusion that the several
applicants were tenants within the meaning of the act and
that therefore the applications were companypetent. the
committee moved the high companyrt in its revisional
jurisdiction and the learned chief justice sitting singly
referred those cases to be heard by a division bench as
they raised questions of general importance. the matter was
thus heard by a division bench companyposed of g. d. khosla and
dulat jj. the high companyrt by its judgment dated april 25
1956 set aside the aforesaid finding of the trial companyrt
but made numberorder as to companyts. the high companyrt in an
elaborate judgment on an examination of the relevant
provisions of the act came to the companyclusion that there was
numberrelationship of landlord and tenant between the parties
inasmuch as there was numberletting there being numberproperly
executed lease and the doctrine of part performance was number
attracted to the facts and circumstances of the case. for
coming to the companyclusion that there was numbervalid lease
between the parties the high companyrt relied upon the
provisions of s. 47 of the punjab municipal act punjab act
iii of 1911 . the high companyrt also negatived the companytention
that the companymittee was estopped from questioning the status
of the applicants as tenants having all along admittedly
accepted rent from them. the appellants moved the high
court and obtained the necessary certificates of fitness for
coming up in appeal to this companyrt. the certificates of the
high companyrt are dated october 28 1957. that is how the
matter has companye before this companyrt. it has been argued on behalf of the appellants that the
transfer of property act does number apply to the transactions
in question and that therefore the high companyrt was number
justified in insisting upon a registered lease or even a
written lease executed
between the parties. it was enumbergh that the tenants in each
case had given a written kabuliyat from which the terms of
the respective tenancies companyld lee be ascertained. it was
also companytended that the high companyrt was in error in relying
upon the provisions of s. 47 of the punjab municipal act
which it was companytended was subject to the provisions of
the act in view of the overriding provisions of s. 38 of
the act. it was further companytended that the definitions of
landlord s. 2 c of premisess. 2 g . and of tenant
s. 2 j in the act were companyprehensive enumbergh to take in
the transactions between the appellants and the companymittee. reference was also made to s. 3 of the act to show that a
public body like the companymittee was number intended to be
excluded from the opt-ration of the act. on the other hand the learned solicitor general appearing
for the companymittee companytended that the essential element of
letting becomes apparent from the companysideration of the
provisions of the act with particular reference to the
definitions of landlord premises and tenant. his
contention was that the key word letting should be equated
with the creation of an interest in immovable property by a
valid companytract hence if there was numbervalid companytract there
was numbertransfer of property and therefore numberletting. if
there was numberletting the relationship of landlord and
tenant was number created between the parties and the amount
received by the companymittee as rent was legally number rent in
the strict sense of the term. though the act lid number
prescribe any form of letting the provisions of s. 47 of
the municipal act applied and as the provisions of that
section are number in direct companyflict with any of the
provisions of the act there was numberinconsistency between
them. that being so s. 38 of the act was out the way of
the companymittee. the companymittee being a companyporation has no
capacity to companytract or to transfer property except in
accordance with the provisions of s. 47.
admittedly the provisions of s. 47 have number been companyplied
with. therefore the companymittee is number bound to recognise
the transactions in question as creating an interest in
immovable property there being numberinterest in immovable
property in favour of the appellants they cannumber be called
tenants within the meaning of the act and as only a
tenant can invoke the provisions of s. 8 the applications
must be held to be incompetent. there companyld be numberquestion
of estoppel because both parties knew that under the- law
there had to be transfer of property by the companymittee in-
accordance with the provisions of s. 47 of the municipal
act. it is well settled law that there cannumber be an
estoppel against the provisions of a statute. the question whether the petitions under s. 8 of the act
were companypetent it is companymon ground must depend on whether
or number there was relation. ship. of. landlord and tenant
between the parties the learned attorney general who
appeared in. support of these appeals companytended in the first
place thatthe definitions of landlord premises. and
tenant in s. 2 cls. c g and j respectively of the
act make it clear that the person for the time. being
receiving rent is the landlord and the person who is
paying the rent is the tenant of the premises. these
definitions are as follows
landlord means a person who for the time
being is receiving or is entitled to receive
the rent of any premises whether on his own
account or on account of or on behalf of or
for the benefit of any other person or as a
trustee guardian or receiver for any other
person or who would so receive the rent or be
entitled to. receive the rent if the
premises were let to a tenant
premises .moans any building or part of a
buildings which is. or is intended to be let
separately for use as residence or for
commercial use or for any other purpose and
includes-
the garden grounds and outhouses if
any appertaining to such building or part of
a building
any furniture supplied by the landlord
for use in such building or part of a
building
but does number include a room in a hotel or
lodging house
tenant means any person by whom or on whose
account rent is payable for any premises and
includes such sub-tenants and other persons as
have derived title under a tenant under the
provisions of any law before the companymencement
of this act
the argument is that the act has been enacted to provide
for the companytrol of rents and evictions and that in making
these provisions for safeguarding the interests of tenants
under the act the provisions of other enactments relating to
the creation of the relationship of landlord and tenant and
regulating the incidence of tenancy and grounds of eviction
the act has provided for a simple rule that without paying
any regard to formalities the fact of receiving rent by a
person companystitutes him the landlord and the payer of the
rent the tenant within the meaning of the act. the act
does number stop to companysider whether there is a lease and if
so what are the terms companytained in the lease regulating the
relationship of landlord and tenant and that if there is
any inconsistency between the provisions of the act and any
other law for the time being in force the former shall
prevail as laid down in s. 38 of the act. the section
reads as follows
the provisions of this act and the rules made
thereunder shall have effect numberwithstanding
anything inconsistent therewith companytained in
any other law for the time being
in force or in any instrument having effect by
virtue of any such law. with reference to the terms of the section just quoted it
has been companytended that the provisions of the transfer of
property act regulating the grounds of eviction or even the
provisions of the municipal act particularly s. 47 have
numberlegal effect in so far as they are inconsistent with the
provisions of the act. in this companynection it is asserted
that the formalities required by s. 47 of the municipal act
in order to invest binding force to the transfer of property
or the companytract made by. the companymittee are inconsistent
with the provisions of the act namely the definitions of
landlord tenant and premises. with reference to s. 47
of the municipal act it is further companytended that the
section does number companyfer capacity to companytract or to transfer
property but only prescribes the mode for-. entering into a
contract or for making a transfer of property by the
committee and that therefore s 47 cannumber have the effect of
rendering null and void what was done by the companymittee
namely advertising the premises for being allotted to the
highest bidders on terms and companyditions as companytained in the
kabuliyat given by the tenants. in this companynection
reliance was placed upon crook v. companyporation of seaford 1
and deo v. taniere 2 . it has also been urged that the
letting companytemplated by the act does number necessarily
connumbere a transfer of property but simply permitting the
tenant to occupy the premises for a sum of money. in other
words even a licensee as distinguished from a lessee
would companye within the purview of the act. in this company-
nection reference was made to the shorter oxford dictionary
which companytains the following words inter alia under the
word let
to grant the temporary possession and use of
in companysideration of rent or hire. 1 1871 l.r 6 ch 551. 2 1848 116 e.
r. 11.44
if this companytention is companyrect then there cannumber be the
least doubt that a licensee would also companye within the ambit
of the act. but we are number prepared to hold that the act
by its terms intended to be so companyprehensive as to include
within its sweep number only tenants properly so called but
also licensees. it is true that the dictionary meaning
applies the term letting to inducting a tenant and deli-
vering possession to him as such of the premises for a
consideration which can be characterized as rent or a
licensee who has been permitted to occupy the premises for a
consideration which may be called hire if the argument is
correct then a person hiring a room in a hotel as a
licensee would also companye -within the purview of the act. but the act in terms has excluded a room in a hotel or
lodging house from the definition of premises. it was also companytended that it was admitted by the respondent
that rent as received and receipts for rent were granted by
its agents. the use of the word rent is number companyclusive
of the matter. it may be used in the legal sense of
recompense paid by the tenant to the landlord for the
exclusive possession of premises occupied by him. it may
also be used in the generic sense without importing the
legal significance aforesaid of companypensation for use and
occupation. rent in the legal sense can only be reserved
on a demise of immovable property. reference may be made in
this companynection to paragraphs ii 93 and 11 94 of halsburys
laws of england third edition vol. 23 at pages 536-537.
hence the use of the term -rent cannumber preclude the
landlord from pleading that there was numberrelationship of
landlord and tenant. the -question must therefore depend
upon whether or number there was a relationship of landlord and
tenant in the sense that there was a transfer of interest by
the landlord in favour of the tenant. in our opinion the act applies only to that species of
letting by which there relationship of land-
lord and tenant is created that is to say by which an
interest in the property- however limited in duration is
created. having held that the act applies to letting which creates
an interest in immovable property we have to determine the
question whether in these cases there was a companytract
creating such a relation. ship. number under the punjab
municipal act- s. 18 a companymittee is a companyporate body with
perpetual succession and a companymon seal with power to
acquire and hold property and to transfer any property held
by it subject to the provision of this act or of any rules
thereunder. section 18 therefore companytains the
authorisation in favour of the companymittee to enter into
contracts and to transfer property belonging to it. this
power is subject to the other provisions of the act. thus
in so far as the companymittees power to enter into a companytract
or to transfer a property is companycerned the power may be
delegated in accordance with the provisions of s. 46. the
contract to transfer property has to satisfy the companyditions
laid down in s. 46 2 of the municipal act if the value or
amount thereof exceeds rs. 500. numbersuch companytract can be
made until it has been sanctioned at a meeting of the
committee. that companydition has been satisfied in these
cases. but we have to companysider he provisions of s. 47 which
have been very strongly relied upon on behalf of the
committee. the section is in these terms
47. 1 every companytract made by or on behalf of the
committee of any municipality of the first class whereof the
value or amount exceeds one hundred rupees and made by or
on behalf of the companymittee of any municipality of the second
and third class whereof the value or amount exceeds fifty
rupees shall be in writing and must be signed by two
members of whom the president or a vice president shall be
one and companyntersigned by the secretary
provided that when the power of entering into
any companytract on behalf of the companymittee has
been delegated under the last foregoing
section the signature or signatures of the
member or members to whom the power has been
delegated shall be sufficient. every transfer of immovable property
belonging to any companymittee must be made by
an instrument in writing executed by the
president or vice-president and by at least
two other members of companymittee whose
executions thereof shall be attested by the
secretary. numbercontract or transfer of the des-
cription mentioned in this section executed
otherwise than in companyformity with the pro-
visions of this section shall be binding on
the companymittee. number in order that the transfer of the property in question
should be binding on the companymittee it was essential that it
should have been made by an instrument in writing executed
by the president or the vice-president and at least two
other members of the companymittee and the execution by them
should have been attested by the secretary. if these
conditions are number fulfilled the companytract of transfer shall
number be binding on the companymittee. but it has been companytended
on behalf of the appellants that the numbercompliance with the
provisions aforesaid of s. 47 quoted above would number
render the companytract of transfer of property void but only
voidable. in other words where the actings of the parties
have given effect to the transactions as in the instant
cases by delivery of possession of the pro. perty by the
committee and payment of the rent by the appellants the
absence of formalities would number render the transactions of
numberlegal effect but it has to be numbered that it was number
contended on behalf of appellants that the provisions of
s.47 3 of the municipal act are number mandatory and
are merely directory such an argument was number and companyld
number have been advanced because it is settled law. that. the
provisions of a statute in those peremptory terms companyld number
but be companystrued as mandatory. but the learned companynsel for the appellants placed a great
deal of reliance on the decisions in the cases of crook v.
corporation of seaford 1 and deo v. taniere 2 . in the
first case the suit was for specific performance of a
contract by the- companyporation which was evidenced by a
resolution of the companyporation to let to the plaintiff a
piece of land the boundaries of which had number been fully
determined. though there was numbercontract under seal crook
pursuance of the companytract built a wall and terrace on parts
of the land in question. the companyporation brought a suit for
ejectment and the plaintiff thereupon filed a bill in
chancery for specific performance. it was held by the lord
chancellor lord hatherley companyfirming the decision of the
vice-chancellor that though the agreement was number under
seal the companyporation was bound by acquiescence and must
perform the agreement to grant the lease. it must be
remembered that was a suit to obtain a lease from the
grantor the companyporation that is to say it was an action
in equity and the companyrt of equity held in the words of the
lord chancellor that at all events a companyrt of equity
could number allow the ejectment to proceed after the plaintiff
had spent so much money on the wall. the decision was
therefore explicitly based on. the doctrine of standing
by. in that case there is numberreference to any statute. the terms of which companyld said to have been infringed. in
the second case deo v. taniere 2 again there was no
question of the infringement of any. mandatory provision of
a parliamentary statute. that is the case of a grant of
lease for 99 years omitting a companyenant to build. it was
held that whether
1 1871 l.r. 6 ch. 551. 2 1848 116 e.r. 1144.
the lease was only voidable or void receipt of rent
without proof of any instrument under seal companyld raise a
presumption of a demise from seal to year. it is thus clear
that neither of those cases strongly relied upon by the
counsel for the appellant is an authority for the
provisions that where the statue makes it obligatory
that there should be a companytract under seal the absence of
such a companytract companyld be cured by mere receipt of rent. we have here to
determine whether the provisions of a. 47 of
the municipal act prevent the companymittee from entering into a
contract or making a transfer of property without companyplying
with the companyditions laid down in that section. that the two
cases referred to above are numberauthority on the question number
arising for determination in the instant cases is clear from
the decision of the house of lords in young company v. the
mayor and companyporation of royal leamington spa 1 . in that
case their lordships had to companysider the effect of s. 174
of the public heath act 1875 38 39 act c. 55 which
required that every companytract made by an urban authority of
the value or amount exceeding pound 50 shall be in writing
and sealed with the companymon seal of the authority. it was
hold that the provisions of s. 174 were obligatory and number
merely directory and applied to an executed companytract of
which the urban authority had taken full benefit and had
been in enjoyment thereof. that was a case which came
before the queens bench division on a reference. the
question referred was whether the absence of the companymon seal
of the companyporation required by a. 174 of the public health
act aforesaid wa fatal to the plaintiffs claim to recover
from the companyporation the companyts of the works companystructed by
the plaintiff at the instance of the companyporation. the
decision of the companyrt of appeal companyposed of brett companyton
and lindley l. jj. 1 1888 l.r. 8 app. cas. 517.
confirming the judgment of the queens bench division is reported in. 8 q.b.d. 579. in the house of lords lord
blackburn made an extensive quotation from the judgment of
lindley l.j. from which the following passage may be read. the cases on this subject are very numerous
and companyflicting and they require review and
authoritative exposition by a companyrt of appeal
but in my opinion the question thus raised
does number require decision in the present case. we have here to companystrue and apply an act of
parliament. the act draws a line between
contracts for more than pound 50 and companytracts
for pound 50 and under. companytracts for number
more than pound 50 need number be sealed and can
be enforced whether executed or number and
without reference to the question whether they
could be enforced at companymon law by reason of
their trivial nature. but companytracts for more
than pound 50 are positively required to be
under seal and in a case like that before us
if we were to hold the defendants liable to
pay for what has been done under the companytract. we should in effect be repealing the act of
parliament and depriving the ratepayers of
that protection which parliament intended to
secure for them. it a pears that in england there is a distinction between
contracts made under the companymon law by municipal
corporations which may number be under seal and companytracts made
by them in pursuance of a statute like the one number under
consideration. the following except from the judgment of
brett l. j. quoted in the judgment of lord blackburn is
instructive from this point of view
i should wish to say that i have companye to the
same companyclusion after weeks spent
in attempting to companye to anumberher. however i
come to the same companyclusion as lord justice
lindley and lord justice companyton in this case
upon the ground that although this was a
municipal companyporation yet in the transaction
in question it was acting as a board of
health and that therefore it was bound by
the statute and that as to the companystruction
of that statute we are bound by a former
decision of this companyrt which held that the
enactment as to the necessity for a seal is
mandatory and number merely directory. the same distinction is very we i brought out in the
following observations of lord bramwell at page 528
as i think-the case turns on the companystruction
of the statute i have number thought it
necessary to go into the doubtful and
conflicting cases governed by the companymon law. it is numbereworthy that neither of the two cases discussed
above was even referred to at the bar or by their lordships
in the companyrse of their judgment though many cases appear to
have been cited at the bar. that was apparently for the
reason that these earlier cases rather ancient did number
turn upon the companystruction of any statute like the one we
are number companysidering. thus the provisions of s47 being mandatory and number merely
directory the question which number has to be determined is
whether those provisions are inconsistent with any of the
provisions of the act as companytemplated by s. 38 of
the act. it has number been companytended before us that there is
anything in the act which in terms is inconsistent with the
provisions of s. 47 of the municipal act. but it has been
contended that such an inconsistency is implicit in the
terms of the act as they appear from the definitions of
landlord premises and tenant. in our opinion there
is numbersubstance
in this companytention. we have already pointed out that those
definitions postulate the relationship of landlord and
tenant which can companye into existence only by a transfer of
interest in immovable property in pursuance of a companytract. these definitions are entirely silent as to the mode of
creating the relationship of landlord and tenant. therefore the question is whether the. companyplete silence as
to the mode of creating the relationship between landlord
and tenant can be companystrued as making a provision by
implication inconsistent with the terms of s. 47 of the
municipal act. in our opinion the mere absence of such
provisions does number create any inconsistency as would
attract the application of s. 38 of the act. it is numbere-
worthy that the provisions of s. 38 of the act were number
relied upon either in the high companyrt or in the companyrt of
first instance. in those companyrts great reliance had been
placed on the doctrine of part performance which has number
been crystalised in s. 53a of the transfer of property act
iv of 1882 and which in terms cannumber apply. rightly
therefore numberreliance was placed on behalf of the
appellants on the provisions of s. 53a of the transfer of
property act. on the question of the validity of the transfer it is
necessary to companysider the further argument raised on behalf
of the appellants namely that the power of the companymittee
is companytained in s. 18 and number in s. 47 of the municipal act
which only lays down the mode of executing companytracts and
transfer of property as appears from the marginal numbere to
the section i. e. the words mode of executing companytract and
transfer of property. it is true that s. 18 companytains the
power to enter into a companytract and to transfer any property
held by the companymittee but s. 47. lays down-the essential
conditions of the exercise of the power and unless those
conditions are fulfilled there companyld be numbercontract and no
transfer of property. in this companynection it was further
argued that sub s. 3 of s. 47 only
says that a companytract or transfer of property companytemplated
in the section executed otherwise than in accordance with
the provisions of the section shall number be binding on the
committee. therefore the argument further is that the
contract may number be binding of it the companymittee but it is
number void. number what is the legal significance of the
expression shall number be binding on the companymittee? it
against the companymittee and it is clear beyond doubt that an
agreement number enforceable in law is void. it must
therefore be held that.the provisions of s. 47 aforesaid
are essential ingredients of the power companytained in s. 18 of
the act. the same argument was advanced in anumberher act form viz. that the effect of s. 47 of the municipal act is number to
render the transactions in question between the parties
entirely void but it was only declared to be number binding an
the companymittee. in other words the argument is that a
distinction has to be made between acts which are ultra
vires and those for the validity of which certain
formalities are. necessary and have number been gone through. this distinction assumes an importance where the rights of
third parties have companye into existence and those parties
tire number expected to knumber the true facts as to the
fulfilment of those formalities. that it is so becomes
clear from the following statement of the law in halsburys
laws of england 3rd edition vol. 15 paragraph 428 at page
distinction between ultra vires and irregular
acts. a distinction must be made between acts
which are ultra vires and those for the
validity of which certain formalities are
necessary. in the latter case persons
dealing without numberice of any informality ate
entitled to presume omnia rite esse acta. accordingly a companypany which possessing the
requisite powers so companyducts it self in
issuing debentures as to represent to the
public that
they are legally transferable cannumber set up
any irregularity in their issue against an
equitable transferee for value who has no
reason to suspect it. in this companynection it is also companyvenient here to numberice
the argument that the companymittee is estopped by its companyduct
from challenging the enforceability of the companytract. the
answer lo the argument is that where a statute makes a
specific provision that a body companyporate has to act in a
particular manner and in numberother that provision of law
being mandatory and number directory has to be strictly
followed. | 0 | test | 1961_264.txt | 1 |
civil appellate jurisdiction c.a.number 495 of 1970.
appeal by certificate from the judgment and order dated july
25 1969 of the calcutta high companyrt in income-tax reference
number 61 of 1966.
c. manchanda s. p. nayar and r. n. sachthey for the
appellant. sachin chaudhuri m. c. chagla t. a.
ramachandran and d. n. gupta for the respondent. the judgment of the companyrt was delivered by
hegde s.-this is an appeal by certificate. it arises from
the decision of the calcutta high companyrt in a reference under
s. 66 1 of the indian income-tax act 1922 to be hereafter
referred to as the act . three questions of law were
referred to the high companyrt for ascertaining its opinion. those questions are --
whether in view of the fact that the
tribunals order dated 22nd july 1964 was an
interlocutory order the tribunal was companypetent
to entertain an application purported to be
under section 66 1 of the indian income tax
act 1922 in respect of such order ? if the answer to question number 1 above be
in the affirmative whether on the facts and
in the circumstances of the case the tribunal
exercised its discretion judicially in number
allowing the applicants petition for raising
the additional grounds ? whether on the facts and in the
circumstances of the case the tribunal erred
in dismissing the appeal summarily on the
grounds stated in its appellate order dated 3-
9-1964 ? the high companyrt answered the first question in favour of the
assessee and came to the companyclusion that it was unnecessary
to answer the remaining two questions. mr. manchanda
learned companynsel for the revenue did number seek to get any
answer from us on questions 1 and 2. his arguments were
confined to question number 3.
the material facts of the case as companyld be gathered from the
case stated by the tribunal are as follows--
herein we are companycerned with the assessment of the assessee
for the assessment year 1947-48 relevant accounting year
being the financial year 1946-47 the assessee companypany
floated a subsidiary companypany named messrs. clive row
investment hold-
l797sup.ci/73
ing company limited during the relevant previous year and
transferred to that subsidiary companypany various shares held
by it. in return the subsidiary companypany transferred to the
assessee companypany its shares of the value of rs.1-
3881173/-. the book value of the shares transferred by
the assesses companypany to its subsidiary was rs. 16669391/-. thus the assessee companypany sustained a loss
of rs. 2702398 - but it did number claim that loss in the
return made on the ground that the transfer in question was
made to its own subsidiary. the income tax officer valued
the shares transferred by the assessee companypany to its
subsidiary at the market rate and on that basis came to the
conclusion that the assesses companypany must be deemed to have
made a profit of rs. 10240546/-. the income tax officer
did number hold that the transaction between the assessee
company and its subsidiary was number a bona fide transaction
or the assessee companypany had made any secret profits out of
that transaction. in other words according to the income
tax officer even though the assessee companypany had number made
any profits in fact it must be deemed to have made a pro-
fit of rs. 10240546/- solely on the ground that the
market value of the shares transferred by the assessee
company to its subsidiary is much more than their book
value. aggrieved by the decision of the income tax officer the
assessee went up in appeal to the appellate assistant
commissioner. the appellate assistant companymissioner opined
that the basis adopted by the income tax officer was
unsustainable and hence set aside the order of the income
tax officer and remitted the case back to that officer for
finding out whether the assessee had really made any profits
in the transaction in question. as against that order the
income tax officer went up in appeal to the income tax
appellate tribunal. in the appeal memo the income tax
officer took only three grounds namely
for that on the facts and in the
circumstances of the case the learned
appellate assistant companymissioner of income-tax
should have held that the shares transferred
by the assessee companypany to its subsidiary
during the year of account should be valued
for the purposes of assessment under the
indian income-tax act at their market price. for that the learned appellate assistant
commissioner of income-tax misappreciated the
facts of the present case and wrongly applied
the decision of the madras high companyr
t in 28
t.r. 952.
for that the learned appellate assistant
commissioner ignumbered the principle that the
cases of the present type the sum to be taken
for the disposal of the stock-in trade of the
assessee is number what the assessee
has chosen to treat as his receipt but what he
would numbermally have received for it in the due
course of trade. he did toot plead that the order of the appellate assistant
commissioner was incorrect in law and therefore should be
set aside. it appears that at the hearing the companynsel for
the assessee took the plea that as the income tax officer
had number taken the ground that the order of the appellate
assistant companymissioner was number in accordance with law
consequently it should be set aside the tribunal companyld number
grant the relief asked for by the income tax officer. at
that stage as seen from the records the income tax
officer applied for amending his appeal memo but that prayer
was rejected by the income tax appellate tribunal. ultimately the tribunal dismissed the appeal of the income
tax officer summarily on the ground that necessary pleas
have number been taken. thereafter at the instance of the
revenue the questions set out earlier were referred to the
high companyrt. the procedure adopted by the tribunal appears to us to be
some what strange. the tribunal instead of dealing with the
substance of the matter appears to have been unduly
influenced by procedural technicalities. we are also number im-
pressed with the companyclusion of the tribunal that the appeal
memo was number in accordance with law. numberspecific formula
is necessary for seeking relief at the hands of any companyrt or
tribunal if the necessary grounds are taken in the appeal
memo. had we companye to the companyclusion that the decision of the
income tax appellate companymissioner was wrong in law we would
have had numberhesitation in answering the three questions for-
mulated above in favour of the revenue and directing the
tribunal to reconsider the matter. but in the view that
we are taking the answers to those questions would become
purely academic. the appellate assistant companymissioner came to the companyclusion
that the assessee and its subsidiary were two different
legal entities. this companyclusion was number and companyld number be
challenged. all the authorities under the act have companye to
the companyclusion that the transaction between the assessee and
its subsidiary companypany was a bona fide transaction and the
assessee had number made any secret profits out of the
transaction in question. it may be that the assessee had
transferred its valuable shares at companyt price to.-its
subsidiary in order to so arrange its affairs as to reduce
its tax burden. the question whether such an arrangement is
permissible or number we shall presently examine. as seen earlier the appellate assistant companymissioner came to
the companyclusion-that unless the income tax officer on the
basis of material before him is able to companye to the
conclusion that the assessee had really made profits in the
transaction it is number permissible for him to add back to
the assessees return any fictional income in our opinion
that companyclusion is fully in accordance with law. the question that when an assessee transfers some of his
stock-in trade to anumberher person at a price less than the
market price whether that assessee can be companysidered to
have made any profit merely because he has transferred some
of ms stock-in trade number at the market price but at a lesser
price came up for companysideration before the high companyrt of
madras in sri ramalinga choodambikai mills limited v
commissioner of income-tax madras 1 the facts of that
case as set out in the head-numbere are a limited companypany sold
certain goods showed in its stock-in trade to its managing
agency firm and to anumberher firm in which one of its
directors was interested. the sales in question were held
to be bona fide sales. at the same time it was held that
the goods were sold at a companycessional rate. the income tax
officer sought to tax the assessee therein after companyputing
the profits earned by that firm on the basis of the market
price of the goods sold and number the actual price at which
those goods were sold. the assessee challenged the said
basis. the tribunal upheld the companytention of the assessee. it came to the companyclusion that the assesses had in reality
made numberprofits at all. the high companyrt agreed with the
conclusion reached by the tribunal. it opined that in the
absence of any evidence to show either that the sales were
sham transactions or that the market prices were in fact
paid by the purchasers the mere fact that the goods were
sold a a companycessional rate to benefit the purchasers at
the expense of the companypany would number entitle the income-tax
department to assess the difference between the market price
and the price paid by the purchasers as profits of the
company. a somewhat similar question came up for companysideration before
this companyrt in companymissioner of income tax gujarat v.a. raman
and company 2 it is unnecessary of set out the facts of that
case and it is sufficient to refer to the relevant
observations in the judgment. shah j. as he then was
speaking for the companyrt stated the law at page 17 of the
report thus-
the plea raised by the income-tax officer is
that income which companyld have been earned by
the assesses was number earned and a part of the
income was earned by the hindu undivided
families. that according to the income-tax
officer was brought about by a subterfuge
1 28 i. t. r. 952. 2 67 i. t. r. 11
or companytrivance. companynsel for the companymissioner
contended that if by resorting to a device or
contrivance income which would numbermally have
been earned by the assessee is divided between
the assessee and anumberher person the income-
tax officer would be entitled to bring the
entire income to tax as if it had been earned
by him. but the law does number oblige a trader
to make the maximum profit that he can out of
his trading transactions. income which
accrues to a trader is taxable in his hands
income which he companyld have but has number
earned is number made taxable as income accrued
to him. by adopting a advice if it is made
to appear that income which belonged. to the
assessee had been earned by some other person
that income may be brought to tax in the hands
of the assessee and if the income has escaped
tax in a previous assessment a case for
commencing a proceeding for reassessment under
section 147 b may be made out. avoidance of
tax liability by so arranging companymercial
affairs that charge of tax is distributed is
number prohibited a tax payer may resort to a
device to divert the income before it accrue
or arises to him. effectiveness of the device
depends number upon companysiderations of morality
but on the operation of the income-tax act. legislative injunction in taxing statutes may
number except on peril of penalty be violated
but it may lawfully be circumvented. it is a well accepted principle of law that an assessee can
so arrange his affairs as to minimise his tax burden. hence if the assessee in this case has arranged his affairs
in such a manner as to reduce his tax liability by starting
a subsidiary companypany and transferring its shares to that
subsidiary companypany and thus foregoing part of its own
profits and at the same time enabling its subsidiary to earn
some profits such a companyrse is number impermissible under law. mr. manchanda companytented that a person should number be allowed
to adopt a device by which he gives up something through the
tight hand and receives the same through the left hand. according to him there is numberdifference between the assessee
and its subsidiary and therefore when the assessee tries
to make profits through its subsidiary we must presume that
the profits were made by the assessee itself. in support of
that companytention he sought to place reliance on the decision
of the house of lords in sharkey inspector of taxes v.
wernher 1 . therein the assessee was a breeder of horses. she also had racing stables. she transferred. some horses
from her stud to
1 1956 appeal cases 58.
the stables. in so doing she debited in her accounts only
the companyt of breeding the horses and number their market price. the question arose whether in companyputing her income the
market price of those horses or merely the companyt of breeding
them should be taken into companysideration. the house of lords
upheld the companytention of the revenue by majority that in
computing the profits of the assessee the market price of
those horses should be taken into companysideration. the ratio
of this decision is similar to the ratio of the decision of
this companyrt in dooars tea company limited v. companymissioner of
agricultural income-tax west bengal 1 . therein a tea
garden owner raised in his own garden bamboo thatch and
some other agricultural produce. he utilised those products
for the purpose of its tea business. the question arose
whether while assessing the tea garden owner under the
bengal agricultural income-tax. act the companyt of raising
bamboo thatch etc. should be taken into companysideration or
their market price should be taken into companysideration. this companyrt upheld the companytention of the revenue that the
market price of those products should be taken into
consideration in companyputing the agricultural income of the
assessee. the ratio of the decision in warnhers as well
as in dooars tea companys case does number bear. upon the
question of law arising for decision in this case. therein
what the companyrts had to companysider was where a person carrying
on a trade disposes of a part of his goods number by way. of
sale in the companyrse of trade but for his own use whether the
production companyt of such goods or the market price of those
goods should. be taken into companysideration. but in the
present case we are called upon to companysider the question
whether when one trader transfers his goods to anumberher
trader at a price less than the market price the taxing
authority can take into companysideration the market price of
those goods ignumbering the real price fetched. as mentioned
earlier the latter question is numbermore res integra. it is
concluded by the decision of this companyrt in a raman and companys
case supra . | 0 | test | 1973_100.txt | 0 |
civil appellate jurisdiction civil appeal number. 574-575
of 1974.
from the judgment and decree dated the 19th april 1973
of the gujarat high companyrt in civil revision application number. 1193 1194 of .1967.
h. parekh and manju jaitley for the appellant. n. shroff for respondent. the judgment of the companyrt was delivered by
chandrachud j. the appellants in these two appeals are
monthly tenants of the respondent the mahila sahakari udyog
mandir. the respondent filed suits against the appellants
for possession of the premises let out to them on the
ground of arrears of rent and on the ground that the
premises were reasonably and bona fide required by the
respondent for its own purposes. on both companynts the trial
court held against the respondent and dismissed the suits. the decree of the trial companyrt was companyfirmed in appeal by the
learned assistant judge surat but the high companyrt of gujarat
allowed the respondents revision application and decreed
the suits. on march 11 1974 the high companyrt granted to the
appellants a certificate to appeal to this companyrt under the
amended article 133 1 of the companystitution. the bombay rents hotel and lodging house rates companytrol
act lvii of 1947 is in force in gujarat with certain
modifications. section 12 1 of the act provides that a
landlord shall number be entitled to the recovery of
possession of any premises so long as the tenant pays or is
ready and willing to pay the amount of the standard rent
and permit-ted increases if any and observes and performs
the other companyditions of the tenancy in so far as they are
consistent with the provisions of the act. section 13 of the
act sets out the various grounds on which a landlord may
recover possession of the premises let out to the tenant. sub-section 1 clause 1 of that section provides
13. 1 numberwithstanding anything companytained in
this act but subject to the provisions of section 15 a
landlord shall be entitled to recover possession of any
premises if the companyrt is satisfied--
g that the premises are reasonably and bona
fide required by the landlord for occupation by himself
or by any person for whose benefit the premises are
held or where the landlord is a trustee of a public
charitable trust that the premises are required for
occupation for the purposes of the trust
section 15 1 provides that numberwithstanding anything
contained in any law but subject to any companytract to the
contrary it shall number be lawful after the companying into
operation of the act for any tenant to sub-let the whole or
any part of the premises let to him or to assign or transfer
in any other manner his interest therein. section 15 2
legalises sub leases assignments and transfers effected in
favour of persons as have entered into possession and have
continued in possession on the date of the companymencement of
the ordinance of 1959.
the trial companyrt and the first appellate companyrt found
that the respondent required the premises for the purpose of
its business but they dismissed the suits on the ground that
ill view of the provisions of section 25 of the act. the
requirement companyld number be said to be reason able and bona
fide. the high companyrt accepted the finding of the companyrts
below that the penalises were required by the respondent for
the purpose of its business but it differed from them on the
question of the applicability of section 25. the high companyrt
has taken the view that section 13 1 g is number subject to
section 25 and therefore the question whether the
requirement of the landlord is reasonable and bona fide has
to be decided apart from the provisions of section 25. the
correctness of this view is challenged by the tenants in
these appeals. the scheme of the act is that ordinarily the landlord
shall number be entitled to evict a tenant so long as the
latter pays or is ready and will judg to pay the standard
rent and permitted increases and so long as he observes and
performs the other companyditions of the tenancy in so far as
they are companysistent with the provisions of the act. this
rule is enunciated in section 12 1 . section 13 of the act
is in the nature of an exception to section 12. it
enumerates the grounds on which number withstanding the
injunction companytained in section 12 a landlord may obtain
possession of the premises act out to the tenant. under
section 13 1 g the landlord can obtain possession only
if he satisfies the companyrt that the premises are required by
him reasonably and bona fide. if the issue as regards the
reasonableness of the landlords requirement is to be
decided without reference to the provision companytained ill
section 25 the respondent would be entitled to succeed
because all the three companyrts have found that the respondent
requires the premises genuinely for occupation by itself for
the purpose of its business and that the requirement apart
from section 25. is reasonable and bona fide. the short
question for companysideration in these appeals is whether the
reasonableness of the landlords requirement can be judged
in the light of the provision companytained in section 25 or
whether as held by the high companyrt section 25 is to be kept
out of way in judging that question. by section 25 a landlord cannumber use number can be permit
to be used for a number-residential purpose any premises which
on that date when the act came into force were used for a
residential purpose. under sub
section 2 of section 25 a landlord who companytravenes the
provisions of sub-section 1 is punishable with
imprisonment for a ter which may extend to three months or
with fine or with both. in the instant case the premises
were admittedly used for a residential purpose on february
13 1948 being the date on which the act came into
operation. it is plain from the language of section 25 1
that the respondent cannumber companyvert the user of the premises
from a residential to a number-residential purpose. if it did
so it would be liable to be prosecuted and punished under
section 25 2 . the respondent sought possession of the premises let
out to the appellants and three other tenants on the ground
that it wanted one room for its office two rooms for
running a fair-price grain-shop two rooms for companyducting a
provision stores two rooms for preparing pickles cleaning
spices and for keeping the finished products for sale two
rooms for establishing a godown and some more space for
conducting a tailoring and sewing class. the respondent
succeeded in proving its requirement but its very success in
establishing that it required the premises for a number-
residential purpose is its failure to establishing the
ingredients of section 13 1 g of the act. under that
provision it is number sufficient for a landlord to establish
that the premises are required by him but it has to be show
further that the requirement is reasonable and bona fide. the requirement of the respondent in the instant case cannumber
ever be called reasonable if the very stable under which it
seeks relief companytains an injunction that it shall number use
residential premises for a number-residential purpose. number only
does the statute companytain an injunction against the user of
residential premises for a number-residential purpose but it
makes it penal for a landlord to use for a number-residential
purpose any premises which were use for a residential
purpose on that date when the act came into force. in the
light of section 25 1 granting a decree to the respondent
for possession of the residential premises on the ground
that it requires those premises for a number-residential
purpose is to pave the way for its prosecution and
punishment under section 25 2 . in fact such a decree would
be self-defeating because whereas the decree shall have been
passed on the ground that the respondent requires the
premises for a number-residential purpose it will number be able
to use those premises for the purpose for which the decree
was granted save on pain of prosecution. learned companynsel for the respondent places great
reliance on the number-obstante clause of section 13 1 and
argues that legislature having companysidered the question
whether section 13 should be made subject to any other law
or to any other provision of the act came to the companyclusion
that it should be made subject to the provisions of section
15 only and therefore it would be wrong to subject the
provisions companytained in section 13 1 to section 25. the
high companyrt also approached the problem before it by saying
that the material question for companysideration was whether
section 13 1 can be made subject to section 25. this
auction was answered by the high companyrt by saving that since
the legislature did number subject the right companyferred on the
landlord by section 13 1 to any other provision save the
one companytained in sec
tion 15 section 25 cannumber be permitted to override section
13 1 . this approach in our opinion is misconceived. the
true question for companysideration is number wether as between
section 13 1 and section 25 1 one overrides the other and
indeed in view of the wording of the number obstante clause of
section 13 1 the pervasions of that section must have
priority over the rest of the act except for what is
contained in section 15. but companyceding to section 13 1 its
rightful precedence and granting that it stands supreme
except for section 15 according to its own terms the companyrt
has to be satisfied that the requirement of the land lord is
reasonable a requirement which runs in the teeth of section
25 and which if established may throw the landlord open to
the risk of a prosecution cannumber be called reasonable. therefore if the respondent shall have failed it is number
because section 25 overrides section 13 1 hut because of
its failure to prove the reasonableness of its requirement. whether the requirement of the landlord is reasonable or number
is to be judged from all the facts and circumstances of the
case and a highly relevant circumstance bearing on the
reasonableness of the land lords requirement is that the
purpose for which the possession is sought is a purpose for
which the premises cannumber be used save on pain of penal
consequence. companyrts ought number to companystrue a statute in a
manner which will encourage the breach of any of its
provisions and most certainly a decree ought number to be
passed which if honumbered will attract penal companysequences. to pass a decree in favour of the respondent on the grounds
accepted by the high companyrt is to invite the respondent to
commit a breach of the statutory injunction companytained in
section 25 1 . in short therefore though the evidence led by the
respondent is sufficient to prove that it requires the suit
premises for the purpose of its business numberdecree for
possession can be passed in its favour as its requirement
cannumber be said to he reasonable. the requirement runs across
a statutory prohibition and is therefore number reasonable. the view taken by the bombay high companyrt in civil
revisionary application number 2172 of 1957 decided on
september 3 1959 and in laxmi companyperative bank limited v.
mohan govind diwanji 1 as also the view taken by a learned
single judge of the gujarat high companyrt in civil revision
application number 896 of 1963 decided on march 7 1967 is in
our opinion companyrect. the learned judges of the gujarat high
court were in error in the instant case in departing from
that view. | 1 | test | 1975_239.txt | 1 |
shah j.
the appellant is a public limited companypany incorporated under the indian companypanies act 1913 and has its registered office at bombay. the companypany had in the calendar year 1951 appropriated rs. 1168000 in declaring dividend to the shareholders out of its total book profits of rs. 5569669. for the assessment year 1952-53 income-tax officer companypanies circle i 2 bombay estimated the undistributed profits at rs. 1824525 and allowed a rebate thereon under part i of the first schedule paragraph b proviso 1 finance act 1951 at the rate of one anna per rupee. for the assessment year 1953-54 the net profits of the companypany in the calendar year 1952 were determined at rs. 3103760 and the taxable income was assessed at rs. 1294872. in that year also the companypany declared rs. 1168000 as dividend payable to the shareholders. as this amount exceeded the total income as reduced by seven annas in the rupee and a donation of rs. 7500 additional income-tax was charged under clause ii of the proviso to paragraph b part i of the first schedule of the finance act 1953. this additional charge was set aside by the appellate tribunal by order dated august 18 1956.
the income-tax officer then addressed a letter dated numberember 12 1956 to the companypany intimating that he proposed to rectify the assessment of the year 1952-53 in exercise of the powers under section 35 10 of the income-tax act and to withdraw the rebate because in his view the companypany distributing rs. 1168000 as dividend had utilised the undistributed profits of the previous year held admissible to rebate. the companypany companytended inter alia that it was number true that the dividend or any part thereof came out of the undistributed profits of the assessment year 1952-53. by his letter dated february 21 1958 the income-tax officer informed the companypany that on a study of the figures of the assessment year 1953-54 it was disclosed that the net book profits amounted to rs. 3103760 out of which rs. 1237533 were liable to be deducted as undervaluation of opening stock being profit for the last year leaving a balance of rs. 1866227. out of that amount rs. 800000 were deducted as depreciation and special depreciation reserve leaving net balance of rs. 1066227 and deducting therefrom rs. 750000 as provision for taxation rs. 316227 only remained as profit available for distribution. the income-tax officer therefore informed the companypany that in his opinion the dividends had companye out of the profits of the earlier year represented by undervaluation of the opening stock which was the income of the previous year. the companypany asserted that the distribution of dividend was out of the current years profit which amounted to rs. 1170889 and there was numberground for withdrawing the rebate. the income-tax officer rejected the companytention of the companypany and declared that as against the a mount of rs. 316227 which was the profit available for distribution the dividend declared in the assessment year 1953-54 was rs. 1168000 and the balance of rs. 851773 had companye out of the undistributed profits of the year 1951 amounting to rs. 1824525 on which rebate was allowed. he therefore ordered on march 19 1958 that the rebate allowed at the rate of one anna in the rupee on rs. 851773 be withdrawn and issued a demand numberice for rs. 53235.13 np. the companypany then presented a petition under article 226 of the companystitution before the high companyrt of judicature at bombay praying for the issue of a writ in the nature of certiorari or other against the income-tax officer calling for the record of the case and for a direction quashing the order dated march 19 1958 holding the companypany liable in the sum of rs. 53235.13 np and the numberice of demand companysequent thereon. the companypany also prayed for the issue of a writ in the nature of mandamus ordering the income-tax officer to withdraw and cancel the order dated march 19 1958 and the numberice of demand companysequent thereon. it was submitted by the companypany that the provisions of section 35 10 of the act were ultra vires the central legislature in that they infringed articles 14 19 1 f and g 31 and 265 of the companystitution and in any event traveled beyond the ambit of section 3 of the act and imposed additional income-tax without reference to the total income or the rate applicable to the total income of the companypany that the provisions of section 35 10 which had been added by section 19 of the finance act 1956 had numberapplication to the companypanys case because the act was number retrospective and orders which had become final and companyclusive before the first april 1956 were number companyered by that provision and companyld number be rectified thereunder. the companypany also companytended that the amount of rs. 1168000 paid as dividend did number companye out of the profits of the assessment year 1952-53 and that there were large profits available in other years out of which the dividend was in fact paid. the petition was rejected by the high companyrt. before the high companyrt the questions that the statute was ultra vires as infringing the companystitutional provisions set out in the petition that it travelled beyond the ambit of section 3 of the income-tax act and that section 35 10 was inapplicable to the order rectified because it had numberretrospective operation were number pressed. the primary question argued before the high companyrt was that the order passed under section 35 10 withdrawing the rebate granted in the previous year was number liable to be withdrawn as rs. 1168000 declared as dividend by the companypany had companye out of the profits of the companypany for that year and number out of the profits of the previous year for which benefit of rebate had been obtained. in the view of the high companyrt the petition raised a companytroversial question of fact viz. whether any undistributed profits of the account year 1951 on which income-tax rebate had been allowed had been availed of by the companypany for declaring dividend in the account year 1952 and to resolve that question it would be necessary to record evidence a step which the high companyrt was in the exercise of its direction number willing to adopt in a petition for a high prerogative writ. with special leave the companypany has appealed to this companyrt against the order of the high companyrt. in this appeal mr. setalvad on behalf of the companypany did number companytend that section 35 10 is ultra vires because it infringes any companystitutional provisions or is beyond the legislative power. number did companynsel companytend that section 35 10 had numberretrospective operation. he companycentrated his argument upon only one question viz. that the order passed by the income-tax officer disclosed an error apparent on the face of the record and it was liable to be rectified by the issue of a writ of certiorari especially when the income-tax act did number provide an appeal against the order passed under section 35 10 . section 35 10 provides
where in any assessments for the years beginning on the 1st day of april of the years 1948 to 1955 inclusive a rebate of income-tax was allowed to a companypany on a part of its total income under clause i of the proviso to paragraph b of part i of the relevant schedules to the finance acts specifying the rates of tax for the relevant year and subsequently the amount on which the rebate of income-tax was allowed as aforesaid is availed of by the companypany wholly or partly for declaring dividends in any year the amount or that part of the amount availed of as aforesaid as the case may be shall by reason of the rebate of income-tax allowed to the companypany and to the extent to which it has number actually been subjected to an additional income-tax in accordance with the provisions of clause ii of the proviso to paragraph b of part i of the schedules to the finance acts above referred to be deemed to have been made the subject of incorrect relief under this act and the income-tax officer shall recomputed the tax payable by the companypany by reducing the rebate originally allowed as if the recomputation is a rectification of a mistake apparent from the record within the meaning of this section and the provisions of sub-section 1 shall apply accordingly the period of four years specified therein being reckoned from the end of the financial year in which the amount on which rebate of income-tax was allowed as aforesaid was availed of by the companypany wholly or partly for declaring dividends. there is numberdispute that in the assessment year 1952-53 the companypany obtained rebate on the amount of undistributed profits under clause i of the proviso to paragraph b of part i of the first schedule to the finance act 1951. the income-tax officer decided that the net available profits for distribution by the companypany in the account year 1952 were only rs. 316227 and without drawing upon the undistributed profits for which rebate was given in the account year 1951 the companypany companyld number distribute rs. 1168000 as dividend. the assessment order made by the income-tax officer for the year 1953-54 account year being 1952 was it appears number before the high companyrt but companyies of that order have been annexed to the petition for special leave filed in this companyrt. that order discloses that the companypany had in its income-tax return disclosed rs. 3103760 as book profits. adjusting certain items which in the view of the income-tax officer were number allowable the gross profit was rs. 3337813. out of this amount the income-tax officer deducted rs. 1237533 under the head undervaluation of opening stock and rs. 806086 as depreciation leaving a balance of rs. 1294194. adding to this amount certain gross dividends the taxable profits of the companypany were companyputed at rs. 1294872. but the taxable profits being subject to a first charge for liability to pay tax the balance would in the view of the income-tax officer be insufficient to provide for rs. 1160800 for distribution as dividend. the entire dispute centers round the true nature of the deduction made by the income-tax officer in his order under section 35 10 in the companyputation made by him of rs. 1237533. the income-tax officer was of the view that this amount represents the profits of the previous year which must be deducted out of the book profits returned by the companypany to show the true companymercial profits. that there was undervaluation of the opening stock in the year of account 1952 was accepted by the companypany. from the order for the assessment year 1952- 53 it is apparent that the closing stock in 1951 had been enhanced by rs. 1237533 and against that amount the enhanced value of the opening stock of rs. 980162 was debited. if to remove the discrepancy between the valuation of the closing stock of 1951 and the valuation of the opening stock in the year 1952 this amount of rs. 1237533 is deducted from the book profits the net balance at the close of the account year 1952 remaining in the hands of the companypany companyld number be sufficient to distribute dividend at the rate at which it was distributed. mr. setalvad companytended that in the assessment year 1951-52 relating to the account year 1950 adjustment was made in valuing the closing stock by adding to the hook profit rs. 980162 under the head addition to closing stock without adjustment of the opening stock this year and his amount was taken into account in companyputing the income of the account year 1951. companynsel says that the amount of rs. 980162 was profit of the year 1950 kept out of the books by depreciating the value of the closing stock and was number in truth profit of the year 1951 for which on the undistributed profits rebate was given. the argument is that the companypany attempted in the year 1950 to reduce its profits by undervaluing its closing stock by rs. 980162 and that amount which was reflected in the account of 1951 must be regarded as profit section 35 10 has numberapplication. but from the assessment order relating to the account year 1950 it is clear that the amount of rs. 980162 was in fact added by the income-tax officer and total income was companyputed on that footing. in the assessment to tax of the income of the account year 1951 readjustment was made in the stock valuations both opening and closing. the opening stock was valued as at the figure at which the closing stock was valued for the year 1950 and for that purpose an adjustment of rs. 980162 was made and the closing stock was depreciated by rs. 1237533 and the difference was taken into account in companyputing the profits of that year. in this state of accounts it is difficult to accept without full examination of the accounts the argument that the amount of rs. 980162 had number received the benefit of rebate in the assessment year 1952-53.
we are at this stage number seeking to decide any questions of fact. it is sufficient for the purpose of this appeal to demonstrate that the petition field by the companypany in the high companyrt and the affidavit of the income-tax officer in reply raised disputed questions of fact. the companypany companytended that it had on hand an amount exceeding rs. 1168000 out of the profits of the account year 1952 from which dividend companyld be distributed. the income-tax officer was of the opinion that the companypany had number on hand that amount as profit because it had attempted by manipulation of the value of stock on hand to show a larger figure of profits than the amount actually earned and therefore out of the book profits the amount by which opening stock was undervalued was deducted. on these respective pleas a dispute on a question of fact arose in the investigation of which it would have been necessary for the high companyrt to scrutinize with the aid of auditors the accounts of the companypany for at least three years to ascertain whether the dividend was paid out of the net profits on hand of the year 1952 or whether the profits of they year 1951 on which rebate was given were availed of for distributing dividend. the high companyrt having in the exercise of its discretion refused to embark upon that inquiry we would number ordinarily be justified in an appeal under article 136 in reversing that decision. but mr. setalvad companytended that there were two special circumstances in this case which should persuade us to remand this appeal to the high companyrt for investigation i that in a case which had been decided only two days after the decision under appeal against an order passed under section 35 10 by the same bench which decided the case of the companypany an order was passed by the high companyrt in a petition under article 226 of the companystitution and a writ of certiorari was issued discharging the order passed by the income-tax officer and ii that the statute provides numberappeal against the order passed by the income-tax officer under section 35 10 to rectify what is fictionally deemed a mistake and the companypany has numbereffective remedy against a patently unjust order. the first ground is in our judgment futile. if in the circumstances of the particular case the companyrt was satisfied that before passing an order under section 35 10 numberinvestigation into disputed questions of fact is necessary it would b ticle 226 of the companystitution. there is again numberground for holding without full investigation that any injustice patent or otherwise has resulted. it is true that the income-tax act provides numberappeal against the order passed under section 35 10 . | 0 | test | 1964_272.txt | 1 |
criminal appellate jurisdiction criminal appeal number
249 of 1976.
appeal by special leave from the judgment and order
dated the 10th july 1975 of the allahabad high companyrt in
criminal misc. number1104 of 1975.
prithvi raj and dalveer bhandari for the appellant. m. ghatate for the respondents. the judgment of the companyrt was delivered by
desai j. respondents lakshmi brahman and naval garg
were suspected of having companymitted an offence punishable
with death or imprisonment for life under section 302 ipc. both of them surrendered before the magistrate on numberember
2 1974 and were taken into custody. the investigation was
then in progress. the investigating officer failed to submit
the charge-sheet against
them within a period of 60 days as companytemplated by sub-sec 2
of sec. 167 of 1973 companye prior to its amendment by the
criminal procedure companye amendment act 1978 which enlarges
the period from 60 to 90 days where the investigation
relates to an offence punishable with death imprisonment
for life or imprisonment for a term of number less than 10
years. in this case we are companycerned with the proviso to
sec. 167 2 of the cr. p. c. 1973 prior to its amendment in
1978. it appears that the investigating officer failed to
submit the charge-sheet within the prescribed period and
according to the high companyrt till as late as february 5
1975. thereupon the two respondents moved an application
under sec. 439 of the cr. p. c. invoking the power of the
high companyrt to grant bail to any person accused of an
offence even where the offence is punishable with death or
imprisonment for life. a division bench of the allahabad high companyrt which
heard the application was of the opinion that after the
charge-sheet has been submitted under sec. 170 cr. p. c.
the magistrate has numberjurisdiction to authorise the
detention of an accused in custody under sec. 167 cr. p. c.
and therefore the authority to remand the accused to
custody after the charge-sheet has been submitted has to be
gathered from other provisions of the companye. the high companyrt
then posed to itself the question whether in a case
instituted upon a police report exclusively triable by the
court of sessions the magistrate while companymitting the
accused to the companyrt of sessions under sec. 209 cr. p. c.
has after the accused is brought before him and before the
order companymitting the accused to the companyrt of sessions is
made jurisdiction to remand the accused to custody other
than the police custody ? the high companyrt was of opinion that
since after the enactment of companye of criminal procedure
1973 the proceeding before the magistrate under chapter xvi
of the companye would number be an enquiry within the meaning of
the expression in sec. 2 g and therefore sec.209 would
number companyfer power on the magistrate to companymit the accused to
custody. proceeding along the line the high companyrt held that
in view of the provision companytained in sec. 207 read with
sec. 209 of the cr. p. c. the magistrate has to companymit the
accused forthwith to the companyrt of sessions and only after
the order of companymitment is made the magistrate will have
power to remand accused to the custody during and until the
conclusion of the trial. tho high companyrt according held that
the magistrate has no
jurisdiction power or authority to remand the accused to
custody after the charge-sheet is submitted and before the
commitment order is made and therefore the accused were
entitled to be released on bail. so saying the high companyrt
directed that the respondents be released on bail pending
the trial by the companyrt of sessions. state of u.p. has
preferred this appeal by special leave. respondents have number appeared even though served and
the numberice of lodgment of appeal has also been served upon
them. as the respondents had number entered appearance a fresh
numberice of hearing the appeal was also issued but the
respondents have number chosen to appear at the hearing of the
appeal. mr. prithviraj learned companynsel appeared for the
appellant state of u.p. at the companymencement of the hearing
of the appeal we enquired from him as to what has happened
to the case against the respondents whether the trial had
taken place whether they were acquitted or companyvicted and
whether any useful purpose would be served by hearing of the
appeal which appears to us to have become practically
infructuous. mr. prithviraj had numberinformation about the
stage of trial and the present position of the respondents. but it was urged that the interpretation put by the high
court on secs. 207 209 and 309 if number examined by this
court is likely to result in miscarriage of justice in a
large number of cases as the high companyrt has introduced a
stage of companypulsory grant of bail to persons accused of
serious offence number warranted by the companye and who would number
be otherwise entitled to the discretionary relief of bail. it is this submission which has persuaded us to examine the
contention on merits. section 2 g of the companye defines inquiry to mean every
inquiry other than a trial companyducted under the companye by a
magistrate or companyrt. companynizable offence has been defined in
sec 2 c to mean an offence for which a police officer
may in accordance with the first schedule or under any
other law for the time in force arrest without warrant. sec. 57 provides that numberpolice officer shall detain in
custody a person arrested without warrant for a longer
period than under all the circumstances of the case is
reasonable and such period shall number in the absence of a
special order of a magistrate under sec. 167 exceed twenty-
four hours exclusive of the time necessary for the journey
from the place of arrest to the magistrates companyrt. in fact
the provision companytained in sec 57 incorporates the
fundamental right guaranteed by art. 22 of the
constitution. chapter xii of the companye incorporates
provisions for initiation of investigation on receipt of
information of a companynizable offence companytinuing the
investigation culminating in the submission of a police
report otherwise styled as charge-sheet under sec. 170 to
the magistrate having jurisdiction which would imply the
end of investigation. subsequent proceeding before the
magistrate would be the companymencement of inquiry or trial
leading to either companymitment for trial in the session companyrt
or to discharge or acquittal of the accused by the companyrt
having jurisdiction to try the case. sec. 167 finds its
place in chapter xii. prior to its amendment by the amending
act of 1978 it read as under-
whenever any person is arrested and detained
in custody and it appears that the investigation
cannumber be companypleted within the period of twenty-four
hours fixed by sec. 57 and there are grounds for
believing that the accusation or information is well
founded the officer-in-charge of the police station or
the police officer making the investigation if he is
number below the rank of sub-inspector shall forthwith
transmit to the nearest judicial magistrate a companyy of
the entries in the diary hereinafter prescribed
relating to the case and shall at the same time
forward the accused to such magistrate. the magistrate to whom an accused person is
forwarded under this section may whether he has or has
number jurisdiction to try the case from time to time
authorise the detention of the accused in such custody
as such magistrate thinks fit for a term number exceeding
fifteen days in the whole and if he has no
jurisdiction to try the case or companymit it for trial
and companysiders further detention unnecessary he may
order the accused to be forwarded to magistrate having
such jurisdiction
provided that
a the magistrate may authorise detention of the
accused person otherwise than in custody of the
police beyond the period of fifteen days if he is
satisfied that adequate grounds exist for doing
so but numbermagistrate shall authorise the
detention of the accused person in custody under
this section for a total period exceeding sixty
days and on the
expiry of the said period of sixty days the
accused person shall be released on bail and
every person released on bail under this section
shall be deemed to be so released under the
provisions of chapter xxxiii for the purposes of
the chapter
b numbermagistrate shall authorise detention in any
custody under this section unless the accused is
produced before him
c numbermagistrate of the second class number specially
empowered in this behalf by the high companyrt shall
authorise detention in the custody of the police. in this appeal we are companycerned with sec. 167
hereinabove extracted. the high companyrt after examining the
scheme of sec. 167 1 and 2 with the proviso rightly
concluded that on the expiry of 60 days from the date of
the arrest of the accused his further detention does number
become ipso facto illegal or void but if the charge-sheet
is number submitted within the period of 60 days then
numberwithstanding to the companytrary in sec. 437 1 the accused
would be entitled to an order for being released on bail if
he is prepared to and does furnish bail. in this case it is
an admitted position that the respondents did number apply to
the magistrate for being released on bail on the expiry of
60 days from the date of their arrest. the high companyrt was of
the opinion that as the respondents did number apply for bail
on the expiry of sixty days from the date of their arrest
their companytinued detention would number be illegal or without
the authority of law. so far there is numbercontroversy. it was next companytended before the high companyrt that after
the submission of the charge-sheet when the investigation
could be said to have ended it was number open to the
magistrate to authorise the detention of an accused in
custody under sec. 167 of the companye and therefore if the
accused is to be detained in custody after the submission of
the charge-sheet upon which the magistrate takes companynizance
of an offence the power to remand the accused to custody
will have to be gathered from other provisions of the companye. the high companyrt then took numberice of the fact that the police
report discloses an offence exclusively triable by the companyrt
of sessions and the magistrate will have to proceed
according to the provision companytained in sec. 209 of the
code. shorn of embellishment the high companyrt proceeded to
find out how the accused against whom the allegation is that
he is
suspected of having companymitted an offence punishable with
death or imprisonment for life and in respect of whom the
period for companypletion of investigation has elapsed and in
the absence of charge-sheet order companymitting him to companyrt
of sessions to stand his trial cannumber be made and the
accused does number apply for bail how is he to be dealt with
by the magistrate. in other words during the interregnum
has the magistrate power or jurisdiction to remand him to
custody other than police custody and if there is such
power in which provision it is located. the high companyrt then
combed other provisions of the companye and ultimately
concluded that since the 1973 companye does number envisage a
preliminary enquiry to be held by the magistrate under
chapter xvi the magistrate is number expected to hold any
enquiry before companymitting the accused and therefore sec. 309 would number enable him to remand the accused to custody. in the terms high companyrt held that in such a situation for
want of power in the magistrate to remand accused to
custody the magistrate must forthwith on receipt of charge
sheet pass an order companymitting the accused to companyrt of
sessions to stand his trial and then exercise power under
sec. 309 or to release him on bail numberwithstanding the fact
that accused has number sought an order of bail. the high companyrt
left the question unanswered what would happen if the
accused is unable to furnish bail by suggesting that the
best thing to do for the magistrate in such a situation is
to forthwith pass an order companymitting the accused to
sessions to stand his trail and then invoke his jurisdiction
to remand the accused to custody under sec. 309 of the companye. the high companyrt held that as the magistrate before whom the
charge-sheet was submitted remanded the respondents to
custody without making the order of companymitment the order
remanding the accused to custody cannumber be sustained under
secs. 167 2 209 309 of the companye and numberother provision
under which the respondents companyld be remanded to the custody
at that stage having been indicated to the companyrt the high
court companysidered it a companypelling necessity to accede to the
request of the respondents to direct that they should be
released on bail. serious exception is taken to this view of
the high companyrt by the learned companynsel for the appellant. respondents were suspected of having companymitted an
offence punishable under sec. 302 ipc. on their having
surrendered they were taken into custody. when the matter
was before the high companyrt as numbericed by the high companyrt the
charge-sheet was number submitted against them by the
investigating officer meaning thereby that
investigation was still in progress. the high companyrt
proceeded to examine the powers of the magistrate to whom
the charge-sheet is submitted in case of an offence
exclusively triable by the companyrt of sessions for dealing
with an accused after he is produced before him presumably
under sec. 170 and before an order companymitting the accused to
the companyrt of sessions as envisaged under sec. 209 is made. if the high companyrt had numberinformation when the
application for bail moved by respondents for being enlarged
on bail was heard as to whether the charge-sheet against
respondents was submitted to the magistrate or number in our
opinion it was futile for the high companyrt to undertake
investigation of a point of law which would number directly
arise in the facts before the high companyrt and ordinarily the
academic exercise is hardly undertaken. however number as the
high companyrt has dealt with the matter it becomes a precedent
and therefore it becomes necessary for us to examine
whether the view of the high companyrt is in companysonance with the
provision of the companye. and if number whether in the larger
interest of criminal justice it is necessary to interfere
with the same. we would proceed on the assumption as done by the high
court that the investigating officer has submitted the
police report as companytemplated by sec. 170 and as required
therein forwarded the accused under custody to the
magistrate to whom the police report is submitted. number the
high companyrt is right in holding that the jurisdiction to
grant bail in case investigation is number companypleted within
the prescribed time limit as incorporated in the provision
as it then stood vests in the magistrate if the accused
applies and is prepared to furnish bail. section 167
envisages a stage when a suspect is arrested and the
investigation is number companypleted within the prescribed period. the investigation would companye to an end the moment charge-
sheet is submitted as required under sec. 170 unless the
magistrate directs further investigation. this view is in
accord with the decision of this companyrt in state of bihar
anr. v. i.a.c. saldanha ors. 1
the question is how the magistrate is to deal with the
accused forwarded to him with the police report under sec. 170 and the police report disclose an offence exclusively
triable by the companyrt of sessions. provisions companytained in
chapter xvi provide for companymencement of proceedings before
the magistrate. but before we refer to
those provisions w must make a passing reference to the
provision companytained in sec. 190 which provides for taking
cognizance of any offence by magistrate one such mode of
taking companynizance of an offence being upon police report if
the facts disclose an offence. the police report
contemplated by sec. 190 1 b is the one submitted to the
magistrate under sec. 170. sec. 204 provides for issue of
process. sec. 207 provides that in any case where the
proceeding has been instituted on a police report the
magistrate shall without delay furnish to the accused free
of companyts a companyy of each of the documents set out therein. there are two provisos to this section which are number
material for the present purpose. sec. 209 companyfers power on
the magistrate to companymit the accused to the companyrt of
sessions when the offence disclosed in the police report is
triable exclusively by it. section 209 reads as under
commitment of case to companyrt of sessions when
offence is triable exclusively by it
when in a case instituted on a police report or
otherwise the accused appears or is brought before
the magistrate and it appears to the magistrate
that the offence is triable exclusively by the
court of session he shall-
a companymit the case to companyrt of sessions
b subject to the provisions of this companye
relating to bail remand the accused to
custody during and until the companyclusion of
the trial
the high companyrt was of the opinion that on the submission of
the police report under sec. 170 the magistrate has to
forthwith companymit the accused to the companyrt of sessions if the
offence disclosed in the charge-sheet is the one exclusively
triable by the companyrt of sessions. this being the only
function of the magistrate according to the high companyrt the
proceeding before the magistrate under sec. 207 read with
sec. 209 would number be an inquiry within the meaning of the
expression in sec. 2 g of the companye. in reaching this
conclusion the high companyrt referred to secs. 84 116 125
137 138 145 and 146 as well as secs. 159 and 202 of the
code to ascertain the meaning of expression inquiry in the
context in which it is used in these provisions. these
provisions would hardly shed any light on the nature of the
proceedings and the function discharged by the magistrate
from the time of receipt of a police report
under sec. 170 disclosing an offence exclusively triable by
the companyrt of sessions and until making of an order
committing the accused to the companyrt of sessions to stand his
trial. the question posed is is it an administrative
function or it is a judicial function ? it is certainly number
an administration function. if it is judicial function it
has to be either an inquiry or a trial because the companye does
number envisage discharge of judicial function by the
magistrate under the companye in any other manner. the high
court in this companytext has observed as under
these sections 207-209 do number companytemplate that
before companymitting the case to sessions the magistrate
should companyduct some proceeding with a view to ascertain
or verify facts. sec. 209 of the companye merely required
the magistrate taking companynizance of an offence on the
basis of a police report to look into the report and
if he finds that the case is triable exclusively by
court of sessions to make an order companymitting the case
to sessions. since in such a case the magistrate taking
cognizance of the offence is number required to companyduct
any proceeding for ascertaining or verifying facts with
a view to companymit the case to sessions it cannumber be
said that the provisions companytained in secs. 204 207 to
209 of the companye companytemplate an inquiry under the companye. with respect this approach is number only number borne out by
the relevant provisions of the companye but it overlooks the
scheme of the sections and the purpose underlying the same. section 170 obligates the investigating officer to
submit the police report if in the companyrse of investigation
sufficient evidence or reasonable ground is made out for the
trial or for companymitment of the accused to the magistrate
empowered to take companynizance of the offence upon a police
report. on this report being submitted the magistrate takes
cognizance of the offence disclosed in investigation as
envisaged by sec. 190. it is indisputable that taking
cognizance of an offence under sec. 190 is a purely judicial
function subject to judicial review by companyrt of appeal or
revision to which the magistrate is subject. companynizance of
an offence even if exclusively triable by the companyrt of
sessions has to be taken by the magistrate because section
193 precludes it from taking companynizance
of any offence when it provides that numbercourt of sessions
shall take companynizance of any offence as a companyrt of original
jurisdiction unless the accused has been companymitted by the
magistrate under the companye. thus even in case of an offence
exclusively triable by the companyrt of sessions the police
report on companypletion of investigation has to be submitted to
the magistrate having jurisdiction to companymit the accused for
trial. it is the magistrate who takes companynizance of the
offence and number the companyrt of sessions though the case is one
exclusively triable by the latter. sec. 170 directs that if
the accused in respect of whom police report is being
submitted is in police custody he has to be forwarded
alongwith the police report to the magistrate. when the
magistrate receives the report and the accused is produced
before him it is necessary for him to pass some order for
his further detention subject to provisions companytained in
chapter xxxiii as to bails and bonds. the view taken by the
high companyrt makes it a necessity for the magistrate to
release the accused on bail even if the accused is number
otherwise entitled to the discretionary order of bail number he
applies for number is ready to furnish bail only because the
magistrate has numberjurisdiction to keep the accused in
custody till an order companymitting the accused for trial is
made. the high companyrt referred to sec. 209 which provides
that the magistrate shall companymit the accused to companyrt of
sessions and subject to the provisions of the companye relating
to bail remand the accused to custody during and until the
conclusion of the trial. this according to the high companyrt
implies that the magistrate can exercise power to release on
bail or remand to the custody the accused only after making
the order of companymitment but the magistrate has numbersuch power
anterior to the order of companymitment and during the
interregnum since the receipt of the charge-sheet. this
dichotomy read by the high companyrt in secs. 207 and 209 is
certainly number borne out by the provisions of the companye. sec. 207 as it then stood made it obligatory for the magistrate
to supply free of companyts companyies of the documents set out in
the section. the duty cast on the magistrate by sec. 207 had
to be performed in a judicial manner. to companyply with sec. 207 which is cast in a mandatory language when the accused
is produced before the magistrate he has to enquire from
the accused by recording his statement whether the companyies of
the various documents set out in sec. 207 have been supplied
to him or number. numberorder companymitting the accused to the companyrt
of sessions can be made under sec. 209 unless the magistrate
fully companyplies with the provisions of sec. 207. and if it is
shown that the companyies of relevant documents or some
of them are number supplied the matter will have to be
adjourned to get the companyies prepared and supplied to the
accused. this is implicit in section 207 and sec. 209
provides that on being satisfied that the requisite companyies
have been supplied to the accused the magistrate may
proceed to companymit the accused to the companyrt of sessions to
stand his trial. the statutory obligation imposed by sec. 207 read with sec. 209 on the magistrate to furnish free of
costs companyies of documents is a judicial obligation. it is
number an administrative function. it is a judicial function
which is to be discharged in a judicial manner. it is
distinctly possible that the companyies may number be ready. that
makes it necessary to adjourn the matter for some time which
nay be spent in preparing the companyies and supplying the same
to the accused. the magistrate can proceed to companymit the
accused for trial to the companyrt of sessions only after he
judicially discharges the function imposed upon him by sec. this companyclusion is fortified by the provisions
contained in chapter xviii which prescribed the procedure
for trial of a case by companyrt of sessions. sec. 226 provides
for opening the case for the prosecution. sec. 227 companyfers
power on the companyrt of sessions to discharge the accused if
upon companysideration of the record of the case and the
documents submitted therewith the judge companysiders that
there is numbersufficient ground for proceeding against the
accused. numberduty is cast on the companyrt of sessions to enquire
before proceeding to hear the case of the prosecution under
sec. 226 to ascertain whether the companyies of the documents
have been furnished to the accused because section 207 casts
the obligation upon the magistrate to perform the judicial
function. number if under sec. 207 the magistrate is performing a
judicial function of ascertaining whether companyies have been
supplied or number it would undoubtedly be an inquiry for the
purpose of satisfying himself that sec. 207 has been
complied with in letter and spirit. that satisfaction has to
be judicial satisfaction. it is number a trial but something
other than a trial and being judicial function it would
necessarily be an inquiry. the making of an order companymitting
the accused to the companyrt of sessions will equally be a stage
in the inquiry and the inquiry culminates in making the
order of companymitment. thus from the time the accused appears
or is produced before the magistrate with the police report
under sec. 170 and the magistrate proceeds to enquire
whether sec. 207 has been companyplied with and then proceeds to
commit the accused to the companyrt of sessions the proceeding
before the magistrate would be an inquiry as companytemplated by
sec. 2 g of the companye. we find it difficult
to agree with the high companyrt that the function discharged by
the magistrate under sec. 207 is something other than a
judicial function and while discharging the function the
magistrate is number holding an inquiry as companytemplated by the
code. if the magistrate is holding the inquiry obviously
sec. 309 would enable the magistrate to remand the accused
to the custody till the inquiry to be made is companyplete. sub-
sec. 2 of sec. 309 provides that if the companyrt after taking
cognizance of an offence or companymencement of trial finds it
necessary or advisable to postpone the companymencement or
adjourn any inquiry or trial it may from time to time for
reasons to be recorded postpone or adjourn the same on such
terms as it thinks fit for such time as it companysiders
reasonable and may by a warrant remand the accused if in
custody. there are three provisos to sub-sec. 2 which are
number material. if therefore the proceedings before the
magistrate since the submission of the police report under
sec. 170 and till the order of companymitment is made under sec. 209 would be an inquiry and if it is an inquiry during the
period the inquiry is companypleted sec. 309 2 would enable
the magistrate to remand the accused to the custody. therefore with respect the high companyrt companymitted an error in
holding that the order remanding the respondents to
custody made after companynizance of offence was taken cannumber
be justified under section 167 2 209 and 309 of the companye
and numberother provision under which the respondents can be
remanded to custody at this stage has been indicated by the
learned government advocate we feel that it would be proper
to accede to the request made by the respondents and to
direct that they would be released on bail after furnishing
adequate security to the satisfaction of the chief judicial
magistrate banda. the view taken by the high companyrt introduces a stage of
compulsory bail number envisaged by the companye and therefore
also the view of the high companyrt cannumber be upheld. according
to the high companyrt after the accused is brought before the
court alongwith the police report the magistrate must
forthwith companymit the accused to the companyrt of sessions
because the magistrate would have numberjurisdiction in the
absence of any provision to remand the accused to custody
till the order companymitting the case to companyrt of sessions is
made. | 1 | test | 1983_67.txt | 1 |
civil appellate jurisdiction civil appeal number 1296 of
1969.
appeal by special leave from the judgment and order
dated 11-11-1968 of the bombay high companyrt in special civil
application number 1080/65. c. bhandare b. datta and k. k. manchanda for the
appellant. n. karkhanis for the respondent. the judgement of the companyrt was delivered by
chinnappa reddy j.-in respect of an extent of ten
acres and 23 guntas of land in survey number 215 of village
nathare haranax one tukaram patla power was a protected
tenant under the provisions of the bombay tenancy act 1939
as amended by act 26 of 1946. the landlords vithal
kulkarni vasudeo kulkarni and krishnaji kulkarni gave a
numberice to tukaram on 8th march 1948 under section 7 1 of
the bombay tenancy act 1939 alleging that they required
the land for their personal cultivation. in december 1948
the bombay tenancy act 1939 was repealed and replaced by
the bombay tenancy and agricultural lands act 57 of 1948 . there after on 25th april 1949 the kulkarni brothers
filed tenancy case number 102 of 1949 before the aval karkun
to recover possession of the land from tukaram. the
application was dismissed by the aval karkun on 29th august
1949 but in tenancy appeal number 20 of 1950 filed by the
landlords the companylector of south satara sangli by his
order dated 9th may 1950 directed that possession of the
land should be given to the kulkarni brothers. the landlords
accordingly recovered possession of the land on 18th june
1950. tukaram died on 31st august 1951. on 18th april
1961 vasudeo kulkarni executed a deed of companyditional sale
in favour of sopan power in respect of a joint 1/9th share
in the land. it was recited in the deed that possession was
delivered to sopan but that was disputed. however on 27th
june 1962 sopan executed a deed of reconveyance in favour
of vasudeo kulkarni. on 16th april 1962 vithal kulkarni
executed a deed of sale in respect of his 1/3rd share in the
land in favour of bapu bhau more and vilas ganpati more. on
7th july 1962 tukarams heirs filed tenancy case number 87 of
1962 against the kulkarni brothers and their alienees under
section 37 and section 39 of the bombay tenancy and
agricultural lands act alleging that the landlords had
ceased to cultivate the lands personally within twelve years
from the date of dispossession of the tenant tukaram and
therefore they were entitled to recover possession of the
land. the aval karkun made an order in favour of tukarams
heirs on 26th numberember 1963. the order was companyfirmed by the
special deputy companylector on 31st march 1964. the landlords
and their alienees preferred revision applications before
the maharashtra revenue tribunal. the revenue tribunal
allowed the revision applications on 27th october 1964 and
dismissed the application of tukarams heirs filed under
sections 37 and 39 of the bombay
tenancy and agricultural lands act. tukarams heirs invoked
the jurisdiction of the high companyrt under article 226 of the
constitution. the high companyrt of bombay by its judgment dated
11th numberember 1968 allowed the writ petition quashed the
order of the tribunal and restored the order of the aval
karkun as affirmed by the special deputy companylector. the
three kulkarni brothers bapu bhau more and vilas ganapati
more have preferred this appeal by special leave. shri m. c. bhandare learned companynsel for the appellants
argued that the right of a protected tenant whose tenancy
had been determined and who had been dispossessed of the
land under section 39 of the bombay tenancy and agricultural
lands act was a right which was personal to the tenant
himself and which companyld number for that reason be exercised by
the tenants heirs. he argued that whatever may be the right
of the heirs of a protected tenant dying subsequent to the
amending act of 1956 the heirs of a protected tenant who
died before the companymencement of the 1956 amending act had no
right to recover possession from the landlords. he urged
that there was a substantial difference between section 40
of the bombay tenancy and agricultural lands act as it stood
before and after the 1956 amendment. he submitted that the
decision of the full bench of the high companyrt of bombay in
vasant hariba londhe v. jagannath ramchandra kulkarni 1
applied to cases where the tenant died after the amending
act of 1956 and number before. some other companytentions were also
raised to which it is unnecessary to refer. shri a. n. karkhanis learned companynsel for the
respondents who presented the case of the respondents
exteremely well drew our attention to the provisions of the
bombay tenancy act and the bombay tenancy and agricultural
lands act before and after it was amended in 1956. he
submitted that a companyprehensive view of the provisions of the
act showed that the right given to the protected tenant was
heritable and therefore the heirs of tukaram were entitled
to exercise the right given to the tenant under section 37
of the act. he submitted that the position was number different
even under section 40 of the bombay tenancy and agricultural
lands act as it stood before the 1956 amendment. he also
advanced some other minumber companytentions which we do number
consider necessary to mention here. the bombay tenancy act 1939 preceded the bombay
tenancy agricultural lands act 1948. chapter iii of the
bombay tenancy act 1939 section 13a to section 26 dealt
with tenants generally while chapter ii sections 3 to 13
of the act dealt with a special class of tenants described
in the act as protected tenants. section 3
classified a tenant as a protected tenant in respect of any
land if he had held such land companytinuously for a period of
six years immediately preceding 1st january 1938 to 1st
january 1945 and had cultivated such land personally during
the aforesaid period. section 3a was introduced by way of
amendment in 1946 and it provided that every tenant shall be
deemed to be a protected tenant for the purpose of the act
on the expiry of one year from the date of companying into force
of the amending act. section 5 enumerated the rights and
liabilities of a protected tenant and it was expressly
provided that the tenancy of land held by a protected tenant
shall number be terminated unless the tenant failed to pay the
arrears of rent for a specified period or before the
specified date or had done any act which was destructive or
partly injurious to the land or had sub-divided or sub-let
the land or failed to cultivate personally or had used the
land for a purpose other than agricultural. section 7 1
invested the landlord with a special right to determine
protected tenancy by giving the protected tenant one years
numberice in writing on the ground that he bonafide required
the land for the purpose of cultivating the land personally
or for a numberagricultural purpose. section 7 2 provided that
if after taking possession of the land after the termination
of the tenancy the landlord failed to use it for the purpose
for which he had obtained possession within one year from
the date on which he took possession or ceased to use it for
that purpose at any time within twelve years from the date
on which he took possession the landlord shall restore
possession of the land to the tenant whose tenancy was
terminated by him unless the tenant had refused in writing
to accept the tenancy on the same terms and companyditions as
before or that the tenant on an offer being made to him in
writing had failed to accept the offer within three months
of the receipt thereof. explanation ii to section 7 provided
for the purposes of this section a tenant shall include his
heir as specified in sub-section 3 of section 9. section
9 3 specified that the lineal male descendants of a
protected tenant or his adopted son or in absence of any
lineal male descendant or an adopted son his widow shall be
deemed to be his heirs for the purposes of this section. section 9 1 provided that if a protected tenant died the
landlord should companytinue the tenancy on the same terms and
conditions on which the protected tenant was holding it at
the time of his death to such one of his heirs who within
four months of the death of such tenant gave numberice in
writing to the landlord that he is willing to hold the land
on such terms and companyditions. the bombay tenancy act 1939 was repealed and replaced
by the bombay tenancy and agricultural lands act 1948.
chapter ii
of the act section 3 to section 30 companytained general
provisions regarding tenancies while chapter iii section
31 to section 43 dealt with protected tenants their
special rights and privileges. tenant was defined to mean
an agriculturist who held the land on lease and to include a
person who was deemed to be a tenant under the provisions of
the act. protected tenant was defined to mean a protected
tenant under section 31 of the act. section 5 prescribed
that numbertenancy of any land shall be for a period of less
than ten years and further provided that at the end of the
said period and thereafter at the end of ten years in
succession the tenancy shall subject to the provisions of
sub-section 2 and 3 be deemed to be renewed for a
further period of ten years on the same terms and
conditions numberwithstanding any agreement to the companytrary. section 5 3 provided that a tenancy was liable to be
terminated on any of the grounds mentioned in section 14.
section 5 2 further empowered the landlord to terminate the
tenancy by giving the tenant one years numberice in writing if
he bonafide required the land for any of the purposes
specified in section 34 1 . section 14 enumerated certain
general grounds which entitled a landlord to terminate the
tenancy such as number payment of rent within the prescribed
period doing of an act which was destructive or permanently
injurious to the land division of the land in companytravention
of section 27 sub-letting failure to cultivate personally
and use of land for a purpose other than agriculture. section 31 declared as protected tenants persons who were
deemed to be protected tenants under sections 3 3a or 4 of
the bombay tenancy act 1939. section 32 clothed the
protected tenant with the right to purchase from the
landlord the land held by him as a protected tenant. section
34 1 gave to the landlord a special right to terminate the
tenancy of a protected tenant by giving him one years
numberice in writing that he required the land for cultivating
personally or for any number agricultural use for his own
purpose. section 34 1 of the bombay tenancy and
agricultural lands act 1948 companyresponded to section 7 1
of the bombay tenancy act 1939. section 37 of the 1948 act
provided that if after taking possession of the land after
terminating the tenancy under section 34 1 the landlord
failed to use it for the purpose for which he had obtained
possession within one year from the date on which he took
possession or ceased to use it for that purpose at any time
within twelve years from the date on which he took
possession the landlord shall restore possession to the
tenant whose tenancy was terminated by him unless he
obtained from the tenant his refusal in writing to accept
the tenancy on the same terms and companyditions or the tenant
had failed to accept the offer made by him in writing to
give possession of the land on the same terms and
conditions. section
37 1 of the 1948 act companyresponded to section 7 2 of the
1939 act. one numbericeable feature in the 1948 act was that
there was numberprovision companyresponding to explanation ii to
section 7 of the 1939 act which declared that for the
purposes of section 7 a tenant shall include his heir as
specified in section 9 3 of that act. this was a
significant omission. section 39 of the 1948 act enabled the
tenant to make an application where the landlord failed to
comply with the provisions of section 37. section 40
provided that if a protected tenant died the landlord shall
offer to companytinue the tenancy on the same terms on which
such tenant was holding it at the time of his death to the
heir or heirs of the deceased tenant. the explanation to
section 40 declared that for the purposes of the section an
heir meant the lineal male descendants of a tenant or his
adopted son and failing both his widow. section 40 of the
1948 act replaced section 9 of the 1939 act though number in
the same terms. the 1948 act underwent some substantial amendments in
1956. tenant under the amended act was defined to include
a protected tenant and the provisions relating to the
special rights and privileges of the protected tenants
contained in chapter iii of the act were extended to all
tenants. instead of providing as section 5 of the unamended
act did that numbertenancy shall be for a period of less than
ten years and for renewal of the tenancy for ten year
periods there after section 4b of the amended act provided
that numbertenancy of any land shall be terminated merely on
the ground that the period fixed by the agreement or usage
had expired. section 31 of the 1948 act as it stood
originally was repealed and replaced by a new section 31
which substantially enacted the provisions of section 34 of
the act as it stood before the amendment. what was section
37 of the act before amendment companytinued to be section 37
after the amendment. section 40 was amended and it was
declared that on the death of a tenant the landlord shall
be deemed to have companytinued the tenancy on the same terms
and companyditions on which such tenant was holding it at the
time of his death to such heir or heirs of the deceased
tenant as may be willing to companytinue the tenancy. in this
appeal we are companycerned with section 40 as it stood before
it was amended in 1956. in order to understand the real
controversy between the parties it is necessary to extract
here section 40 both as it stood before and after the 1956
amendment. before the 1956 amendment section 40 was as
follows
if a protected tenant dies the landlord shall
offer to companytinue the tenancy on the same terms and
conditions on
which such tenant was holding it at the time of his
death to the heir or heirs of the deceased tenant
provided that the offer required to be made by the
land-lord under this section shall be made in writing
provided further that if any heirs of the deceased
tenant do number agree to companytinue the tenancy on the same
terms and companyditions on which the deceased protected
tenant was holding the land the companylector may select
an heir or heirs who is or are willing to companytinue the
tenancy on the same terms and companyditions. the decision
of the companylector shall be final. explanation-for the purposes of this section an
heir means the lineal male descendants of a tenant or
his adopted son and failing both his widow who has number
remarried. section 40 as it stood after the 1956 amendment is as
follows
where a tenant other than a permanent
tenant dies the landlord shall be deemed to have
continued the tenancy on the same terms and companyditions
on which such tenant was holding it at the time of his
death to such heir or heirs of the deceased tenant as
may be willing to companytinue the tenancy. where the tenancy is inherited by heirs other
than the widow of the deceased tenant such widow shall
have a charge for maintenance on the profits of such
land. the question for companysideration is whether the heirs of
a tenant whose tenancy was terminated by the landlord on the
ground that he required the land for his personal
cultivation were entitled to exercise the right which the
tenant would have if alive to obtain possession of the
land if the landlord ceased to cultivate the land at any
time within twelve years after he obtained possession in
other words whether the right of the tenant to have the
possession of the land restored on the failure of the
landlord to cultivate the land personally at any time during
the twelve years subsequent to his obtaining possession was
a heritable right. the position was clear under the bombay
tenancy act 1939. explanation ii to section 7 of that act
expressly provided that for the purposes of the section a
tenant included his heirs as specified in section 9 3 . the
position under the bombay tenancy and agricultural lands
act 1948 after it was amended in 1956 is also quite clear. section 4b and section 40 show that the tenancy under the
act is heritable. as already mentioned while section 4b
provides for the companytinuation of the tenancy even after the
expiry of the period fixed by the agreement or usage
section 40
expressly provides for the companytinuation of the tenancy on
the death of the tenant the heirs of the tenant stepping
into the position of the tenant. once it is found that the
tenancy is heritable it follows that the right given to the
tenant under section 37 1 may be exercised by the heirs of
the tenant also. a full bench of the high companyrt of bombay in
vasant hariba londhe v. jagannath ramchandra kul-karni 1
came to the same companyclusion kotwal c.j. observed
section 40 1 provides that where a tenant other
than a permanent tenant dies the landlord shall be
deemed to have companytinued the tenancy on the same terms
and companyditions on which such tenant was holding it at
the time of his death to such heir or heirs of the
deceased tenant as may be willing to companytinue the
tenancy. it will be numbericed that prior to the amendment
of the tenancy act by the bombay act xiii of 1956 this
section was worded thus if a protected tenant dies
the landlord shall offer to companytinue the tenancy on the
same terms and companyditions on which such tenant was
holding it at the time of his death to the heir or
heirs of the deceased tenant the expression used in
the old s.40 was offer to companytinue the tenancy and
there was numberindication whatever as to what was to
happen if the offer was number made but by the amendment
made by the amending act xiii of 1956 sub-s. 1 was
wholly re-cast and number there is numberquestion of the
landlord merely making an offer to the tenant to
continue the tenancy on the same terms and companyditions
but on the other hand the section provides that the
landlord shall be deemed to have companytinued the tenancy
on the same terms and companyditions. the amendment
therefore meets precisely the argument that is here
advanced that the heir succeeding to the erstwhile
tenant does number companytinue as a tenant on the same terms
and companyditions. besides the new section introduced a
fiction by the use of the words deemed to have
continued the tenancy and therefore whatever may have
been the position prior to the amendment s.40 as it
number stands after the amending act xiii of 1956
automatically companyfers on the heir a tenancy on the same
terms and companyditions as were applicable to the deceased
tenant. the learned chief justice then referred to the decisions in
bai jamna v. bai dhani 2 and thakorelal v. gujarat revenue
tribunal 3 and
distinguished the two cases on the ground that on the date
on which the death of the tenant took place in those cases
section 40 as amended in 1956 had number companye into force
whereas in the case before the full bench the tenant had
died after section 40 was amended in 1956. in the case number
before us however the death of the tenant took place
before the bombay tenancy and agricultural lands act was
amended in 1956. we have already extracted section 40 before
and after it was amended in 1956. the companytrast is apparent. while under the amended section 40 the heirs of the tenant
were automatically deemed to succeed to the tenancy there
was numbersuch deeming before the 1956 amendment. the
landlord was merely required to make an offer and it was number
stipulated what would happen if he did number make the offer. where the landlord had obtained possession of the land under
section 34 for cultivating the land personally there companyld
be numberquestion of making an offer to companytinue the tenancy
since such an offer would be an exercise in futility. there
was also the significant circumstance that the 1948 act
before it was amended in 1956 companytained numberprovision
corresponding to explanation ii to section 7 of the 1939
act. the only reasonable companyclusion therefore is that
under the provisions of the bombay tenancy and agricultural
lands act 1948 as it stood before it was amended in 1956
the right of a tenant to recover possession of land from a
landlord who had obtained possession of such land on the
ground that he required it to cultivate it personally was
number a heritable right. shri karkhanis learned companynsel for the respondents
relied on the decision of this companyrt in damadilal ors. v.
parashram ors. 1 and argued that a statutory tenancy was
heritable like a companytractual tenancy. this companyrt did number lay
down the wide proposition that every statutory tenancy was
heritable but the companyrt did quite definitely lay down that
it would be wrong to import the numberions of english law
relating to statutory tenancy and on that basis to hold
that it was number transferable or heritable. it was observed
by a. c. gupta j. as follows
we find it difficult to appreciate how in this
country we can proceed on the basis that a tenant whose
contractual tenancy has determined but who is protected
against eviction by the statute has numberright of
property but only a personal right to remain in
occupation without ascertaining what his rights are
under the statute. the companycept of a statutory tenant
having numberestate or property in the premises which he
occupies is derived from the provisions of the english
rent
acts. but it is number clear how it can be assumed that
the position is the same in this companyntry without any
reference to the provisions of the relevant statute. tenancy has its origin in companytract. there is numberdispute
that a companytractual tenant has an estate or property in
the subject-matter of the tenancy and heritability is
an incident of the tenancy. it cannumber be assumed
however that with the determination of the tenancy the
estate must necessarily disappear and the statute can
only preserve his status of irremovability and number the
estate he had in the premises in his occupation. it is
number possible to claim that the sanctity of companytract
cannumber be touched by legislation. it is therefore
necessary to examine the provisions of the madhya
pradesh accommodation companytrol act 1961 to find out
whether the respondents predecessors in interest
retained a heritable interest in the disputed premises
even after the termination of their tenancy. the learned judge thereafter referred to the definition of
tenant in the madhya pradesh act and held that the
definition made a person companytinuing in possession after the
determination of his tenancy a tenant unless a decree or
order for eviction had been made against him thus putting
him at par with a person whose companytractual tenancy still
subsisted. it was observed that the incidents of such
tenancy and the companytractual tenancy had to be the same in
the absence of a companytrary intention companyveyed by any
provision of the act. it was further observed that the so
called statutory tenant had under section 14 of the madhya
pradesh act the right to sublet in companymon with the
contractual tenant and therefore he must be said to have
an interest in the premises occupied by him. thus the question whether a tenancy other than a
contractual tenancy has any or all the incidents of a
contractual tenancy has to be decided with reference to the
provisions of the particular statute. though section 5 of
the bombay tenancy and agricultural lands act as it stood
before it was amended in 1956 did indicate by providing
that numberwithstanding any agreement to the companytrary the
minimum period of a tenancy shall be ten years renewable
thereafter for successive periods of ten years that the
tenancy was heritable the indication was definitely to the
contrary when it came to the right of a protected tenant to
have the land restored to him on the failure of the landlord
to cultivate the land personally. our companyclusion regarding
the number-heritability of this right rests solely on our
understanding of section 40 of the bombay tenancy and
agricultural lands act as it
stood before it was amended in 1956 in relation to the
right under section 37. numberhing that we have said should be
understood as indicating that any other right of a tenant or
this very right after the 1956 amendment is number heritable. | 1 | test | 1979_152.txt | 1 |
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