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Civil Appeal No. 3582 of 1986.
From the Judgment and Order dated 24.7.1985 of the Delhi High Court in Civil W.P. No. 435 of 1985.
section Rangarajan and Ms. Asha Rani Jain for the Appellant.
V.C. Mahajan, Ms. C.K. Sucharita and C.V. Subba Rao for the Respondents.
32 The Judgment of the Court was delivered by SEN, J.
This appeal by special leave directed against the judgment and order of the High Court of Delhi dated July 24, 1985 raises two questions, namely: (1) Was the Union of India justified in passing an order dated September 17, 1982 in terms of FR 25 declaring the appellant to be unfit to cross the efficiency bar as Assistant Engineer, Central Public Works Department at the stage of Rs.590 in the prerevised scale of pay of Rs.350 590 EB 900 as from October 5, 1966? And (2) Is the appellant entitled to interest on the delayed payment of his pension? This litigation has had a chequered career.
The appellant who was as Assistant Engineer in the Central Public Works Department was placed under suspension pending a departmental enquiry under r.12(2) of the Central Civil Services (Classification, Control & Appeal) Rules, 1965 on September 3, 1959.
He remained on suspension till May 25, 1970 when on repeated representations the Chief Engineer, Central Public Works Department revoked the order of suspension and he was reinstated in service.
During the aforesaid period of suspension, adverse remarks in his confidential reports for the period between April 1, 1957 and August 31, 1957 and between April 1, 1958 and March 31, 1959 were communicated to him on December 16, 1959.
After a period of nearly five years, the departmental proceedings culminated in an order of dismissal from service dated March 12, 1964 but the same on appeal by him, was set aside by the President of India by order dated October 4, 1966 with a direction for the holding of a fresh departmental inquiry under r. 29(1)(c) of the Rules, with a further direction that he shall continue to remain under suspension.
The order of suspension was revoked by the Chief F Engineer on May 8, 1970 but the departmental proceedings were kept alive.
As a result of this, the appellant was reinstated in service on May 25, 1970.
Immediately thereafter, he made representation to the Department to pass an order under FR 54 for payment of full pay and allowances for the period of suspension i.e. the period between September 3, 1959 and May 25, 1970 but the same was rejected on the G ground that departmental inquiry was still pending.
There was little or no progress in the departmental inquiry.
on April 25, 1972 the Chief Engineer passed an order of compulsory retirement of the appellant under FR 56(j).
The appellanrmade representations to various authorities, including the President of India, H against his compulsory retirement but the same was rejected Eventu 33 ally, on July 20, 1972 the appellant filed a petition under article 226 of the Constitution in the High Court challenging the validity of the order of compulsory retirement and prayed for a direction in terms of FR 54 for payment of full pay and allowances for the period of suspension and also for payment of all increments to which he was entitled.
He also prayed for quashing of the departmental proceedings.
A learned Single Judge (Wad, J.) by his judgment and order dated January 5, 1981 held that the order of compulsory retirement of the appellant was bad in law, not being relatable to FR 56(j) inasmuch as the action was not based on an overall assessment of the appellant 's record of service and was in breach of the instructions issued by the Government of India, Ministry of Home Affairs dated June 23, 1969 laying down the procedure to be followed under FR 56(j).
He further held that the action to compulsorily retire the appellant in 1972 under FR 56(j) could not obviously be taken on the basis of adverse remarks for the years 1950 51 when he was an Overseer, nor on the adverse remarks for the years 1957 59 communicated to him on December 16, 1959, after a lapse of 20 years and 13 years respectively.
Further he observed that the adverse remarks of 1957 59 were not serious enough to cut short the career of the appellant as a Government servant, particularly in view of the fact that the general confidential reports for two years immediately preceding his retirement on July 28, 1972 did not reveal anything blameworthy against him.
He accordingly quashed the order of compulsory retirement of the appellant and held that he shall be deemed to have continued in service till March 31, 1978, the date when he attained the normal age of superannuation.
During the course of his judgment, the learned Judge also adversely commented on the failure of the Department to pass an order in terms of FR 54 consequent upon the reinstatement of the appellant on May 25, 1970 within a reasonable time.
He observed that ordinarily he would have left it to the Department to pass an order under FR 54 as to whether the suspension of the appellant for the period from September 3, 1959 to May 25, 1970 was justified or not but due to the inactivity or refusal on the part of the Government to pass an order under FR 54, the Court was left with no other option but to deal with the question.
After referring to the various stages of the departmental proceedings, the learned Judge held that the suspension of the appellant was not justified and the period of suspension must be regarded as spent on duty and therefore the appellant under FR 54(2) was entitled to full pay and allowances and the increments for that period.
He further held that r. 9(2)(b) of the Central Civil Services 34 (Pension) Rules, 1972 was not attracted and accordingly quashed the departmental proceedings.
The operative part of the judgment of the learned Judge reads as follows: "The petition, for the reasons stated above, succeeds.
The order of compulsory retirement dated 25.4.1972 is set aside.
The petitioner would be entitled to continuation in service upto March 31, 1978 (the date when he reached his normal age of superannuation) and consequential benefits.
The continuation of suspension of the petitioner was without any justification.
The petitioner would be entitled to full pay and allowances from 3.9.1959 to 24.5.1970 with increments and other service benefits according to Rules.
The pending departmental proceedings are quashed.
" Aggrieved, the Union of India went up in appeal but a Division Bench by its judgment dated March 24, 1982 declined to interfere.
The appellant had in the meanwhile submitted his bill of arrears and the respondents having failed to comply with the direction of the learned Single Judge, he moved the High Court for contempt.
In response to the notice issued by the High Court, respondent No. 4 Director General of Works entered appearance on September 6, 1982 and tendered a written apology, upon which the High Court dropped the proceedings.
It appears that the Department paid the appellant about Rs.86,000 in compliance with the judgment of the learned Single Judge.
Although there is a healthy trend and the Government of India has set up an independent Ministry Ministry of Personnel, Public Grievances & Pension for settlement of claims in regard to pension, this case is an instance where a civil servant had been subjected to endless harassment for no fault of his own.
While it is true that the charge levelled against the appellant was serious enough to merit the imposition of a major punishment, there was little or no progress for keeping the departmental proceedings pending for over 20 years.
There was persistent effort on behalf of the Department to visit the appellant with civil consequences, first by placing him under suspension under r. 12(2) of the Rules for a period of 11 years and secondly by directing his compulsory retirement when it was realised that the charge levelled could not be substantiated.
Under FR 54 when a Government servant who had been dismissed, removed or suspended is reinstated, the authority competent to order reinstatement has to make a specific order (a) regarding the pay and allowances to be paid 35 to the Government servant for the period of his absence from duty, and (b) directing whether or not the period of suspension shall be treated as a period spent on duty.
Despite repeated representations made by the appellant, the Government failed in its duty to pass an order in terms of FR 54 within a reasonable time.
The Government also failed to comply with the judgment of the learned Single Judge and pay to the appellant the arrears of pay and allowances amounting to about Rs.86,000 till the High Court issued a notice for contempt.
It is regrettable that respondent No. 4 Director General of Works had to enter personal appearance and tender a written apology.
The payment of Rs.86,000 to the appellant was therefore under threat of contempt and does not redound to the credit of the Government.
The miseries of the appellant did not end with this.
The Department apparently never forgave the appellant for having dragged the Government to litigation and compel the personal appearance of the Head of the Department.
It was expected that the Government would act with good grace but just within a fortnight of the termination of the contempt proceedings, the Director General rejected the appellant 's case for crossing of the efficiency bar at the stage of Rs.590 w.e.f. October 5, 1966 as indicated hereinafter.
In the counter affidavit to the contempt proceedings, the Government stated that there were two conditions for an Assistant Engineer to cross the efficiency bar, namely: (1) that he should have passed the departmental examination in Accounts prescribed for Assistant Engineers, and (2) he should have obtained good reports over the last five years.
The increments above the stage of efficiency bar are to be allowed in accordance with the provisions contained in FR 25 and the Government of India 's decisions thereunder.
The appellant 's case for crossing of efficiency bar at the stage of Rs.590 w.e.f. October 5, 1966 was said to have been considered by the Departmental Promotion Committee on the basis of his performance reports.
Evidently, the Departmental Promotion Committee recommended on the basis of such reports that he was not fit to cross the efficiency bar at the stage of Rs.590 from October 5, 1966 or on any subsequent date upto October 5, 1971.
The report of the Departmental Promotion Committee was accepted by the competent authority.
Accordingly, the Director General of Works on September 17, 1982 passed an order to the following effect: "No.32/426/66.EC.III New Delhi, dated 17.9.82 36 OFFICE MEMORANDUM Sub: Crossing of Efficiency Bar by Shri O.P. Gupta, Assistant Engineer (Civil), Retired.
The Executive Engineer, Central Stores Division No. 1, C.P.W.D. New Delhi is informed that the case of crossing of efficiency bar by Shri O.P. Gupta, Assistant Engineer (Retired) at the stage of Rs.590 in the pre revised scale of pay of Rs.350 25 500 30 590 EB 30 800 EB 30 830 35 900 has been considered by the competent authority, who has found him unfit to cross the efficiency bar w.e.f.5.
10.1966 or from any subsequent date upto 5.
10.1971.
" The impugned order is not as innocuous as it looks.
Just as suspension of a government servant pending a departmental inquiry is not by way of punishment, so also the withholding of increments at the efficiency bar pending such inquiry.
But when the High Court quashed the departmental proceedings which were pending for over 20 years with little or no progress as being wholly invalid and unfair, there was no occasion for the Department to have passed an order under FR 24 for withholding increments to the appellant at the stage of Rs.590 w.e.f. October 5, 1966 unless it was with a view to penalise him financially.
As already stated, the authority competent to order reinstatement failed to make an order in terms of FR 54 after the appellant had been reinstated in service on May 25, 1970 within a reasonable time.
Looking to the long lapse of time, the High Court was entitled to go into the question as to whether the appellant upon his reinstatement was entitled to the full pay and allowances to which he would have been entitled had he not been suspended.
Undoubtedly, the High Court gave a direction in terms in FR 54(2) that the appellant would be entitled to his full pay and allowances as also to his increments etc.
but this would be the normal increment prior to the crossing of the efficiency bar for purposes of FR 54(2).
There has to be a specific order in terms of FR 25 before a government servant can be allowed to draw his increments above the efficiency bar.
The Government was justified in withholding increments under FR 25 pending the departmental inquiry but after the High Court had quashed the departmental inquiry, the question whether the appellant could be deprived of his increments under FR 25 was a live issue till the controversy was settled by the Government of India, Ministry of Finance decision dated September 21, 1967.
We shall first reproduce FR 25 and it is in the following terms: 37 "Where an efficiency bar is prescribed in a time scale, the increment next above the bar shall not be given to a Government servant without the specific sanction of the authority empowered to withhold increment under Rule 24 or the relevant disciplinary rules applicable to the Government servant or of any other authority whom the President may,by general or special order, authorise in this behalf.
" The Government of India, Ministry of Finance 's decision dated September 21, 1967 as clarified by Ministry of Home Affairs, Department of Personnel & Administrative Reforms Memorandum dated April 6, 1979, insofar as relevant is reproduced below: "(7) Procedure for consideration of cases (a) When disciplinary proceedings are pending A Government servant against whom proceedings are pending but who is due to cross the efficiency bar prescribed in his time scale of pay, may not be allowed to cross the bar until after the conclusion of the proceedings.
A question was raised as to the date from which a Government servant whose case for crossing the efficiency bar has not been considered on account of the pendency of a disciplinary/vigilance case against him, should be considered for being allowed to cross the efficiency bar, after the enquiry is over.
It has been decided, in consultation with the Ministry of Home Affairs, that if after the conclusion of the proceedings, the Government servant is completely exonerated, he may be allowed to cross the efficiency bar with effect from the due date retrospectively, unless the competent authority decides otherwise.
If however, the Government servant is not completely exonerated, his case for crossing the efficiency bar cannot be considered with retrospective effect from the due date.
Such cases can be considered only with effect from a date following the conclusion of the disciplinary/vigilance case, taking into account the outcome of the disciplinary/vigilance case.
(b) When conduct is under investigation Same procedure as at (a) may be followed after the conclusion of the investigation and where the competent authority on consideration of the results of the investigation, has formed the opinion that a charge sheet may be issued to the Government servant concerned on specific imputations where 38 departmental action is contemplated or that sanction for prosecution may be accorded where prosecution is proposed.
Otherwise, the normal procedure should be followed.
The sealed cover should be opened after conclusion of the proceedings.
If he is fully exonerated, the recommendations in the sealed cover may be considered by the competent authority who may lift the bar retrospectively from the date recommended by the D.P.C.
In that case, the Government servant will be entitled to the arrears of the increment(s).
In case, however, the proceedings do not result in complete exoneration of the Government servant, he cannot be allowed to cross the bar with retrospective effect.
" The relevant provision in r. 2.636 of the C.P.W.D. Manual, Vol. 1, 1956 edn.
at p. 53 is in the following terms: "2.636.
The Government of India have decided (a) that a departmental examination shall be held by the Chief Engineer twice a year and as far as possible in the months of January and July every year, for all Divisional and Sub Divisional Officers in the Central Public Works Department; (f) Divisional and Sub Divisional Officers who fail to pass the departmental examination should not ordinarily be considered either for promotion or for crossing the efficiency bar.
" It is somewhat strange that when the appellant applied to the learned Judge (Wad, J.) for review, he by his order dated February 2, 1983 declined to interfere saying that there was no ground for review inasmuch as the appellant had not been allowed to cross the efficiency G bar under FR 25 for two valid reasons, namely: (1) his failure to pass the departmental examination, and (2) his confidential reports for the preceding five years were not satisfactory.
As to the question of the appellant being afforded an opportunity before an order under FR 54(2) adverse to him was passed by the disciplinary authority, the learned Judge observed that 'the matter was at large when the petition H for contempt was filed ' and further that 'all pros and cons of the matter 39 had been gone into through the affidavits filed by the parties and at the hearing in the Court ' and added: "I do not think that it is necessary to give any further opportunity to the petitioner for this purpose, particularly when he has admitted that he has not passed the examination." The learned Judge failed to appreciate that no prejudicial order under FR 25 could be made without giving the appellant an opportunity of a hearing as it visited him with civil consequences.
The appellant was thus constrained to move another application for review.
This time the learned Judge by his order dated November 30, 1983 dismissed the application observing that no ground for review had been made out and that the earlier order declining to review had been passed after fully hearing the parties and no further relief could be granted.
But he added a rider that if the appellant was not satisfied with the Government decision, his remedy was to file a separate writ petition.
Thereupon, the appellant went up in appeal but a Division Bench by its order dated April 30, 1984 dismissed the same and reiterated that he should file a writ petition.
The appellant accordingly filed a petition under article 226 of the Constitution to enforce his right to increments after the crossing of the efficiency bar under FR 25.
Again, a Division Bench by its order dated October 30, 1984 declined to interfere saying that the appellant should make a representation to the competent authority with the direction that the same should be considered sympathetically.
In accordance therewith, on December 10, 1984 the appellant made a representation to the Director General of Works, Central Public Works Department.
He thereafter addressed several communications to the authorities on the subject.
Eventually, the Deputy Director of Administration by her letter dated April 9, 1985 informed the appellant that his representation had been rejected.
She further intimated the appellant the following order with respect to his crossing of the efficiency bar under FR 25.
"I am further to inform you that your case for crossing the E.B. at the stage of Rs.590 w.e.f. 5.10.1972 in the prerevised scale of Rs.350 25 500 30 590 EB 30 800 EB 30 830 35 900 and also at the stage of Rs.810 in the revised scale of Rs.650 30 740 35 810 EB 35 880 40 1000 EB 40 1200, w.e.f. 5 10.1973 or from any subsequent date upto the date of your superannuation viz. 31.3.1978 has also 40 been considered carefully by the competent authority.
It is regretted that you have not been found fit to cross the E.B. w.e.f. 5.10.1972 at the stage of Rs.590 in the pre revised scale of Rs.350 25 500 30 590 EB 30 800 EB 30 830 35 900, as also at the stage of Rs.810 in the revised scale of Rs.650 30 740 35 810 EB 35 880 40 1000 EB 40 1200, w.e.f. 5.10.1973 or from any subsequent date upto the date of your superannuation viz. 31.3.1978.
" On July 10, 1985 the appellant filed the present petition under article 226 of the Constitution for redressal of his grievance as regards the crossing of the efficiency bar at the stages indicated in the impugned order and also for grant of interest on delayed payment of pension.
A Division Bench (D.K.Kapur and Mahinder Narain, JJ.) by its order dated July 24, 1985 dismissed the writ petition.
It held that the crossing of the efficiency bar depends on satisfaction of the competent authority under FR 25 and also on the passing of the departmental examination under r. 2.636 of the C.P.W.D. Manual, Vol. 1, 1956 edn.
at p. 53.
It further observed that the sanction of the authority competent under FR 25 was not forthcoming and that 'if the authority concerned had chosen not to give the sanction, the Court had no jurisdiction to interfere particularly as the appellant was not actually in office for such a long period of time '.
Curiously enough, the Division Bench also added that it felt, considering the harassment to which the appellant had been subjected during the long years of suspension, it was a fit case in which the authority concerned should have granted the requisite sanction.
We have set out the facts in sufficient detail to show that there is no presumption that the Government always acts in a manner which is just and fair.
There was no occasion whatever to protract the departmental inquiry for a period of 20 years and keeping the appellant under suspension for a period of nearly 11 years unless it was actuated with the mala fide intention of subjecting him to harassment.
The charge framed against the appellant was serious enough to merit his dismissal from service.
Apparently, the departmental authorities were not in a position to substantiate the charge.
But that was no reason for keeping the departmental proceedings alive for a period of 20 years and not to have revoked the order of suspension for over 11 years.
An order of suspension of a government servant does not put an end to his service under the Government.
He continues to be a member of the service in spite of the order of suspension.
The real effect of the order of suspension as explained by this Court in Khem Chand vs Union of 41 India; , is that he continues to be a member of the government service but is not permitted to work and further during the period of suspension he is paid only some allowance generally called subsistence allowance which is normally less than the salary instead of the pay and allowances he would have been entitled to if he had not been suspended.
There is no doubt that an order of suspension unless the departmental inquiry is concluded within a reasonable time, affects a government servant injuriously.
The very expression 'subsistence allowance ' has an undeniable penal significance.
The dictionary meaning of the word 'Subsist ' as given in Shorter Oxford English Dictionary, Vol.
II at p. 2171 is "to remain alive as on food; to continue to exist".
"Subsistence" means means of supporting life, especially a minimum livelihood.
Although suspension is not one of the punishments specified in r. 11 of the rules, an order of suspension is not to be lightly passed against the government servant.
In the case of Board of Trustees of the Port of Bombay vs Dilip Kumar Raghavendranath Nadkarni & Ors., ; the Court held that the expression 'life ' does not merely connote animal existence or a continued drudgery through life.
The expression 'life ' has a much wider meaning.
Suspension in a case like the present where there was no question of inflicting any departmental punishment prima facie tantamounts to imposition of penalty which is manifestly repugnant to the principles of natural justice and fairplay in action.
The conditions of service are within the executive power of the State or its legislative power under the proviso to article 309 of the Constitution, but even so such rules have to be reasonable and fair and not grossly unjust.
It is a clear principle of natural justice that the delinquent officer when placed under suspension is entitled to represent that the departmental proceedings should be concluded with reasonable diligence and within a reasonable period of time.
If such a principle were not to be recognised, it would imply that the Executive is being vested with a totally arbitrary and unfettered power of placing its officers under disability and distress for an indefinite duration.
It is a fundamental rule of law that no decision must be taken which will affect the rights of any person without first giving him an opportunity of putting forward his case.
Both the Privy Council as well as this Court have in a series of cases required strict adherence to the rules of natural justice where a public authority or body has to deal with rights.
There has ever since the judgment of Lord Reid in Ridge vs Baldwin LR ; been considerable fluctuation of judicial opinion in England as to the degree of strictness with which the rules of natural justice should be extended, and there is growing awareness 42 of the problems created by the extended application of principles of natural justice, or the duty to act fairly, which tends to sacrifice the administrative efficiency and despatch, or frustrates the object of the law in question.
Since this Court has held that Lord Reid 's judgment in Ridge vs Baldwin should be of assistance in deciding questions relating to natural justice, there is always 'the duty to act judicially ' whenever the rules of natural justice are applicable.
There is therefore the insistence upon the requirement of a 'fair hearing '.
In the light of these settled principles, we have no doubt whatever that the Government acted in flagrant breach of the rules of natural justice or fairplay in passing the impugned order.
We do not see why the principles enunciated by the Court in M. Gopala Krishna Naidu vs State of Madhya Pradesh, ; should not apply with equal vigour to a case like the present.
There is no reason why the power of the Government to direct the stoppage of increments at the efficiency bar on the ground of unfitness or otherwise after his retirement which prejudicially affects him should not be subject to the same limitations as engrafted by this Court in M. Gopala Krishna Naidu while dealing with the power of the Government in making a prejudicial order under FR 54, namely, the duty to hear the government servant concerned after giving him full opportunity to make out his case.
Under FR 54 when a government servant who had been dismissed, removed or suspended is reinstated, the authority competent to order the reinstatement shall make a specific order (a) regarding the pay and allowances to be paid to the government servant for the period of his absence from duty, and (b) directing whether or not the said period shall be treated as a period spent on duty.
In the present case, the Government failed in its duty to pass an order in terms of FR 54 despite repeated representations made by the appellant in that behalf.
The learned Single Judge was therefore justified in dealing with the question whether or not the period of suspension should be treated as a period spent on duty and to make a direction regarding payment of the full pay and allowances as also to increments to which he would have been entitled to but for the disciplinary proceedings.
In M. Gopala Krishna Naidu 's case the civil servant concerned had been exonerated of the charges framed against him in a departmental inquiry.
The Government however held that the appellant 's suspension in that case and the departmental inquiry instituted against him 'were not wholly unjustified ' and tried to support its action in this Court on the ground that the making of an order under FR 54 was a consequential order.
This Court repelled the contention and held that an order passed under FR 54 is not always a consequential order or a mere 43 continuation of the departmental proceedings against the delinquent civil servant.
Inasmuch as consideration under FR 54 depends on facts and circumstances in their entirety, and since the order may result in pecuniary loss to the government servant, consideration under the rule 'must be held to be an objective rather than a subjective consideration '.
Shelat, J. who delivered the judgment of the Court went on to observe: "The very nature of the function implies the duty to act judicially.
In such a case if an opportunity to show cause against the action proposed is not afforded, as admittedly it was not done in the present case, the order is liable to be struck down as invalid on the ground that it is one in breach of the principles of natural justice.
" There is thus a duty to hear the concerned Government servant under FR 54 before any prejudicial order is made against him.
The same principle was reiterated in B.D. Gupta vs State of Haryana, ; It must follow that when a prejudicial order is made in terms of FR 25 to deprive the government servant like the appellant of his increments above the stage of efficiency bar retrospectively after his retirement, the Government has the duty to hear the concerned government servant before any order is made against him.
There has to be as laid down in M. Gopala Krishna Naidu 's case an objective consideration and assessment of all the relevant facts and circumstances.
We find it difficult to subscribe to the doctrine evolved by the Division Bench that if the competent authority declines to sanction the crossing of the efficiency bar of a government servant under FR 25, the Court has no jurisdiction to grant any relief.
No doubt, there has to be a specific order in terms of FR 25 by the competent authority before the government servant can get the benefit of increments above the stage of efficiency bar.
The stoppage of such increments at the efficiency bar during the pendency of a departmental proceeding is not by way of punishment and therefore the government servant facing a departmental inquiry is not entitled to a hearing.
Ordinarily, therefore, the Court does not come into the picture at that stage.
But in a case like the present where despite the fact that the departmental inquiry against the appellant had been quashed, and it has been held by the High Court that his suspension was wholly without justification.
44 there was no occasion for the competent authority to enforce the bar against him under FR 25, particularly after his retirement, unless it was by way of punishment.
That being so, the order passed by the competent authority under FR 25 prejudicial to the interests of the appellant in such circumstances must be subject to the power of judicial review.
The reasoning of the learned Single Judge that the authority competent was justified in refusing to allow the crossing of the efficiency bar under FR 25 in the case of the appellant on the ground that (1) the appellant did not have good record of service over the last five years preceding his compulsory retirement, and (2) he had not passed the departmental examination in Accounts prescribed for Assistant Engineers, does not bear scrutiny.
In the first place, there was no question of the appellant having an adverse record for five years preceding his compulsory retirement since for three years he was under suspension and, according to the learned Judge himself, for the next two years there was nothing blameworthy against him.
Secondly, the failure to pass a departmental examination under r. 2.636 obviously could not stand in the way of the appellant since he had already been compulsorily retired.
The appellant having compulsorily retired on July 28, 1972 and also having reached his normal age of superannuation on March 31, 1978, his failure to pass the departmental examination under r. 2.636 could not be treated as a ground for denying him the benefit of crossing the efficiency bar under FR 25.
The word 'ordinarily ' in r. 2.636 must be given its plain meaning as 'in normal circumstances '.
It is extremely doubtful whether in a case like the present the Director General of Works, Central Public Works Department, as the competent authority, could at all have taken a decision to enforce the bar under FR 25 against the appellant after his retirement.
That apart, the competent authority acted in flagrant breach of the instructions contained in the Note beneath Government of India, Ministry of Finance Memorandum dated April 23, 1962, as amended from time to time.
It enjoins that the cases of government servants for crossing of the efficiency bar in the time scale of pay should be considered at the appropriate time and in case the decision is to enforce the bar against the government servant, he should be informed of the decision.
This clearly implies that the competent authority must conform to the rules of natural justice.
It would be a denial of justice to remit back the matter to the competent authority to reach a decision afresh under FR 25, in the facts and circumstances of the present case.
45 The public interest in maintaining the efficiency of the services requires that civil servants should not be unfairly dealt with.
The Government must view with concern that a departmental inquiry against the civil servant should have been kept alive for so long as 20 years or more and that he should have been placed under suspension without any lawful justification for as many as 11 years, without any progress being made in the departmental inquiry.
It should also view with concern that a decision should have been taken by the competent authority to enforce the bar under FR 25 against the civil servant long after his retirement with a view to cause him financial loss.
Such a course not only demoralises the services but virtually ruins the career of the delinquent officer as a government servant apart from subjecting him to untold hardship and humiliation.
We hope and trust that the Government in future would ensure that departmental proceedings are concluded with reasonable diligence and not allowed to be protracted unnecessarily.
The Government should also view with concern that there should be an attempt on the part of the competent authority to enforce the bar against a civil servant under FR 25 long after his retirement without affording him an opportunity of a hearing.
It comes of ill grace from the Government to have defeated the just claim of the appellant on technical pleas.
Normally, this Court, as a settled practice, has been making direction for payment of interest at 12% on delayed payment of pension.
There is no reason for us to depart from that practice in the facts of the present case.
The result therefore is that the appeal succeeds and is allowed with costs.
The judgment and order passed by the High Court are set aside and the writ petition is allowed.
The impugned orders passed by the Director General of Works, Central Public Works Department dated September 17, 1982 and April 9, 1985 declining to permit the appellant to cross the efficiency bar at the stage of Rs.590 in the pre revised scale of Rs.350 900 w.e.f. October 5, 1966 as also from October 5, 1972, and also at the stage of Rs.810 in the revised scale of Rs.650 1200 w.e.f. October 5, 1973 or from any subsequent date upto March 31, 1978, the date of his superannuation, are quashed.
We direct the Director General of Works to make an order in terms of FR 25 allowing the appellant to cross the efficiency bar at the stage of Rs.590 w.e.f. October 5, 1966 and at the stage of Rs.810 w.e.f. October 5, 1973 and subsequent dates, according to the decision of the Government of India, Ministry of Finance dated September 21, 1967 46 as later clarified by the Ministry of Home Affairs Memorandum dated April 6, 1979 and to re fix his salary upon that basis and pay the difference, as also re fix his pension accordingly.
The appellant would be entitled to interest at 12% per annum on the difference in salary as well as in pension.
We further direct that the Government of India will make the payment to the appellant within four months from today.
P.S.S. Appeal allowed.
|
Fundamental Rule 54 requires that when a Government servant who had been dismissed, removed or suspended is reinstated, the authority competent to order reinstatement has to make a specific order (a) regarding the pay and allowances to be paid to the Government servant for the period of his absence from duty, and (b) directing whether or not the period of suspension shall be treated as a period spent on duty.
Fundamental Rule 25 lays down that the increment next above the efficiency bar in a time scale shall not be given to a Government servant without the specific sanction of the authority empowered to withhold increment under R.24.
The Government of India, Ministry of Finance 's decision dated September 21, 1967, as clarified by Ministry of Home Affairs, Department of Personnel & Administrative Reforms Memorandum dated April 6, 1979, stated that if after the conclusion of the disciplinary proceedings, the Government servant is completely 28 exonerated, he may be allowed to cross the efficiency bar with effect from the due date retrospectively, unless the competent authority decides otherwise.
Rule 2.636 of the C.P.W.D. Manual, Vol.
I, 1956 edn., laid down that Divisional and Sub Divisional Officers who fail to pass the departmental examination should not ordinarily be considered either for promotion or for crossing the efficiency bar.
The appellant, an Assistant Engineer in the Central Public Works Department was placed under suspension on September 3, 1959 pending a departmental enquiry.
That order was revoked by the Chief Engineer on May 8, 1970, and he was reinstated in service on May 25, 1970 but the departmental proceedings were kept alive.
Immediately thereafter, the appellant made a representation to the department to pass an order under FR. 54 for payment of full pay and allowances for the period of suspension, which was rejected on the ground that the departmental enquiry was still pending.
Thereafter, the appellant was compulsorily retired by an order of the Chief Engineer dated April 25, 1972 under FR.
56(j).
In the writ petition filed by the appellant under Article 226 of the Constitution challenging the validity of the order of compulsory retirement, and seeking directions in terms of FR 54 for payment of full pay and allowances for the period of suspension and also for payment of all increments to which he was entitled, a Single Judge of the High Court found the order of compulsory retirement bad in law, quashed it, and held that the appellant shall be deemed to have continued in service till March 31, 1978, the date when he attained the normal age of superannuation.
It was further held that the suspension of the appellant was not justified, and the period of suspension must be regarded as spent on duty and therefore the appellant under FR 54(2) was entitled to full pay and allowances and the increments for that period, and that r.9(2)(b) of the Central Civil Services (Pension) Rules, 1972 was not attracted, and accordingly quashed the departmental proceedings.
The Division Bench declined to interfere.
Thereafter the Director General of Works on September 17, 1982 passed an order on the recommendation of the departmental promotion board declaring the appellant unfit to cross the efficiency bar at the stage of Rs.590 in the grade Rs.350 900 with effect from October 5, 1966.
In the contempt proceedings taken by the appellant, the government stated that there were two conditions for an Assistant Engineer to 29 cross efficiency bar namely, (i) that he should have passed the departmental examination in Accounts, and (ii) he should have obtained good reports for the preceding five years.
The Single Judge declined to interfere with the governmental order.
The Division Bench dismissed the appeal and reiterated that a writ petition should be filed.
The appellant thereupon filed the present writ petition on July 10, 1985 under Article 226 of the Constitution to enforce his right to increments after crossing of the efficiency bar and also for grant of interest on delayed payment of pension.
The High Court held that the crossing of the efficiency bar depends on the satisfaction of the competent authority under FR 25 and also on the passing of the departmental examination under r. 2.636 of the C.P.W.D. Manual, Vol. 1, 1956 edn.
and that if the authority concerned had chosen not to give the sanction under FR 25, the Court had no jurisdiction to interfere particularly as the appellant was not actually in office for such a long period of time.
In this appeal by special leave, on the questions: (i) was the Union of India justified in passing the oder in terms of FR 25 declaring the appellant unfit to cross the efficiency bar, and (ii) was the appellant entitled to interest on the delayed payment of his pension? Allowing the appeal, ^ HELD: 1.1 The order passed by the competent authority under FR 25, prejudicial to the interest of the appellant must be subject to the power of judicial review.
[44AB] 1.2 The stoppage of increment at the efficiency bar during the pendency of a departmental proceeding is not by way of punishment, and therefore the government servant facing a departmental inquiry is not entitled to a hearing.
The court does not come into the picture at that stage.
But where despite the fact that the departmental inquiry against the government officer had been quashed, and it had been held by the High Court that the suspension was wholly without justification, there was no occasion for the competent authority to enforce the bar against him under FR 25, particularly after his retirement, unless it was by way of punishment.
[43G 44A] 1.3 It is a fundamental rule of law that no decision must be taken which will affect the rights of any person without first giving him an opportunity of putting forward his case.
Strict adherence to this rule is mandatory where a public authority or body has to deal with rights.
30 There is always the duty to act judicially in such cases.
There is, therefore, the insistence upon the requirement of a fair hearing.
There is no reason why the power of the Government under FR 25 should not be subject to the same limitations.
[41G, 42B,C] 1.4 The note beneath Government of India, Ministry of Finance Memorandum dated April 23, 1962, as amended from time to time enjoins that the cases of government servants for crossing of the efficiency bar in the time scale of pay should be considered at the appropriate time and in case the decision is to enforce the bar against the government servant, he should be informed of the decision.
In enforcing the bar under FR 25 against the appellant the competent authority acted in flagrant breach of these instructions.
[44FG] 1.5 There was no question of the appellant having adverse record for five years preceding his compulsory retirement since for three years he was under suspension and for the next two years there was nothing blameworthy against him.
Furthermore, he having compulsorily retired on July 28, 1972 and also having reached his normal age of superannuation on March 31, 1978, his failure to pass the departmental examination under r. 2.636 could not be treated as a ground for denying him the benefit of crossing the efficiency bar under FR 25.
The word 'ordinary ' in r. 2.636 must be given its plain meaning as in normal circumstances.
[44CE] 2.1 Suspension where there is no question of inflicting any departmental punishment prima facie tantamounts to imposition of penalty which is manifestly repugnant to the principles of natural justice and fairplay in action.
The conditions of service are within the executive power of the State or its legislative power under the proviso to article 309 of the Constitution, but even so such rules have to be reasonable and fair and not grossly unjust.
It is a clear principle of natural justice that the delinquent officer when placed under suspension is entitled to represent that the departmental proceedings should be concluded with reasonable diligence and within a reasonable period of time.
If such a principle were not recognised, it would imply that the executive is being vested with a totally arbitrary and unfettered power of placing its officers under disability and distress for an indefinite duration.
[41DF] 2.2 There is no presumption that the Government always acts in a manner which is just and fair.
In the instant ease, there was no occasion whatever to protract the departmental inquiry for a period of 20 years 31 and keeping the appellant under suspension for a period of 11 years unless it was actuated with the mala fide intention of subjecting him to harassment.
[40F] 2.3 The public interest in maintaining the efficiency of the services requires that civil servants should not be unfairly dealt with.
The Government must view with concern that a departmental inquiry against the civil servant should have been kept alive for so long as 20 years or more and that he should have been placed under suspension without any lawful justification for as many as 11 years, without any progress being made in the departmental inquiry.
It should also view with concern that a decision should have been taken by the competent authority to enforce the bar under FR 25 against the civil servant long after his retirement without affording him an opportunity of a hearing with a view to cause him financial loss.
[45AB] 3.
The Court, as a settled practice has been making direction for payment of interest at 12% on delayed payment of pension.
There is no reason for it to depart from that practice in the facts of the present case.
[45E] 4.
The Director General of Works is directed to make an order in terms of FR 25 allowing the appellant to cross the efficiency bar according to the decision of the Government of India, Ministry of Finance dated September 21, 1967 as later clarified by the Ministry of Home Affairs Memorandum dated April 6, 1979 and to re fix his pension accordingly.
The appellant would be entitled to interest at 12% per annum on the difference in salary as well as in pension.
[45G 46A] Ridge vs Baldwin, LR [1964] AC40; M. Gopala Krishna Naidu vs State of Madhya Pradesh, ; ; B.D. Gupta vs State of Haryana, ; ; Khem Chand vs Union of India; , and Board of Trustees of the Port of Bombay v Dilip Kumar Raghavendranath Nadkarni & Ors., , referred to.
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ivil Appeal No. 1430 of 1990.
From the Judgment and Order dated 21.10.1989 of the Central Government Industrial Tribunal, New Delhi in I.D. No. 40 of 1986.
N.B. Shetye and A.M. Khanwilkar for the Appellant.
Ashok H. Desai, R.P. Bhatt.
P.H. Parekh and Mrs. Sumita Sharma for the Respondents.
The Judgment of the Court was delivered by PUNCHHI, J.
This appeal by special leave is directed against the Award of the Central Government Industrial Tribunal, New Delhi, in I.D. No. 40 of 1986 published in the Gazette of India, New Delhi dated 21.10 89.
The appellant is the Mathura Refinery Mazdoor Sangh (here after referred to as 'Union ').
The contesting respondent is the Indian Oil Corporation Ltd., Mathura Refinery Project, Mathura, U.P. (hereafter referred to as the 'Refinery ').
The Union represents about 900 casual labourers working in the Refinery.
These labourers are contract labourers coming under the Contract Labour (Regulation & Abolition) Act, 1971.
The nature of their work has grouped them .Some of the labourers have formed themselves into cooperative societies and those societies have entered into labour contracts with 470 the Refinery.
Other labourers are working under labour contractors who have contracts with the Refinery.
Theirs is not a constant relationship with one contractor and these labourers keep shifting from one contractor to another.
However it is claimed that these casual labourers, have been working in the Refinery for so many years in the past ranging between ten to fifteen years but they are denied wages and other benefits as also other beneficial service conditions enjoyed by workmen who are regular employees of the Refinery.
Claiming that they had a right to be treated at par with regular employees, the Union filed Writ Petition No. 2876 of 1985 under Article 32 of the Constitution of India in this Court which was disposed of on January 16, 1986 by directing the Central Government to refer to the Industrial Tribunal for adjudication the following questions: 1.
Whether, in law, the petitioners and the 48 workmen whose services have been terminated are employees of the Indian Oil Corporation, Mathura Refinery Project, Mathura? 2.
Whether the termination of the services of 48 workmen was justified? and 3.
To what relief are the workmen entitled?" Status quo was ordered to be maintained and the services of the workmen were ordered not to be terminated.
At that time, the services of 48 workmen alone were involved but as is evident the adjudication of the Tribunal would have affected others too.
Pursuant to the order of this Court, the Central Government referred and the Industrial Tribunal decided the above referred questions holding that the workmen were not employees of the Refinery and were rather the employees of the contractors.
With regard to the termination of the services of the workmen and to what relief they were entitled, the Tribunal, after answering the questions against the Union and in favour of the Refinery, suggested the following steps in the interest of Industrial harmony: (i) Though the Union should have pressed their demand for abolition of the contract labour system in the Refinery to the Central Advisory Board constituted under the Act, and even though it had been pursuing its remedies before this Court and the Tribunal, suggestions were made to the Refinery to approach 471 the Advisory Board to make a study with regard to the desirability of continuance of the contract labour system in the Refinery.
(ii) Till the Central Advisory Board makes its recommendations and the action is taken, the management of the Refinery to ensure that the contract labour is paid at least the minimum of the pay scale of its regular employees performing the same or similar duties as the workmen of the contract labour and further that the workmen among the contract labour who have put in 5 years or more of work at the Mathura Refinery shall be continued to be employed in the same work even if there is a change in the contractor and such workmen shall not be terminated except as a punishment inflicted by way of disciplinary action for misconduct, etc., voluntary retirement or retirement on reaching the age of superannuation (which may be taken as the superannuation age for the I.O.C. employees) or on ground of continuous ill health.
(iii) Refinery to give preference to those workmen in its employment by waiving the requirement of age and other qualifications wherever possible and it may also consider the creation of a benevolent fund for the contract labour wherein it may make a lumpsum contribution initially and then make equivalent or even more contribution to match the contribution made by the workmen of the contract labour.
Having suggested these, the Tribunal has clarified that these ameliorative steps, if taken by the Refinery, shall not be taken to mean that the contract labour has become the direct employees of the Refinery.
Learned counsel for the appellant says that though the above suggestions, which have the colour of directions, are in accord with the decision of this Court in 13HEL workers Association, Hardwar and Others etc.
vs Union of India and Others, [ ; yet they fall short of the expectancies of the Union and in particular to the wide sweep of the principles laid down by this Court in Dharwad Distt P.W.D. Literate Daily Wage Employees Association and Others vs State of Karnataka and Others, [ ; and prayed for directions such as those given to the State of Karnataka in the Dharwad 's case (supra).
The argument of the learned counsel has barely to be noted and 472 rejected.
The Tribunal has given to the appellant Union the maximum which could be given in the facts and circumstances of the, case.
In Dharwad 's case (supra), the State of Karnataka had itself come out with a scheme to absorb the casual workers in regular government service in a phased manner and though it did not satisfy all concerned, yet it was given a workable final shape.
This Court observed as follows: "Though the, scheme so finalised is not the ideal one but it is the obligation of the court to individualise justice to suit a given situation in a set of facts that are placed before it.
Under the scheme of the Constitution the purse remains in the hands of the executive.
The legislature of the State controls the Consolidated Fund out of which the expenditure to be incurred, in giving effect to the scheme, will have to be met.
The flow into the Consolidated Fund depends upon the policy of taxation depending perhaps on the capacity of the payer.
Therefore, unduly burdening the State for implementing the constitutional obligation forth with would create problems which the State may not be able to handle.
Therefore, the directions have been made with judicious restraint.
" Those casual workers were under the employment of the State and the State came out with a scheme for phased absorption and a graded financial responsibility.
In the instant case before us, the contract labourers are not, and have also not been found to be, having a direct connection with the Refinery, even though it is a State for the purpose of enforcement of fundamental rights.
The suggestions/directions given by the Tribunal, appear to us to be the only relief which was due to the appellant and its members in the given situation and circumstances.
Therefore, the impugned Award of the Tribunal cannot be improved upon.
Finding no merit in the appeal, we dismiss the same.
No costs.
T.N.A. Appeal dismissed.
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The appellant Union, representing about 900 casual labourers falling under the Contract Labour (Regulation and Abolition) Act, 1971 some of whom formed Co operative societies and entered into contracts with the respondent refinery while others worked for contractors who had contracts with the refinery, filed a writ petition in this court claiming parity in wages and service conditions with the regular workmen of the respondent refinery.
This Court disposed the petition by directing the Central Government to refer to the Industrial Tribunal for adjudication the questions whether the petitioners and some of the workmen whose services were terminated were employees of the refinery; whether their termination was justified and to what relief they were entitled to.
The Government referred and the Tribunal decided the questions against the appellant union by holding that the labourers were employees of the contractors and not of the refinery and their termination was justified.
But the Tribunal gave certain directions by way of relief for consideration by the Advisory Board about the desirability of continuance of the contract system in the refinery, for providing minimum pay of scale of regular employees to the contract labour and giving them preference in the regular employment.
Against the award of the Industrial Tribunal, the Union filed an appeal in this Court praying for directions to the refinery to absorb and regularise the casual labourers in a phased manner.
Dismissing the appeal, this Court, 469 HELD:The contract laboures are not, and have also not been found to be, having a direct connection with the Refinery, even though it is a State for the purpose of enforcement of fundamental rights.
The directions given by the Tribunal was the only relief which was due to the appellant_union and its members.
Hence the Tribunal has given to the appellant union the maximum which could be given in the facts and circumstances of the case.
Therefore, the impugned Award of the Tribunal cannot be improved upon.
[472E F] BHEL Workers Association, Hardwar and Ors.
vs Union of India and Ors.
, ; , referred to.
Dharwad Distt.
P.W.D. Literate Daily Wage Employees Association and Ors.
V. State Of Karnataka and Ors.
, ; , distinguished.
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Writ Petition No. 1555 of 1979 etc.
(Under Article 32 of the Constitution of India).
144 D.N. Dwivedi and Sarwa Mitter for the Petitioners.
Dr. L.M, Singhvi, B.D. Sharma, Shri Narain, Sandeep Narain, Shrid Rizvi and D.K. Singh for the Respondents.
The Judgment of the Court was delivered by R.M. SAHAI, J.
Validity of Rajasthan Agricultural Pro duce Markets Act, 1961 (for brevity the Act) levying market fee on sale and purchase of agricultural produce in market yard or sub marketyard was challenged by dealers for lack of legislative competence, violation of Articles 14, 19, 30 1 and 304 of Constitution, absence of any quid pro quo in the fee paid and service rendered, illegal and arbi trary inclusion of manufactured articles such as Khandsari, Shakkar, Gur and Sugar as agricultural produce in the sched ule etc.
Acts of other States, for instance, Punjab and Haryana and U.P. were also assailed for similar infirmities.
Whether these petitions, which appear to be identical, are reproduc tion of any of those petitions, which were pending in this Court from before is not relevant but various group of petitions of Punjab and Haryana dealers challenging consti tutionality and legality of Act and its provisions including Gut, Khandsari and Shakkar as agricultural produce in the schedule of Punjab Act have been dismissed by different benches presumably because of decisions in Kewal Krishan Puri vs State of Punjab, ; ; Ramesh Chandra vs State of U.P., ; Rathi Khandsari Udyog vs State of U.P., and Sreenivisa General Traders vs State of Andhra Pradesh, AIR 1983 SC 1264.
Despite these decisions spelling out basic principles for determining validity of marketing legislations dealing with agricultural produce the petitioners were not willing to take it lying down probably because none of these deci sions dealt with sugar.
It was urged that inclusion of sugar in the Schedule of the Act was arbitrary., primarily because it being a declared commodity of public importance under Entry 52 of List I of Schedule VII the State legislature was precluded from legislating on it.
Its inclusion in the Schedule was also assailed as it being a Mill or Factory produce it could not be deemed to be agricultural produce which is basically confined to produce of or from soil.
Sugar is one of the items which was included in the Schedule to the Act, statutorily, right from its inception.
Such inclusion is found in 145 Maharashtra, Gujarat, West Bengal, Bihar etc.
Whether it was subsequently deleted or re included or re grouped or it was added later was immaterial as Section 40 of the Act empow ered State Government to amend or include any item in the Schedule of agricultural produce.
Existence of such delegat ed power is usual feature of the statutes.
No illegality or infirmity could be pointed out in it.
Any challenge, there fore, rounded on excessive delegation of legislative power was misconceived.
Inclusion of sugar in the Schedule was urged to be arbitrary as it was not produced out of soil the basic ingredient of agricultural produce.
Fallacy of the submis sion is apparent as it was in complete disregard of defini tion of the word "agricultural produce" in the Act which includes all produce whether agricultural, horticultural, animal husbandry or otherwise as specified in the Schedule.
The legislative power to add or include and define a word even artificially, apart, the definition which is not ex haustive but inclusive neither excludes any item produced in mill or factories nor it confines its width to produce from soil.
If that be the construction then all items of animal husbandry shall stand excluded.
It further overlooks expanse of the expression "or otherwise as specified in the Sched ule.
" Nor switch over from indigenous method of producing anything to scientific or mechanical method changes its character.
Khandsari sugar, which is produced by open pan process and is not different from sugar produced by vacuum pan process except in composition, filterability and conduc tivity as held in Rathi Khandsari Udyog, (supra) was held to be agricultural produce in some decisions.
No distinction was made on method of production, namely, by modern plant and machinery.
To say, therefore, that sugar being produced in mill or factories could not be deemed to be agricultural produce is both against the statutory language and judicial interpretation of similar provisions of the Act in statutes of other States.
Rice or dal produced in mills have been held to be agricultural produce in Ramesh Chandra vs
U.P. State, and State of U.P. vs Ganga Das Mill, Even in Halsbury Law of England, ' Vol.
I the word agricultural produce for purpose of agricultural marketing schemes is understood as, 'including any product of agriculture or horticulture and any article of food or drink wholly or partly manufactured or derived from any such product and fleeces (including all kinds of wool) and the skins of animals '.
In the same volume products covered by the provisions of EEC Treaty as to agriculture (classified according to the Brussels Nomenclature of 1965) are men tioned in paragraph 1845.
Sugar is one of them.
146 Another legalistic challenge regarding inhibition of State to legislate on sugar or of repeated argument of occupied field was more attractive than of any substance.
Reliance on Article 246 of the Constitution was academic only.
As far back as 1956 Constitution Bench of this Court in Choudhary Tika Ram and others vs State of U.P., ; examined the matter in detail and held sugar legis lations to be within the scope of Entry 33 of concurrent list.
It was observed that all 'Acts and the notifications issued thereunder by the Centre in regard to sugar and sugarcane were enacted in exercise of concurrent jurisdic tion '.
Effect of it was described thus, 'The Provincial Legislature as well as the Central Legislature would be competent to enact such pieces of legislation and no ques tion of legislative competence would arise '.
Any further discussion on clash between Entry 52 of List I of VII Sched ule with Entry 28 of List II in the circumstances is unnec essary.
As regards the submission of occupied field suffice it to say that there is no repugnancy m the Central and State legislation.
At least none was made out.
Even if there would have been any the Act having received assent of the President it is fully protected by Article 254(2).
For these reasons these petitions fail and are dismissed with costs.
N.P.V. Petitions dismissed.
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In the Writ Petition flied in this Court, the validity of Rajasthan Agricultural Produce Markets Act, 1961, levying market fee on sale and purchase of agricultural produce was challenged for lack of legislative competence, and arbitrary inclusion of Khandsari, Shakkar, Gur and Sugar as agricul tural produce in the Schedule.
It was contended that inclu sion of sugar was arbitrary inasmuch as it being a declared commodity of public importance under Entry 52 of List I of Schedule VII, the State Legislature was precluded from legislating on it and that being a mill or factory produce, it could not be deemed to be agricultural produce, which was basically confined to produce of or from soil.
Dismissing the Petitions, this Court, HELD: 1.1 Sugar is one of the items which was included in the Schedule to the Rajasthan Agricultural Produce Mar kets Act, 1961, statutorily, right from the inception.
Such inclusion is found in many States.
Whether it was subse quently deleted or re included or regrouped or was added later was immaterial, as Section 40 of the Act empowered State Government to amend or include any item in the Sched ule of agricultural produce.
Existence of such delegated power is 143 usual feature of the statutes.
No illegality or infirmity could be pointed out in it.
Any challenge, therefore, round ed on excessive delegation of legislative power was miscon ceived.
[144H, 145A B] 1.2 The definition of the word "agricultural produce" in the Act includes all produce whether agricultural, horticul tural, animal husbandry or otherwise as specified in the Schedule.
The legislative power to add or include and define a word even artificially, apart, the definition which is not exhaustive but inclusive, neither excludes any item produced in mill or factories nor it confines its width to produce from soil.
Nor switch over from indigenous method of produc ing anything to scientific or mechanical method changes its character.
To say, therefore, that sugar being produced in mill or factories could not be deemed to be agricultural produce is both against the statutory language and judicial interpretation of similar provisions of the Act in statutes of other States.
[145C D, F] Kewal Krishan Puri vs State of Punjab, ; ; Ramesh Chandra vs State of U.P., ; Rathi Khandsari Udyog vs State of U.P., ; Sreenivisa General Traders vs State of Andhra Pradesh, AIR 1983 SC 1264; Ramesh Chandra vs U.P. State and State of U.P. vs Ganga Das Mill, , re ferred to.
Halsbury 's Law of England, Vol.
I and Paragraph 1845, re ferred to. 2.
In view of the settled position of law that sugar legislations are within the scope of Entry 33 of Concurrent List, no further discussion on clash between Entry 52 of List I of Vllth Schedule and Entry 28 of List II is neces sary.
There is no repugnancy in the Central and State legis lation.
Even if there would have been any, the Act having received assent of the President is fully protected by Article 254(2) of the Constitution.
[146B D] Choudhary Tika Ram and Others vs State of U.P., ; , followed.
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ition No. 6607 of 1981.
Kapil Sibal (A.C.) for the Petitioner.
N.C. Talukdar and R.N. Poddar with him for the Respondent.
Miss A. Subhashini for CBI.
Daniel Latiffi and N.K Agarwal with him for the Intervener.
The Judgment of the Court was delivered by PATHAK, J.
The petitioner, Shri Bhagwant Singh, has applied to this Court for relief in the matter of the death of his married daughter, Gurinder Kaur.
113 Shri Bhagwant Singh is a member of the Indian Revenue Service.
His daughter, Gurinder Kaur, was one of three children.
She was an intelligent and talented girl who secured a first division in the Senior Cambridge Examination and had obtained a B. Sc.
(Home Science) Degree from Lady Irwin College.
She was endowed with good looks and a pleasing personality, and her education and deportment attracted notice.
It is apparent that the father was proud of his daughter.
Shri Bhagwant Singh and Shri Kartar Singh Sawhney were colleagues in the office.
They had been friends for over thirty years.
Shri Kartar Singh has a son, Amarjit Singh.
The family lived at J 7/93, Rajouri Garden, New Delhi.
The son ran a motor parts shop at Kashmere Gate, Delhi.
It appears that the two colleagues decided on a marriage between Gurinder Kaur and Amarjit Singh in view of the close association of the two families.
From the very beginning, it seems, Shri Bhagwant Singh was opposed to the evils of the dowry system, and the sentiment was also deeply entrenched in Gurinder Kaur for, it appears, she along with other girls of her college signed a pledge in favour of the "anti dowry movement".
According.
to Shri Bhagwant Singh, there was an express stipulation between the respective parents that no dowry would be demanded in the marriage.
The marriage started off well and the young couple enjoyed a harmonious relationship for the first few months.
But very soon, it is alleged, Gurinder Kaur became conscious of broad hints from her mother in law that gifts in the shape of money and jewellery were expected from her parents.
Shri Bhagwant Singh, on being formed of this, decided to ignore it, firm inn his conviction that any insidious attempt to extract a dowry should not be countenanced.
It is alleged that from this point Gurinder Kaur became the victim of constant ill treatment by her mother in law.
She was carrying a baby, but amidst the oppressive tensions at home she suffered a miscarriage and was admitted to a Nursing Home.
According to Shri Bhagwant Singh, his daughter continued to be ill treated and was often taunted that unless the observed the family tradition of presenting a necklace to her mother in law she would remain without child.
It is said that the pressure on Gurinder Kaur continued unabated, and it was not long before her husband got it conveyed to Shri Bhagwant Singh that he required about 114 Rs. 50,000 for financing his business.
As Shri Bhagwant Singh remained firm in his resolve not to yield to these pressures, it is alleged that the girl continued to be harassed and her parents in law made it plain to her that they regretted the marriage.
The attitude and relations of her husband and his family towards her went from bad to worse, and the regard which ordinarily a bride in the house can expect to receive was replaced by a continuing scorn and contempt and ill will.
It must be recalled that Gurinder Kaur was a girl of good family, of refined character and well educated.
Brought up in a home where the dowry system was regarded as an evil to be opposed, it can be presumed that she rebelled strongly against the attempts at extortion directed against her father.
It is reasonable to assume that the relations between the young husband and wife were vitiated by bitter discord, and that she lived in the home in an atmosphere of open and continuous hostility.
On August 9, 1980, ten months after the marriage, Gurinder Kaur, aged 22 years was found dead of third degree burns from a kerosene fire in the bath room.
According to the family of Kartar Singh, all the members of the family had proceeded to the Gurudwara Bangla Sahib in the early morning, and on their return the girl had prepared breakfast for the eight members of the family.
She and her husband ate breakfast later and, it is said, the husband left for work about 10.
30 A.M.
Within an hour thereafter, the girl was found dead in the bathroom.
The tragedy occasioned universal distress, and on the versions put out by the newspapers agitated letters condemning the dowry system and calling for urgent legislative and social measures for reform poured into the press.
The police authorities, it seems, tend to believe that the case was one of suicide, but Shri Bhagwant Singh is convinced that murder cannot be ruled out.
It is not possible in this case, nor indeed would it be right for us to do so, to enter into the question whether Gurinder Kaur committed suicide or was murdered.
That is a matter which is properly involved in the trial of a criminal charge by a court possessing jurisdiction.
We are concerned here only with an examination of the question whether, after being informed of Gurinder Kaur 's death, the police authorities conducted themselves as law and justice required of them.
A counter affidavit of October, 1981 of Shri P.S. Bhinder, Commissioner of Police, Delhi states that Gurinder Kaur was admitted in the Ram Manohar Lohia Hospital on August 9, 1980 at 12.15 P.M. with "100% burn injury" by her father in law, 115 Shri Kartar Singh Sawhney, and that on receiving information a Sub Inspector of Police visited the hospital and was told by the doctor on duty at 3.
10 P.M. that Gurinder Kaur was unfit to make a statement.
His enquiries led him to believe that Gurinder Kaur had attempted to commit suicide.
He registered the case as F.I.R. No. 507 dated August 9, 1980 under section 309 of the Indian Penal Code and commenced investigation.
IS P.M.
On the same day Gurinder Kaur died.
The police investigation brought to light that Gurinder Kaur was found burning at about 11 A.M.
On August 9, 1980 in the bathroom of the first floor of the house.
The police say that the bath room was found bolted from inside, and it was broken open by a servant, Ramu, with the assistance of Smt.
Satinder Kaur, the elder daughter in law.
After the fire was extinguished, Gurinder Kaur was removed to the hospital.
It is said that a tin can of S litters of Kerosene oil, two match boxes and one looking glass with the words "Do not hold any one responsible Pinky" written on its surface with a soap cake were found.
The Central Forensic Science Laboratory experts summoned for the purpose were of opinion that the writing on the mirror was that of Gurinder Kaur.
It was also said that the door of the bathroom could have been broken open from outside.
When Shri Bhagwant Singh complained about the manner in which the police investigation was proceeding and expressed his suspicions in regard to the circumstances in which his daughter died, the police added section 4 of the Dowry Prohibition Act to the charge on November 29, 1980.
Subsequently, on May 15, 1981 reference to section 306 of the Indian Penal Code was also included.
The police continued their investigation until August 29, 1981, and from the investigation they inferred that it was a case of suicide.
It seems that thereafter the investigation was entrusted by the Minister of State for Home Affairs in the Government of India to the Central Bureau of Investigation, and the file was sent to its Director on September 10, 1981.
For that reason, it is said, no question arose of filing any report under section 173 (2) of the Code of Criminal Procedure.
Shri Bhagwant Singh has vigorously contended that the investigating agency in this case did not carry out its statutory duties in a bonafide manner and deliberately withheld the filing of a police report and resorted to delaying the progress of the investigation in order to ensure that no proceedings were taken against the accused in the case.
He disputes the version of the police that the doctor 116 on duty at the hospital had said that Gurinder Kaur was unfit to make a statement and that it was not possible for the police to obtain her statement before her death.
He has referred to the statement of Shri Kartar Singh Sawhney, the father in law of the girl, made to the police on November 13, 1980, in which he had disclosed that Shri Bhagwant Singh had come to the hospital and he found that his daughter was talking occasionally, and that during the period from 2.30 P.M. to 8.30 P.M. Shri Bhagwant Singh, his wife, his niece, who was a doctor, and his elder brother Balwant Singh, as well as the latter 's wife and two sons, had been talking to the girl.
In his affidavit Shri Bhagwant Singh also alludes to the statement of Smt.
Satinder Kaur recorded by the police on August 9, 1980 where she stated that at the time of the tragedy she rushed upstairs and fainted and that when.
she regained consciousness many people including her father in law, mother in law and brother in law, Raman Deep Singh who lived on the second floor were present.
It is pointed out that if this statement is true, then it is not possible to accept the version put forward by the family of Shri Kartar Singh that the servant, Ramu, with the assistance of Smt.
Satinder Kaur had to break open the door of the bathroom because it was bolted from inside.
It is also pointed out that the servant Ramu and Smt.
Satinder Kaur were alleged to be on the ground floor when the burning took place in the both room on the first floor of the house where the mother in law, Gurbachan Kaur was present.
Gurbachan Kaur, according to her statement, was ironing clothes at that movement on the first floor, a few yards away from the bathroom and would have been the first person to have witnessed the tragedy and yet, it is questioned, there is no reason why she should not have been the first to assist the servant Ramu in breaking open the door if indeed the door had to be broken open.
It is also alleged that the police never attempted to take into possession the cake of soap in the bathroom with which the deceased is supposed to have written on the looking glass, nor did they take possession of the blanket, which according to the statement of Shri Kartar Singh Sawhney, was employed to extinguish the fire.
Several suspicious circumstances have been set forth by Shri Bhagwant Singh in his affidavit, and the opinion of the C.F.S.L. experts has been assailed on the ground that it was delivered on an examination of the mirror after more than a month.
He has also attempted to rebut the assertion of the police that he did not join in the investigation from the outset and that he had originally said that he did not suspect any foul play.
On the contrary, he has dwelt at some length on the 117 continuous attempts made by him to ensure an effective investigation into the cause of his daughter 's death, approaching in this behalf the highest authorities in the land.
When this case came before this Court, an order was made directing the filing of a detailed affidavit by the Commissioner of Police setting forth full particulars of the various steps taken by the police in connection with the investigation.
A further counter affidavit was filed by Shri P. section Bhinder, Commissioner of Police.
It is stated in the counter affidavit that the investigating officer remained busy with the investigation of other cases and with matters concerning the maintenance of law and order.
and that this particular case was with Sub Inspector Amrit Lal, who had 12 cases in hand, from August 9, 1980 to August 11, 1980.
and thereafter was entrusted to Sub Inspector Sri Ram, who had 29 cases in hand, from August 12, 1980, to November 13,1980, and subsequently to Inspector Charan Das, who had only one case in hand, from November 13, 1980 to May 28, 1981.
It is stated that these police officers "could not investigate this case all the time" because besides the other cases in hand, they had also to look after the day to day work of the Police Station.
It is said also that during the period when the case was under investigation with Inspector Charan Das, the file remained under submission to the Crime Bench of Delhi for scrutiny with a view to guide the local police on further investigation.
Finally, the case passed into the hands of Inspector R. P. Kochhar of the Crime Branch, who had four cases in hand, and he dealt with this case from May 28, 1981 to September 9, 1981.
It is pointed out that Inspector Kochhar was at that time entrusted also with the investigation of a number of cases involving a notorious dacoit as well as two sensational murders.
It is reiterated in the counter affidavit that the statement of Gurinder Kaur could not be recorded by the police as the doctor on duty had declared her unfit to make a statement.
It is admitted that the blanket with which the fire was extinguished was not taken into possession by the police, but it is asserted that the soap cake was taken on August 9, 1980.
It is also asserted that on August, 10, 1980 Sub Inspector Amrit Lal brought a team of C.F.S.L. experts to the place of occurrence and a photograph of the mirror was taken.
It is alleged that although every effort was made to record the statement of Shri Bhagwant Singh, he declined to make any statement.
It was only on April 21, 1981 that he did so.
It is conceded that reference to section 306 of the Indian Penal Code was added only on May 15, 1981, the omission 118 to do so earlier being explained as a mistake.
The delay occasioned A in the investigation is ascribed by the Commissioner of Police to the fact that Shri Bhagwant Singh permitted his statement to be recorded only as late as April 21, 1981.
We think it can be fairly stated that the police did not display the promptitude and efficiency which the investigation of the case required.
There is much that calls for comment.
It appears from the entries in the police Case Diary that a Sub Inspector visited the place of occurrence on August 9, 1980 and seized a number of articles.
But it is conceded that he did not take into custody the blanket with which the fire is said to have been put out.
On the next day, experts from the Central Forensic Science Laboratory visited the place and appear to.
have made an examination for chance prints.
They also photographed the mirror.
And yet, it was not until over five weeks later that the police were able to obtain a report from them.
Curiously, although the minor was removed from the scene of occurrence and was examined for chance prints, no "identifiable prints" could be developed.
In cases such as this, it would have been of the essence that on visiting the place of occurrence immediately on information of the incident, the mirror should have been taken into possession by the police and handed over forthwith to the Central Forensic Science Laboratory experts for an urgent report in regard to the existence and identification of the prints.
Delay in such a matter is vital and can often result in the loss of valuable clues.
It is of little consolation that, according to the entry G. D. No. 7 dated September 23, 1980 the Deputy Commissioner of Police wrote a reminder to the Director, Central Forensic Science Laboratory for an urgent examination of the writing.
An important question was whether the bathroom door was latched from inside and had to be forced open, or was in fact latched from outside.
According to the family of Shri Kartar Singh, the door was forced open with the help of the servant Ramu.
The entry C. D. No. 1 dated August 9, 1980 in the Case Diary does not indicate that Ramu 's statement was recorded by the police on that day, although it shows that the statements of other persons were recorded.
There is a suggestion by the learned counsel for the State that Ramu 's statement was also recorded on that very day, but that is not shown by the Case Diary extracts filed before us.
It is only as late as January 25, 1981, according to the entry C. D. No. 13 of that date, that the servant was examined by the Station House officer.
Ramu 119 was a material witness, and yet strangely, as it appears from the entries in the police Case Diary, he was allowed to leave the town and go to his village before he could be fully examined by the police.
There is no evidence that the police expressed any anxiety to put him through a thorough examination immediately or shortly after the date of the occurrence or at least before Shri Kartar Singh 's family allowed Ramu to leave the town for his village.
Much has been made by the police of the reluctance of Shri Bhagwant Singh to make a statement to them.
As a responsible officer of sufficiently senior status in the Government of India it would have been natural to expect that he would have come forward from the very first to have his statement recorded and to cooperate with the police, especially in view of the fact that he would have been particularly anxious to have the truth determined into the death of his own daughter.
It is indeed difficult to believe that he did not cooperate with the police in the investigation or declined to give his statement until April 21, 1981.
But if he did so, it could only be because of want of confidence in the manner in which the police investigation was being conducted.
The most vital evidence would have been the statement of Gurinder Kaur herself, and yet even on that point there is a conflict of testimony on the question whether she was fit to make a statement at 3.10 p.m. when the Sub Inspector approached the doctor for the purpose.
On the other hand, according to the statement made by her father in law, Shri Kartar Singh, himself to the police on November 13, 1980, when her father Shri Bhagwant Singh came to the hospital and entered the room, the girl was talking occasionally, and during the period 2.30.p.m.
to 8.30 p.m. Shri Bhagwant Singh, his wife, his niece who was a. doctor and other members of his family had been talking to the girl.
According to the statement of Dr. Rajinder Pal Kaur, niece of Shri Bhagwant Singh, Gurinder Kaur was in possession of her senses at the time and when Dr. Kaur suggested to one of the police officers, who was present, to record to statement of the girl, he declined to do so.
It is regrettable that there is a conflict on the question whether the girl was fit to make a statement to the police, and we are constrained to point out that the conflict centres on a vital part of the case.
There are other features of the case, including the question of the transfer of a Television set to the family of Shri Kartar Singh as a palliative by the uncle of the unfortunate girl, but.
we find it 120 unnecessary to enter into them.
It is enough to point out that A the investigation by the police does not inspire confidence.
It was, in fact, considered materially inadequate by the Crime Branch itself.
For on May 12, 1981, a memorandum was addressed by the Crime Branch to the Deputy Commissioner of Police, Delhi pointing out that the file showed that statements of material persons had not been recorded.
We may also advert to the fact that although the girl was taken to the hospital in a taxi, the police do not appear to have attached any importance to recording the statement of the taxi driver.
There is also an affidavit of one Shri Jagjit Singh before us from which it appears that he was among the first to reach the house when the incident occurred and that it was he who suggested that the girl, who was lying burnt half inside the bathroom and half outside in the verandah, should be taken forthwith to the hospital, and he states that it was he who wag instrumental in sending for the taxi.
Shri Jagjit Singh was an important witness, and although he was in the neighbourhood, no attempt was made to record his statement expeditiously.
Two inferences follow irresistibly from the material before us.
One is that the investigation by the police following the occurrence was desultory and lackadaisical, and showed want of appreciation of the emergent need to get at the truth of the case.
There is a powerful suggestion made by learned counsel for Shri Bhagwant Singh that the police were anxious not to embarrass Shri Kartar Singh and his family and may indeed, as it were, have looked the other way instead of vigorously pursuing the investigation.
Whatever may be the reason, there is no doubt that the investigation of the case suffered from casualness lack of incisiveness and unreasonable dilatoriness, and this is demonstrated most effectively by the manner in which the case was passed from one police official to another, being entrusted successively to Sub Inspectors and Inspectors each of whom already had his hands full with the investigation of several other cases.
There is the admission that these police officers were preoccupied with numerous other cases in their hands and they were officers who were also required to look after the day to day work of the police station.
It was only when on the repeated and insistent petitions of Shri Bhagwant Singh the case passed into the control of the Crime Branch that the investigation showed some signs of being speeded up.
The other inference which disturbs us is that the entries in the police Case Diary (set forth in the annexure to the counter affidavit 121 on the record) do not appear to have been entered with the scrupulous completeness and efficiency which the law requires of such a A document.
The haphazard maintenance of a document of that status not only does no credit to those responsible for maintaining it but defeats the very purpose for which it is required to be maintained.
We think it to be of the utmost importance that the entries in a police Case Diary should be made with promptness, in sufficient detail, mentioning all significant facts in careful chronological order and with complete objectivity.
We believe it would be appropriate to make a few further observations at this stage.
It is impossible to escape the conclusion that, in a case such as this, the death of a young wife must be attributed either to the commission of a crime or to the fact that, mentally tortured by the suffocating circumstances surrounding her, she committed suicide.
Young women of education, intelligence and character do not set fire to themselves to welcome the embrace of death unless provoked and compelled to that desperate step by the intolerance of their misery.
It is pertinent to note that such cases evidence a deep seated malady in our social order.
The greed for dowry, and indeed the dowry system as an institution, calls for the severest condemnation.
It is evident that legislative measures such as the Dowry Prohibition Act have not met with the success for which they were designed.
Perhaps, legislation in itself cannot succeed in stamping out such an evil, and the solution must ultimately be found in the conscience and will of the social community and in its active expression through legal and constitutional methods.
Besides this, what is important to point out is that where the death in such cases is due to a crime, the perpetrators of the crime not infrequently escape from the nemesis of the law because of inadequate police investigation.
It would be of considerable assistance if an appropriately high priority was given to the expeditious investigation of such cases, if a special magisterial machinery was created for the purpose of the prompt investigation of such incidents, and efficient investigative techniques and procedures were adopted into taking account the peculiar features of such cases.
Among other suggestions, we would recommend that a female police officer of sufficient rank and status in the police force should be associated with the investigation from its very inception.
There are evident advantages in that.
In a case where a wife dies in suspicious circumstances in her husband 's home it is invariably a matter of 122 considerable difficulty to ascertain the precise circumstances in which the incident occurred.
As the incident takes place in the home of the husband, the material witnesses are usually the husband and his parents or other relations of the husband staying with him.
Whether it was cooking at the kitchen stove which was responsible for the accident or, according to the inmates of the house, there was an inexplicable urge to suicide or whether indeed the young wife was the victim of a planned murder are matters closely involving the intimate knowledge of a woman 's daily existence.
If the incident is the result of a crime by the husband or his family, the problem of ascertaining the truth is burdened by the privacy in which the incident occurred.
In circumstances where it is possible to record the dying declaration of the victim, it would, in our opinion, be more conducive to securing the truth if the victim made the declaration in the presence of a female police officer who can be expected to inspire confidence in the victim.
Psychological factors play their part, and their role cannot be ignored.
A young wife can be the subject of varying psychological pressures, and because that is so the nuances of feminine psychology support the need for including a female police officer as part of the investigating force.
While making these observations we may emphasise that we intend no aspersion on the rectitude or efficiency of the male members of the police involved in the investigation of such cases.
Another suggestion which has found favour with us is the need to extend the application of the to other cities besides those where it operates already.
The application of the will make possible an immediate inquiry into the death of the victim, whether it has been caused by accident, homicide, suicide or suddenly by means unknown.
It contains provisions which are entirely salutary for the purpose of such inquiry, and we have little doubt that an inquiry under that enactment would be more meaningful and effective and complete in the kind of case before us.
We are aware that the Code of Criminal Procedure, 1973 contains, in sections 174 and 175, provision for a police inquiry pursuant to an information that a person has committed suicide or has been killed by another or by an animal or by machinery or by an accident or has died under circumstances raising reasonable suspicion that some other person has committed an offence.
In such a case the police officer makes an investigation and submits a report to the District Magistrate or the Sub Divisional Magistrate, and thereafter the 123 District Magistrate of Sub Divisional Magistrate or other Executive Magistrate empowered in that behalf is required to hold an inquest.
The police officer making an investigation is entitled to summon two or more persons for the purpose of the investigation and any other person who appears to be acquainted with the facts of the case to attend and answer truly all questions other than questions the answer to which would have a tendency to incriminate him.
We think that in the category of cases we have in mind the more appropriate and effective procedure would be that contemplated by the , which ensures that the inquiry into the death is held by a person of independent standing and enjoying judicial powers, with a status and jurisdiction commensurate with the necessities of such cases and the assistance of an appropriate machinery.
We have referred to some of the important features of the case.
We have done so not for the purpose of determining whether the girl was murdered or had committed suicide, but solely with the object of drawing attention to the manner in which the investigation of the case was conducted.
Disappointing as it may seem to those who have desired the institution of criminal action on the basis that a crime has been committed, we do not think that on the material before us we can go that far.
The investigation of the case was transferred from the police administration of Delhi to the Central Bureau of Investigation at the instance, we understand, of the petitioner.
We hope and trust that this investigation has been completed.
It not, we would request the Central Bureau of Investigation to complete the investigation within three months from the today and take such action as may be warranted by the result of the investigation.
The petition is disposed of accordingly.
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The petitioner Bhagwant Singh a member of the Indian Revenue Service applied to the Court for intervention and necessary relief in the matter of the death of his married daughter Gurinder Kaur alleging that due to several circumstances he was convinced that his daughter was murdered in the house of her parent 's in law by burning her and that the police investigation was improper and irregular and ineffective.
According to the petitioner: (i) that he and his daughter were opposed to the evils of the dowry system and therefore, with a stipulation that no dowry should be demanded at the time of the marriage he gave his daughter to one Amarjit Singh, son of his colleague Kartar Singh Sawhney and a friend for over thirty years; (ii) that after the marriage his daughter came to be ill treated by her mother in law hinting that gifts and jewellery were expected from her parents and such oppressive tensions at home resulted in the mis carriage of a child, from which time onwards the mother in law taunted her saying that unless she observed the family tradition of presenting a necklace to her mother in law she would remain without a child; (iii) that sometime later, the son in law got it conveyed to Bhagwant Singh that he required Rs. 50,000 for financing his business which was not acceded to; (iv) that on August 9, 1980 i.e. ten months after the marriage his daughter was found dead of third degree burns from a kerosene fire in the bath room and was admitted in the Ram Manohar Lohia Hospital by her father in law at 12.15 P.M.; (v) that the police did not get the statement of his daughter recorded though she was able to speak; (vi) that the police added section 4 of the Dowry Prohibition Act to the charge on November 29, 1980 and only on May 15, 1981 a reference to section 306 IPC was included in the F.I.R.; and (vii) that the police failed to examine material witnesses and recover material objects and proceeded in a leisurely manner.
110 The Court admitted the writ petition and called for full details from the Inspector General of Police about the investigation of the case and the circumstances leading to the non filing of the report under section 173(2) of the Code of Criminal Procedure.
Disposing of the Writ Petition and directing the C.B.I. to complete the investigation within three months, the Court ^ HELD: 1:1 Disappointing as it may seem to those who have desired the institution of criminal action on the basis that a crime has been committed, the material on record does not, however, justify an order to that effect by the Supreme Court.
The investigation of the case now stands transferred to the C.B.I. at the instance of the petitioner.
[123 E F] 1:2.
It is not possible, in this case, nor indeed would it be right for the Court to do so, to enter into the question whether Gurinder Kaur committed suicide or was murdered.
That is a matter which is properly involved in the trial of a criminal charge by a court possessing jurisdiction.
[114 G H] 2:1.
The police did not display the promptitude and efficiency which the investigation of the case required.
There is much that calls for comment.
Though the CD entry made on August 9, 1980 indicates the visit of a sub inspector to the place of occurrence and seizure of several things, the blanket with which the fire is said to have been put out has not been seized.
On the next day when the experts from the Central Forensic Science Laboratory visited the place for getting any chance prints, the mirror was not taken possession of, nor was the report obtained for full five weeks.
In cases such as this, it would have been of the essence that on visiting the place of occurrence immediately on information of the incident, the mirror should have been taken into possession by the police and handed over forthwith to the Central Forensic Science Laboratory experts for an urgent report in regard to the existence and identification of the prints.
Delay in such a matter is vital and can often result in the loss of valuable clues.
Since Ramu the servant was reported to have helped in forcing open the door of the bathroom, he was a material witness for deposing whether the bathroom was latched from inside and had to be forced open or was in fact latched from outside.
It was only as late as January 25,1981, according to entry CD 13 of that date, that Ramu was examined by the Station House Officer.
Strangely he was allowed to leave the town and go to his village before he could be fully examined by the police.
There is no evidence that the police expressed any anxiety to put him through a thorough examination immediately or shortly after the date of the occurrence or at least before Shri Kartar Singh 's family allowed Ramu to leave the town for his village.
The fact that the investigation by the Delhi Police does not inspire confidence is clear from the memorandum dated May 12, 1981 issued by the Crime Branch to the Deputy Commissioner of Police to the effect that the statement of several material witnesses had not been recorded.
[118 B H, 119 A B, 120 B] 2:2 The investigation by the police following the occurrence was desultory and lackadaisical, and showed want of appreciation of the emergent need 111 to get at the truth of the case.
Whatever may be the reason, there is no doubt that the investigation of the case suffered from casualness, lack of incisiveness and unreasonable dilatoriness, and this is demonstrated most effectively by the manner in which the case was passed from one police official to another, being entrusted successively to sub Inspectors and Inspectors each of whom already had his hands full with the investigation of several other cases.
There is the admission that these police officers were not only preoccupied with numerous other cases in their hands but they were officers who were also required to look after the day to day work of the police station.
It was only when on the repeated and insistent petitions of Shri Bhagwant Singh the case passed into the control of the Crime Branch that the investigation showed some signs of speeding up.
Secondly, the haphazard maintenance of a police case diary not only does no credit to those responsible for maintaining it but defeats the very purpose for which it is required to be maintained.
It is of the utmost importance that the entries in a police Case Diary should be made with promptness, in sufficient detail, mentioning all significant facts, in careful chronological order and with complete objectivity.
[120 E H, 121 A.B] 2.3 In a case such as this, the death of a young wife must be attributed either to the commission of a crime or to the fact that.
mentally tortured by the suffocating circumstances surrounding her, she committed suicide.
Young woman of education, intelligence and character do not set fire to themselves unless provoked and compelled to that desperate step by the intolerance of their misery.
Such cases evidence a deep seated malady in our social order.
The greed for dowry, and indeed the dowry system as an institution, calls for the severest condemnation lt is evident that legislative measures such as the Dowry Prohibition Act have not met with the success for which they were designed.
Perhaps, legislation in itself cannot succeed in stamping out such an evil, and the solution must ultimately be found in the conscience and will or the social community and in its active expression through legal and constitution methods.
[121 C E] 3.
The Court suggested the following (i) Where the death in such cases is due to a crime, the perpetrators of the crime not infrequently escape from the nemesis of the law because of inadequate police investigation.
It would be of considerable assistance if an appropriately high priority was given to the expeditious investigation of such cases, if a special magisterial machinery was created for the purpose of the prompt investigation of such incidents, and efficient investigative techniques and procedures were adopted taking into account the peculiar features of such cases; [121 F G] (ii) A female police officer of sufficient rank and status in the police force should be associated with the investigation from its very inception.
There are evident advantages in that.
In a case where a wife dies in suspicious circumstances in her husband 's home its invariably a matter of considerable difficulty to ascertain the precise circumstances in which the incident occurred.
As the incident takes place in the home of the husband the material witnesses are 112 usually the husband and his parents or other relations of the husband staying with him.
Whether it was cooking at the kitchen stove which was responsible for the accident or, according to the inmates of the house, there was an inexplicable urge to suicide or whether indeed the young wife was the victim of a planned murder are matters closely involving the intimate knowledge of a woman 's daily existence.
[121 H, 122 A B] If the incident is the result of a crime by the husband or his family, the problem of ascertaining the truth is burdened by the privacy in which the incident occurred.
In the circumstances where it is possible to record the dying declaration of the victim, it would be more conducive to securing the truth if the victim made the declaration in the presence of a female police officer who can be expected to inspire confidence in the victim.
Psychological factors play their part, and their role cannot be ignored.
A young wife can be the subject of varying psychological pressures, and because that is so the nuances of feminine psychology support the need for including a female police officer as part or the investigating force; and [122 C E] (iii) The need to extend the application of the to other cities besides those where it operates already.
The application of the will make possible an immediate inquiry into the death of the victim, whether it has been caused by accident, homicide, suicide or suddenly by means unknown.
lt contains provisions which are entirely salutary for the purpose of such inquiry, and an inquiry under that enactment would be more meaningful and effective and complete than one under sections 174 and 175 of the Code of Criminal Procedure.
The procedure contemplated by the , ensures that the inquiry into the death is held by a person of independent standing and enjoying judicial powers, with a status and jurisdiction commensurate with the necessities of such cases and the assistance of an appropriate machinery.
[122 F H, 123 B C]
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4620.txt
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Appeal No. 164 of 1962.
Appeal from the judgment and decree dated june 19,1958, of the Andhra Pradesh High Court in Appeal Suit No. 944 of 1953.
K. Bhimasankaram, J. V. Kriahna Sarma and T. Satyanarayana, for the appellant.
A. Ranganadham Chetty, Miss A. Vedavalli, N. Rajeshwara Rao and A. V. Rangam, for respondents 1 (a) and (b).
November 14.
The judgment of the Court was delivered by AYYANGAR, J.
This appeal comes before us on a certificate of fitness granted by the High Court of Andhra Pradesh under article 133(1)(a) of the Constitution.
57 The following facts are necessary to be stated to apperciate the contention , urged before us.
We consider it would be convenient to refer to the parties by their array in the trial Court.
The 2nd defendantfirm Hajee Abdul Kadir Sahib and Lala Batcha Sahib & Co., had been apparently carrying on business in several places including Vizianagaram, Bellary, Madras etc., in skins and hides since 1941 when the partnership was formed between the 3rd and the 4th defendants.
It was common ground that from about 1947 or 1948 the firm had not been doing any businesss in Vizianagaram and by that time it had contracted quite a large volume of debts, the tannery business there proving a loss.
The two partners accordingly entered into a deed of dissolution dated March 31, 1949, in which it is stated that the book debts, stock in trade, immovable properties and other assets including the goodwill of the firm were of the value of Rs. 2,90,000/ , and at the same time that the partnership which was admitted to be suffering losses owed debts to the extent.
of Rs. 2 1/2 lakhs.
It ' was agreed between the partners that the 3rd defendant Abdul Shukoor Saheb should go out of the partnership taking with him one item of property in Vaniyambadi valued at Rs. 20,000/ while the suit tannery which was estimated as of the same value was to become the sole property of the 4th defendant who was described in the deed as "the continuing partner".
Soon after this deed of dissolution the 4th defendant entered into an agreement with the plaintiff for the sale to him of the suit property for a sum of Rs. 19,000/ , and later executed the deed of sale on May 20, 1949.
The plaintiff was, however, advised that it would be safer to have the conveyance in his favour executed by the other partner also and accordingly the 3rd defendant was also an executant of the sale deed.
On the execution of the sale deed the plaintiff entered into possession and he claimed to have thereafter effected improvements to the property.
58 While so, the 1st defendant Arji Papa Rao filed suit O. section 46 of 1950 in the Court of subordinate judge at Visakhapatnam for the recovery of a sum of Rs. 12,950/5/8 against the 2nd defendant firm and its partners defendants 3 & 4 and obtained a decree for the sum claimed with interest and costs on June 19, 1951.
Soon after filing the plaint he obtained an order for attachment before judgment of the suit property and that order was on the passing of the decree made absolute, subject however, to the result of a claim petition which had been filed by the plaintiff for raising the attachment.
The Subordinate judge of Visakhapatnam dismissed the plaintiff 's claim and this has led to the suit O. section 145 of 1951 out of which this appeal arises to set aside that summary order under O. XXI, r. 63, Code of Civil Procedure.
The plaintiff impleaded as parties to the suit besides the attaching decree holder who was made the 1st defendant, the debtor firm and the two partners as defendants 2 to 4 respectively and the son of the 4th defendant who executed the sale deed as his agent under a power of attorney as the 5th defendant.
The plaintiff claimed that he purchased the property bonafide and for its full value, that since its purchase he having entered into possession, 'was in enjoyment thereof in his own right, paying the rates and taxes due thereon and had effected valuable improvements thereto, and that consequently the property was not liable to be attached as belonging to the partnership or any of its partners.
Broadly stated, the defence of the 1st defendant the only contesting defendant, the others either remaining ex parte or supporting the plaintiff, was that the sale in favour of the plaintiff was either a sham and nominal transaction or in fraud of creditors of whom he was one.
The trial court upheld the plaintiff 's claim that the sale was real and was fully 59 supported by consideration.
It also negatived the contention raised by ' the first defendant that the sale was fraudulent as intended to defeat or delay creditors under section 53 (1) of the .
The 1st defendant filed an appeal to the High Court and the learned judges reversed the decision of the trial judge and directed the dismissal of the plaintiff 's suit.
It is the correctness of this decision that is challenged in this appeal.
Learned counsel for the appellant raised four principal points in support of the appeal : (1) that on a proper construction of the written statement the only real and effective defence that was raised was that the sale in favour of the appellant was sham and nominal and that the Courts below were in error in proceeding on the basis that the sale was in the alternative impugned as brought about to defeat or delay creditors within section 53 (1) of the ; (2) that on the facts and circumstances of the case it had not been established that the sale in favour of the appellant was vitiated by fraud against creditors falling within section 53 (1) of the ; (3) that in any event, the plaintiff was a purchaser in good faith and for valuable consideration and was therefore protected even on the basis that the transferor intended, by the alienation, to defraud his creditors; (4) that on a proper construction of section 53 (1) of the , as it now stands, read in the light of the provisions of the Code of Civil Procedure particularly those relating to claim petitions under O. XXI rr.
58 to 63, a transfer which was voidable under section 53 (1) could be avoided only by a representative suit filed on behalf of creditors and not by an individual creditor who may be defeated or delayed, by way of defence to a suit to set aside a summary order under O. XXI, r. 63, Code of Civil Procedure.
We shall deal with each of these points and in that order.
There is no doubt that the written 60 Statement has not been artistically drafted, keeping in view the real distinction between a sham and nominal sale which is not intended to pass title and a sale which is real but which is voidable at the instance of creditors because the transfer is intended in the language of section 53 (1) of the "to defeat and delay creditors".
In paragraph 2 of the Written Statement the 1st defendant stated : , "The said sale deed is sham; nominal and collusive document not intended to pass any title but brought about to screen the suit properties from the creditors of defendants 2 to 5.
No consideration passed under the sale deed and the recitals thereof in the document are fictitious and make believe.
" The paragraph.
however, further went on to add "It is further submitted that even if the sale deed is true, it, is in fraud of creditors including the plaintiff and not binding on them." In paragraphs 3 the allegation was made that the plaintiff was the relative of defendants 2 to 5, that the plaintiff and the vendors were natives of the same place and that the sale deed was clandestinely brought into existence at Madras at a. time when defendants 2 to 5, were hard pressed by the plaintiff and other creditors and unable to pay their debts.
, at V,izianagaram and that in order to put the properties beyond the reach of the creditors, defendants 2 to; 4 seem to, have hit upon the frauds device.
of the alleged We to the plaintiff".
In the light of these averments it, cannot be , said that the defendants did not raise two distinct pleas (1) that the sale was a sham, a pretended Sale without any consideration and not intended to pass any title to the nominal purchaser and in the alternative (2) that even if it were a 61 real transaction supported by consideration and intended to pass title to the plaintiff, still the same was, having Tegard to the circumstances stated, a fraud upon the creditors and therefore voidable at his instance.
Though the pleading in the Written Statement was in this form, the issues struck did not raise the two defenses as distinct pleas but rolled both of them into a single plea raising the question "whether the plaintiff hid title to the suit property and whether the claim order was liable to be set aside.
" Notwithstanding the indefiniteness in the frame of the issues it could not be said that when the parties proceeded to adduce evidence the same was not directed to both the above defences.
As we have necessarily to consider thus evidence in dealing with the submissions made to us regarding the correctness of the dismissal of the plaintiff 's suit by the High Court it is unnecessary to set out the details of the evidence which indicates that the defence based upon section 53 of the was borne in mind.
At the, stage of the arguments before the trial Judge it was the subject of keen contest between the parties.
The learned trial judge first dealt with the question as to whether the sale was real as pleaded by the plaintiff or whether it was without consideration and sham and nominal not intended to pass any little, and recorded a clear finding in favour of the plaintiff After having done so he considered in detail the various circumstances which were relied on by the first defendant in support of the plea that the sale was in fraud of creditors so as to be voidable under.
section 53(1) of the .
He negatived this plea and upheld the plaintiff 's claim to the Property and passed a decree in his favour.
In these circumstances we consider that there is no force in the objection that there has not been a sufficient plea of a defence based upon section 53 of the as to justify or entitle the court to afford relief if satisfied that the same was proved.
62 Before dealing with the second point it is necessary to make a few observations in relation to certain submissions made by learned Counsel for the appellant.
This was in relation to the manner in which the. learned judges of the High Court had approached this question and arrived at a conclusion adverse to his client.
The learned judges had formulated the questions to be considered in the appeal as follows : "The main point that falls to be considered in this appeal is whether the sale deed in favour of the Plaintiffs Exhibit A 2, is a genuine transaction supported by consideration; and, if on this point the finding is in favour of the plaintiff, the further question that falls to be determined is whether the suit sale deed was executed in fraud of creditors and as such not binding on the first defendant and other creditors of defendants, 2 to 5.
If the finding on this issue is that the transaction was in fact in the fraud of creditors, the further question that would arise for consideration is whether the plaintiff could claim to be the transferee in good faith and for consideration so as to claim the benefit of the exemption contained in section 53 of the .
Learned Counsel had no quarrel with the propositions as here set out or the mode of approach, but his complaint was that in dealing with the appeal these were not kept in view.
He urged that they did not consider either initially or even later the question as to whether the sale to the plaintiff was real or was sham and nominal unsupported by consideration and though they stated in one portion of the judgment that they did not propose to consider this question because they were satisfied that the decision on the other points might be sufficient to dispose of the appeal,yet they made passing observation which appeared to throw doubt on the reality of the sale.
63 Again, learned Counsel pointed out that though they had formulated the two questions viz., (1) assuming the sale to be real whether the sale was intended by the transferor to defeat or delay creditors, and (2) assuming the sale was voidable under section 53(1) of the whether the plaintiff was a bona fide purchaser in good faith, as distinct and separate questions, in the discussion which followed they did not keep these two points separate.
Besides, it was urged that there were some statements or assumptions made in the judgment which were entirely not, warranted by the facts.
We cannot say that there is not some force in these submissions.
In view of this, the course which we intimated to the teamed Counsel that we would adopt was that we would ourselves consider the entire evidence on the record and arrive at our own conclusions on such evidence in regard to the two issues: (a) whether the sale was in fraud of creditors, and (b) whether the plaintiff was a bona fide purchaser for value and that if it became necessary to arrive at any finding as regards the reality of the sale, we would remand the appeal to the High Court for the matter being considered since the learned judges had expressly reserved the consideration of that question.
We shall now proceed to consider the facts and circumstances of the case which are relevant to the issue as to whether the sale was to defeat or delay creditors.
There was some argument before us about the burden of proof in such cases but learned Counsel for the appellant submitted that he would assume for the purpose of argument that the onus was upon the plaintiff purchaser and that he would satisfy us that burden had been discharged.
This apart, we consider that the question of onus of proof is merely academic at this stage because the entire evidence is before us and except in a rare case where the considerations are evenly balanced, it would have little significance.
64 The circumstances which are relevant for the consideration of this question are these: The second defendant firm was in financial embarrassment at the time of the sale.
The deed of dissolution dated March 31, 1949 recites that the business carried on by the firm was resulting in losses and that the debts amounted to about 2 1/2 lakhs of rupees.
No doubt, it is there stated that the assets of the firm were by consent of the parties estimated of the value of Rs. 2,90,000/ .
This estimate however included the value of the goodwill, which would not be of any real value in the case of a losing business of this sort and we do not know how much was attributed to this item.
This apart, the assets were said to be made up of book debts, stock in trade, immovable property etc.
There is however, no indication as to the relative value of these several components to judge whether or not the alienation of the suit property would have the effect of delaying, if not defeating the creditors.
It can however be asserted that the picture presented by the deed of dissolution is certainly of a firm whose financial position was far from satisfactory.
There is no evidence on the record whether the partners or either of them had any property of their own besides the assets of the partnership for discharging the debts due to the firm 's creditors.
Though the 4th defendant filed a written Statement supporting the plaintiff, the plaintiff did not choose to examine him as a witness in order to elucidate this matter or otherwise explain the circumstances in which the impugned sale ' was effected.
The next feature to be noticed is that the plaintiff and the 4th defendant were both members of the same community labbais of North Arcot district, a fairly small and well knit community several of whom are engaged in the hides and skins business.
The learned judges of the High Court have referred to the plaintiff and the 4th defendant as natives of ,the same place and as relatives.
Learned Counsel 65 for the Appellant pointed out that whereas the 4th defendant was a native of Vaniyambadi, the plaintiff was, native of Parnambet and the suggestion made that they were relatives had been denied, in the evidence.
Learned Counsel might be right on these matters but we consider that not much turns on them.
Both of them were conducting business in Madras and the plaintiff had also a business in Vizianagaram though it was in bidis and not in hides and skins.
In these circumstances we consider that it matters little whether they were relatives or not.
The significance of the 'plaintiff and his vendors being members of the same community and well known to each other consists in this, that the plaintiff might have been chosen because of his willingness to take the sale without any searching enquiry as to the circumstances necessitating it,and because there would be less publicity in the transaction being put through between them such as for instance inspection of the property or enquiries in the locality as regards value etc.
, which would take place if the sale was to be to a total stranger which would attract the attention of the firm 's creditors.
The next circumstance is as regards the pressure exerted on the 3rd and 4th defendants by the creditors immediately prior to the impugned sale and which, in the normal course of events, would be relevant, as providing that the sale was effected in order to put the property beyond the reach of creditors by converting it into cash.
On April 20, 1948, O. section 162 of 1948 on the file of the District Munsiff 's Court, Vizianagaram was filed for the recovery of Rs. 1,016/ on a promissory note for Rs. 1,000/executed by the firm.
On September 8, 1948, it was reported as adjusted out of court.
Besides this some other suits were filed for the recovery of amounts 'from the partnership but they were defended and were ultimately dismissed.
Then we come to 66 O. section 191 of 1949 in which the plaint was presented on April 4, 1949, for recovery of a sum of Rs. 1,385/and odd which was decreed with interest and costs on November 22, 1949.
The date on which this last mentioned suit was filed is of some significance because of another suit which was filed at about the same time.
One Damayanti presented a plaint on March 9, 1949, against the firm for the recovery of Rs .
3,000/ being the principal and interest due on a promissory note.
The date fixed for the appearance by the defendant was April 4, 1949.
It will be noticed that the deed of dissolution was executed on March 31, 1949.
The defendant did not enter appearance on the day fixed and the Court passed an ex parte decree on April 5, 1949; for the amount claimed.
She filed an application for execution on April 18, 1949, and obtained an order on April 21, 1949, for the attachment of the suit property though the attachment was actually effected on June 8, 1949, because the court was closed for the summer vacation.
Long before these dates the 4th defendant had made up his mind to alienate the suit property and we have a letter from the 4th defendant to the plaintiff as early as February 5, 1949, which evidences negotiations for the sale of the property.
There was apparently some giggling about the price which caused some delay and a few days after the attachment was ordered, on April 27, 1949, a formal agreement of sale was entered into between the plaintiff and the 4th defendant under which he agreed to purchase the property for a sum of Rs. 19,000/and the agreement recited that the purchaser, i. e., the plaintiff had paid a sum of Rs. 10,000/ in advance as earnest money and the sale deed itself was executed on May 20, 1949.
In pursuance of the order dated April 21, 1949, Damayanti attached the suit property as already stated on June 8, 1949 and thereupon the plaintiff filed a claim under O. XXI, r, 59, Code of Civil Procedure, for raising the 67 attachment but this, however, was dismissed on November 16, 1950, and thereafter the amount of the decree was paid up by the judgment debtor just a few days before tile expiry of the one year period of limitation for filing the suit under O. XXI, r. 63, Code of Civil Procedure.
A suggestion was made to the plaintiff while he was examined in the case that it was he who had paid up the decree debt of Damayanti but he denied it and we shall proceed on the basis that debt was discharged by the judgment debtors themselves.
For the purpose of establishing that the firm was hard pressed by its creditors at the time of the negotiations which resulted in the sale impugned in these proceedings and at the time of the sale, it matters little who paid this decree debt.
Next we have the circumstance that though the properties were at Vizianagaram, the document was registered at Madras and the suggestion made to the plaintiff was that this was meant as a measure of secrecy to keep this alienation from the knowledge of the firm 's creditors.
The explanation offered by the plaintiff was that having regard to the distance between the native places of the two parties from Vizianagaram and the proximity of these to Madras and the fact that both the Plaintiff, as well as the executants were at Madras it was found more convenient to have the document presented for registration at Madras instead of incurring the expenses of a journy to Vizianagaram for having it registered there.
The learned trial judge accepted this explanation and held that the registration of the sale deed at Madras was not a suspicious circumstance indicating an intention to keep the transaction secret.
The learned judges of the High Court, however, considered it otherwise and expressed the view that this was done in order to keep the transaction secret.
We are inclined to agree with the learned judges of the High Court 68 in their appreciation of this piece of conduct.
Admittedly, the 4th defendant had his agent at Vizianagaram and similarly the plaintiff himself had his men there to look after ' his, bidi business.
There was no impediment in these circumstances and no expenses of traveling involved if only the 4th defendant had executed a power @ of attorney in favour,of some one at Vizianagaram to present the document for registration and admit its execution.
In fact, it may be mentioned that even the sale deed now impugned was executed not by the 3rd and 4th defendants but by the 4th defendant 's son K. L. Abdulla in whose favour a general power of attorney was executed on April 26, 1949, apparently immediately the agreement for sale was concluded.
It is in the light of this feature that we are not disposed to dismiss as irrelevant the circumstance that the document was registered at Madras.
The next feature of the case to which.
we must direct attention relates to the purpose for which the sale was executed.
As regards this, there is no evidence led to indicate why exactly the 4th defendant desired with some urgency to dispose of the property at that juncture.
The relevant circumstance in the present case is that there was a great deal of pressure from creditors, who not having been paid the amounts due to them as and when they became due, were forced to file suits and those which were decreed were those which were not defended and the firm was mulcted with costs under each of these decrees.
In the circumstances one would expect an explanation as to why the sale was being effected.
Ordinarily in circumstances such as in this case there could only be two alternatives : (1) a sale in order to pay the creditors out of the proceeds obtained; and (2) a sale in ' order to convert immovable property which was capable of being attached and brought to sale for the realisation of the amounts due to the creditors 69 into cash, which could either be secreted or used for the vendor 's own purposes.
If the purpose was as that indicated in the first of the above alternatives the proceeds of the sale would have been earmarked for the payment of particular debts for which pressure Was the greatest.
It is needless to add that if this were the case and if creditors who were not so provided were defeated or delayed it would merely be a case of a fraudulent preference which could be impugned only under the law relating to insolvency and not as a fraud on creditors for which section 53 of the makes provision.
It is, however, common ground that apart from the sale deed not making any provision that the consideration was to be utilised for the discharge of any particular debts, it is not the case of the plaintiff that there was any such stipulation as to the application of the money or that without any stipulation therefor the money was so utilised.
It would therefore not be an unreasonable inference to draw from the circumstances of the tale at the Juncture at which it took place that the Vendor 's object was merely to convert this immovable property into cash, so that it may not be available to the creditors.
Before leaving this point it is necessary to advert to one matter which was suggested by learned Counsel for the appellant.
He submitted that the property sold was only a part of the assets of the partners and that unless there was evidence to show that nothing was left available for the creditors after the impugned sale, its validity could not be impugned under section 53 of the .
We consider that there is no force in ' this submission.
As a matter of fact, there is no evidence as to what other properties the partners had beyond what 'is contained in the deed of dissolution on March 31, 1949.
But that apart, the terms of section 53(1) are satisfied even if the transfer does not " 'defeat" but only "delays" the 70 creditors.
The fact therefore that the entirety of the debtors ' property was not sold cannot by itself negative the applicability of section 53(1) unless there is cogent proof that there is other property left, sufficient in value and of easy availability to render the alienation in question immaterial for tie creditors.
In the present case, as already pointed out, we have no definite, evidence as to the nature and quality of the property left as available to the creditors after the impugned alienation, and though light on this could have been thrown by the 4th defendant being called as a witness, the plaintiff did not choose to take the step, nor indeed did ' he even summon the production of the accounts of the firm which might have disclosed the true state of affairs.
Each of these circumstances might be capable of some explanation consistent with the case that the transfer now impugned was effected in the normal and ordinary course of business by the 4th defendant for some purpose which did not involve an intention to defeat or delay his creditors, but the question we have to consider is their cumulative effect and so viewed the conclusion appears irresistible that the object of the transaction was to put the property out of the reach of the creditors.
The transfer was therefore plainly within the terms of the 1st paragraph of section 53 (1) of the and was voidable at the instance of the 1st defendant who was a decree creditor.
The next question is whether the plaintiff is a bona fide purchaser for value so as to be protected by the second paragraph of section 53 (1) reading : "Nothing in this section impairs the rights of the transferee in good faith and for consideration.
As stated earlier, the learned trial judge held that the Rs. 19,000/ , the sale price was the full value of 71 the property and that the consideration as recited in the document was paid by the purchaser.
This finding has not been set aside by the High Court.
We are, therefore, proceeding on the basis that the Transfer was real and supported by consideration.
The narrow question is whether the plaintiff was a transferee in good faith.
It was submitted on behalf of the appellant that the learned judges of the High Court had directed the dismissal of the plaintiff 's suit even without a definite finding that the plaintiff was a party to the fraud on the part of the transferor to defeat or delay the creditors.
There might be some force in this submission that there is no specific finding to that effect but that does not in any way assist the appellant.
Where fraud on the part of the transferor is established i. e. by the terms of paragraph (i) of section 53(1) being satisfied, the burden of proving that the transferee fell within the exception is upon him and in order to succeed he must establish that he was not a party to the design of the transferor and that he did not share the intention with which the transfer had been effected but that he took the sale honestly believing that the transfer was in the ordinary and normal course of business.
When once the conclusion is reached that the transfer was effected with the intent on the part of the transferor to convert the property into cash so as to defeat or delay his creditors, there cannot be any doubt on the evidence on record that the plaintiff shared that intent.
For this purpose the following circumstances may be pointed out (1) The plaintiff and the vendor belong to the same community, a small, compact and well knit one and they must obviously have known each other having been in trade for several years in several places in common and must therefore have been wellacquainted with the financial and business affairs of each other.
72 (2) This general inference apart, the plaintiff admittedly had with him a copy of the deed of dissolution dated March 31, 1949, which disclosed that the firm 's business had resulted in losses and that it was greatly indebted, the debts amounting to Rs. 2 1/2 lakhs.
(3) If as we have held that registration of the sale deed at Madras was with a view to keep the transaction secret from the creditors, the plaintiff was, as much a party to the secrecy as the transferor.
(4) One matter which would be of considerable relevance and significance in this connections would be the enquiries that the plaintiff made before he took the transfer.
He no doubt led evidence to show that he consulted his lawyers about the title of the vendor; but any attempt at an enquiry of the 4th defendant as to why he was effecting the sale of the only immovable property of the firm which was alloted to him under the deed of dissolution is significantly absent.
In the circumstances, it stands to reason that; the plaintiff must be fixed with notice of the design in pursuance of which the transfer was effected.
If the object of a transferor who is heavily indebted was to convert his immovable property into cash for keeping it away from his creditors and knowing it the transferor helped him to achieve that purpose it has naturally to be held that he shared that intention and was himself a party to the fraud.
In this connection, there is one circumstance which is rather significant.
Even when the plaintiff was fixed with notice that the firm 's business had been running at a loss and had accumulated a very large volume of debts as disclosed by the recitals in the deed of dissolution, which was placed in his hands, the purchaser did not insist that the consideration which he was paying should be utilised for the discharge of at least some 73 of the debts.
We are therefore satisfied that the Plaintiff was not a transferee in good faith and that the transfer itself was a scheme by the transferor with the knowledge and concurrence of the transferee to put the property out of the reach of the creditors The result therefore would be that the plaintiffs suit, was liable, to be dismissed for the reason that the defence plea invoking section 53 (1) of the was made out.
What remains for consideration is a ;point of law that was raised on behalf of the appellant that a transfer which is voidable under section 53 (1) of the can be avoided only by: a suit, filed by a creditor impugning the transfer on behalf of himself and the other creditors and not byway of defence to a suit under O. 21,.
r. 63, Code of Civil Procedure by a claimant whose application has been rejected in summary proceedings under O. 21, rr. 58, to 61, Code of Civil Procedure.
Section 53 (1) of the , as it stands at presented is, as amended by the Transfer of Property (Amendment) Act (Act 20 of 1929).
As part of the argument on this head was based on a comparison of the provisions of the section before and after the same was amended, we shall set out in parallel, columns section 53 (1) as it stood before it was.
amended in 1929 and as it stands as amended section 53(1);as it stood before section 53 (1) as it stands the Amending Act, 1929 after the Amending Act, 1929 "Every transfer of "Every transfer of immov immovable property able property made with made with intent to de,, intent to defeat or delay fraud prior or subsequent the creditors of 1 the 74.
section 53 (1) as it stood before section 53 (1) as it standsafter the Ameding Act, 1929.
transferees thereof for consideration or coowners or other persons having an interest in such property or to defeat or delay the creditors of the transferor, is voidable at the option of any person so defrauded or delayed.
Where the effect of any transfer of immovable property is to defraud, defeat or delay any such person, and such transfer is made gratuitously or for a grossly inadequate con sideration, the transfer may be presumed to have been made with such intent as aforesaid.
Nothing contained in this section shall impair the rights of any transferee in good faith and for consideration." after the Amending Act, 11929.
transferor shall be voidable at the option of any creditor so defeated or delayed.
Nothing in this sub section shall impair the rights of a transferee in good faith and for consideration.
Nothing in this subsection shall affect any law for the time being in force relating to insolvency.
A suit instituted by a creditor (which term includes a decree holder whether he has or has not applied fore execution of his decree) to avoid a transfer on the ground that it has been made with intent to defeat or delay the creditors of the transferor, shall be instituted on behalf of, or for the benefit of, all the creditors.
" Two points were made by the learned Counsel in support of this submission; the first being independent of the amendment effected by the Act of 1929 75 and the other based on the provision as amended.
The former was based on the impact of the nature G. of the proceedings under O. 21, rr.
58 to 61, Code of Civil Procedure, and of the order that would be passed therein and particularly of the questions that would arise in a suit under O. 21, r. 63, Code of Civil Procedure, to set aside summary orders; while the latter was based on the amendment by which a creditor 's suit was required to be in a representative capacity.
It would be seen that so far as the first point was concerned, the amendment made no change and that if the learned Counsel were right the position would have been the same even on the section as it stood before it was amended.
It was conceded that on the section as it stood prior to the amendment, there was a direct decision against this argument, of a Full Bench of five 6 judges of the Madras High Court as early as 1920 (Ramaswami Chettiar vs Mallappa Reddiar (1) which had been consistently followed by every other High Court in India up to this date without any doubt or dissent.
Gleamed Counsel however urged that this Court was not precluded from considering the correctness of this decision notwithstanding its having held the field for over forty years without question, As a legal proposition, Counsel is undoubtedly right, but the question is whether any reasons have been adduced before us to consider that decision was wrong.
We shall be presently setting out the reasoning on which it is contended that an attaching creditor who has succeeded in the summary proceedings under O. XXI, rr. 58 to 61, cannot, in a suit to set aside the summary order under O. XXI, r. 63, raise by way of defence the plea that the sale in favour of the plaintiff the transferee claimant is vitiated by fraud under section 53(1) of the , but (1) Mad.
760 76 before doing so it is necessary to point out that this very argument was urged before the Full Bench referred to and after elaborate consideration, rejected by them, Now the argument as regards the inference to be drawn from the nature of the enquiry in the summary proceedings for investigating.
claims to property which has been attached is briefly as follows:: s 53 of the assumes that there, is a real transfer intended to pass title to the transferee but that the transfer is vitiated by fraud which renders it voidable.
In the summary proceedings under O. XXI, rr. 58 to 61, having regard to the terms of r. 61, the Court is concerned only with the question as to whether the transferee is in possession of the property in his own right and not on behalf of the judgment debtor, when a transfer is real, though it is liable to be impeached as a fraud on creditors, and the tranferee has entered into possession, he would succeed in the summary proceedings, with the result that it is the defeated attaching 'creditor who would have to figure as a plaintiffq If he figures as a plaintiff the suit would have to be in a representative capacity, that is, under O. 1, r. 8, Code of Civil Procedure.
In every case, therefore, when a transfer is real but is liable to be set aside under section 53 (1) on the provisions of O. XXI, rr. 58 to 61, Code of Civil Procedure,the transferee is bound to succeed in the summary proceedings and the attaching decree holder would have to figure as a plaintiff and the suit would be a representative suit.
From this it is said that it follows that in no case can an attaching creditor who defends a suit to set aside a summary order in 'his favour resist it on the plea of fraud under section 53(1).
It would however be seen that, this last step, which is vital for the argument to have force does not follow for the argument does not proceed on any construction of the terms of section 53(1) nor on any legal 77 theory as to the mode or procedure ,by which; the intention to avoid the transaction which the attaching creditor claims is voidable at his instance may be expressed or enforced.
The argument would only establish that if the Court investigating claims under O. XXI.
r. 58 etc., conformed strictly to the terms of those provision is the transferee under a real sale would succeed in those proceedings and, he would be a defendant and need 'not be a plaintiff in suits to set aside the summary order under O. XXI, r. 63.
This line of reasoning does not take into account at least the following possibilities: (1) The claim or objection by the transferee may be rejected, not on :the merits, but because it has been designedly or unnecessarily delayed (vide O. XXI, r. 58, Code of Civil Procedure).
It is certainly not the contention of learned Counsel that when there is a rejection of a transferee 's claim under this provision the order of rejection is any the less final and has not to be set aside by a suit contemplated by O. XXI, r. 63, Code of Civil Procedure, in order to overcome the effect of that finality.
(2) The Court making the summary enquiry might come to an erroneous conclusion that the transfer is sham and not real or that the transferee is in possession for the benefit of the judgmentdebtor.
In the suit filed by the transferee to set aside ' this erroneous order, the plaintiff would have to establish his title and even if he succeeds in showing that the sale to him was real and effective, still the question would remain whether, having regard to the circumstances of the transfer, the same is not voidable under section 53(1).
Thus there would be occasions when a defeated transferee whose transfer is real might have to figure as a plaintiff in a suit to set aside a summary order under O. 21, r. 63, Code of Civil Procedure.
(3) The attaching decree holder might raise in the summary proceedings two alternative defenses to a transferee 's claim (a) that the sale was sham and nominal and therefore the possession 78 of the transferee was really on behalf of the judgment debtor, and (b) that even if the sale be real and intended to pastitle it was voidable as a fraud on creditors.
It is, no doubt, true that the second or the alternative defence is not open in the claim proceedings, but if however the same were erroneously entertained and an order passed, rejecting the claim of the transferee, the same would nevertheless be an order which would have to be set aside by a suit by the defeated transferee and he cannot ignore it.
It would thus be seen that the entire argument as regards the impact of the nature of the enquiry under O. 21, r. 59,on the defences which would be open in a suit under O. 21, r. 63, depends on two factors: (1) the summary order being passed on the merits and not because the making of the claim was designedly or unnecessarily delayed, and (2) the summary order being right on the merits and strictly in conformity to the provisions of the Code.
As we have already pointed out, the points urged before us as regards the scope of the enquiry into claim petitions was also the subject of elaborate argument and consideration by the learned judges of the Madras High Court in the Full Bench.
Sadasiva Ayyar, J., classified the cases of transferees who failed in their claim petitions and had to file suits to set aside summary orders under O. 21, r. 63, under three heads : (a) Where the transferee was a mere benamidar; (b) Where he was a fraudulent transferee in possession; and (c) Where he was a fraudulent transferee not in possession.
The learned Judge said : "A creditor decree holder, who is in most cases a stranger, cannot reasonably be expected to know of his own knowledge whether a transfer 79 by his judgment debtor is only fraudulent or is wholly nominal or partly nominal and partly fraudulent, and whether the transferee is in possession and if in possession, whether he is so for him self or for the judgment debtor.
He would therefore ' usually both in the claimpetition and in the suit which afterwards arises out of the order against the claimant, be obliged to raise and be justified in raising alternatively all the pleas open to him, and the Court which decided the claim against the claimant might, in its conclusions on each of the three points, be either right or wrong." He further pertinently pointed out that to hold that a plea based on the transfer being voidable under section 53(1) could not be raised in defence to a suit to set aside a summary order would mean that " 'The creditor decree holder would be in a much worse position for his success in the summary claim proceedings than if he had lost in those proceedings".
Section 53(1) of the rendered the transaction voidable at the instance of the creditors if the transfer was effected with the particular intent specified and the statute does not prescribe any particular method of avoidance.
Referring to this the learned judges observed : "If the creditor knowing of the transfer applies for attachment; the application is sufficient evidence of his intention to avoid it; if he only hears of the transfer when a claim petition is preferred under O. 21, r. 58, and still maintains his right to attach, that again is a sufficient.
exercise of his option to avoid and entitles him to succeed in the subsequent suit under r. 63".
They further pointed out that "the suit under r. 63 is by the unsuccessful party to the claim petition to establish the 80 right which he claims to the property in dis pute.
Whether this suit be instituted by the attaching decree holder or by the transferee claimant it must equally be decided in favour of the former if the transfer is shown to have been fraudulent; because, in consequence of the fraudulent character of the transfer and its avoidance by the judgment creditor, the result ,is that the transfere has not the right which he claims, namely, to hold the property free from attachment in execution by the judgments." The learned judges based their conclusion on this and on several other lines of reasons which we consider unnecessary to set out, but it is sufficient to say that we are enentire agreement with all of them.
There is therefore no substance in the point ;that there is anything in section 53(1) as it originally stood which precluded a defence by an attaching creditor to a suit to set aside a summary order under O. 21, r. 63, that the: sale in favour of the plaintiff is vitiated by fraud of the type specified in the earlier quoted pro vision and the amendment has admittedly made no change in this matter.
It was next urged that the third paragraph of the amended section 53 (1) has, effected a change in the law and that thereafter transfers voidable under 1st paragraph of section 53 (1) could be avoided only in suits filed by a defeated or delved creditor as plaintiff suing on behalf of himself and other creditors.
We consider that there is no substance in this objection either.
We shall first refer to the purpose of the amendment.
In decisions rendered prior to the amendment, there were a large number in which it was held, following certain English cases decided with reference to 13 Eliz., Ch. 5, on which section 53(1) was based, 81 that suits by creditors for avoiding a transfer under section 53 (1) was a representative action.
To that general rule however, an exception was recognised in a number of ' decisions when the suit was to set aside a summary order under O. 21.
r. 63, and was brought by an attaching decree holder against whom an adverse order had been made in the summary proceedings, it being held that such a suit need not be in a representative capacity.
The decisions on this point were however not uniform.
It was merely to have a uniform rule and to avoid these conflicting decisions that the third paragraph was inserted so that after the amendment the rule that a suit by a creditor should be brought in a representative capacity would apply as much to a suit set aside a summary order under O. 21, r. 63, as to other suits.
It was not suggested that there was anything in the terms of the amended section 53 (1) which referred to a defence to a suit and, in fact, learned Counsel did not contend that if a defence under section 53 (1) could be raised by defeated attaching creditor such a defence had to be in a representative capacity, and we consider that learned Counsel was correct in this submission.
From a provision as to how a plaintiff, if he filed a suit, should frame it, we can see no logical process by which it could be held that a defendant cannot impugn the validity of the sale which is voidable at his instance.
We have, therefore, no hesitation in rejecting the legal point urged on behalf of the appellant.
The result is that the appeal fails and is dismissed with costs.
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The appellant purchased the suit property under a sale deed executed by defendant 4 on May 20, 1949.
Defendants 3 and 4 had been doing business in partnership, which, how.
ever, was dissolved on March 31, 1949.
The deed of dissolution showed that the partnership owed debts to the extent of Rs. 2 1/2 lakhs and that the suit property was allotted to defendant 4.
The first respondent to whom money was due from the partnership obtained a decree on june 19, 1951, and had the suit property attached.
The appellant filed a claim petition for raising the attachment but it was dismissed.
He then instituted a suit to set aside the summary order under O. 21, r. 63, of the Code of Civil Procedure.
The first respondent 's defence, inter alia, was that the sale was fraudulent intended to defeat or delay.
creditors and, therefore, was invalid under section 53 (1) of the .
The appellant pleaded that on a proper construction of section 53 (1) of the Act, a transfer which was voidable under the section could be avoided only by a representative suit filed on behalf of creditors and not by an individual creditor by way of defence to a suit to set aside a claim order.
The evidence in the case showed that the appellant was not a transferee in good faith and that the transferor itself was a scheme by the transferor with the knowledge and concurrence of the transferee to put the property out of the reach of the creditors.
Held : (1) that section 53 (1) of the , rendered a transaction voidable at the instance of the creditors if the transfer was effected with the particular intent specified and that the statute did not prescribe any particular method of avoidance.
There was nothing in section 53 (1), as 56 it originally stood before the amendment of the section in 1929, which precluded a defence by an attaching creditor to a suit to set aside a summary order under O. 2 1, r. 63, Code of Civil Procedure, that the sale in favour of the plaintiff was vitiated by fraud ; and the amendment made no change in this matter.
(2) that it was merely to have a uniform rule and to avoid conflicting decisions that the third paragraph was inserted in section 53 (1) so that after the amendment, the rule that a suit by a creditor should be brought in a representative capacity would apply as much to a suit to set aside a summary order under O. 21, r. 63, as to other suits.
(3) that the terms of section 53 (1) were satisfied even if the transfer did not "defeat" but only "delayed" the creditors.
The fact that the entirety of the debtor 's property was not sold could not by itself negative the applicability of the section unless it was proved that there was other property left, sufficient in value and of easy availability to render the alienation in question immaterial for the creditors.
Ramaswami Chettiar vs Mallappa Reddiar, Mad., 760, approved.
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Appeal No. 2458 of 1966.
Appeal by special leave from the judgment and decree dated April 1, 1963 of the Allahabad High Court in Sales tax Reference No. 391 of 1959.
C.B.Agarwala and O.P. Rana, for the appellant.
J.P. Goyal and Sobhag Mal Jain, for the respondent.
711 The Judgment of the Court was delivered by Shah, J.
The Judge [Revisions] Sales Tax, U.P., Lucknow, referred the following question to the High Court of Allahabad for opinion: "Whether the preparation of medicines on prescriptions of the applicant amounted to a manufacture of "medicines and pharmaceutical preparations" within the meaning of notification No. S.T. 3504/X dated 10th May, 1956, and whether the applicant was assessable to tax on the turnover of the medicines so dispensed ?" The High Court held that the respondent was not a manufacturer of medicines and pharmaceutical preparations within the meaning of the notification.
Against the answer recorded by the High Court, the Commissioner of Sales Tax, U.P., has appealed to this Court with special leave.
The respondent is a medical practitioner and in the performance of his professional duties he examines patients, advises them and prescribes medicines which are issued from his dispensary.
The Sales Tax Officer being of the view that the dispensing of medicines, according to the prescriptions issued by the respondent, amounted to manufacture of medicines within the meaning of the notification No. S.T. 3504/X dated May 10, 1956, assessed the respondent to pay tax on a turnover of Rs. 12,943 for the year 1956 57.
The order was confirmed in appeal by the Judge (Appeals) and was further confirmed by the Judge (Revisions) Sales Tax.
The sole question which falls to be deterrained in this appeal is whether by virtue of the notification, the respondent is exempt from liability to pay tax.
Section 3 of the U.P. Sales Tax Act, 1948, makes every dealer liable to pay in each assessment year a tax at a certain rate on the turnover.
Section 3A provides: "Notwithstanding anything contained in section 3 the State Government may . declare that the turnover in respect of any goods . shall not be liable to tax except at such single point in the series of sales by successive dealers as the State Government may specify." On May 10, 1965, the Governor of Uttar Pradesh issued a notification No. S.T. 3504/X that "In exercise of the powers conferred by section 3A of the U.P. Sales Tax Act, 1948, as amended from time to time, and in supersession of all the previous notifica 712 tions on the subject, the Governor of Uttar Pradesh is hereby pleased to declare that with effect from May 8, 1956, the turnover m respect of medicines and pharmaceutical preparations shall not be liable to tax except (a) in the case of medicines and pharmaceutical preparations imported from outside Uttar Pradesh, at the point of sale by the importer.
and (b) in the case of medicines and pharmaceutical preparations manufactured, in Uttar Pradesh, at the point of sale by the manufacturer; And the Governor is further pleased to declare that such turnover shall with effect from the said date be taxed at the rate of . " The respondent is not an importer of medicines and pharmaceutical preparations from outside Uttar Pradesh.
That Is common ground.
The Revenue authorities, however, held that when in his dispensary medicines and pharmaceutical preparations as prescribed by him were mixed, the process of mixing resulted in "manufacture" of medicines, by him as a "manufacturer".
The expression "manufacture" has in ordinary acceptation a wide connotation: it means making of articles, or material commercially different from the basic components, by physical labour or mechanical process; and a manufacturer is a person by whom or under whose direction and control the articles or materials are made.
The notification in the first instance exempts from tax sales of medicines and pharmaceutical preparations.
It then proceeds to withdraw the exemption in respect of two classes of sales of medicines and pharmaceutical preparations, (i) sale by an importer of medicines etc., imported from outside the State and (ii) sale by a manufacturer of medicines etc., manufactured in the State.
The tax levied in respect of the excepted categories is a single point tax: it may be levied when medicines and pharmaceutical preparations manufactured in the State of Uttar Pradesh are sold by the manufacturer.
In our judgment when, as prescribed by a medical practitioner, a mixture of different drugs is prepared by the medical practitioner or by his employees specially for the use of a patient in the treatment of an ailment or discomfort diagnosed by the medical practitioner by his professional skill, and which mixture is normally incapable of being passed from hand to hand as a commercial commodity, the medical practioner supplying the medicines cannot be said to be a manufacturer of the mixture and the mixture cannot be said to be manufactured within the mean 713 ing of the notification.
Exemption granted by the notification ceases to apply under cl.
(a) if the importer of medicines and pharmaceutical preparations manufactured outside the State sells them, and under cl.
(b) if the manufacturer of medicines and pharmaceutical preparations manufactured in Uttar Pradesh sells them.
The scheme therefore is to levy sales tax at one point only, viz., at the point of sale by the importer in respect of medicines imported by him into the State,.
and at the point of sale by the manufacturer of medicines manufactured by him within the State.
If preparation of a mixture of drugs as prescribed by a medical practitioner in his own dispensary is not manufacture of medicines or pharmaceutical preparation, the exception clause of the notification will have no application.
Acceptance of the contention by the Revenue would imply that a medical practitioner supplying to his patients medicines and pharmaceutical preparations separately is not liable to tax: when under his direction they are mixed by his employees for the special use of a patient under his treatment and to achieve a specific purpose, the turnover from the resultant mixture is taxable.
In the absence of clearer phraseology, the Court would not in a taxing provision be willing to give that interpretation.
The appeal therefore fails and is dismissed.
The delay in filing the respondent 's statement of the case is condoned.
There will be no order as to costs in this appeal.
G.C. Appeal dismissed.
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The respondent was a medical practitioner in Uttar Pradesh and maintained a dispensary from which medicines were issued to his patients according to his prescriptions.
According to notification No. S.T. 3504/X, dated May 10, 1956 issued under section 3A of the U.P. Sales Tax Act, 1948, tax in respect of sale of medicines and pharmaceuticals manufactured in the State was payable at single point on the sale effected by the manufacture.
The Sales Tax Officer held that dispensing of medicines was manufacture ' within the meaning of the aforesaid notification and assessed the respondent to sales tax for the year 1956 57 on the turnover of medicines dispensed.
The order was confirmed by the appellate and revisional authorities, but the High Court decided in favour of the respondent.
The State appealed.
HELD: When as prescribed by a medical practitioner, a mixture of different drugs is prepared by the medical practitioner or by his employees specially for the use of a patient in the treatment of an ailment or discomfort diagnosed by the medical practitioner by his professional skill, and which mixture is normally incapable of being passed 'from hand to hand as a commercial commodity, the medical practitioner supplying the medicines cannot be said to be a manufacturer of the mixture and the mixture cannot be said to be manufactured within the meaning of the notification.
[712 G H] In the absence of clearer phraseology the Court would not in a taxing provision be willing to give an interpretation whereby a medical practitioner supplying to his patients medicines and pharmaceutical preparations separately is not liable to tax, but when under his direction they are mixed by his employees for the special use of a patient under his treatment and to achieve a specific purpose, the turnover from the resultant mixture is taxable.
[713 D]
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tions (C) Nos.
331 47 of 1984.
(Under Article 32 of the Constitution of India. ) Rajinder Sachar and K.T. Anantharaman for the Petitioners.
Narayan B. Shetty, G.B. Pai, S.S. Shroff, Mrs. P.S. Shroff, Miss Girja Krishan, S.A. Shroff, Mrs. Pallavi Shroff, O.C. Mathur and A.M. Dittia for the Respondents.
The Judgment of the Court was delivered by 365 DUTT, J.
In these writ petitions, the petitioners are former officers and employees of the Caltex Oil Refining (India) Ltd., which has since been amalgamated with the Hindustan Petroleum Corporation Limited.
The complaint of the petitioners is with regard to the inter se fitment of the officers and employees of the Caltex Oil Refining (India) Ltd. and the other two Companies which have also been amalgamated with Hindustan Petroleum Corporation Ltd., namely, ESSO Standard Refining Company of India Ltd. and Lube India Ltd. In 1974, the Undertakings in India of ESSO Eastern Inc. that is, ESSO Standard Refining Company of India Ltd. (for short 'ESSO ') and Lube India Ltd. (for short 'LIL ') were acquired by the ESSO (Acquisition of Undertakings in India) Act, 1974 and vested in Hindustan Petroleum Corporation Ltd. (for short 'HPCL '), a Government Company.
In 1977, the shares of Caltex Oil Refining (India) Ltd. and Undertakings in India of Caltex (India) Ltd. were acquired by the Caltex (Acquisition of Shares of Caltex Oil Refining (India) Ltd. and the Undertakings in India of Caltex (India) Ltd. Act, 1977 and vested in Caltex Oil Refining (India) Ltd. (for short 'CORIL '), a Government Company.
On May 5, 1978, by the order of the Company Law Board, CORIL was amalgamated with HPCL.
By an order dated June 17, 1978, the Central Government appointed a one man Committee of Mr. B.B. Tandon, IAS (Retd.), for the purpose of examining the problems arising out the the integration of the management staff of CORIL and HPCL.
The said Committee was to make recommendation inter alia on the following: (i) fitment in equivalent Groups; (ii) criteria to be adopted for determination of seniori ty and fixation of inter se seniority; and (iii) placement in appropriate positions.
In September, 1970, the Tandon Committee submitted a report to the Central Government recommending that for equating positions in the two companies and fitting them in equivalent groups, the following two principles should be followed: 1.
The principle of functional similarity 2.
The principle of co equal responsibility.
366 We shall have occasion to refer to the report of the Tandon Committee later in this judgment, for much reliance has been placed by the petitioners on the report.
While the report of the Tandon Committee was under the consideration of the Central Government, HPCL appointed two functional directors for the purpose of formulating a rationalisation scheme.
In this connection, we may refer to a letter dated July 28, 1979 of the Central Government whereby it advised HPCL that the pay scales and perquisites of management and employees in the nationalised oil companies should be ratio nalised and fitted into the pay scales of the Indian Oil Corporation, hereinafter referred to as 'IOC ', a public sector Company.
Further, it was stated in the said letter that the guiding principle to be adopted for the purpose was to find out the equivalence, that is to say, the equality of duty and also the equality of responsibility.
On July 7, 1980, a circular letter was issued by HPCL annexing thereto a rationalisation scheme consisting of two pans.
In the first part, the past service benefits that would be admissible to each employee of CORIL on the basis of existing pay scales and in the second pan, details were given of the rationalised conditions of service, payscales, perquisites and retirement benefits.
In the circular it was stated as follows: "In relation to your fitment or fixation of salary in the proposed rationa lised scales, should you have any grievance you will be at liberty to represent your case to a Grievance Committee, which has been specially constituted for the purpose.
I am directed to request you to signify your acceptance of this offer within 30 days from the date of receipt of this letter by returning the duplicate copy of this letter duly signed by you.
On receipt of your acceptance, consequent letters will be issued.
" In the scheme the pay scales of ESSO, LIL and CORIL sought to be equated with the pay scales of HPCL are as follows: From ESSO To : HPCL HPCL Salary Group Salary Group Salary Scale RS.
E 7, E 8 A 750 40 1150 50 1550 E 6 B 1050 50 1450 60 1750 367 E 5, E 5A C 1450 60 1690 65 1950 E 4 D 1600 65 2120 E 3 E 1850 100 2350 E 2 F 2000 100 2500 O & E 1 & Unclassified G 2250 100 2750 General Manager H 2500 100 3000 From : LIL To : HPCL HPCL Salary Group Salary Group Salary Scale L 7 A 750 40 1150 50 1550 L 6 B 1050 50 1450 60 1750 L 5 C 1450 60 1690 65 1950 L 4 D 1600 65 2120 L 3 E 1850 100 2350 L 2 F 2000 100 2350 L 1 G 2250 100 2750 General Manager H 2500 100 3000 From CORIL To : HPCL HPCL Salary Group Salary Group Salary Scale R 6 A, R 6 B A 759 40 1150 50 1550 R 7 A, R 7 B B 1050 50 1450 60 1750 R 8 C 1450 60 1690 65 1950 R 9 D 1600 65 2 120 R 10 E 1850 100 2350 R R 12 G 2250 100 2750 General Manager H 2500 100 3000 So far as CORIL is concerned, it appears that it has 10 grades, while HPCL has 8 Grades.
For, the purpose of equa tion of these 10 grades of CORIL with 8 Grades of HPCL, some compression has been made in the lower Grades, namely, R6 A and R6 B have been clubbed together and equated with Grade A of HPCL.
Again Grades R7 A and R7 B of CORIL have been clubbed together and equated with Grade B of HPCL.
In ESSO, .the
Grades E 7 and E 8 have been clubbed together and equated with Grade A of HPCL.
In the Salary Group of ESSO, the Grades E 5 and E SA have been shown to be two different Grades, but it is not disputed before us that these two Grades are really one Grade.
368 The complaint of the petitioners is that in the matter of fitment/ integration of the officers of CORIL, that is, the petitioners, and the officers of ESSO/LIL into HPCL/IOC Grades, gross disparities have been made to the prejudice of the officers of CORIL.
It is the case of the petitioners that the officers of CORIL have been fitted by HPCL consist ently in one or two Grades lower in HPCL vis a vis their counterparts in ESSO/LIL, performing similar duties and having similar responsibilities and status.
It is urged on behalf of CORIL that in integrating the officers CORIL with those of ESSO and LIL, HPCL did not make any attempt to equate all the positions held by the officers of CORIL with those held by the officers of ESSO/LIL.
It is submitted that before any fitment can be made into any scale of pay, it is incumbent to make an equation of posts and without such equation the officers of CORIL could not be fitted into the pay scales of HPCL along with the officers of ESSO and LIL.
In support of the contention that HPCL has not made any equation of posts before fitment in HPCL/IOC scales of pay, Mr. Sachar, learned Counsel appearing on behalf of the petitioners, has placed much reliance on the Tandon Commit tee 's Report.
In the said report, the post of General Sales Representative of ESSO has been equated with the post of Retail Development Supervisor of CORIL.
In the scheme pre pared by HPCL, the post of General Sales Representative of ESSO (E 6) and that of Depot Superintendent (E 6) have been placed in the Salary Group B of HPCL, while the post of Retail Development Supervisor (R6 A) and Depot Superintend ent/Relief Depot Superintendent (R6 B) of CORIL have been placed in the Salary Group A of HPCL.
In Tandon Committee 's Report, it has been observed that the functional similari ties and the responsibility carried by both these function aries, namely, Retail Development Supervisor of CORIL and General Sales Representative of ESSO, are alike.
Further, it has been observed that since these two posts are congruent, they can be fitted in the same Group, that is, in Group B of the new HPCL Grade Structure representing IOC scales of pay.
The post of Depot Super intendent A (R7 B) and that of Mar keting Representative (R7 A) of CORIL have been placed in the Salary Group B of HPCL, but similar posts of ESSO being E 5/E 5A have been placed in the Salary Group C of HPCL.
It is thus complained that the scheme, which has been prepared by HPCL, is arbitrary and is not based on a proper equation of posts.
On the other hand, it is the case of HPCL that before the rationalisation scheme was finalised.
HPCL Employees Management 369 Staff Association and CORIL Staff Association submitted their written submissions on December 6, 1977 and July 17, 1977 respectively.
These representations were considered by the Government and after several meetings between the Chief Executives of HPCL and CORIL and the Secretary and other senior officers of the Ministry and Bureau of Public Enter prise, Government formulated the guidelines for rationalisa tion and communicated its decision to both CORIL and HPCL by its letter dated July 28, 1979.
With a view to giving a further opportunity to the employees of erstwhile ESSO and CORIL group of officers, the Chairman of HPCL appointed two Committees to submit their recommendations as to the equiva lence and fitment of existing officers on the basis of IOC 's scales of pay in accordance with the Government guidelines.
HPCL considered the reports submitted by the said two Com mittees and also different methods of fitment and equiva lence of different pay scales of ESSO, LIL and CORIL with the pay scales of IOC and, keeping in view all these factors including the submissions made by the Officers ' Association through their representations, HPCL approved the proposal of rationalisation of pay scales, allowances and perquisites.
Accordingly, an offer letter dated July 7, 1980 together with the terms and conditions of new appointment as per the rationalisation scheme was sent to each of the employees.
The further case of HPCL is that without exception every one of the CORIL Management Employees accepted the fresh terms offered to them by the said letter dated July 7, 1980.
It is, accordingly, contended by Mr. Pai, learned Coun sel appearing on behalf of HPCL, that the impugned rational isation scheme having been finalised after repeated consul tations with the officers of CORIL and their Association and all the officers of CORIL having accepted in writing the said scheme, they are precluded from challenging the same.
Another fact, upon which reliance has been placed on behalf of HPCL, is an order of this Court dated December 17, 1979 passed in Civil Appeal No. 3214 of 1979 whereby HPCL challenged the judgment of the Delhi High Court quashing a circular dated March 8, 1978 issued by the Board of Direc tors of CORIL, on the writ petition filed by the employees of CORIL being Writ Petition No. 426 of 1978.
Two other appeals being Civil Appeal No. 3212 of 1979 and Civil Appeal No. 35 186 of 1979 were also filed by the officers of CORIL and Bharat Petroleum Corporation Ltd. respectively.
The said order is as follows: "The petitioner Corporation will be at liberty to frame a 370 scheme, if it wishes to do so, in accordance with the judg ment of the High Court under appeal.
If the scheme is framed, it will not be implemented for a period of three weeks from the date of its framing and the respondents will be at liberty within the period of 3 weeks to apply to this Court for stay.
This order will be without prejudice to the rights and contentions of the petitioner Corporation in the appeal.
" Admittedly, no application was made to this Court by the officers of CORIL praying for stay of the rationalisation scheme within a period of three weeks.
Relying on the said order of this Court and also on the fact that no application for stay was made to this Court within the period allowed, it is submitted on behalf of HPCL that the petitioners accepted the rationalisation scheme which is also evidenced by their written acceptance.
If they had any objection to the scheme, they would have surely made a representation to this Court in the said Civil Appeal No. 3214 of 1979 which was then pending.
In the writ petition, the petitioners have emphatically denied the allegation of HPCL that discussions were made with individuals and groups of Management Staff of CORIL with regard to the rationalisation scheme.
As to the accept ance of the rationalisation scheme, the case of the peti tioners is that on July 12, 1980 a news item appeared in the Bombay edition of the Times of India to the effect that under the scheme of rationalisation, the services of nearly 950 officers of HPCL would be terminated, and that such officers would simultaneously be reappointed on the basis of public sector salary.
In view of the said news, the peti tioners filed an application in this Court in the said Civil Appeals praying for stay or suspension of the operation of the said offer letter dated July 7, 1980 and for restraining HPCL from terminating the services of the Management Staff of CORIL pending the disposal of the Civil Appeals.
HPCL filed an affidavit in opposition to the said application of the petitioners to the effect that no decision had been taken by HPCL to terminate the services of the officers of CORIL.
Accordingly, this Court disposed of the said applica tion recording that in view of the said affidavit of HPCL, no order was needed to be passed.
Further, the case of the petitioners is that in spite of the said order of this Court, the petitioners still apprehended that HPCL would terminate the services of the petitioners in the event of their refusal to accept the said scheme and, as such, the petitioners under duress were forced to signify their con sent to the said scheme.
371 We have considered the explanation of the petitioner justifying the acceptance of the said offer letter dated July 7, 1988 and the rationalisation scheme sent therewith and also the contention of HPCL in that regard.
In our opinion, the apprehension of the petitioners that in the event of their refusal to accept the scheme, their services will be terminated cannot be rejected on the face of it.
It may be that there was no reasonable basis for such apprehen sion, but the plea that because of such apprehension the petitioners had no other alternative than to accept the scheme, cannot be disbelieved.
At the same time, we do not also put any blame on HPCL for implementing the said scheme which was accepted by the petitioners and other officers of CORIL.
Instead of disposing of these writ petitions on this technical grounds, we may proceed to consider the respective contentions of the parties on merits.
The main grievance of the petitioners appears to be that in the rationalisation scheme a compression has been made at the lower level, namely, Grades R6 A and R6 B have been clubbed together and instead of placing them in the Salary Group B of HPCL, as has been done for the equivalent Grade E 6 of ESSO, they have been placed in the Salary Group A of HPCL.
Similarly, the Grades R7 A and R7 B have been clubbed together and placed in Salary Group B of HPCL, while the equivalent Grade of ESSO has been placed in the Salary Group C of HPCL.
The contention of the petitioners is that the compres sion should have been made at the higher grades, namely, Grades R11 and R12 and the Grade of General Manager.
This is not for this Court to say whether the compression should have been made in the lower grades or in the higher grades.
By such compression, Grades R6 A and R7 A have been upgraded and the persons placed in those Grades have been benefited by such upgradation.
There is much substance in the conten tion made on behalf of HPCL that if compression had been made in the upper grades, there would be much complications and, moreover, such compression in the upper grades was not convenient to be made in view of functional differences.
The Grade of General Manager cannot be clubbed together with a lower grade.
In the circumstances, we are unable to accept the contention of the petitioners that the compression should have been made in the higher grades of CORIL.
The most important question that requires consideration is whether in framing the rationalisation scheme HPCL has really made the equation of posts of CORIL with those of ESSO/LIL.
It is the 372 positive case of the petitioners that no such equation has been made and the fitment of the officers of CORIL and those of ESSO/LIL in the IOC/HPCL scales of pay have been made without the equation of posts, which is a sine qua non for integration of officers coming from different sources.
The petitioners have mainly relied upon the recommendation of the Tandon Committee that General Sales Representative of ESSO has been equated with the post of Retail Development Supervisor of CORIL.
In the scheme prepared by HPCL, the post of General Sales Representative of ESSO and that of Depot Superintendent have been placed in the Salary Group B of HPCL, while the post of Retail Development Supervisor and Depot Superintendent/Relief Depot Superintendent of CORIL have been placed in the Salary Group A of HPCL.
As against this, the contention of HPCL is that the two Committees that were appointed by the Chairman of HPCL considered the different methods of fitment and equivalence of different pay scales of ESSO, LIL and CORIL with the pay scales of IOC.
Except the bare allegation, no material has been produced before us on behalf of HPCL to show that the said Committees had, as a matter of fact, considered the question of equation of posts on the basis of the principle as laid down by the Central Government while referring the matter to the Tandon Committee, namely, functional similari ty and co equal responsibility.
In the affidavits filed on behalf of HPCL, no particulars have been given with regard to the functional equivalence or otherwise of the different grades of these officers of CORIL, ESSO and LIL.
It is also not stated what happened to the consideration by the Govern ment of the Tandon Committee 's report.
There can be no doubt that the Government is not bound to accept the recommenda tion of the Tandon Committee but, at the same time, the equation of posts has to be made on the principle of func tional equivalence and co equal responsibility.
As no mate rials have been produced in that regard on behalf of HPCL, it is difficult for us to hold that the different grades of posts have been compared before placing the officers of these companies in the IOC/HPCL scales of pay.
While it is not within the domain of the Court to make the equation of posts for the purpose of integration, it is surely the concern of the Court to see that before the integration is made and consequent fitment of officers in different grades/scales of pay is effected, there must be an equation of different posts in accordance with the principle stated above.
As there is no evidence or material in support of such equation of posts, it is difficult to accept the ra tionalisation scheme with regard to the placing of the officers of CORIL in different IOC/HPCL grades of pay.
373 The petitioners approached the Grievance Committee, but the Grievance Committee did not consider the objections of the petitioners to the said scheme.
In our opinion, there is much substance in the contention made on behalf of HPCL that it was not the business of the Grievance Committee to con sider the propriety or otherwise of the rationalisation scheme, but if any officer has not been placed in the proper grade, the Grievance Committee may place such officer in the proper grade in accordance with the rationalisation scheme.
Be that as it may, in the view which we take, namely, that there has been no equation of posts, the rationalisa tion scheme cannot be accepted in full.
The prayer of the petitioners in the writ petition is for a declaration that the said scheme is violative of Articles 14 and 16 of the Constitution of India and for a writ, order or direction in the nature of mandamus directing HPCL to remove the discrim ination against the petitioners in regard to the impugned rationalisation scheme.
The question is whether we should set aside the scheme after the lapse of about eight years.
During these eight years, by virtue of implementation of the scheme, many changes have taken place with regard to the positions and ranks of the officers of HPCL including the petitioners and to set aside the whole scheme at this stage would surely affect the service structure of HPCL.
We are also not obliv ious of the order of this Court dated July 20, 1984 record ing the statement made in the affidavit of HPCL that if this Court would ultimately decide the matter in favour of the petitioners, HPCL would accord to them all the benefits which they would be entitled to.
That is an undertaking given by HPCL, but we should also look to the interest of several officers of HPCL who would be affected, if the scheme is set aside.
In the circumstances, without setting aside the scheme, we direct HPCL to appoint a Committee consisting of high officials of HPCL and Central Government, other than those who were in the previous Committees, within one month from date for the purpose of considering the question of equation of posts on the basis of functional similarity, equivalence and co equal responsibility, that is to say, whether on that basis Grades R6 A and R6 B of CORIL, either jointly or separately, can be equated with the Grade E 6 of ESSO and, similarly, Grades R7 A and R7 B of CORIL, either jointly or separately, can be equated with Grade E 5/E 5A of ESSO.
In considering the question of equation of posts, the respond ents shall also take into its consideration the report of the Tandon Committee.
Such consideration shall be 374 made within six months from today.
If such equation is found to be in favour of the petitioners, HPCL shall give effect to the same.
But, in view of the lapse of about eight years for which the petitioners are also to some extent responsi ble, the date or dates from which the consequential benefit will be given effect to and also the quantum of such benefit will be such as may be deemed fit and proper by the respond ents, having regard to the financial involvement and the changes that have taken place.
We make it clear that, in no event, promotions and the existing positions of the officers of HPCL, by virtue of the implementation of the impugned scheme, will be interfered with.
The writ petitions are disposed of as above.
There will be no order as to costs.
P.S.S Petitions allowed.
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ESSO Standard Refining Company of India Ltd. and Lube India Ltd. were acquired by the ESSO (Acquisition of Under takings in India) Act, 1974 and vested in the Hindustan Petroleum Corporation Ltd.
In 1978 Caltex Oil Refining India Ltd., another Government company was amalgamated with HPCL.
Consequent upon this integration of management staff of CORIL and HPCL, dispute arose as to their fitment in equiva lent groups and fixation of inter se seniority.
The Tandon Committee appointed to examine the issues recommended the application of the principles of (1) functional similarity, and (2) co equal responsibility, for equating positions in the two companies.
The HPCL appointed two functional direc tors for framing a rationalisation scheme.
In the said scheme for the purpose of equation of 10 grades of CORIL with 8 grades of HPCL some compression was made in the lower grades, namely, R6 A and R6 B of CORIL were clubbed together and equated with grade A of HPCL.
Again, grade R7 A and R7 B were clubbed together and equated with grade B of HPCL.
The complaint of the petitioners, former officers and employees of CORIL, was that the rationalisation scheme was arbitrary, in that the fitment of officers of CORIL and those of the ESSO/LIL in the HPCL scales of pay had been made without the equation of posts, which was a sine qua non for integration of officers coming from different sources, so much so that they had been consistantly fitted in one or two grades lower in HPCL vis a vis their counterparts in ESSO/LIL performing similar duties and having similar re sponsibilities and status; that in the Tandon Committee report, the post of General Sales Representative of ESSO had been equated with the post of Retail Development Supervisor of CORIL on the principle of functional similarity and co equal responsibility; that since these two posts were con gruent, they should have been fitted in the same group, that is, in Group B of the new HPCL 363 Grade structure, whereas in the said scheme the post of General Sales Representative of ESSO (E 6) and that of Depot Superintendent (E 6) have been placed in the Salary Group B of HPCL, while the post of Retail Development Supervisor (R6 A) and Depot Superintendent/ Relief Depot Superintendent (R6 B) of CORIL have been placed in Salary Group A of HPCL.
It is further averred that the post of Depot Super intend ent A (R7 B) and that of Marketing Representative (RT A) of CORIL have been placed in the Salary Group B of HPCL, but similar posts of ESSO being E 5/E5A have been placed in Salary Group C of HPCL; that the compression should have been made at the higher grades namely, grades R 11 and 12 and the grade of General Manager, and that the petitioners were forced to signify their consent to the said scheme under duress.
They, therefore, prayed for a declaration that the said scheme was violative of Articles 14 and 16 of the Constitution of India.
For the respondents, it was contended that the two committees that were appointed by the Chairman of HPCL considered the different methods of fitment and equivalence of different pay scales of ESSO, LIL and CORIL with the pay scales of IOC, that the reports submitted by these two committees were considered by the HPCL along with the sub missions made by the officers ' association through their representations before approval, that the terms and condi tions of the new appointments as per the rationalisation scheme were circulated to each of the CORIL employees with its letter dated July 7, 1980 and they having accepted in writing the said scheme they were precluded from challenging the same.
Allowing the writ petitions, HELD: 1.
While it is not within the domain of the Court to make the equation of posts for the purpose of integra tion, it is surely the concern of the Court to see that before the integration is made and consequent fitment of officers in different grades/scales of pay is effected, there must be an equation of different posts in accordance with the principle Of functional equivalence and co equal responsibility.
[372G H] In the instant case, no evidence or material has been placed before the Court on behalf of the HPCL in support of such equation of posts.
The rationalisation scheme with regard to the placing of the officers of CORIL in different IOC/HPCL grades of pay, therefore, cannot be accepted in full.
[372H] 364 2.
This is not for the Court to say whether the compres sion should have been made in the lower grades or in the higher grades.
By such compression, grades R6 A and R7 A have been upgraded and the persons placed in those grades have been benefitted.
If compression had been made in the upper grades there would have been much complications in view of the functional differences, for the grade of General Manager cannot be clubbed together with a lower grade.
The contention that the compression should have been made in the higher grades of CORIL cannot, therefore, be accepted.
[371F G] 3.
The apprehension of the petitioners that in the event of their refusal to accept the scheme, their services will be terminated cannot be rejected.
It may be that there was no reasonable basis for such apprehension, but the plea that because of such apprehension the petitioners had no other alternative than to accept the scheme, cannot be disbe lieved.
[371B] 4.
Having regard to the interest of several officers of HPCL who would be affected if the scheme is set aside, and in view of the fact that during the eight years in which the scheme had been in operation many changes had taken place with regard to the positions and ranks of the officers of HPCL including petitioners, HPCL is directed to appoint a committee consisting of high officials of HPCL and Central Government, other than those who were in the previous com mittees, within one month for the purpose of considering the question of equation of posts on the basis of functional similarity, equivalence and co equal responsibility, and to give effect to the same.
Promotions and the existing posi tions of the officers of HPCL by virtue of the implementa tion of the impugned scheme, not to be interfered with.
[373D, F G; 374B]
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"ivil Appeal No. 203 of 1975.\nFrom the Judgment and Order dated 12.12.1974 of the Madhya Pradesh Hi(...TRUNCATED)
| "One Govind Rao Harshe mortgaged some agricultural land and a house to Lakshmi Chand and Duli Chand (...TRUNCATED)
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"ew Petition No. 37 of 1959.\nPetition for Review of this Court 's judgment and order dated October (...TRUNCATED)
| "Where at the hearing of an appeal filed by special leave from a decision of the High Court in a Wri(...TRUNCATED)
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"Civil Appeal No. 1224 of 1977.\nAppeal by special leave from the judgment and order dated the 3rd S(...TRUNCATED)
| "The Bombay Town Planning Act, 1954 (which was made applicable to the State of Gujarat) provides for(...TRUNCATED)
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